Wind Power in China – Ten Stocks That Will Benefit
China expects renewable energy to provide 15% of its needs by 2020, and it plans to spend $265 billion to meet this target. Wind power will be a significant part of this programme.

According to the 2007 “China Wind Power Report”:

China has chosen wind power as an important alternative source in order to rebalance the energy mix, combat global warming and ensure energy security. Supportive measures have been introduced. In order to encourage technical innovation, market expansion and commercialisation, development targets have been established for 2010 and 2020, concession projects offered and policies introduced to encourage domestic production.

By the end of 2006, cumulative installed wind capacity had reached 2.6GW; the average annual growth rate over the past ten years has been 46%. Between 2004 and 2006, China's ranking in the world wind energy league moved up from the top 10 to the top 6, and the country is planning to host some of the biggest wind farms in the world.

By the end of 2007 China had wind power generating capacity of 5.6GW, and some estimates are that the country will have 70GW of capacity by 2020. It has already led to a huge boom in business, with some of the big global names in wind power among the beneficiaries, thanks to early decisions to launch production inside China.

Here are introductions to 10 companies that stand to benefit:

AES is a giant US power company (2006 revenues of more than $12 billion), with operations in 28 countries. It was the first US-based power company to enter China, and it now operates seven power plants there. In a joint venture with Guohua Energy Investment it is building a 49.5MW wind farm in Hebei Province.

American Superconductor is a high-tech company active in the field of alternative energies. It has received a series of multi-million dollar orders from Chinese companies for wind turbine equipment. China is now its biggest overseas market.

China Wind Systems, listed on the OTC market, manufactures industrial equipment for the textile and energy industries in China. Since August 2007 it has shifted its strategy to focus on wind energy, and has begun to supply high-precision rolled rings to companies in the wind power energy industry.

Gamesa of Spain is the world’s second-largest manufacturer of wind power equipment. It has manufacturing facilities in Tianjin and has become a leader in the Chinese market, behind Goldwind and Vestas. It reported in its September 2007 quarterly report that China accounted for 16% of total company installations.

General Electric is involved in wind power through General Electric Energy. It opened a wind turbine assembly plant in Shenyang in 2006, and has become one of the leaders in supplying the country’s needs.

Goldwind Science & Technology is China’s largest manufacturer of wind power equipment. It has grown rapidly, and now holds an estimated one-third of the market. When it listed on the Shenzhen Stock Exchange in December 2007 the shares soared 264% in a day.

Nordex of Germany announced in November 2007 that it planned to invest EUR 50 million to boost annual production capacity in China from 225MW to 800MW by 2011. It aims to raise its share of the Chinese market from 3% at the end of 2006 to 15% by 2011, and will also use its Chinese production facilities as a base for expansion throughout Asia.

Suzlon Energy of India, the world’s fifth-largest wind power equipment manufacturer, has been active in China since 2005, and opened its largest production plant in Tianjin in 2007.

Vestas, the Danish company that is the world leader in wind power equipment, operates three factories in the city of Tianjin. It has an estimated one-quarter of the Chinese market.

Welwind Energy International, a small company which trades on the OTC market, is building wind farms at Yangxi and Zhanjiang in Guangdong Province. It expects a total investment of $1.2 billion and the construction of 600 turbines.

January 25th, 2008

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Wind Power in China – Ten Stocks That Will Benefit China expects renewable energy to provide 15% of its needs by 2020, and it plans to spend $265 billion to meet this target. Wind power will be a significant part of this programme.

Wind Power in China – Ten Stocks That Will Benefit
China expects renewable energy to provide 15% of its needs by 2020, and it plans to spend $265 billion to meet this target. Wind power will be a significant part of this programme.