Canada fears losing wind turbine business
The Canadian wind energy industry said the country must develop its own supply chain to support market opportunities related to construction of wind farms before the U.S. market and supply chain become too large and have too great a competitive advantage.
Wind Industry Supply Chain Opportunities for Canadian Manufacturers, was released this week by the Canadian Wind Energy Association and Canadian Manufacturers & Exporters.
The report found the presence of wind turbine manufacturers in Canada would require stable, consistent and predictable long-term opportunities in regional markets that are located relatively close to one another, and within 'striking distance' to the U.S. market.
Canadian manufacturers may also benefit from the domestic construction of turbine tower sections, rotor blades, nacelle assemblies and covers, casting and forgings.
'The high cost to transport these components due to their large size and often irregular shape provides some incentive for manufacturing facilities to be relatively close to wind farm developments and to have access to good quality transportation routes that can accommodate the products,' the report said.
The report noted that a second supply chain opportunity may come from the need for engineering procurement and construction services, logistics, craning, transformers and geotechnical and site preparation services.
In addition, the report said gears and generators offer supply chain opportunities. 'Technology and manufacturing standards can be easily transferred from experience in applications other than wind turbines,' it said.
Canada is the sixth-largest electricity producer in the world, generating 600 terawatt hours annually, and is the fourth-largest exporter of power, with all of its exports going to the United States.
Canada also ranks 18th in the world for the contribution of wind in meeting domestic electricity demand. In 2009, every province counted at least one wind farm contributing power to the grid. By the end of 2009, Canada added 950 megawatts of new wind generating capacity for a total of more than 3,300 megawatts.
However, the United States dominates wind energy development in North America. The country installed about 8,500 megawatts of wind energy projects in 2009 and had a total of 35,159 megawatts of installed capacity by the end of the year. Wind power represents about 2 percent of the electricity mix in the United States, or enough to power more than 7 million households.
The wind industry in the United States has grown at more than 30 percent a year for the past five years. There are now more than 70 manufacturing facilities in operation or under development to support the U.S. demand for new wind farms. As a result, about half of the components of a wind turbine are produced in the United States today, up from 30 percent in 2005, according to the Canadian report. ' Chris Gillis