The wind power industry, which saw a fast and constant growth for five consecutive years, is now slowing down. Virulent price competition, over capacity, increased technical thresholds and the withdrawal of subsidy policies are signaling the arrival of the industry's bottleneck, China Business News reported Monday.
The Inner Mongolia province has installed wind power stations that reached 3 million kilowatts in capacity by the end of 2008. [File photo]
The first half of the year saw a sharp decline in business for wind turbine generator system producers, affecting listed companies such as Sinovel Wind Group Co, Xinjiang Goldwind Science & Technology Co, Dongfang Electric Corp and Xiangtan Electric Manufacturing Co, the report said.
Sinovel, considered the leader of the industry, disclosed in its interim report on Monday that its group achieved an operating revenue of 5.33 billion yuan ($792.57 million) in the first half, down 29.45 percent compared with the same period last year. Net profits decreased by 48.3 percent year-on-year to 659 million yuan.
Goldwind attributed the slide to funding pressure brought by a comparative tight monetary policy and rising prices of raw materials. New industrial policies such as tightening approvals of new projects and enhancing the industrial threshold create more short term pressure for the wind power companies, Goldwind's interim report said.
Goldwind made an operating revenue of 5.19 billion yuan in the first half, down 17.61 percent year-on-year. It generated a net profit belonging to the parent company of 425 million yuan, a decrease of 45.05 percent compared with a year ago, the report said