00:00 Last year saw a record number of wind farms built in Europe, but it`s still way short
00:07 of what`s needed to meet the EU`s green energy targets.
00:10 It`s a very ambitious target. Last year, if I record correctly, we counted 17 gigawatt
00:16 which has been installed in Europe. So, if you just count what we have installed today
00:20 until the end of the decade to reach the target, we need 31 gigawatt every year in average.
00:26 They want us to build twice as many new wind farms as what we`re building today. Now, we
00:31 can do that, but we`re facing competition now from Chinese wind turbine manufacturers.
00:37 Hello, and welcome to "Business Planet." ZF Wind Power in Northern Belgium is a world
00:44 leader in the manufacture of gearboxes, the heart of a wind turbine. But as demand rises,
00:51 can production keep pace? Let`s find out.
00:55 Demands are getting bigger, and so are gearboxes and powertrains, and the equipment needed
01:01 to test them too.
01:02 I joined ZF Wind Power CEO Felix Henssela in the factory in Lommel.
01:08 What you see here on the test break is a 7.2 megawatt machine, and we are also testing
01:13 it by 7.2 megawatt with full torque and full vibration and full load.
01:18 Where the clock is ticking, the EU`s launched the wind power package to accelerate the wind
01:23 industry buildout.
01:25 Felix Henssela says while doubling next year is unrealistic, some factories are actually
01:32 underused, meaning room for rapid growth once the orders come in.
01:36 There is already capacity available in the market which we could use to ramp up. It is
01:42 ambitious, but in general, also not impossible to reach it. But we need to start now. We
01:47 have all the tools in hand now, even with the wind power package which has been released
01:52 last year from the European Union and all the member states agreed on it.
01:55 Is it frustrating that it`s just come now at the end of 2023?
02:00 The real frustrating thing is that wars need to be happened to make them aware. This is
02:05 a point which is frustrating. The speed afterwards, I have to say I`m quite proud of the European
02:10 Union. I`ve never seen such a speed before.
02:13 ZF Wind Power makes powertrains for Vestas, the world`s leading wind turbine manufacturer.
02:19 I caught up with Group`s senior vice president Morten Dehelm in Denmark, who says Europe
02:24 needs to simplify bureaucracy or it`ll run out of time.
02:29 We can take in Europe, for example, between seven and 10 years from, you know, policymakers
02:35 decide to go ahead with a wind power project until it actually starts producing electricity
02:41 to the grid. So, you know, we have this, we can call it the say-do gap.
02:47 Wind power is 19 percent of the electricity Europe consumes, enough to cover Portugal`s
02:52 entire electricity use. The target is 30 percent by 2030.
02:58 Twenty-six EU countries have now signed up to the wind charter, committing to the actions
03:03 outlined in the wind power package. These include streamlining permitting rules, improving
03:09 auctions by indexing prices and reducing the problems caused by rising inflation, and investment
03:16 in ports and the grid.
03:18 For industry body, Wind Europe based in Brussels, this is welcome news.
03:24 Crucially, it`s getting easier to get permits for new wind farms. It was very difficult.
03:30 It was very legal and bureaucratic. The European Union`s now brought in new rules to simplify
03:36 the permitting. In Germany and in Spain, last year, they awarded 70 percent more permits
03:44 for onshore wind than they had done in the previous year. But we`re facing competition
03:48 now from Chinese wind turbine manufacturers.
03:52 How fierce is the competition?
03:54 Very fierce. They are coming in, offering lower prices than what we offer. They know
04:00 what we offer and they undercut us. And they offer very generous financing terms. They
04:05 say you do not need to pay us for three years, deferred payment. We`re not allowed to offer
04:10 that.
04:11 And China is also worryingly strong in terms of critical raw materials.
04:18 Today, we depend on China for rare earths that are in the permanent magnets in many
04:24 of our wind turbines. The EU wants to reduce our dependency on China, diversify the supply.
04:31 The industry wants that as well. And we`re working with the EU to try and make that happen,
04:35 source these materials from other countries, even expand the European supply chain for
04:40 these materials.
04:42 Time is of the essence if Europe`s wind industry is to realize its full potential, not only
04:48 in terms of the energy produced by the wind, but keeping control of its supply chain and
04:53 manufacturing.
04:54 See you next time on "Business Planet."
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