ReCharge: Goldwind is going from strength to strength in US

By Benjamin Romano Seattle Friday, January 13 2012  Updated: Sunday, November 25 2012

Goldwind, which has been praised for its approach to the US market, continues amassing orders.

The Chinese turbine manufacturer has a significant stable of US and international components suppliers, and announced sales this week to Enel Green Power North America, Wind Energy Developers and Debenham Energy.

While the orders are modest – each consisting of no more than three permanent-magnet direct-drive (PMDD) machines – Recharge has learned of a 20MW order in the US expected in the coming weeks.

Goldwind had 86 turbines installed or under construction across nine projects in the US at the end of last year, far outpacing any other Chinese manufacturer. It now has projects in California, Illinois, Iowa, Massachusetts, Minnesota, New York, Ohio and Rhode Island.

Executives say that more than 60% of the materials used to make their turbines comes from local suppliers, including Timkin (bearings), LM Wind Power (blades) and Broadwind (towers).

The end product is a turbine that “isn’t as Chinese as people think”, Matthew Olive, its vice-president of sales in the Americas, told the US-China Wind Summit last month.

In addition to improving project economics, the localisation strategy helps customers avoid becoming political lightning rods, he adds.

By the end of 2012, Goldwind will have nearly 100 turbine-years of operating experience in the US – a threshold that proves the worth of their machines to developers, financiers and certification groups.

Goldwind is backed by a $6bn China Development Bank credit facility, and Goldwind Capital, its financing unit, can provide turbine supply loans, letters of credit for interconnection agreements and other mezzanine financing.

The company is pricing aggressively. “We have to price in a way that creates some value for early adopters,” Olive says, adding that the lower operating cost of its PMDD machines lessens the need to drop prices significantly below market levels.

The strategy is working. Daniel Mallo, managing director of energy projects and structured finance for French bank Societe Generale, says his group has received “several enquiries” from clients about Goldwind turbines.

Olive joined Goldwind after running project mergers and acquisitions in Gamesa’s US development arm. He joins alumni of Clipper, GE and First Wind at the company, which established a US headquarters in Chicago in 2010 and now has 36 employees.

The company has distinguished itself from many of its Chinese rivals, which have tried to replicate its business practices in the US.

“Goldwind is showing a lot of signs of being a clever, more experienced international company,” says Chris Raczkowski, managing director of China-based wind consultancy Azure International.

Ed Einowski, a partner with business law firm Stoel Rives, and chairman of the US-China summit, suspects Goldwind has not made money in the US yet, but says it has a foothold that its Chinese competitors do not. “They are miles ahead because of the risks they’ve taken.”

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