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Ducker Worldwide Predicts Problems for the Domestic Wind Power Industry, Despite Recent Tax Credit Incentives

October 21, 2008

TROY, Mich., Oct. 21 /PRNewswire/ — Although the recent renewal of Production and Investment Tax Credits for alternative energy will provide additional incentive for wind power development, prospects for turbine makers, suppliers, developers, and utilities remain uncertain. Based on recent industry research, Ducker Worldwide believes the industry will continue to struggle with several key issues before realizing its significant growth potential.

Critical challenges facing the wind power industry

Source of Funding – Despite increased renewable energy attention, companies are finding it difficult to raise capital. Potential investors struggle to find opportunities where existing infrastructure is adequate to support new development. Developers say that they lack statistical research to provide accurate ROI forecasts. Manufacturers say they lack data regarding the market viability of specific technologies, so it is often difficult to justify capital investment to take the wind turbine technology to the next level.

Production Capacity – Wind turbine manufacturers and assemblers continue to face long backlogs due to limited production capacity in gearboxes and bearings in particular. While a current shortage in large wind turbine bearings is creating a turbine production bottle neck, diversified bearing manufacturers find it difficult to justify production shifts from more secure, high volume market segments to support increasing (but more volatile) demand for wind turbine bearings, without accurate long-term regional demand forecasts.

Chinese supplier improvements – Chinese suppliers are rapidly gaining market share despite their reputation as being second-tier technology providers among key purchasers interviewed by Ducker Worldwide. Although supply relationships with European gearbox and bearing producers currently give most multi-national turbine providers a size (MW) and performance advantage, Ducker Worldwide’s ongoing monitoring of global market share developments suggests that multiple North American and European producers are at risk of share loss – and require a deeper understanding of customer needs to defend territory won.

Ducker Worldwide believes industry players who can address these issues will benefit tremendously in an industry that has the potential to grow nearly 20 – 25% within the next five years.

About Ducker Worldwide:

Ducker Worldwide continuously monitors developments in a multitude of renewable energy markets to identify opportunities, assist clients in developing strategic plans, and provide a unique and proven combination of custom market intelligence, strategic analysis and market consulting services. For more information please contact info@ducker.com.

   Media Contact:   Brooke Vogel   (1-877-538-2537)   brookev@ducker.com  

Ducker Worldwide

CONTACT: Brooke Vogel of Ducker Worldwide, +1-877-538-2537,brookev@ducker.com




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