Renewable energy leader Vestas has unveiled its ambitious plan to invest a whopping $40 million in its two Colorado manufacturing facilities. The aim is to kickstart the production of the cutting-edge V163-4.5MW wind turbine, designed specifically for the thriving US onshore market. With projections indicating a modest growth resurgence in 2024, Vestas is gearing up to meet the anticipated demand by bolstering its local workforce.
Between 800 and 1,000 employees will be recruited to support manufacturing operations at Vestas’ blade facility in Brighton and nacelle factory in Windsor, located north of Denver. These ambitious plans entail significant building expansions, the introduction of new blade molds, and the installation of state-of-the-art equipment dedicated to the production of the V163-4.5MW turbine. Distinguished by its remarkable 163-meter rotor diameter, the turbine surpasses all others previously installed by Vestas in the US.
Blade production for the V163-4.5MW turbine is slated to commence this year at the Windsor site, while the Brighton factory is expected to join in the production efforts by 2024. To facilitate the rapid deployment of wind energy and address the growing demand, Vestas will leverage its established supply chain and existing infrastructure encompassing transportation, installation, and operations.
Laura Beane, President of Vestas North America, emphasized the economic benefits that wind energy brings to local communities. She expressed excitement about the prospect of introducing clean energy jobs and fostering economic development in Colorado. Governor Jared Polis, a Democrat, concurred with Beane’s sentiments, heralding Colorado as an ideal destination for starting and expanding businesses, particularly in the flourishing clean energy sector.
The V163-4.5MW turbine represents an evolutionary optimization step for Vestas, building upon the success of its popular V150-4.2MW and V150-4.5MW models. As a key player in the US onshore wind turbine market, Vestas’ 4MW platform currently holds a dominant position, outpacing its closest competitor, Nordex. The latest advancements in turbine technology have enabled individual turbines to capture more energy and be deployed in areas with lower wind speeds, further maximizing energy production.
In recent years, rotor diameters have witnessed significant growth, leading to a reduction in the overall cost of wind energy. The increased energy output resulting from larger rotors helps offset the expenses associated with manufacturing and installing larger turbine components. However, developers are grappling with mounting challenges in securing sites with favorable wind conditions due to grid interconnection issues, congestion, and inadequate transmission capacity to meet the surging national demand.
While Vestas solidifies its position as the second-largest player in the US onshore wind turbine market, industry leader GE Renewable Energy has been focusing its efforts on the 2.5-3MW segment. In a notable move, GE recently announced a substantial $50 million investment to transform a gas turbine manufacturing plant in upstate New York into a facility dedicated to producing components for a 6.1MW onshore wind turbine with a remarkable 158-meter rotor.
GE cited the 2022 Inflation Reduction Act (IRA), a groundbreaking climate law signed by President Joe Biden in August of last year, as a key factor driving its investment decision. The legislation introduced a manufacturer’s tax credit equivalent to 30% of the invested amount for the construction or enhancement of factories manufacturing specific renewable energy components. Notably, the IRA also introduced an “advanced” manufacturers tax credit for eligible components sold to unrelated parties within the US.
According to forecasts by BloombergNEF, S&P, and Wood Mackenzie, the annual US onshore installations are expected to reach an average of 12.7GW over the next eight years. The year 2023 is projected to be relatively weaker, with installations totaling approximately 8GW, followed by an upward trend in subsequent years, reaching around 9GW in 2024, 11GW in 2025, and an estimated 15GW by 2030.
Projects meeting specific criteria will qualify for generous federal investment or production tax credits under the IRA. These incentives aim to propel the growth of the renewable energy sector and facilitate the transition towards a sustainable future.
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