Vestas wind turbines were photographed in North Rhine-Westphalia (Germany) on September 19, 2021.
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According to Vestas, a wind turbine manufacturer Vestas, the sector of wind energy faces a difficult road ahead because of a variety factors.
The Danish firm stated Wednesday that “the global business environment for wind power remains volatile in short term and prosperous long term”, before adding that it expected cost inflation to have a significant impact on the near future and at most 2022.
Vestas also stated that “the emergence a crisis in energy due to geopolitics, fossil fuel volatility has also led to dramatic increases in energy costs.”
Vestas reported that its revenue for 2021 was 15.6 billion euros ($17.59 trillion), a record. Its earnings before interest, taxes margin before special items was expected to be 3%. This is in contrast to the updated guidance of 4%. Initial guidance was between 6% and 8%.
Vestas stated that the increase in prices for wind turbines was “a necessity to address inflation and ensure long-term value creation.”
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The company recognized that wind energy was likely to be affected by a variety of interconnected issues.
It stated that the pandemic caused supply chain instability, which led to rising transportation and logistics costs, was expected to continue to affect the wind power industry through 2022.
“In addition, Vestas will feel an increased impact from cost inflation in raw materials and wind turbine components as well as energy prices.”
The company spoke out about its outlook for 2022. It said that revenue for full-year 2022 would be between 15 and 16.5 trillion euros. EBIT margins before special items will range from 0% – 4%.
Vestas referred to a cyber attack in 2021 and stated that although it had not “caused significant indirect impact” on its operations, it had “temporarily affected our efficiency and the ability of the organisation to be fully focused upon end-of-year execution.”
Vestas isn’t the only one highlighting the problems facing the wind energy sector. Siemens Gamesa Renewable Energy stated last week that supply chain tensions had “resulted” in higher than anticipated cost inflation, which mainly affected our Wind Turbine segment.
The company also stated that “volatile market conditions” had “impacted some of our customers investment decisions.” This had caused delays in certain SGRE’s projects.
