Why full-power wind converters are not overtaking the market yet
High prices for rare earth materials, lagging offshore wind development, and high demand for doubly-fed converters by China continue to hamper the market.
The global market for utility-scale onshore wind converters continues to be led by doubly fed (DFIG) converters, according to a new report entitled “The World Market for Wind Converters – 2013” from IHS Inc.
DFIG converters are forecast to outpace full-conversion products by a compound annual growth rate (CAGR) of 1.6% from 2012 to 2017, reaching more than 9,900 units shipped in 2017. Three major factors are hindering the sales of full-conversion products in the converter market: high rare earth material prices, lagging offshore wind development and China’s high demand for doubly-fed converters.
“In the first case, the high price of rare earth materials has led turbine original equipment manufacturers (OEMs) and generator manufacturers to reduce production costs by using less rare earth materials in their designs,” said Jared Kearby, analyst at IHS. “This has resulted in an emphasis on continuing the production of doubly fed converter solutions, due to the increased demand.” This year, doubly-fed converter shipments will outpace full-converter shipments by 4%.
A number of companies, in fact, have put a halt on offering permanent magnet (PM) generators and full-power wind converters, due to the lack of demand from developers and turbine OEMs. Now instead of a complete switch from DFIG to full conversion during the next five years, there will first be a shift toward medium-speed generators using doubly fed generators combined with a reduced gearbox. Over an extended amount of time, another slow transition will likely take place toward permanent magnet, full-conversion low-speed generators without a gearbox. The swing in products has already started as medium-speed generators are currently being implemented, and the trend will continue to hold for the next 15 to 20 years.
The second factor impacting full-conversion product sales stems from a slowdown of offshore installations, which did not increase as previously expected, because of delays in sitting permits and lack of investment in 2012. As a result, offshore utility-scale converter shipments were revised down by 14% compared to earlier 2012 projections. With close to 58% of shipped offshore converters bearing a full-conversion solution in 2012, the growth of the offshore wind market will have a direct impact on the use of full-conversion products into 2017 and beyond.
A third factor is the Chinese wind industry, which also carries significant impact on the converter market because of the country’s large market size. China last year accounted for more than 25% of global converter shipments for the onshore utility-scale market. Given the country’s importance in the wind converter market, China’s continued use of DFIG solutions has also brought down the sales of full-conversion products. China’s doubly fed converter market is forecast to grow at a CAGR of 2.4% in terms of shipments from 2012 to 2017, higher than the 1.7% CAGR for full-power converters being shipped to the country during the same period.
Overall, doubly fed converters will remain the predominant technology in wind turbines, making up 78% of total wind converter shipments in 2017. Full-conversion products, meanwhile, will become the industry standard for wind applications in the next 20 years as rare earth prices stabilize and offshore wind development increases.
- Events & Awards
- Magazine Archives
- Oil & Gas Engineering
- Salary Survey
- Digital Reports
Annual Salary Survey
Before the calendar turned, 2016 already had the makings of a pivotal year for manufacturing, and for the world.
There were the big events for the year, including the United States as Partner Country at Hannover Messe in April and the 2016 International Manufacturing Technology Show in Chicago in September. There's also the matter of the U.S. presidential elections in November, which promise to shape policy in manufacturing for years to come.
But the year started with global economic turmoil, as a slowdown in Chinese manufacturing triggered a worldwide stock hiccup that sent values plummeting. The continued plunge in world oil prices has resulted in a slowdown in exploration and, by extension, the manufacture of exploration equipment.
Read more: 2015 Salary Survey