Cost of Energy
Vestas’ wind power plants must have the lowest Cost of Energy and ensure that the price of wind power continues to fall. Conversely, the price of fossil fuels is expected to rise, thus steadily increasing the competitiveness and resulting value of wind power. Through large-scale investments in development and test facilities around the world, Vestas will seek to consolidate its leadership position within wind power. At the end of the first quarter of 2011, nine per cent of Vestas’ staff was employed with Vestas Technology R&D, which is now organised in specialised centres around the world and managed from Aarhus, Denmark. In addition to improved design, which also facilitates the work of service technicians, lighter materials and the possibility of recycling all turbine components, Vestas is also investing large resources in optimising the location of each turbine in a wind power plant with a view to fully harnessing the wind.
In the years ahead, many new products and services will contribute to ensuring that Vestas accomplishes Triple15. All of the new products are designed to provide the customers with Business Case Certainty and the lowest Cost of Energy. On 30 March 2011, Vestas announced the specifications for its V164-7.0 MW turbine. It is the first dedicated offshore turbine in Vestas' product range and will become the largest single investment ever in Vestas Technology R&D. If demand for the turbine leads to a sufficient order intake in the coming years, Vestas will commence serial production in 2015. The first prototype will be built towards the end of 2012. Accordingly, the V164-7.0 MW turbine will not have a positive earnings impact until after 2015.
Vestas has also launched its V100-2.6 MW turbine based on the thoroughly tested 3.0 MW platform. The turbine is marketed in Europe and Asia and is intended to further expand Vestas' broad product range, which has been expanded by the V112-3.0 MW, V100-1.8 MW and V60-850 kW turbines in recent years.
The motivation behind Vestas’ development initiatives is the goal of having increasingly robust wind power plants built by easily accessible and environmentally friendly materials and the necessity of increasing output per kilogramme turbine for the benefit of the environment. As part of these initiatives, under the “As green as it gets” principle, Vestas has stepped up its efforts to minimise the consumption of resources. One result of the intensified efforts is that, from the second quarter of 2009, Vestas has reported on quarterly developments in its non-financial highlights in order to give prominence to the performance in achieving its environmental and safety targets.
In the first quarter of 2011, consumption of raw materials rose by 44 per cent, and waste generation was up by 8 per cent relative to the first quarter of 2010 due to the higher level of activity. Consumption of energy, on the other hand, only rose by 6 per cent. Energy consumption increases less than the consumption of raw materials, due to energy consumption being linked to capacity rather than actual production.
Vestas has implemented a green building policy, which will contribute substantially to reducing energy consumption from Vestas' buildings in the years ahead. The extension of the development centres on the Isle of Wight, UK, and at Lem, Denmark, as well as the establishment of the new headquarters for Vestas Americas in Portland, USA, and for the Vestas Group, in Aarhus, Denmark, respectively will all live up to the new green building policy. The annual CO2 emissions at the new headquarters in Aarhus will be significantly reduced compared with a similar building, among other things owing to the installation of Denmark’s largest geothermal heating plant.
Vestas’ energy policy stipulates that all electricity must be from renewable energy sources, subject to availability. The target is for 40 per cent of Vestas’ energy consumption to come from renewable sources by 2011. The precondition is that the proportion of renewable electricity is increased to more than 95 per cent by 2011.
In the first quarter of 2011, the share of renewable energy was 31 per cent and the share of renewable electricity was 70 per cent. The corresponding figures for the year-earlier period were 43 per cent and 93 per cent. As announced in the third quarter of 2010, Vestas has closed a total of five factories in Denmark and Sweden, which all had a high share of renewable energy, and at the same time additional capacity has been established in Asia and the USA, where access to renewable energy in certain regions is limited. Vestas will henceforth build turbines for in-house use in order to balance the energy consumption from areas in which it is still not possible to buy green energy. In some cases, Vestas may also in this connection act as co-investor in customer projects.
On 25 January 2011, a Vestas employee was killed in a tragic industrial accident in India, which overshadows the positive development of the incidence of industrial injuries per one million working hours, which during the first quarter was improved to 3.8. This equals a decline of 14 per cent relative to the first quarter of 2010.
Safety comes first at Vestas. The ultimate goal is zero accidents, and constant improvements over the past five years prove that Vestas is on the right track. Thus, the incidence of industrial injuries per one million working hours was 5.0 in 2010, declining from 8.1 in 2009. The target for 2011 is to maintain a maximum incidence of 5.0 industrial injuries per one million working hours, and for 2012 the target is a
maximum of 3. The target for 2015 is a maximum of 0.5. Vestas has joined a joint global safety educational programme for the entire industry to further improve safety.
