http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/RSS.ashxVestas Win[d] PagesWed, 13 Aug 2008 07:19:27 +0200http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=1http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=1Win[d] W I N D , O I L A N D G A S No. 13 Ye a r 0 5 15 August 2008 China: Growth at breathtaking speed Connecting the states · Seeking out world-class talent · Nuclear: a threat to wind? New innovation partnerships · Fine-tuned transport means turbines on time Vestas learns from the best · Better prototypes – better wind turbines2008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=2http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=2From one to ten One per cent. That is roughly how much – or how little – of global electricity consumption that is currently covered by wind energy, or as we call it: Modern Energy. So does wind energy really deserve all the attention the sector is receiving? To my mind there can be no doubt that it does, simply because its potential is enormous. No other form of energy is developing so rapidly worldwide today, and we at Vestas are working to ensure that in 2020, wind power can cover 10 per cent of global electricity consumption – even taking into account that the demand for energy is set to rise significantly over the same period. The growth that the sector is currently enjoying is based on the fact that no other form of energy can compete with the advantages of wind power today. Modern energy is sustainable, clean and predictable, and it makes it possible to install appreciable capacity quickly. At the same time, it contributes to ensuring energy independence and – in contrast to other forms of energy – does not draw on precious water resources. For these reasons, wind power has the potential to play a key role in the energy mix, but this will not happen without dedicated input from the entire sector, a sector that, in just a few years, must undergo development that other industries have taken decades to achieve. As the leading player in the field, we at Vestas are prepared to shoulder the responsibility that Ditlev Engel, President and CEO Vestas Wind Systems A/S we, as No. 1 in Modern Energy, believe is ours: the responsibility for improving quality, professionalism and performance in every link of the value chain; for everyone’s benefit. However, if the potential is to be realised, wind energy – just like all other forms of energy – needs political backing to ensure that the long-term framework for the development is in place. Many countries still need more long-term strategies and specific action plans for the realisation of their goals in the field of wind energy. Nevertheless, the initiatives that are already emerging indicate that wind energy is beginning to play a much more central role in energy supply systems. This is perhaps best exemplified by the decision to locate Vestas’ new development centre in the United States. The facility is to be established in Houston, Texas – the city which, more than any other in the world, is synonymous with the forms of energy against which wind power is to measure itself and to supplement: oil and gas. This is yet more clear evidence of our vision of Wind, Oil and Gas – which is also the title of the magazine you are currently reading. For this reason, I can confidently conclude that Modern Energy is more than sustainable.2008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=3http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=3Content 4 Connecting the states In the US, 20 per cent wind power by 2030 is a realistic target – if obstacles to new transmission lines can be removed. 32 Towards the perfect turbine How the Engineering & Products division of Vestas Technology R&D is using improved management and communications to deliver better products. 12 Spreading our wings Vestas announces a worldwide university programme to stimulate windrelevant research and attract the best students. 38 40 Fewer changes to future prototypes 3D software enables Vestas to make better prototypes and avoid redesign. Improved quality thanks to Toyota experience Toyota experience is being used to improve product development quality. 18 New technology through ‘open innovation’ To seek out and develop cutting-edge wind technology, Vestas is entering into some unusual partnerships around the world. 44 Does nuclear compete with wind? The easy availability of nuclear power may be undermining progress towards truly sustainable energy. 22 The battle for China Just four years ago, China was only a footnote to the global wind power market. In a few years, it will be the largest single market in the world. Read about the development that has left most players gasping for breath. 48 Quality has to be top class all the way round All customers are to receive their turbines on time. That is why Vestas is now optimising its transport process. The ambitious goal for 2008 is 4 Sigma.2008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=4http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=442008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=5http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=5Connecting the states For the US, 20 per cent wind power by 2030 is a feasible target. Cooperation between states to share the costs of new long-distance transmission capacity is one of the biggest issues to be solved. 52008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=6http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=6The US could be getting 20 per cent of its electricity from wind power by 2030, according to an authoritative report published in May. The main challenges are to streamline procedures for choosing wind power sites and issuing permits, and especially to build new long-distance transmission lines. ‘20 % Wind Energy by 2030’ was produced by the US Department of Energy (DOE) with the help of several government departments and national laboratories, engineering firm Black & Veatch, the American Wind Energy Association (AWEA; www.awea.org), and more than 50 other organisations. Boosting US wind generation from 16.8 GW now to 304 GW in 2030 will be challenging yet feasible, the report says. At 20 per cent wind, managing the variable nature of wind power will cost less than 0.5 cents per kWh and is not considered a problem. Domestic wind turbine manufacturing capacity will need to increase, and the reliability and operability of wind systems must improve, the report says. To address these issues the DOE has signed an agreement with six leading wind turbine manufacturers (see box on page 7). A bigger challenge will be to create a permitting system that can keep pace: to meet the target, the number of turbines installed annually will have to increase from around 2,000 in 2006 to almost 7,000 by 2017. And most significantly, the US must invest in new transmission lines to carry power to the cities from generating sites in sparsely-populated regions. Making the most of the existing grid According to Brian Parsons, Senior Project Leader for Wind Integration at the government-funded National Wind Technology Center (www.nrel.gov/wind/), the US has no accurate national or regional assessment of how much transmission capacity is left, and in the short term it is certainly possible to find spare capacity without building new lines. “Transmission capacity is still rated by rules dating back to the 1940s, and I hope we’re smarter than that now,” he says. “A lot of lines suffer from ‘paper congestion’, where capacity is available but cannot be relied on without further analysis,” confirms Roby Roberts, Vice President of Government Relations with Vestas Americas. “For instance, a recent study of a very congested path in Oregon and Washington revealed hundreds of megawatts of additional capacity.” “Then there is congestion caused by ‘pinch points’ where transmission lines cross mountains and rivers. Many of these bottlenecks can be relieved in a relatively short time frame, by upgrading transmission or adding generation capacity.” Further capacity could be gained by rating lines to carry more power when the wind is blowing, says Brian Parsons. Many overhead lines are limited by the heat they generate: as a line gets hot it sags, sometimes to the point of touching nearby trees or passing vehicles. Traditionally, calculations for thermal rating are based on a windless summer day, so allowing for the cooling effect of wind or low ambient temperatures could increase capacity for much of the year. Another idea is simply to switch off wind power whenever the grid cannot cope, Brian Parsons suggests. “Over a year, there might be only a few dozen hours when the system cannot handle all the power that is available from the wind plants,” he says. New capacity needed urgently Yet although some spare transmission capacity undoubtedly exists, new lines are urgently needed. “We have a transmission challenge, no matter what our energy future is. We have not built much new transmission for 10-20 62008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=7http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=7Building tomorrow’s wind turbine industry Although it is essential to reinforce and expand the transmission grid, this is by no means the only challenge if the US is to get 20 per cent of its electricity from wind by 2030. Ensuring a large enough supply of reliable turbines is also key to success. At the beginning of June the US Department of Energy signed a two-year memorandum of understanding on research and development issues with Vestas and five other wind turbine manufacturers: Clipper, Gamesa, General Electric, Siemens and Suzlon. Key points of the agreement are to: • increase turbine reliability and reduce the costs of installation, operation and maintenance • develop siting strategies to address environmental and technical issues like radar interference in a standardised way • develop standards for turbine certification and interconnection • develop design, automation and fabrication techniques that will reduce product-toproduct variability and premature failure, while strengthening the US manufacturing base • create new standards for the training and certification of technical staff in the wind industry. 72008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=8http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=8years, and demand growth has used up most of our spare capacity,” says Brian Parsons. “There are different opinions about which generation portfolio the country will end up with, and some policymakers would place a higher bet on clean coal or nuclear,” says Rob Gramlich, AWEA Policy Director. “We’re making the case for wind as a big part of the solution, but at the same time we are appealing to policymakers to build a transmission superhighway system, because we’re going to need it in any carbon-constrained generation portfolio.” The DOE report says that the 20 per cent wind target will need over 30,000 km of new 765 kV transmission line. “That’s a lot,” says Brian Parsons, “and permitting and siting transmission in the US is not easy.” With lead times of 10 or 15 years for new transmission, compared to two or three years for a wind power plant, it is important to start soon. The need for more cables is not hard to understand. Most people in the US live in the eastern half of the country and on the west coast, while the biggest wind potential is in the vast open spaces in the middle of the country, in a belt stretching from Texas to North Dakota. “There are about ten states with incredible wind potential – over 40 per cent capacity factor – and open spaces where farm owners and ranchers welcome wind generation,” says Rob Gramlich. “However, these are a long way from the population centres.” Finding the money for new transmission capacity should not be a problem, say the experts. First of all, it is comparatively inexpensive: 30,000 km of new line will cost roughly $60 billion, says Brian Parsons, compared to between $450 billion and $600 billion for the 300 GW of new wind generating capacity needed under the 20 per cent plan. According to the Edison Electric Institute (www.eei.org), US current spending on transmission is already nearly $9 billion a year and is increasing at 6-10 per cent annually. And while 30,000 km of new transmission sounds like a lot, 82008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=9http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=9the US already has ten times that length of transmission line operating at 230 kV and above. Second, says Rob Gramlich, there is plenty more money in the pot. “During most of the 1990s utilities ignored transmission because they saw better opportunities in merchant generation,” he says. “But transmission typically returns 12 per cent with relatively low risks, and after a lot of people lost money in the generation sector, transmission became viewed quite favourably. Wall Street has plenty of money that would love to get into that business. The challenge for potential investors is to break into the industry.” Loving thy neighbour? Rather than lack of money, it is the segregated nature of the US power industry that is really the bottleneck for grid expansion. Most activity in the power industry is controlled by the individual states, and in the past these states have often been reluctant to cooperate. “From a regulatory perspective, crossstate transmission lines are a huge challenge,” says Roby Roberts. “If you’re putting a highvoltage line across three states and trying to figure out how to get permits and allocate the costs, it gets really sticky.” “There are precedents for moving power over long distances, for instance into Califor- nia from coal-fired power plants in the west, or from the upper midwest to the Chicago region,” Rob Gramlich points out. “But aside from those, existing inter-state transmission has generally been done only for security reasons – it’s the minimum needed to keep a reliable grid operating.” “Much of the transmission is controlled by the states and their Public Utility Commissions,” says Roby Roberts. “There is a Federal Energy Regulatory Commission (FERC), but it can only regulate decisions taken by the ‘Jurisdictional’ publicly-traded utilities. Grids need to work across state lines, but the states do not want to give authority to the FERC.” “There’s a lot of competition between states. A few months ago, for instance, the Arizona Regulatory Commission rejected a transmission line into California because they felt it overly benefited California, not Arizona.” Distrust of Federal interference following market deregulation and the Enron scandal has not helped matters, Roby Roberts adds. Within the next decade the AWEA would like to see a FERC with stronger powers to create a coherent national grid and generating portfolio, says Rob Gramlich, as well as dependable long-term tax relief for wind power and a Federal target for renewable electricity. In the shorter term, Rob Gramlich says, progress is the responsibility of individual states: “We’re working closely with state governors, some of whom are exercising great leadership to develop regional solutions within the current regulatory framework.” Forward thinking If a true US national grid and energy policy are still some way off, individual states are at least making good progress in expanding their renewable portfolios and building new transmission ahead of generation. Typically, a generating company first makes a proposal for a new power plant, and the grid authority will then say whether or not there is enough transmission capacity, says Brian Parsons. This “generator first” procedure is less than ideal when new transmission capacity is so slow to build, he notes. 92008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=10http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=10A better alternative is the “transmission first” policy already adopted by Texas, California, Colorado and Minnesota. These states have designated geographical areas for new renewable generation and started to build the necessary transmission infrastructure, which should therefore be ready at the same time as the power plants. The Western Governors’ Association has begun a similar process for the 19 states it represents. Texas, the state with the most wind power, has done a number of sensible things, Rob Gramlich says. As well as having an open and competitive market, high power prices set by natural gas, and a relaxed policy on permitting, Texas has done a good job in building transmission to connect wind power plants in the west and north of the state with the cities of the east and south. As Brian Parsons puts it: “The 20 per cent wind vision report from the DOE does an excellent job of setting a realistic time frame and looking at the challenges of what has to be done. The broad conclusion of the report is that it’s doable but challenging. We have to start now and work hard.” 102008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=11http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=11The long search for energy security The search for energy independence in the US dates back to the oil crisis of 1973. Yet despite being talked about by every president since Richard Nixon, US energy independence – as measured by energy imports – has fallen steadily, and the country now imports around 30 per cent of its energy. Jimmy Carter, who made the issue a centrepiece of his presidency and created the US Department of Energy in 1977, was the only president during whose office US energy independence increased. The story is a familiar one. While nine out of ten people said the US needs to find ways to produce more of its own oil, and eight of ten said they were concerned about the country’s energy self-sufficiency, the vast majority of Americans oppose the construction of power plants and refineries in their own cities, according to a 2007 survey by RBC Capital Markets. “True Carter-style energy independence is pretty tough. It’s a global world!” says Brian Parsons of the National Wind Technology Center. “But using more domestic resources to reduce our dependence on countries that aren’t friendly to our economy sounds like a reasonable goal. Wind can be a big part of that.” Wind accounted for more than 30 per cent of new US generating capacity in 2007, second only to natural gas. The US wind energy industry has grown at 30 per cent annually over the last five years. Further reading 20% Wind Energy by 2030 (http://www.20percentwind. org/20percent_wind_energy_report_05-11-08_wk.pdf) 112008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=12http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=12Spreading 122008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=13http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=13our wings The search for talent and technology is going global, and a new university programme will help pave the way. 132008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=14http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=14This May, a plan to mobilise the talents of selected masters’ and PhD engineering students and university researchers around the world was launched with the opening of a new Global University Programme. The plan is part of a dramatic ambition to propel Vestas straight to the international cutting edge of wind technology. It’s all about knowledge, says Jan Kristiansen, senior vice president of Global Research. About channelling the right talents and technologies into the Vestas pipeline: “We need to secure top competencies on a global level. And that means broadening our network to ensure that the relevant knowledge and technology is sourced in to Vestas.” The new programme was developed by Vestas Technology R&D in cooperation with R&D project manager Lise Backer, Vestas Government Relations. “When fully operational it will tie the Vestas organisation into a global network of top universities, professors and talented PhD and masters’ students,” she says. 142008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=15http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=15Efforts will then be made to find a Vestas engineer who is interested in collaborating on any of the projects. If this ‘matchmaking’ is successful, the Vestas engineer, the professor and the student will submit a more detailed proposal, including a justification of its value to the company. A final evaluation will determine which of these collaborations will receive a go-ahead. Thanks to the initial sorting process, applicants will at this point have a good chance of acceptance: “Our goal is that we will be able to accept up to 50 per cent of these detailed proposals,” says Carsten H. Westergaard, manager of the Vestas research facility at Risø, Denmark, that is administering the programme. New professorships The university programme also allows wellestablished university researchers anywhere It will also bring into the company a wide range of new development projects that might otherwise have gone undetected, unsupported and undeveloped. And it will provide a winning scenario for everyone involved. A worldwide call For masters’ and PhD students, the scenario begins with an open, twice-yearly call for company-relevant research project proposals – a so-called ‘declaration of interest’ - from universities around the world. To filter out the less serious suggestions and identify the best, these proposals must come from a professor who, together with a promising masters’ or PhD candidate, will submit a short description of their project through a newly-launched website. in the world to apply for sponsorship of a five-year position as professor in their field, if the area is relevant to Vestas. During the sponsorship period, Vestas will underwrite the new professor’s wages and research expenses, on the condition that, when the sponsorship is finished, the university agrees to retain the professorship and take over the financial responsibility for it. 152008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=16http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=16In this way, Vestas will be able to stimulate university interest in areas that are important to the company. The goal here is to sponsor one or two new professorships each year, says Carsten H. Westergaard. Everyone will benefit For masters’ students, project approval will mean a six-month, Vestas-sponsored thesis project. PhD candidates with successful collaboration proposals will be hired by Vestas for a three-year period while they complete a dissertation based on the project proposal. Students involved in the programme are also likely to be hired permanently by the company when the project is finished. Meanwhile, researchers accepted into the professorship programme will receive a significant boost to their careers. And everyone involved in the programme – students, researchers, professors and their universities - will have the opportunity to work on and publish breakthrough technology. For Vestas, the benefits in terms of stimulating new research and bringing it into the company are obvious. But the programme has the additional benefit of attracting talented new people who might not otherwise have considered a career with Vestas. A challenging partner “Our ambition is to create a university tradition at Vestas - to brand ourselves as an exciting workplace and a technological leader,” says Carsten H. Westergaard. “People need to know that today’s high-technology wind turbines are more than just a farm generator on a stick.” Vestas has already been working with PhD students for a number of years through collaborations with Danish universities. One of these students is Kasper Zinck Østergaard, who received his PhD in control engineering at the Danish University of Ålborg this spring and has now been hired permanently by the company. He was attracted to Vestas because of the chance to work on a thesis project with a challenging corporate partner: “During the past 3-5 years, the wind industry has become much more technology-driven than it was before, and Vestas has become much more interesting for control engineers. There is an increasing need for intelligent mechanisms to improve the function of the turbines,” he notes. Beyond the borders Needless to say, Vestas is interested in attracting more talented engineers like Kasper Zinck Østergaard. But the Danish arena is no longer 162008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=17http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=17Staying on top The Global University Programme was officially launched by Vestas Technology R&D on 19 May 2008. In a statement to the press on the launch date, Vestas Technology R&D President Finn Strøm Madsen called the programme “a natural consequence of our growth.” “We are highly interested in working closely with leading researchers worldwide in order to ensure that we maintain our position as the leading supplier of wind energy solutions and reinforce the recruitment of the brightest students from these universities,” he added. big enough to provide all the needed talents and competencies, says Chief Specialist Philip Carne Kjær, who has been responsible for establishing a number of university collaboration agreements in Denmark and abroad. “Today, the leaps in knowledge we want to achieve require many new people. Not enough of these people are being trained in Denmark, and we are not alone in trying to attract them. And not enough research is being done in Denmark in all the areas that are relevant for us,” he says. By giving Vestas the opportunity to sponsor relevant new professorships and to pick and choose from a worldwide array of project proposals, the international university programme will help the company make a technological – and proactive – leap ahead of the competition. Philip Carne Kjær puts it this way: “This is no time to be following the lead of others. We need to move to the front and dictate our own development priorities in the areas that are strategically important to us.” Further information about the Vestas University programme may be found at www.vestas.com. 172008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=18http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=18182008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=19http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=19New technology through ‘open innovation’ 192008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=20http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=20The new Vestas University Programme is one way to seek out possible new research partners and recruit talented employees – but universities are not the only spots where windrelevant technology is being developed. Hot new research may also be going on in some rather unexpected places – and Vestas wants to be a part of this action as well. The company is therefore in the process of mapping some very specific centres of knowledge around the world. Apart from top universities, such centres could include government agencies and research institutes, independent research laboratories and even private companies whose R&D might have applications for the wind industry. 202008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=21http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=21Working with partners outside the company flies in the face of the traditional business innovation model, where research is kept strictly in-house. Companies using the so-called ‘open innovation’ approach actively seek out external partners with special expertise in a particular field. To secure the specific interests of each party, they rely on well-crafted agreements for the sharing of intellectual property rights. New partnerships: Asia and beyond Four partnership agreements of this type have already been reached in Asia, says Managing Director Matthew Low of Vestas Technology R&D Singapore, a part of Vestas’ worldwide Global Research Centre. He is also vice president of Technology R&D in Asia and is responsible for external collaboration partnerships, especially in East Asia. Matthew Low expects many other partnerships to be established with Vestas over time, not only through the Singapore technology centre but also through a similar Vestas technology centre in Chennai, India and a centre that will be established later this year in the US. “The idea is to create a global network of partnerships that we can leverage under the umbrella of open innovation,” he says. ‘Adjacent industries’ One of the partnerships established through the efforts of the Singapore centre is with the Australian-based Cooperative Research Centre for Advanced Composite Structure, a private research entity in Melbourne. Its focus is on finding new materials for use in the aerospace industry – but Vestas is interested in exploring how these materials might also be used in wind turbines. Access to best-in-class development from what Matthew Low calls ‘adjacent industries’ is one of the benefits of open innovation: “Companies within the aerospace industry, for example, will not like to share too much trade technology with each other, but this is not an issue when dealing with non-competing industries like wind. In this case, the similar research findings can be deployed differently, and Vestas can leverage on such science and technology to enhance its efficiency in the wind-related application. A matter of national interest Two of the other research partnerships established through the Singapore-based technology centre are with Nanyang Technological University (NTU), and the Agency for Science, Technology and Research (A*Star), an independent research entity funded by the Economical Development Board (EDB) of Singapore. Another partnership links Vestas to researchers at China’s Tsing Hua University, which is the country’s top educational and research institution for science and technology. These technology research agreements are broadly-based ‘master collaborations’ which will involve more than one project. “Our university partners in Singapore, Australia and China are all very interested in industrial companies who can bring reality to their research and help them make an impact on the clean energy sector,” says Matthew Low. “Moreover, China today has a large demand for energy, with rich wind resources across the land. China’s development on wind energy is strategically important for the country’s growth. For them, partnership with companies like Vestas is a matter of national interest. And Vestas is pleased to be a part of this development process.” 212008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=22http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=22222008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=23http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=23The battle for China On 28 April this year, the Shanghai Daily newspaper wrote that the Chinese National Development and Reform Commission (NDRC) had been discussing the possibility of raising the goal for accumulated wind energy in 2020 from 30 GW to 100 GW. In other words more than treble the original target. The new figure illustrates better than anything else the almost breakneck speed that currently distinguishes the development of the Chinese wind power market. A market which will be the biggest in the world in just a few years. 232008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=24http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=24China is not only the biggest country in the world, measured by population. Within the foreseeable future, the country will also be recognised as the richest measured by gross domestic product. With a projected average annual growth rate until 2050 of 7.4 per cent, China looks set to overtake Japan as early as 2016, and to leapfrog the United States for top spot as the richest nation in the world in 2040. But growth on this scale needs one thing in particular: energy. If China is to be capable of maintaining its momentum, the country will have to invest broadly and not make do with putting all its eggs in one basket based on coal and water – its two main sources of energy today. Challenging growth One of the energy sources that features strongly on the agenda in China is wind power. Up until 2004, this form of energy had played only an insignificant role in the Chinese energy mix, but suddenly the pace picked up. In 2005, a total of 498 MW was installed, corresponding to a 151 per cent increase on the previous 242008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=25http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=25Chinese Wind Energy Association The CWEA plays an active role in the development of the Chinese wind power market. For example, the organisation functions as a platform for the exchange of knowledge and technology between the players in the sector, and the CWEA also acts as a bridge between the Chinese Government and the wind power industry. Moreover, the CWEA is the Chinese wind power industry’s window to the rest of the world. ”More and more developers are beginning to concentrate more clearly on the overall economy of and profits from wind power projects.” Qin Haiyan, Secretary General, CWEA. that the tendency is set to continue, and that China will achieve its new target of 100 GW of installed capacity in 2020. However, he highlights three crucial preconditions that must be fulfilled if wind power is to become one of the major energy sources in China. “Firstly, the foundations for the Chinese wind industry must be appreciably reinforced,” stresses Qin Haiyan, who goes on to explain: “At present, there are more than 250 manufacturers in the sector, but generally speaking they are lacking know-how. In addition, key technologies and the reliability of the equipment must be improved.” The electricity grid as a critical factor The second precondition for continued development of the market, according to Qin Haiyan, is that the authorities invest in an expansion of the Chinese electricity grid. The reason for this is that the majority of the highwind areas in the country are located at some wind power project in Gansu, the authorities have already drawn up a list of requirements for the grid, and it is anticipated that this will generate experience that can be subsequently be applied to other projects. The third crucial precondition identified by the Secretary General of the CWEA is that China may well be rich in wind resources, but it is absolutely vital to identify and specify precisely how these resources are distributed. “The government has decided to invest RMB 300 million in mapping the country’s wind resources, and I consider this to be crucial to our ability to plan the future expansion of wind power in China,” says Qin Haiyan. Important legislation As evidence of the importance the Chinese authorities attach to the development of renewable sources of energy, a historic law about precisely this area was passed in March 2005. The Renewable Energy Act regulates the expansion in four important areas: 1. The development and utilisation of renewable energy must remain within the planned framework. 2. The feed-in tariff for current from sustainable energy projects is to be set by a special pricing department under the year. In 2006, the figure was 1,334 MW, or year-on-year growth of 168 per cent. And last year, China installed no less than 3,287 MW, overtaking the traditional “big hitters” of Spain, Germany and India, and coming second only to the United States in newly installed capacity. At the Chinese Wind Energy Association, Secretary General Qin Haiyan is convinced distance from the consumers, and that the electricity grid is very weak. “In addition, China plans to build hundreds of giant wind farms – up to GW-size – which will place an extreme load on the grid and turn it into a bottleneck for future development unless something is done about the problem,” adds Qin Haiyan. He then relates that in connection with a major 252008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=26http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=26Ambitious goals “We aim to reinforce the Chinese management element of our business plans in the future.” Lars Andersen, Managing Director, Vestas’ sales company in China. In August 2007, China’s National Development and Reform Commission published its ambitious “Medium and Long-Term Development Plan for Renewable Energy in China”. This plan lays down the following goals for the proportion of the total energy consumption in China that is to be covered by renewable sources of energy. 2010: 10 % 2020: 15 % In addition, the plan states that all energy generators with a capacity in excess of 5 GW are obliged to increase their share of sustainable energy (over and above hydropower) to 3 per cent in 2010 and to 8 per cent in 2020. government, on the basis of the nature of the project and, if applicable, local conditions. The intention behind this regulation is to promote the development of an economic and rational base that matches the current status of technological development. 3. Wind power projects with an installed capacity of more than 50 MW must be approved by the National Development and Reform Commission (NDRC), while smaller projects can be approved by the local authorities and then registered with the NDRC. 4. Grid companies are to carry out the expansion and upgrading of the electricity grid in such a way as to ensure that in future, the grid can accommodate all the electricity generated by sustainable sources of energy. Lars Andersen, Managing Director of Vestas’ sales company in China, highlights the fact that the Chinese government has passed extremely 262008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=27http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=27272008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=28http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=28progressive legislation that makes it attractive to invest in wind energy. “But the real driving force behind the impressive growth is the huge value wind power can offer China. The country seriously needs to reduce its reliance on coal-fired power. It is not simply a matter of reducing CO2 emissions and cutting pollution. Coal-fired power also demands enormous volumes of drinking water – which is already a precious commodity in China. In addition, appreciable resources have to be devoted to mining and transporting coal. Wind power plants are quick to install and generate electricity without using drinking water. In fact, wind energy is no longer ‘alternative energy’ in China; it is a modern, clean and cost-efficient source of energy that can help China deal with some of its most pressing problems as regards the environment, climate and energy requirements,” says Lars Andersen. Customer focus is shifting Over and above remarkable technological development, Qin Haiyan believes that the immediate future will bring major changes as regards customers, which currently largely take the form of huge state-owned power groups. “At the moment, the primary focus is on price and installed capacity, but there is evidence to suggest that more and more developers are beginning to concentrate more clearly on the overall economy of and profits from wind power projects.” In this context, Qin Haiyan stresses that efficiency – and thus the energy return during the total lifetime of the project – is sure to become a key factor. Chinese manufacturers have taken the lead The big foreign wind turbine manufacturers have clearly noticed the new competition situation, which is one of the consequences of the colossal growth on the Chinese market. While foreign manufacturers held almost 80 per cent of the market in 2004, and the first Chinese manufacturer was only to be found in third place on the list, the picture is very different today. In 2007, the Chinese manufacturers had 57.5 per cent of the market, and the top two names on the list were Goldwind and Sinovel, both local companies, with shares of 25 and 20 per cent, respectively. Lars Andersen makes no secret of the fact that the development of the Chinese market has posed major challenges. “But we are not surprised by this positive development. We have expanded significantly in China over the past two years. We have already opened seven new factories and are currently working on two more,” he says, stressing that things moved so 282008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=29http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=29Chinese manufacturers The colossal growth that is currently distinguishing the Chinese wind power market is also reflected on the manufacturing side. At present, more than 30 local wind turbine manufacturers are involved in the battle for China. • Goldwind • Sinovel (DHI/Huarui) • Dongfang Steam Turbine Works (DFSTW) • Zhejiang Yunda Windey • Shanghai Electric (SEWIND) • Mingyang Wind Power Technology Co. Ltd. • Galaxy Wind • Xiangtan Electric Manufacturing Co. Ltd. (XEMC) • Baoding Tianwei Wind Power • Beijing Beizhong Steam Turbine Generator Co., Ltd. • Beijing Wandian • Changzhou Railcar Propulsion Engineering Center (CPC), Wind Power Equipment Manufacturing Company • ZheJiang Huayi Wind Energy Development (HeWind) Ltd. Co. • Envision • Chonqing Haizhuang Wind Power Equipment (CSIC) • Guangzhou Enggawind Energy Ltd. Co. • Harbin Wind Power Equipment Holding Co. Ltd. • Harbin Turbine Company Co. Ltd. (HTC) • Nantong Kailian Windpower Equipment Co. Ltd. • Shanghai Wande Wind Power Co. Ltd. • Shenyang Huachuang Wind Energy Co. Ltd. • Wuxi-Baonan Machine Building Co. Ltd. • Huayi Goldwind Wind Power Co. Ltd. • Guizhou Changzheng Electrical Apparatus Co. Ltd. • Jiangxi Zhonghang • Tianjin Eastern Steam Turbine Engineering Co Ltd. • Wuzhong Instrument /Meters Co., Ltd. • Baoding Huide Wind power engineer Co., Ltd. quickly for Vestas that just a few months after the company commenced the construction of its first factory in Tianjin, the management decided to build three more. • Hunan Hara XEMC Windpower Co Ltd. (Hara) • Guodian • Sufoma 292008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=30http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=30“The real driving force behind the impressive growth is the huge value wind power can offer China.” Lars Andersen, Managing Director, Vestas’ sales company in China. Efficient Chinese In a report, the consultancy company McKinsey has concluded that the Chinese industrial companies generally increase their productivity appreciably more quickly than their overseas counterparts, and that as early as 2005, the privately owned Chinese high-tech manufacturers were operating with productivity levels that were 35 per cent higher than those of their foreign competitors measured in produced value per year per person. This is a parameter that is naturally reflected in product prices, and which is therefore significant to the Chinese manufacturers’ ability to win orders and capture market shares. Lars Andersen stresses, for example, that Vestas already employs a large number of Chinese people in its Chinese organisation – at senior and middle management level, too. “We aim to reinforce the Chinese management element of our business plans even further in the future, and I believe that this will help us to achieve a unique balance in which we apply the best management methods and mindset from the two cultures.” Capacity and communication According to Lars Andersen, the challenge facing Vestas here and now primarily consists of two aspects: firstly, to bring capacity up to a level to match demand, which, with the current pace of market development, makes the familiar problem of component shortages a critical factor. Secondly, it is essential to engage customers in dialogue about the values which, taken together, give grounds for Vestas turbines always being included in the considerations for every new wind power project. A business case “For customers, a megawatt of wind power is not just a megawatt of wind power. It is the reliability of the energy generated, which keeps the lights on in Chinese homes. So it is crucial to customers that Vestas has the capacity to deliver cost-efficient wind power projects involving the lowest total costs per kilowatt hour throughout the lifetime of the project.” For this same reason, Vestas never wins orders in China on price, but on what Lars Andersen calls the Vestas Business Case. 302008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=31http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=31Vestas’ production facilities in China: Current: • Tianjin: nacelle, generator and blade factory Future: • Hohot, Inner Mongolia: “all-inclusive” factory for the production of kW turbines. • Xuzhou, Jiangsu Province: foundry • Tianjin: machining and controller factory “Vestas’ strength lies in the same factors as it has done for many years, i.e. first and foremost our technology. However, it also has to do with our ability to deliver on time, the fact that things work from day one, and, in particular, the fact that we fulfil customers’ expectations for a good, reliable return on their investment. In other words, we are not simply selling a wind turbine. We are selling a wind power project with a business case, and this is something that very few of our competitors can match.” Long-term strategy As mentioned previously, China is currently being driven by a need and a pace of growth that makes the country stand apart from all other wind energy markets. “Things are simply moving faster in China right now, and we expect growth on the Chinese market to continue, as our strategy for the market clearly reflects,” adds Lars Andersen. Lars Andersen is, however, in no doubt that Vestas will retain a strong position in the long term. Vestas is currently implementing a long-term strategy in China, where expansion goes hand in hand with assuring safety and quality. “Whatever happens, we do not intend to sit back and let the market grow to be the largest in the world without sharpening our competitive edge every single day,” is his concluding evaluation of what in Vestas terminology has come to be known as “The Battle for China”. 312008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=32http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=32322008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=33http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=33Turning ideas into better wind turbines is the job of Vestas’ Technology R&D Engineering & Products division. Towards the perfect turbine Hours, days, months, years, decades: Vestas, like any successful company, works on many different timescales. Within Vestas Technology R&D, that means a Global Research division to plan new products and technologies up to 20 years ahead, while the Operations division concerns itself with the here-and-now of wind turbines that are already installed. And in the middle, with a time horizon of a few weeks to a few years, is the Engineering & Products division. “We are accountable for developing and maintaining the Vestas product line, and executing on our product and technology roadmaps,” says Troy Patton, Senior Vice President and head of Vestas Technology R&D Engineer332008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=34http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=34ing & Products. As he goes on to explain, these processes rely as much on communications as on engineering. The division’s most important achievement so far, Troy Patton says, has been to create a system for sharing knowledge. Since 2005 Vestas has had a policy of integrated product development: the idea that existing products should evolve, and new products be developed, based on input from right across the value chain. Yet though the idea was sound, he explains, communications in the past were not always as smooth as they should have been. Now, he says, Engineering & Products has developed effective ways to share information with customers, salespeople, factories and suppliers, as well as with the two other divisions of Vestas Technology R&D. “Integrated product development does not mean that each of Vestas’ 16,000 employees has a direct voice,” he explains, “but we do have clear channels for people to supply their input. Understanding when to compromise is part of the art and science of product development.” Within Vestas, knowledge is shared through formal meetings that include presentations and minutes, Troy Patton explains. With external stakeholders, the preference is for informal workshop discussions without written documents. “We are not setting expectations or giving away ideas,” Troy Patton says, “just gauging market reaction to technology and product directions we might be inclined to take. These channels are clearly defined through the Product Management organisation in Vestas Technology R&D, with the sales business units always involved.” This activity is linked to Vestas’ Must-Win Battle 3: Sales excellence: creating a winning market strategy on a competitive global market. All-round communications Customers are a rich source of opinions on features to include in new products or add to existing ones. In most cases customers make their views known to the sales and service business units, who then forward this information via two groups within Vestas Technology R&D: Product Management and Operations. Sometimes, however, this is not enough. “Of course Vestas has customer surveys, but these can be too general for our purposes, 342008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=35http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=35R E S U L T R E S U L T Modelling cost of energy Cutting the cost of energy is a key target for Vestas because it is one of the most important questions when a company is considering whether to buy from Vestas or a competitor. The cost of energy is a simple figure with a complex makeup. It depends on the cost of buying and erecting the turbine, the cost of routine servicing, the amount of energy the turbine generates, and reliability over the turbine’s 20-year working life. Vestas Technology R&D Engineering & Products has spent several years developing a reliable energy cost model based on data from the production and sales and service business units. Standardising tower production Only about 20 per cent of Vestas’ towers are actually made in Vestas factories. “But we oversee everything that’s done at our suppliers everywhere in the world, so we control much more of the supply chain than our competitors do. That’s unusual in the wind industry, and we believe it is a key differentiator for us,” says Troy Patton. “The downside is that tower development has been piecemeal, and we have ended up with hundreds of different tower variants. This is not sustainable, so we are re-thinking the range to optimise both cost and quality.” “It would not have been possible under the previous business structure, because there was not enough alignment between production, sales and technology. The whole exercise will make it easier for Vestas to deliver towers of consistently high quality.” In a world where reducing time to market can bring big business advantages, halved the time it takes to design and develop a new blade is a real achievement. “It’s a result of improvements in how we do integrated product development, the gate review process, getting inputs from Research and Operations, and balancing priorities between Engineering and the rest of the business,” Troy Patton says. “Engineers talk about the ‘design spiral’ through which they home in on a final design through a series of iterations. The new structure allows us to do that faster. It’s not a question of using new materials, say, or new computer-aided design software, or testing techniques. Instead, it’s the way everything comes together, getting input from the people who need to give it, at the time when it’s most useful.” R E S U L T Halving blade design time so to get more specific information we also run workshops with customers,” Troy Patton explains. “And when customers are performing technical ‘due diligence’ before buying turbines, they may want to speak to senior engineers in Engineering & Products. We take these opportunities to gauge their reactions to some of our plans for new product development.” “We also do workshops with the service people – not just managers, but the guys who climb turbines every day. We have learned a lot from them, though sometimes we have to point out that something that will make their job easier will cause difficulties in production, and vice versa.” The project is an essential part of Must-Win Battle 7: Tower programme, V80 and V90 turbines: Reducing the number of variants by standardising tower sections, platforms and flanges, which is sponsored by Vestas Towers President Knud Bjarne Hansen. “Now that the product development team has clear points of contact with the sales, service and production business units, as well as customers, we get the necessary buy-in and involvement right away.” Engineering & Products also works closely with the other two divisions of Vestas Technology R&D. “The Operations people are our eyes and ears,” Troy Patton says. “They look after the Vestas Data Centre, which logs more 352008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=36http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=36The new focus for R&D In November last year Vestas reorganised its Technology R&D business unit into three parts: Global Research (see Win[d] no. 11, page 16); Engineering & Products; and Operations (see Win[d] no. 12, page 25). According to President Finn Strøm Madsen, the new Vestas Technology R&D features clearer internal roles and responsibilities, and stronger relations with the rest of Vestas. The aim is to help Vestas respond to the needs of its customers, especially by cutting the cost of wind power. Planned improvements All this dialogue translates into better turbines through a process known as mark upgrades, in which each turbine type is updated no more than twice a year. Like the process of gathering than a hundred signals, every ten minutes, from thousands of turbines. That’s a wealth of knowledge that can help our design engineers understand what the field conditions are really like.” feedback, mark upgrades are a compromise between speed of response and the requirements of efficient production. “You can never optimise production if you’re continuously making little tweaks to turbine designs,” says Troy Patton. “So two years ago Vestas adopted the mark upgrade process, under which we consolidate a series of improvements into each twice-yearly upgrade.” The automotive industry uses a similar process, he points out. Ways of working “This is a matrix organisation where everyone is subject to sideways pulls from sales and service business units, from production, from customers, from the spares and procurement departments, as well as from their line managers,” Troy Patton points out. “All these people are pulling on the same resources, but they don’t always have the same objectives. So one of the aims of the reorganisation was to align the priorities of The Global Research division, meanwhile, plays an important part in setting out the technology roadmap, which defines what new features or products Vestas will create. “Global Research works towards a series of time horizons: twenty years, ten, five,” says Troy Patton. “By the time they get to two or three years out, it’s already part of my planning. There’s a flow down from the technology roadmap into the product roadmap, and the product roadmap defines what goes into the turbine upgrades. Between us, we create a seamless product life cycle.” Technology development for each of Vestas’ four main turbine groups (850 kW, 1.65 MW, 2.0 MW and 3.0 MW) is the responsibility of a platform manager within Engineering & Products. Each platform manager has a team whose job is to gather input from Operations (field issues that need to be fixed), production business units (changes in procurement or assembly), and – via the sales business units and product managers – the customers. “There are three drivers for mark upgrades: improving reliability or serviceability; cutting costs; and opportunities to introduce new product variants or new technology that will improve performance,” says Troy Patton. “Every month there is a meeting to define the list of improvements that will go into the next mark upgrade.” 362008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=37http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=37A man of energy each platform with those of the line organisation. Starting with my staff meetings, there’s now a clear escalation path for prioritisation questions. This is huge difference between how we did business a year ago and how we work today.” Another important part of the work process within Engineering & Products is “gate review”, a framework many companies use when planning new products. Defining the various milestones that a project must meet on its way towards production reduces risk and makes sure that everyone knows what to expect, Troy Patton explains. Documentation is important in many other ways, he adds. Engineering & Products currently has around 700 people, around two-thirds of whom are based in Denmark, and like every other part of Vestas, the division is expanding rapidly. “My biggest challenge is training, and that means documenting what we do. We can’t continue to lead through tribal knowledge,” Troy Patton says. “I’m not worried about fixing a problem in the field, because I know we have the competence to do that. But with the rapid growth we are experiencing, how can we train new people unless we document what we are doing?” A varied career has given Troy Patton experience of several other energy sources besides wind. A US citizen, he started work in the nuclear industry 16 years ago and qualified as a nuclear power plant operator. He followed this with six years with the US Navy, serving on an aircraft carrier and a submarine: “I did power plant maintenance – it just happened to be on board nuclear warships.” After a second degree in aerospace engineering Troy spent two years with Pratt & Whitney, testing jet engines for the US Air Force. This included the advanced F119 engine, with its steerable jet nozzle, designed for the F-22 Raptor fighter aircraft. He then moved to General Electric, where he worked on the design and prototyping of large combined-cycle (gas turbine and steam turbine) power plants up to 500 MW. In 2002 Troy entered the world of wind power after GE acquired Enron’s wind energy business. “I became part of the acquisition team, helping to make the new business a part of GE. Once we had the organisation set up I worked primarily in technology, as a principal engineer,” he explains. “In 2006 I was recruited by Vestas to lead the mechanical design team, and last year under the reorganisation I moved up to head the Engineering & Products function within Vestas Technology R&D.” Troy Patton has been in Denmark with his wife and two children for 18 months now. Moving from South Carolina, he says, “the toughest part has been the weather: cold, dark and wet!” “But we like the people, and Århus is a nice town with an old-world feel. I know my wife and kids miss some things about the US, but there are plenty of things we like a lot: great parks, woodland bike trails, bakeries, the soccer and cycling culture. And we love the safety: in the States my wife would never let the kids run off on their own, but in Denmark she knows they will be safe.” 372008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=38http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=38Fewer changes to future prototypes 382008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=39http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=393D software minimises errors on the drawing board, and a full-scale model is the perfect way to pick up on the last minor issues. A more polished prototype John K. Grevsen, Director, Nacelle & Hub Design at Vestas Technology R&D, has already experienced the benefits of being able to view an entire nacelle on a single screen: ”With this reinforced design tool, I hope that we will be able to produce more polished prototypes that are not littered with outstanding issues to solve. In the short time that we have been using the new tool, we have already experienced several situations in which we have avoided having to redesign.” For example, there are drawings that show major components overlapping each other. The abil- Full-scale model captures the final details Even though the design program itself picks up on most faults and errors, it is still not possible to see every little detail on a drawing. For this reason, a mock-up model of a 2 MW nacelle on a scale of 1:1 has been built at the factory in Viborg, Denmark. This model makes it possible to see whether the theory holds water in practice. Finn Kolind Christensen Chief Project Manager, sees many benefits in the approach of combining the two methods for verifying turbine design. For this reason, he confirms that the combination of the 3D design software and the mock-up model will continue to be a fixed part of the design, verification and optimisation of Vestas’ turbines. The prototypes of the future will contain far fewer errors than previously. This will be assured at multiple levels at Vestas. The process starts on the virtual drawing board, where ultra-powerful computers make it possible to display a 3D view of an entire nacelle on a single screen. Where, previously, it was only possible to present simplified sketches of individual parts of the nacelle, designers can now – literally – display everything at once. ”This means that we can perform verification at the cheapest stage, before the bolts are tightened on the turbine,” explains Carsten Bruun Andersen, Mechanical Technician, Nacelle & Hub Application at Vestas Technology R&D. ity to view the entire nacelle at once makes it easier to see the big picture and to plan how to make room for all the large components in the limited space available. Meanwhile, the actual work process has been greatly simplified because a remote control program makes it possible for designers in different parts of the world to view the same 3D image at the same time, while simultaneously holding a telephone conference. 392008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=40http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=40Improved quality thanks to Toyota experience 402008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=41http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=41Vestas is applying experience gained by a Japanese expert in quality to improve product development. 412008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=42http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=42When everyone pulls together The ‘All the People All the Time’ philosophy means that everyone involved must think quality all the time. The philosophy can be illustrated by drawing three overlapping circles. The first circle stands for focus on processes, the second for focus on roles and responsibility, while the third stands for focus on quality. The relationship between the sizes of three circles shows where the company’s primary focus lies. At Japanese companies, the focus on quality is much greater than on processes and roles/responsibility, while the situation is typically reversed at Western companies. Source: Tatsuhiko Yoshimura, professor and quality expert. “Information and communication always deteriorate in the ‘border zone’ between individual departments, but it is precisely here that value can be created through good discussion.” Tatsuhiko Yoshimura, professor and quality expert. What do wind turbines and cars have in common? Quality optimisation. Mr. Tatsuhiko Yoshimura, who has played a key role in the development of the quality for which the Toyota Motor Company is rightly famous, is now sharing his knowledge with companies looking to optimise their quality and sharpen their competitive edge. This spring, he spent three days at Vestas to provide his assessment of the company’s quality and integrated product development. Discussion is a key concept One of Mr. Tatsuhiko Yoshimura’s most important messages for Vestas was that the company must ensure that product development is not run from a desk, but through a working relationship involving all the appropriate people from all the appropriate departments. One of his observations at Vestas was that even though communication within the separate departments is very good, it is less well-developed between them. “Information and communication always deteriorate in the ‘border zone’ between individual departments, but it is precisely here that value can be created through good discussion. For example, improving the dialogue between different functions can result in a company identifying a weakness in a product that would otherwise have gone unnoticed,” explains Tatsuhiko Yoshimura. This is fully in line with his “All the People All the Time” philosophy, which stresses that everyone involved must think quality all the time by applying a principle he calls GD3: Good Dissection (analysis), Good Discussion and Good Design. Employees should use these three parameters in all areas throughout the organisation. Tatsuhiko Yoshimura was invited by Troy Patton, Senior Vice President for Engineering and Products at Vestas Technology R&D, who found the meeting to be a real eye-opener: “For example, Tatsuhiko Yoshimura asked how often the designer of the pitch system has lunch with the head of hub production. When we checked, we found that they had never had lunch together. This is the level we are starting on.” Vestas’ executive management welcomes the advice from the Japanese quality expert. “I found it inspiring to hear how Toyota succeeded in living out ‘failure is not an option’ through their ongoing focus on quality,” says Ditlev Engel, President and CEO. Tatsuhiko Yoshimura will be visiting Vestas again this autumn, when it will be the turn of the engineers to find out more about integrated product development. Moreover, Troy 422008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=43http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=43Mr. Tatsuhiko Yoshimura CV: • Professor, consultant (2008–) • General Motors (2003–2007) During his 32-year career with Toyota, Mr. Tatsuhiko Yoshimura, the quality expert, achieved remarkable success in improving quality at the company. • Professor, Kyushu University (2000–2003) • Toyota Motor Company (1968–2000) Patton expects that in future Vestas will be inviting the quality expert to visit once every 3–6 months for a week at a time to run workshops about quality and to pass on the experience he gathers from companies that are facing similar challenges. 432008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=44http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=44Does nuclear compete with wind? 442008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=45http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=45Climate change is increasingly used as a justification for new nuclear generating capacity. Is this just delaying the inevitable switch to Modern Energy? Is nuclear power a dangerous and dirty technology that should be replaced immediately by wind and other renewable power sources? Or is it, at least for the next few decades, our only hope of holding climate change in check? For many people the answer is a matter of faith, and it depends a lot on where you live. Nations with no nuclear power, like Denmark, manage just fine. Countries with a significant proportion of nuclear power, on the other hand, are feeling pressure to renew this as existing nuclear reactors reach the end of their working lives. Ten or twenty years ago, countries which decided not to renew existing nuclear capacity could build power plants fired by coal or gas instead. Today, with climate change high on the energy agenda, replacing low-carbon nuclear with fossil fuels is seen as a backward step. A case in point is the UK, which relies on nuclear for 20 per cent of its electricity. The UK has not built a new nuclear power station since 1995, and now faces the prospect that by 2020 only three of the current 11 nuclear plants will still be operational. Combined with the expected closure of several coal-fired plants under the EU’s Large Combustion Plants Directive, this leaves the UK facing a shortfall of around 20 per cent of its current generating capacity by 2015. After much delay, the government has given its blessing to a new round of nuclear plants. Could this “energy gap” be filled by wind power instead of nuclear? In the UK, where planning rules and public opposition hinder the rapid development of wind power, the answer is probably no. Yet France, which relies on nuclear for nearly 80 per cent of its electricity, has recently shown great enthusiasm for wind power. The growth of French wind power took off only in 2006, but the country now has 2.4 GW of cumulative installed wind capacity and ranks number four in Europe. Even countries with pro-wind energy policies may have trouble replacing large amounts of nuclear with wind in the short term, however, simply because the global wind industry is already growing as fast as it can. 452008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=46http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=46The US, for instance, has one of the world’s fastest-growing wind economies, yet depends heavily on nuclear power and is planning new nuclear capacity. Developing nations including India and China are expanding both nuclear and wind in an effort to keep pace with rocketing energy demand. Germany, a leader in wind and solar power, recently reviewed its earlier decision to phase out nuclear power, though the policy seems likely to stand. Nuclear disadvantages Yet neither the pressure to find new low-carbon energy sources nor the limited growth capacity of the wind power industry mean that nuclear is necessarily the right option. Nuclear is not sustainable or renewable, and it carries a baggage of issues including the problem of waste disposal, links to nuclear weapons, and the risk of catastrophic accidents. Many years of operation have demonstrated the basic reliability of nuclear power, but as the 1986 Chernobyl accident showed, the potential for serious, widespread and long-term harm is always there. In a survey published in January 20071, European Union citizens came out strongly in favour of renewable technologies and against nuclear. For wind power, 71 per cent said they were in favour and only 5 per cent against; for nuclear, 20 per cent were in favour and 37 per cent against. The costs of nuclear power are especially difficult to pin down. While the overall picture from countries such as France suggests that nuclear is affordable and even cheap, many experts believe that nuclear’s historical R&D costs, subsidies, tax breaks, insurance and waste disposal costs show a very different picture. Energy policy analyst Charles Komanoff suggests that the US nuclear industry has consumed around 25 times as much in subsidies as the wind industry. From 1950 to 1990, he says, nuclear subsidies totalled $154 billion2. The nuclear industry argues that new plants will be based on standardised reactor designs that are quick to build, safe, and contribute relatively little to existing nuclear waste stockpiles. Examples are the US Westinghouse AP1000 and the French/German European Pressurised Reactor (EPR). The first AP1000 plant is currently being built at Sanmen, China. The first two EPRs are now being built at Olkiluoto, Finland, and Flamanville, France, where the picture does not look as rosy as the industry forecasts. Both EPR projects have been delayed by serious construction delays, and in September 2007 the Olkiluoto operator, TVO, announced that the project was at least two years behind schedule. Construction at Flamanville has been hit by problems with the concrete and its steel reinforcement, and in May the French nuclear safety agency, ASN, ordered a suspension of work until these issues were resolved. As usual, it comes down to politics. In a world with rising energy demand and an urgent need to cut carbon dioxide emissions, there is no doubt that nuclear power has gained respectability among some environmentalists. Given the high cost and long timescales associated with new nuclear plants, on the other hand, it is hard to believe that energy conservation and renewables cannot fill the energy gap – especially when wind power has the shortest construction time of any largescale generating technology. A government near you will be making its decision shortly. Sources: 1. Eurobarometer 262, http://ec.europa.eu/public_opinion/archives/ ebs/ebs_262_en.pdf 2. http://gristmill.grist.org/story/2008/5/15/104213/829 462008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=47http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=47Nuclear numbers The world has 439 nuclear reactors for electricity production, with a total capacity of 372 GW. Each nuclear power plant may have up to four reactors, though ones and twos are the most common. The top ten nuclear countries, between them accounting for around 85 per cent of world nuclear power production, are: °• the US (99 GW from 104 reactors) °• France (63 GW from 59 reactors) °• Japan (48 GW) °• Russia (22 GW) °• Germany (20 GW) °• South Korea (17 GW) °• Canada (13 GW) °• Ukraine (13 GW) °• UK (12 GW) The OECD acknowledges that nuclear power is one of the least carbon-intensive generation technologies. The Kyoto Protocol therefore allows countries to offset their greenhouse gas emissions by building new nuclear plants on their own territory. What they cannot do under Kyoto is to claim carbon credits for exporting the technology – a decision that reflects the argument over whether or not nuclear power qualifies as “sustainable”. In the language of Kyoto, nuclear power is excluded from the Clean Development Mechanism (CDM) and Joint Implementation (JI) systems. These allow industrialised countries to invest in emissions reduction projects in developing countries (CDM) or transition economies (JI), and to offset these reductions against their own quotas. The third of Kyoto’s “flexibility mechanisms”, emissions trading, places no restrictions on nuclear power. The OECD notes that: “The exclusion of nuclear energy from two of the flexibility mechanisms for the present compliance period is largely symbolic in terms of nuclear energy development by 2012. Indeed, the number of nuclear units that might have been ordered owing to these mechanisms is very limited. However, the debate on nuclear energy that has led to its exclusion from the flexibility mechanisms of the Kyoto Protocol may have negative implications for the period after 2008-2012." In addition, Russia, China, India, South Africa and the US are each proposing around two dozen new reactors. Sources: http://www.iaea.org/programmes/a2/ http://www.nei.org/resourcesandstats/nuclear_statistics/worldstatistics/ Nuclear and Kyoto °• Sweden (9 GW from 10 reactors) A further 21 nations produce smaller amounts of power (300 MW-8 GW each) from just short of 100 reactors. Many countries, even those with just one or two nuclear plants, rely on nuclear for a significant proportion of their electricity. In terms of the nuclear fraction of total generating capacity, at the top of the league table are: °• France (77 per cent) °• Lithuania (64 per cent) °• Slovakia (54 per cent) °• Belgium (54 per cent) °• Ukraine (48 per cent) °• Sweden (46 per cent) °• Armenia (44 per cent) °• Slovenia (42 per cent) °• Switzerland (40 per cent) °• Hungary (37 per cent) °• South Korea (35 per cent) °• Bulgaria (32 per cent) Around 34 new plants are currently under construction. Countries currently building more than one reactor are: °• Russia (7) °• India (7) °• China (5) °• North Korea (4) °• Taiwan (2)2008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=48http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=48Quality has to be top class all the way round 482008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=49http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=49Vestas’ turbines are treated with precision and care from start to finish. And now it is time to optimise the transport process, too, because all customers are to receive their turbines on time. 492008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=50http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=50When Hurricane Humberto hit Port of Beaumont, Texas, in the United States in September 2007, more than 100 Vestas turbine blades stored there were torn from their storage frames. The cost of the damage totalled over EUR 4.7 million, and a great deal of work had to be done to make sure new blades reached customers on time. The goal is 4 Sigma The damage caused by Hurricane Humberto is just one example of issues involving the transport of turbine components that Vestas is FACT BOX Six Sigma is a method for eliminating errors/ non-conformities in a company’s processes, with a view to improving the bottom line. 502008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=51http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=51working consciously to prevent. A panorganisational team is focusing clearly on optimising transport quality. The initiative is called “Enabling 4 Sigma in Transport Processes” because the intention is to bring all transport carriers up to 4 Sigma level by the end of 2008. 4 Sigma means that there must be no more than 6,210 incidents of damage per million transported blades. “Of course, we would like to bring the transport quality up to 5 or 6 Sigma, but how far we can reduce the percentage of incidents of damage depends entirely on how you define ‘damage’. It is unrealistic to expect to be able to prevent every little scratch caused during transport. It is not these little knocks, but the incidents of major damage that cause delays, and delivery reliability is of paramount importance to us,” says Hilmar Eliasen, Manager, Global Cargo Risk Management. Monitoring high-risk routes Until the end of 2008, Vestas will closely monitor deliveries on what are known as the “highrisk routes”. Problems arise in particular when the dispatchers hire third-party carriers to continue transporting the components. There can be up to 20–40 transfers between carriers, and the components sometimes have to be placed on the ground for a while – which was what happened at Port of Beaumont. The members of the team must therefore travel around to see how the third-party carriers handle the components, primarily in connection with unloading ships or transferring components from road transporters to railway trucks. In addition, the plan is to set up an electronic solution that can trace each and every component. “We have not yet decided how comprehensive the technological solution is to be, but the most sophisticated version might involve a GPS sensor and perhaps even a temperature and motion sensor to help us make sure that the components have been stored correctly,” explains Henrik Stamer, Director, Risk Assessment, who has primary responsibility for the initiative. Training carriers Duncan Galbraith, a Transport Engineer from Vestas Technology, is in charge of the team that monitors high-risk transports. He explains that training is one of the aspects that make up the initiative. “We train the dispatchers’ and carriers’ key personnel, and focus closely on safety and standard procedures,” he says. At the same time, Vestas is working on the preparation of general specifications for dispatchers to ensure a fair division of risk. “The dispatchers need to know that they are obliged to check what the freight they are shipping can and cannot withstand, and what is needed from a technical perspective. In this way, we can reduce the risk of having to go to court to clarify where the responsibility for damage lies,” explains Hilmar Eliasen. Better transport means delivery on time Vestas expects that the clear focus on transport quality will result in more customers having their projects delivered on time. “The initiative backs our commitment to ‘on-time delivery’, so we expect it to have a positive influence on customers’ perception of Vestas’ ability to deliver,” concludes Henrik Stamer. 512008-08-13T07:19:27+02:00http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=52http://nozebra.ipapercms.dk/Vestas/VestasWind/UK/1308/?Page=52Win[d] W I N D , O I L A N D G A S Contacts Vestas Northern Europe +46 40 376 700 Sales and service in the UK, Ireland, Scandinavia, Poland and the Baltic area. Vestas Central Europe +49 4841 9710 Sales and service in Germany, Austria, Benelux, Russia and Eastern Europe. Vestas Mediterranean +34 902 41 98 00 Sales and service in the countries of the Mediterranean region, the Middle East, Latin America, the Caribbean, and North and West Africa. Vestas Asia Pacific +65 6303 6500 Sales and service in Australia, New Zealand, China, Japan, India and the rest of Asia. Vestas Americas +1 503 327 2000 Sales and service in North America. Vestas Offshore +45 97 30 00 00 Sales and service, offshore. EDITORS: Peter Wenzel Kruse (Editor in Chief) and Hanne Poder Sørensen. TEXT: Charles Butcher, Anne Nielsen, Klaus Bundgård and Carina Britorn Vestergaard. UK For more information about Vestas sales and service units, go to www.vestas.com and click on Contact. Vestas Wind Systems A/S Alsvej 21 · DK–8900 Randers · Denmark Tel. +45 97 30 00 00 · Fax +45 97 30 00 01 vestas@vestas.com · www.vestas.com2008-08-13T07:19:27+02:00