CNBC's Elliot Smith is reporting that the wind power industry is in trouble.
The wind power industry is facing significant challenges as evidenced by falling stocks and declining earnings. The largest renewable energy firms reported a $3 billion decrease in assets in the first half of the year, mainly due to rising construction and financing costs, supply chain disruptions, and quality control issues. Siemens Energy, particularly its subsidiary Siemens Gamesa, experienced severe manufacturing faults, leading to scrapped profit forecasts and requests for substantial government support. Additionally, wind energy firms are increasingly outbid for seabed licenses by oil and gas companies and struggle with low electricity prices that do not cover manufacturing costs. This situation has prompted calls for increased government subsidies. Despite these challenges, companies like Vestas show some positive signs, indicating that the market is at a critical juncture. Industry analysts emphasize the need for political recalibration and adjustments in strategies to realistically transition to net zero, recognizing the increasing costs of wind energy projects. The European Commission's new Wind Power Action Plan aims to increase wind capacity, indicating a step towards addressing these issues. However, substantial investment and time are required for the industry to overcome its current challenges.
(This article was written with assistance from ChatGPT)