General Electric plans to pay $1.65 billion to buy a Danish manufacturer of rotor blades, bringing in-house it’s largest supplier of those components, thereby signaling the industrial giant’s intention to expand its footprint in the non-carbon-based energy sector. It emphasized in its announcement that wind-power projects represented approximately 17.5% of all new electricity capacity additions in 2015.
LM Wind Power develops and manufactures blades and services, and provides logistics for wind-power installations; it holds 190 patents and has 13 manufacturing plants in eight countries, and claims to have produced more than 185,000 blades (approximately 77 gigawatts of installed wind power capacity) since 1978.
The manufacturing plants are in Denmark, Brazil, Canada, China, India, Poland, Spain, and the U.S. (Grand Forks, ND, and Little Rock, AR.)
“Increasingly, wind turbine innovation is driven by system design, materials science, and analytics,” according to Jérôme Pécresse, president and CEO of GE Renewable Energy the operating unit that will take over LM Wind Power. He predicted the “deep pipeline of technical innovations” made possible by the combination would reduce the cost of electricity, and help “sustain growth in the wind power industry.”
Pécresse related how incorporating the rotor-blade expertise would give the GE Renewable Energy organization more local expertise with “more flexibility and knowledge in turbine design and supply, and more ability to innovate and reduce product costs, while improving turbine performance. We will also develop enhanced digital and services capabilities. All of which will be good for customers, competition in the industry, and the growth of wind power globally.”
GE Renewable Energy has technologies and services for onshore and offshore wind power plants, hydro plants, and others technologies like concentrated solar power. It claims to have installed more than 370 GW of renewable energy capacity worldwide.
GE stated it intends to operate LM Wind Power as a standalone unit within GE Renewable Energy. It also stated it intends to continue sourcing blades from other suppliers.
LM Wind Power will retain its existing management team and headquarters and global technology center in Denmark.
“This deal will merge the speed and focus of LM Wind Power’s entrepreneurial culture with GE’s world-class engineering and operational capabilities,” declared Marc de Jong, CEO of LM Wind Power. “Our two organizations are highly complementary and the transaction positions us well to respond faster to customer needs and enhance performance of wind turbines to ultimately reduce the cost of energy.”