LARGEST WIND TURBINE PRODUCTION FACILITY IN CHINA

SHENYANG, China, Jan. 2 /PRNewswire-Asia-FirstCall/ — A-Power Energy Generation Systems, Ltd. (Nasdaq: APWR – News; “A-Power”), today announced it will celebrate the launch of its first wind turbine production facility, the largest in China, with a ribbon-cutting ceremony in Shenyang, China, on Sunday, January 11, 2009. All investors are invited to attend the ceremony, which begins at 8 a.m. Meals and transportation from and to the local Sheraton hotel will be provided.
The inauguration will unveil A-Power’s full-scale wind turbine production business, as well as German Furlander Wind Generation (Shenyang) Company (“German Fuhrlander”), from which A-Power licenses its wind power-generation technology for the current facility.

Mr. Jinxiang Lu, A-Power’s Chairman and CEO, said, “We look forward to having our investors join us at this extremely exciting, and historic, event, which marks the full launch of our wind turbine business in China. Our wind turbine facility, strategically located in the city of Shenyang, is the largest in China, with total annual production capacity of over 1,125MW of wind turbines, and we intend to sell to both domestic and foreign markets. In addition to investors, joining us at our opening ceremony will also be government officials, the management from German Fuhrlander, as well as our existing and potential customers of our wind turbine business.”

this is the reason behind why APWR is going to go north into the future, the SUPPLY/Demand equation is on the side of demand

Tanti’s rationale is about demand and supply. He says that by 2020, the US, Europe, China and India will want to have 20 per cent of their power supply from renewables. The issue is about making wind power “cost competitive” with carbon sources, especially coal, which fuels 65 per cent of India’s electricity and costs at least a quarter less.

“Today wind power is just one per cent of supply. It can grow to seven per cent by 2020. That is the maximum because industry has to find resources, material and execute projects. With greater volumes the price (of wind power) will drop … and (governments) will ask what is the cost for pollution from carbon fuels. You will need a carbon tax.”

Suzlon’s biggest acquisition has been a rollercoaster ride. The Indian company won a bidding war with French nuclear power group Areva with a $1.6bn offer for Repower, a maker of huge wind turbines.

However, the deal remains in limbo after Suzlon’s initial financing deal fell apart as markets crumbled. Repower is the key to Suzlon’s global strategy. Tanti says that by 2020, there will be only five to six global players and to survive Suzlon needed to be big in the US, Europe and Asia. Tanti’s logic was that unlike in the US and Asia, where land is plentiful, in Europe he would need giant offshore wind turbines to produce electricity. Repower’s 5MW generator – double the power output of Suzlon’s biggest turbine – is 100m tall and has a rotor diameter of 126m. It can only be serviced using a helicopter.

Coupled with this technology and a cost base which is 19 per cent lower than the European company, Tanti says he can grow Repower’s business five-fold in a short span.

“It will take three of four years to develop this technology and we need access to European offshore markets. We can reduce the company’s cost and increase their margins and unlock value here,” he says.

Few people would bet against Tanti. In 1994, he ran a textile business and bought two wind turbines to power his factories after becoming frustrated with India’s high-cost, erratic electricity supply. Tanti, a trained mechanical engineer, became fascinated by the economics and technology involved.

Gap in the market

In the 1990s, western firms had little interest in India and Tanti spotted a gap in the market. He decided to leave textiles and began installing and servicing wind turbines for fast-growing companies in India. By the late 1990s he had built up a large domestic business, partly through convincing state governments to adopt a friendly tax regime for green power.

Tanti aims to build Asia’s largest wind farm, exceeding his Indian one in size, in Inner Mongolia that will generate 1,650MW of wind power. The Chinese government has said it wants 100,000MW to come from wind.

The country has a large potential of 250,000MW. That is why we have our manufacturing there. We are a Chinese local company too.”