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28 March 2010

Siemens Plans U.K. Wind Turbine Factory After Brown Port Pledge

Source: Bloomberg

Siemens AG will spend 80 million pounds ($120 million) to build an offshore wind-turbine factory in the U.K. after Prime Minister Gordon Brown pledged to upgrade the country’s ports.

The company is considering sites along the east coast and in the north east of England for the plant that will create around 700 jobs, Siemens said in a statement.

The investment marks the fourth time in two months that Brown’s government has lured a wind turbine factory to the U.K., which is recovering from its worst recession in six decades. Chancellor of the Exchequer Alistair Darling earmarked 60 million pounds in last week’s budget to refit U.K. ports and meet the needs of offshore wind developers.

“The U.K. government has created a stable framework to attract inward investment in renewables and offshore wind power in particular,” Andreas J. Goss, Siemens’s chief executive officer in the U.K., said in the statement. The budget “gives us confidence that the appropriate U.K. port infrastructure can be made available.”

Offshore wind power may employ 70,000 people by 2020, the government said, citing a 2008 study by the Carbon Trust.

Siemens, the U.K.’s biggest provider of wind turbines, already runs wind power research units at the universities of Sheffield and Keele and located its global center for offshore grid connections in Manchester.

World Leader

“This is a fantastic endorsement of the U.K. as a destination for renewable energy businesses,” Business Secretary Peter Mandelson said. The announcement confirms “the U.K. as a world leader in offshore wind.”

The U.K. government, after granting permission for about 32,200 megawatts of offshore projects, said last week it will establish a 2 billion-pound Green Investment Bank to promote low-carbon energy technologies.

General Electric Co. last week said it will spend around 113 million euros ($152 million) on an offshore turbine factory in the U.K. that will employ 1,900 people.

Last month, Clipper Windpower Plc started work on a plant in Newcastle to produce offshore-turbine blades. That plant is set to employ as many as 500 people by 2020. Mitsubishi Heavy Industries Ltd.’s European power division will spend 100 million pounds on a research facility in the U.K.

Brown’s government has lauded those programs, which helped ease concerns about the future of Britain’s wind industry after Vestas Wind Systems A/S shut the only U.K. factory making turbines last year.

Europe’s offshore wind industry may grow by as much as 70 percent in 2010, according to the European Wind Energy Association. If all of the offshore wind energy projects being developed are completed, they could produce as much as 10 percent of the European Union’s electricity, GE said.

To contact the reporter on this story: Ben Sills in Madrid at [email protected]