Thursday, December 6, 2012

Sinovel confirms 54MW of South Africa wind orders

Sinovel hubs outside the company's
factory in Jiuquan
The company – which was named as preferred supplier in last November’s renewables tender – will ship nine of its 3MW turbines to the first project in March next year.

The Dassiesklip project, developed by BioTherm Energy, is located in South Africa’s Western Cape.

It has also won a second 27MW order from another local developer, Metrowind, for its Van Stadens wind farm in the Nelson Bay Municipality in the country’s Eastern Cape province.

Metrowind is expecting to take delivery of the turbines in May next year and start commercial operations in Feburary 2014, according to its website. It adds that Sinovel will “operate and maintain the turbines for 15 years after the commercial operating date”.

Both of the projects will be financed by Standard Bank, says Li Lecheng, Sinovel’s vice president for international sales.

“It is the first time we have got non-recourse financing from a local bank,” he tells Recharge.

Non-recourse loans are typically very difficult for relatively inexperienced Chinese companies to obtain in overseas markets. Such a loan requires that a local bank completes due diligence on the equipment involved and takes on risk related to its long-term viability.

Some Chinese firms get local bank financing by including a state bank or state-owned parent company guarantee into the deal.

A full non-recourse loan would be a major milestone for Sinovel’s expansion in overseas markets.

Sinovel has already installed two of its 3MW turbines in Sweden and has recently shipped 12 units of the machine to a project in southeast Spain.

“This project will be completed at the end of the year,” says Li, without revealing further details of the Spanish project.

Sinovel is one of China’s largest turbine makers, but its domestic sales have plummeted this year on fierce competition and slowing demand from China’s major wind developers.

The company is looking overseas to bolster sales, particularly emerging markets such as Brazil, Eastern Europe and South Africa.

Previous international orders, such as a 34.5MW project in Brazil, have been financed by the China Development Bank (CDB).

Li says Sinovel is preparing for South Africa’s third round of concession projects, expected to take place in May next year.

“We’re confident of winning more orders,” he says.

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