The Daily Caller News Foundation – Will Kessler on June 23, 2023
Siemens Energy announced Thursday that it will be undergoing a technical review after it was found that up to 30% of its wind turbines could have faulty components, according to statements made by the company.
Siemens Energy, an international energy company that seeks to “decarbonize global energy systems,” announced that it is withdrawing its profit guidance for the year after subsidiary Siemens Gamesa found that there was a “substantial increase in failure rates of wind turbine components.” The company believes that between 15% and 30% of its installed fleets are suffering from component failures, Jochen Eickholt, CEO of Siemens Gamesa, said during a Friday morning analyst call.
“The fact that we have identified more quality problems marks a significant setback for us. These quality problems go beyond what we were previously aware of, and they are directly linked to selective components at a few but important suppliers,” Christian Bruch, President and CEO of Siemens Energy, said during the call. “At this point in time, we believe that the costs are likely to be in excess of 1 billion euros.”
Siemens Energy stock fell 36% as of Friday morning after the announcement, according to MarketWatch.
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— Siemens Energy (@Siemens_Energy) June 19, 2023
The use of wind energy has received criticism as operations grow in size, incurring more maintenance costs and environmental concerns. Newer, larger turbines designed to generate enough power to fuel renewable energy desires suffer from a greater rate of component failure, resulting in higher maintenance costs, according to The Wall Street Journal. Some environmentalists also claim that wind farms harm animals, including birds, through habitat destruction and obstructing air travel.
Siemens Energy deferred the Daily Caller News Foundation’s request for comment to the statements previously made in the announcement and analyst call.
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