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October 30, 2007 © SKF Group Slide 1
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October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

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Page 1: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 1

Page 2: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

Wind energy market from the perspective of a major sub-supplier

Presented at EWEC 2009

Stefan Karlsson

Global Segment Manager – Renewable Energy

Marseille 2009-03-19

Page 3: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 3

The dynamic wind energy market

1

Page 4: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 4

Demographic Dynamics

Resource Scarcity Environmental Focus

Main reasons behind massive growth in wind energy

Growth in energy demand Security of energy supplyReduction of CO2-emission

Page 5: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 5

Wind energy market size almost tripled in 5 years

100.0%

150.0%

200.0%

250.0%

300.0%

2002 2003 2004 2005 2006 2007Market 2002 as index=100%

Key challenges on supply chain;• Speed of growth – capacity constrains• Rapid globalisation – logistic challenges• Expanding turbine sizes – new & larger components• Lack of predictive maintenance – stock management

Page 6: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 6

Wind industry technology challenges

Industry Key Issues• Wind gearbox technology• Pitch system technology• Testing of key-components• Offshore reliability• Cold climate applications• System for early detection of failures• Windfarm asset management• Lifetime return on investment

The SKF test-rig for the large mainshaft ”Nautilus” bearing.

Page 7: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 7

Supply Chain Constrains - limiting market growth

Source: BTM-Supply Chain Assessment, August 2008

Page 8: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 8

2SKF, a driving force in wind energy

Page 9: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 9

SKF – a truly global company

Established: 1907

Sales 2008: SEK 63,361 million (~6 B€)

Employees: 44,799

Production sites: 110 in 28 countries

SKF presence: in over 130 countries

Distributors/dealers: 15,000 locations

Global certificates: ISO 14001

OHSAS 18001 certification

SKF group vision; ”To equip the world with SKF-

knowledge”

Page 10: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 10

It is being present and active in:

What is SKF knowledge?

Page 11: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 11

Pitch bearings

Yaw bearingMainshaft housingsand locknuts

Condition Monitoring WindCon/WebCon

Couplings

Automatic distributedlubrication system

Monitoring and diagnosticsservices

Mechanical repairs &refurbishment

Sealing solutions

Bolt tensioning toolsTower alignment services

EngineeringConsultancyServices

Plain bearings

Maintenance tools and grease

SKF contribution to wind turbine technology

Gearbox bearingsTRB/CRB/SRB/CARB/DRTRB

Generator bearingsDGBB/InsoCoated/Hybrid

Mainshaft bearing(s)SRB/CARB/TRB/DRTRB

Page 12: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 12

Market growth vs. SKF growth in wind energy

100%

200%

300%

400%

500%

2002 2003 2004 2005 2006 2007

Wind market growth in MW SKF deliveries to Wind energy industry Index; Year 2002=100%

Page 13: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 13

Capacity Development of SKF Large Size Bearings

•Complete new factory built in Dalian China 2006, expanded with additional capacity/range 2009.

• Complete new factory built in Ahmadabad, India will initate deliveries during 2009.

• New manufacturing channel for pitch & yaw-bearings built in Avallon, France 2006.

• New manufacturing channel for XXL-bearings in Göteborg, Sweden at present under construction.

• Capacity expansion at Hannover plant, USA, and at Schweinfurt plant, Germany

Capacity development;

2010 / 2005 +350%

Page 14: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 14

SKF Large Size Bearing Capacity Development

SKF develops manufacturing capacity in line with plans from our key-customers in wind energy business community.

Being a truly global company, SKF is prepared to develop manufacturing capacity in new emerging markets, when justified.

Development of new manufacturing capacity has a long leadtime; For elimination of bottlenecks (new machinery leadtimes); 12-30

months To build a complete new manufacturing line; 18-30 months For a new greenfield manufacturing unit; 2-6 years (local

variations)

Need to focus on customer forecasts and capacity requirements 2011-2012.

Page 15: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 15

3Predicting the future of wind….

Page 16: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 16

The growth has just started………..

Ten years ago, wind energy contributed to 0,1% of the worlds total generation of electricity.

Today, wind energy contribute to 1% of global electricity.

Ten years from now, predictions estimate that wind energy will contribute to 6% of global electricity supply.

Over the last 5 years, over 30% of all new installed electricity generating capacity in EU has been in form of wind energy.

The EU-Committment of 20-2020 will require 12-15% of Europes electricity to be powered by wind by 2020.

Page 17: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 17

Source: BTM report November 2008

“Exploding” China stretching supply chain further

Installed capacity in China

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

MW

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

Cu

mu

lati

ve M

W

MW Cumulative MWInstalled MWForecast

National targets

2020

2010

already passed during 2007

Most likely passed during 2011

2030

100.000 MWMost likely passed before 2020

Page 18: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 18

Annual Wind Power DevelopmentActual 1990-2007 & Forecast 2008-2012

0

10,000

20,000

30,000

40,000

50,000

60,000

1990 1995 2000 2007 2012

MW

Europe USA Asia Rest of World ExistingSource: BTM Consult ApS - March 2008

BTM-report 2004

Predicting the future of wind energy business…..

Most likely Scenario ?

Page 19: October 30, 2007 © SKF Group Slide 0. Wind energy market from the perspective of a major sub-supplier Presented at EWEC 2009 Stefan Karlsson Global Segment.

October 30, 2007 © SKF Group Slide 19

SKF

The Knowledge

Engineering Company