Vergnet, France’s only manufacturer of wind turbines, has earned its place as the leader in mid-range wind-power generation on the FARWIND® market with its original technology of twin-bladed aerogenerators, which can be tilted down in less than one hour in the event of a cyclonic alert.
Wind power in France
France has the second largest wind resource in Europe after the United Kingdom. Électricité de France, the main French electricity generator and supplier in France plans to increase its capacity to 10 GW in the year 2010.
The French government plans to produce 21% of its electricity consumption with renewable energy in 2010 to comply with European directive 2001/77/CE of 27 September 2001. This means that France has to produce 106 TWh of renewable energy in 2010 when it only produced 71 TWh in 2006. Wind power represents 75% of the 35 TWh additional production in 2010.
France enjoys an abundant wind potential, and is continuing to see strong growth. In 2000, France had only 30 MW of wind generating capacity, mostly small wind turbines in the French overseas territories. At the end of 2008, the total installed wind capacity stood at 3.4 GW, representing an annual growth rate of 38%. France now is the fourth largest market in Europe after Germany, Spain and Italy.
The wind market grew by 950 MW in 2008, and this new wind capacity represents about 60% of all new generation capacity installed in France last year. Wind power is now France’s fastest growing energy source.
The average size of an installed wind turbine in France has increased from an average of 1.2 MW per turbine in 2005 to 1.95 MW in 2008, and is expected to reach 2.5 MW by 2010. The average size of wind farms has also been continuously increasing, from 4.7 MW to 13 MW between 2002 and 2008. It is estimated that the average wind farm size could reach 20 MW by 2010.
In 2008, French wind farms produced 5.6 TWh, with an average capacity factor of 24%. The wind sector now provides around 7,000 jobs to the French economy.
The biggest potential for growth in the coming years is estimated to be in the north and the north east of the country. By 2010, it is expected that the areas for greatest development would all be in the north of France. Out of 4,000 MW of approved wind power projects, more than 700 MW are in the Champagne-Ardennes region and 500 MW in the Picardy region.
The largest wind park in France is in Fruges, in the north of the country, with 70 wind turbines accounting for 140 MW. Built in 2007, the Cormainville wind farm in Eure-et-Loir has an installed capacity of 60 MW and the La-Voie-Sacré wind farm in Lorraine has 54 MW. The largest manufacturers active in the French market are Enercon, Vestas, REpower, Nordex and Gamesa, accounting for 86% of the total capacity in 2007.
A feed-in tariff was introduced in France in 2002, ensuring a tariff of 8.2 ct€/kWh for a period of 10 years, which then decreases during the next five years of the contract.
In July 2005, this law was amended to stipulate that in order to be eligible for the feed-in tariff, wind farms must be built in special Wind Power Development Zones (ZDE). These zones are defined at the regional level based on the criteria of electrical production potential, grid connection capacity and landscape protection. The law also did away with the previous size limit of 12 MW for wind farms.
The feed-in tariff in the ZDE was reaffirmed in a decree signed on 17th November 2008, after the previous decree was cancelled by the Conseil d’Etat, the highest administrative court, in August 2008.
In 2007, during the Grenelle de l’environnement process, the French Syndicat des Energies Renouvelables (SER) suggested a wind power generation target of 25 GW by 2020, including 6 GW offshore. This objective would allow France to reach the European target of 23% of final energy consumption from renewable energy by 2020, as outlined in the new EU Renewables Directive.
This last objective has so far been adopted by the National Assembly and should be adopted by the Senate in the coming months (Grenelle 1 law). The law will finally be approved by the end of 2009 and will come into force shortly thereafter.
Another law from the Grenelle legislative process (Grenelle 2) is expected to be issued in 2009 and will provide for the implementation of renewable energy schemes at the regional level. The schemes should be elaborated both by the executive representative of the state at a regional level (préfet) and by the elected president of the regional council following a consultation process. The aim of these regional schemes is to determine geographical zones for the development of renewable energy, with a specific section for wind energy.
Despite these new provisions, the ZDE will continue to exist, with an additional criterion for the preservation of landscapes. The implementation of regional schemes requires that all ZDEs that are created after the implementation of schemes comply with the regional schemes.
Despite the high wind power potential in France, there are several barriers that remain and hinder the development of wind energy in the country. Barriers include: slow authorization procedure for both ZDE and individual authorizations; inadequate grid connection capacity; and zones in which installation is forbidden.
Rather than promoting wind energy development, the ZDE law has hampered the growth of the French market, since it has resulted in longer and more complex administrative and grid connection procedures. A 2007 study issued by the Ministry of Industry and Economy indicates that 9 weeks are necessary to notify the applicant that the application process is launched and the authorization generally takes 22 weeks to be completed.
Adequate grid connection remains a problem in some areas of France, although some commitment has been made towards reinforcing the French grid to accommodate more wind development.
Offshore wind development in France is slow, as there is no specific legislative or administrative framework for the development of offshore wind energy, and the framework applying to offshore economic activity is not adapted to wind energy. Preparation for the first offshore wind farm in France began with a government tender in 2005, but due to long authorization procedures, construction has been delayed and is now scheduled to start in 2009 or 2010.
However, there are indications that the principle of exclusion zones will no longer be applicable offshore, and work has begun on simplifying offshore planning procedures.
Vergnet
To this day, the Group has provided and installed over 500 aerogenerators throughout the world, generating over 150,000 MWh of eco-friendly electricity each year.
Vergnet’s customers are:
* Electric power companies
* Independent power producers
Historically focused on the international market, Vergnet is established in five regions of the world (France, the Caribbean, the Pacific, the Indian Ocean, and Africa).
The Group’s achievements can be found on all six continents.
A recognised standard in rural hydraulics
Vergnet’s reputation has been made on the design, construction and installation of “the Vergnet hydropump ”., which provides drinkable water to over 40 million people, at 80 000 water points worldwide. The Group is currently growing in the more general area of water conveyance.
A sustainable-development approach
As a forerunner of this sustainable development approach, Vergnet has successfully endeavoured, for both activities, to dialog, share and act in concert with local players.
The Group creates local companies which guarantee new jobs, train technicians, and ensure on-site availability of spare parts, so as to provide a consistent service in the areas of water conveyance and wind-power production.
A planned development strategy for its reference markets
With its current machine, the 275 kW GEV MP, and the development of the 1 MW GEV HP, supported by the setting up of a new sales force, Vergnet seeks to offer larger and more powerful wind farms to its Farwind market clients. The new GEV HP, which features all the innovations typical of Vergnet wind turbines, will allow the construction of wind farms with capacities from 10 to 50 MW.
The Group’s objective is to become the world’s leading provider of wind power on oil/diesel-generated electricity (“petroelectricity”) networks, and the world reference in water-conveyance solutions for developing rural areas.
Background
1976: installation of the first VERGNET Hydropumps in Africa
1988: Marc Vergnet founds Vergnet S.A.The Company’s object at the time was the manufacture and merchandising of pumping systems in rural environments.
1993: the first Vergnet Aerogenerator (GEV) enters the market. The Company focuses its development on wind power worldwide.
2001: the 220-kW GEV is launched; these are the 1st line of FARWIND mid-range aerogenerators. Vergnet aerogenerators are the only ones on the market to include a technology allowing them to be safely installed in cyclonic or hard-to-reach zones.
2002: outsourcing of the wind farm development activity (AÉROWATT, registered on the Open Market in 2006).
2005: after a call for tender, the Group signs a contract with the FEA (the Fiji Electricity Authority) for the construction of the first FARWIND 10-MW power plant.
Successful launch of the new range of water-conveyance products.
2006: VERGNET has become a generic trademark. More than 40 million persons are now supplied with water.
7th development program with the line of FARWIND HP (1-MW GEV HP) aerogenerators.
2007: creation of Photalia, which belongs to the Vergnet Group, and provides tailored photovoltaic systems
2008 : July 2008 : Our new Greneville plant was put into service (GEV HP 1MW wind turbine)
October 2008 : Signature of the Ethiopian contract – 120 wind turbines 1MW with EEPCO
Marc Vergnet received Tuesday November 18, 2008 the 6th Price of Renewable Energies of the hands of the Secretary of State to the Foreign Trade Anne-Marie Idrac.
The conquest of new countries
The development of Vergnet will rely on markets it has already earned and on the conquest of new FARWIND® markets.
Already present in cyclonic areas, and in the islands of Cuba, Fiji, Madagascar, the Philippines, Australia …, the Group intends to consolidate its position in these countries with the development of the GEV HP. Its two product lines, the 275-kW GEV MP and 1-MW GEV HP, will allow VERGNET to conquer new FARWIND markets which lack the infrastructures required for the installation of conventional machines: Africa, Central America, Australia, the Philippines, Japan (Okinawa)…
In the water sector, thanks to its reputation acquired in Africa, the Group seeks to diversify geographically in all developing countries of the Caribbean, Latin America, the Pacific, the Indian Ocean and Asia, to take advantage of the worldwide dynamics in rural-environment equipment.
Strengthening the teams
The current production capacities will be increased, to allow a considerable acceleration in aerogenerator production over the next three years. The Construction departments will be reinforced to set up work sites throughout the world. Customer services, provided by local subsidiaries, will be developed and extended in collaboration with local players.
The R&D platform will be maintained, or even bolstered, to manage Vergnet S.A.’s next development programs.
The Group’s commercial power will be reinforced with the arrival of new teams, to canvass and conquer the entire FARWIND® market.
New sites adapted to growth
In the Orleans region, the Group is moving, to new premises four times more spacious to allow the assembly of the new GEV HP machines and to receive the new teams. Its Aerocomposit Occitane subsidiary will also take over new buildings, adapted to the manufacturing of greater-span blades for the GEV HP (62 meters in diameter).
An ambitious goal
On the financial side, the Group has set itself an objective of 60% annual growth in turnover (partly due to the launch of the 1-MW GEV). The company also seeks to double its operating margin by 2008.
Major contract signed in Ethiopia: €210 million
In the presence of Anne-Marie Idrac, French Secretary of Foreign Trade, Ato Alemayehu Tegenu, Ethiopian Minister of Energy and Mines the Vergnet group represented by Marc Vergnet signed a major contract with the Ethiopian Electric Power Corporation, EEPCo represented by Ato Meheret Debebe. This is the largest contract ever signed between a French company and an Ethiopian company.
The contract, involving the sale and installation of 120 MW wind turbines over a period of three years, with the first 30 units to be delivered in 2009, will result in the largest wind farm in sub-Saharan Africa. The contract is in line with Ethiopia’s energy policy, in response to the fastpaced growth of domestic demand and its intention to eventually export electricity to neighbouring countries.
Vergnet was awarded this bid due to the competitiveness of its wind turbines, which are perfectly suited to the Farwind zones, which present considerable logistic constraints.
The complete integration of the value chain (design, manufacture, installation and maintenance using local teams) was also a key advantage.
A fully financed project
EEPCo will draw on two complementary sources of financing to carry out this project:
– A €165 million bank loan syndicated by BNP Paribas based on a €130 million COFACE guarantee;
– Together with an €45 million loan from AFD (the French Development Agency).
Philippines
In the Philippines, Vergnet has already installed three small wind turbines on Batanes Island in 2003, which have withstood the storms that have passed through the years.
Vergnet is also helping Napocor’s Small Power Utilities Group (SPUG) to provide electricity to off-grid islands and remote areas. Napocor-SPUG project might have a power output of around 20 to 30 MW. Vergnet is also tracking the plans of Trans-Asia to develop a 54-MW wind-farm project in Guimaras. Vergnet has already proposed to help EDC for its planned 86-MW wind-farm power project in Burgos, Ilocos Norte.
A Group dimensioned to manage growth
Vergnet has been preparing to take on new dimensions for many years now. Its teams, production capacities, and management structure have been considerably strengthened in order to enable the group to manage the growth of its 1 MW GEV HP business.
The operating capacities already put in place will be fully operational by year-end 2009, with a production capacity of 100 GEV HP and 50 GEV MP per year. The group is thus well positioned for the future.
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