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ENERGY

Wind of austerity chills Spanish turbine industry

Wearing face masks and wielding sanders, two workers smooth the surface of a massive fan for a wind turbine at the Gamesa factory in Aoiz, a town in Navarre, northern Spain.

Wind of austerity chills Spanish turbine industry
A file image of a wind turbine. Photo: Christophe Vandercam

But in hard times, it will be winds in Finland, not Spain, that make the finished product spin.

Last year, the plant delivered a wind turbine park to Malaga in southern Spain and another to Burgos, in the north, said factory manager Javier Trapiella.

"Now we don't produce for Spain," he added.

"It has all stopped."

For green energy producers, Spain has changed from a paradise with generous public support to a markedly less agreeable home.

Prime Minister Mariano Rajoy's conservative government is imposing an austerity regime to plug an accumulated energy sector deficit of €26 billion ($34 billion).

On Friday, the horizon darkened further with the approval of reforms cutting annual state aid for renewable energies by more than one billion euros.

The change is enough to place at risk huge strides in the Spanish wind energy industry.

Spain ranks as number four globally in terms of installed wind energy but has dropped to seventh place in terms of new projects, according to the Global Wind Energy Council.

"For Spain, wind energy has really been an energy revolution. In 20 years we have gone from producing zero kilowatts to producing 20 percent of national demand today," said Heikki Willstedt Mesa, director of energy policy at the Spanish Wind Energy Association.

In the fourth largest economy of the eurozone, wind is often the main source of electricity.

"Unfortunately, since 2009 the government has slowed the development of wind energy in Spain with various regulatory measures," he said.

Cuts in state aid of 35 percent, removing subsidies for new turbines since the start of 2013, and then the latest changes announced on Friday: the sector
has been hit hard and manufacturers are the first to feel the pain.
   In February, French group Alstom closed two factories in Spain and laid off
373 employees.
   "The economic crisis and the absence of a stable regulatory framework have
slowed domestic demand," the group said, stressing the lack of activity in its
Spanish sites.
   Spain's Gamesa, which is among the industry's world leaders, gave the same
reasons as it laid off 606 of its 4,800 staff in Spain and closed two blade
factories in recent months.
   Gamesa notably pointed to the "regulatory uncertainty" , the persistent
economic crisis and financial problems in the sector, especially in southern
Europe.
   Making a wind turbine is almost a work of craftsmanship, said Gamesa's
Trapiella. "You need good hands," he said. The fibreglass and carbon fibre
blades measure 62.5 metres (205 feet) and weigh 15 tonnes each.
   When finished they will leave by truck overnight for the port of Bilbao to
be shipped by sea to Finland. About 40 blades are scheduled for delivery by
February.
   "If 90 percent of our sales were in Spain 10 years ago, it is the exact
opposite today with 90 percent of sales coming from abroad," said Jose Antonio
Cortajarena, Gamesa's corporate managing director.
   "We are in more than 50 countries," he said, citing Mexico, Brazil and
India as key markets.
   "Even if our corporate headquarters are in Spain, the risk, our dependance
on the Spanish market, is limited."
   The Spanish Wind Energy Association is not so reassured.
   "We have destroyed 25 jobs a day in the wind energy sector since the start
of the year and the industry is on the borderline, it cannot take any more
cuts," it said.
   The industry has already suffered heavily.
   "Of the 43,000 jobs we had in the wind industry in 2009, there are only
23,000 left, said Sergio de Otto, secretary general of the business group
Fundacion Renovables (Renewables Foundation).

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BUSINESS

France’s EDF hails €10billion profit, despite huge UK nuclear charge

French energy giant EDF has unveiled net profit of €10billion and cut its massive debt by increasing nuclear production after problems forced some plants offline.

France's EDF hails €10billion profit, despite huge UK nuclear charge

EDF hailed an “exceptional” year after its loss of €17.9billion in 2022.

Sales slipped 2.6 percent to €139.7billion , but the group managed to slice debt by €10billion euros to €54.4billion.

EDF said however that it had booked a €12.9 billion depreciation linked to difficulties at its Hinkley Point nuclear plant in Britain.

The charge includes €11.2 billion for Hinkley Point assets and €1.7billion at its British subsidiary, EDF Energy, the group explained.

EDF announced last month a fresh delay and additional costs for the giant project hit by repeated cost overruns.

“The year was marked by many events, in particular by the recovery of production and the company’s mobilisation around production recovery,” CEO Luc Remont told reporters.

EDF put its strong showing down to a strong operational performance, notably a significant increase in nuclear generation in France at a time of historically high prices.

That followed a drop in nuclear output in France in 2022. The group had to deal with stress corrosion problems at some reactors while also facing government orders to limit price rises.

The French reactors last year produced around 320.4 TWh, in the upper range of expectations.

Nuclear production had slid back in 2022 to 279 TWh, its lowest level in three decades, because of the corrosion problems and maintenance changes after
the Covid-19 pandemic.

Hinkley Point C is one of a small number of European Pressurised Reactors (EPRs) worldwide, an EDF-led design that has been plagued by cost overruns
running into billions of euros and years of construction delays.

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