Engineering Offshore Wind Marine Energy Week, Offshore Wind Conference, Bilbao, Senior Vice President Siemens Wind Power A/S March 29 th, 2017 www.siemens.com/wind
Siemens Wind Power Organizational Structure Siemens Wind Power CEO Markus Tacke Onshore CEO Thomas Richterich CFO Gerlinde Sturm Offshore CEO Michael Hannibal CFO Pierre Bauer Service CEO Mark Albenze CFO Poul Hansen Market units Supply Chain Management Marc Becker Technology Morten P. Rasmussen Quality management Product integrity... Functions Onshore Offshore Service Businessunits Page 2
Siemens Wind Power globally Facts & Key Numbers Siemens Wind Power Onshore Offshore! ~15.700 turbines/27,7 GW installed! ~2.370 turbines/8,3 GW installed Gearet Platform! +37 years of onshore wind expirence! ~55% of turnover FY16 Gearet Platform! +25 years of offshore wind experience, and among the leading players measured on installed capacity! ~45% of turnover in FY16 Direct Drive Platform Direct Drive Platform New orders!7,9 bn Turnover!5,9 bn Employees 15,200 Order-backlog FY16: ~!15 bn Service ~35GW service base Page 3
Siemens Wind Power Offshore Facts at a glance Pioneered the offshore market and current market leader Installed the world s first offshore power plant in 1991 Sold more than 3,100 offshore turbines Installed base: >2,370 turbines with >8.3 GW capacity Known for robust design with innovative solutions A proven 25+ year product lifetime and >95% real availability Page 4
Securing the below 2 C requires 60% higher generation in wind Gt of CO2 emissions 50 40 COP21 World Energy Outlook 2016 TWh of wind generation, 2040 +60% 6.100 30 20 +430% 3.800 10 717 0 1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2014 COP21 < 2 C Source: OECD/IEA 2016 Page 5
Innovation has been a key driver! From 30 kw to 8 MW turbine size in 35 years A380 154 meter 79.8 meter 35 meter 11 meter 30 kw 450 kw 8 MW SWT-8.0-154 1980 1991 2016 Page 6
Sizes of windfarm has increased significantly over the years! 1991 2000 2003 2012 2013 2016 2019 Vindeby Middelgrunden Nysted Greater Gabbard London Array Gode Wind Hornsea 1 World s 1 st offshore wind power plant World s 1 st offshore wind power plant w/mw turbines World s largest offshore wind power plant in operation World s largest offshore wind power plant in operation World s largest offshore wind power plant in operation Big power plant based on the D6 platform in operation World s largest offshore wind power plant 5 MW 40 MW 166 MW 504 MW 630 MW 582 MW 1200 MW Page 7
We are overcoming the cost challenge! $/MWh 250 200 150 100 50 Historic LCOE Industry 2020 target $110/MWh Horns Rev III X Borssele I & II X X Borssele III & IV X Danish near-shore Kriegers Flak (LCoE) Levelized Cost of Energy ROCs X Early CfDs X X X UK gov t target $150/MWh X East Anglia 1 X X Neart na Goithe UK CfD R3 X X ceiling price CAPEX Wind turbine CAPEX Balance of plant OPEX Lifecycle Energy Output 5% 10% 20% 0 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 Source: Bloomberg New Energy Finance Page 8
New markets new opportunities and challenges, and we are prepared! Developed markets New European markets New Continental markets Key focus Subsidy requirements Logistics Political stability Site conditions Grid connection! Local content! Vessels! Long-distance transport! Manufacturing! Alternating commitment in Asia! Trump in the US?! Turbines designed for Northern Europe! Sismic activity!!!! Capacity Coverage Fluctuations Grid management Page 9
How do Siemens contribute to lower LCoE? Page 10
Recent auctions indicate an LCoE reduction of 72% over the past 8 years Auctioned/awarded support (in!/mwh) Lifecycle cost in real 2014!/MWh (LCoE) 162 168 144 137 118 Grid 145 125 111 106-72% 87 68 60 69 67 60 45 41 48 London Array Hornsea one East Anglia 1 NnG Hornsrev III Borssele 1+2 Danish Nearshore Krigers Flak Borssele 3+4 London Array Hornsea one East Anglia 1 NnG Hornsrev III Borssele 1+2 Danish Nearshore Krigers Flak Borssele 3+4! GBP/EUR exchange rate is constant at 1.2! UK projects reflect real 2012 price in GBP! Subsidy for transmission asset added to non-uk projects! UK ROC with 20 years of subsidy support, UK CfD, NL with 15 years of subsidy support, DK with 12 years of subsidy support! Subsidy payments for UK are inflated with 2% p.a. from 2012 onwards! Subsidy payments for DK and NL projects are not inflated over the lifetime! Post-subsidy power prices are forecasted (IHS Energy 2015) Page 11
Cost reduction through Product Innovation SWT-6.0-154 SWT-7.0-154 SWT-8.0-154 AEP Supply chain Balance of plant Increased output Re-use technology and supply chain Minimal impact Page 12
Offshore Transformer Module HVAC: Offshore Transformer Module OTM Can be installed on a wind turbine foundation or on a separate foundation 30% lower topside volume 33% lower topside weight 20% shorter construction time HVAC up to 40% lower costs Page 13
Jacket foundation Key players in the industry to develop automatic manufacturing process Feasible target up to 40% Lower costs Ageing test for 15 different paint systems Page 14
Improvement in installations, logistics and service concepts also contributes Optimizing our Installations Optimizing our Logistics Holistic approach Optimizing our Services concepts Page 15
Flexible offering We can engineer the solution you need Grid connection Array cables Grid connection Foundations Service Wind turbines Substation Substation Grid code compliance Finance Array cables Foundations Finance Page 16
Gamesa merger a perfect match Page 17
Merger demonstrates our commitment to wind power by creating an even stronger combined company Revenue ~!10.3 bn Siemens: ~!6.0 bn Gamesa: ~!4.3 bn Backlog ~!20.4 bn Siemens: ~!15.0 bn Gamesa: ~!5.4 bn EBIT Adjusted ~!1.0 bn ~ 72 GW Siemens:!566 m Gamesa:!427 m Employees worldwide ~ 24,000 Siemens: ~15,200 Gamesa: ~8,800 Installed capacity worldwide Siemens: ~35 GW Gamesa: ~37 GW Figures as of September 30 th, 2016 Page 18
Thanks for your attention We make real what matters clean energy for generations to come Page 19