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Siemens Energy wants to benefit from the US energy transition

Siemens Camza Wind Turbine

The new DAX team wants to benefit from the U.S. energy transition under Siemens Energy President Joe Biden.

(Photo: Abby)

Munich The U.S. U-turn is currently particularly optimistic for a German company in climate policy under new US President Joe Biden: Siemens Energy, the new docs company. “America is our largest and most important market,” Tim Holt, a member of the team responsible for renewable energy, told Handelsplot. The Electricity and Energy Technology Committee sees a great opportunity in the US President’s plan: “This is the American version of the German energy transformation.”

Joe Biden has called for the first global climate summit since Thursday. As one of its first actions, the United States rejoined the Paris Agreement on climate change earlier this year. His predecessor Donald Trump began stepping down in November 2019. The United States is now expected to become CO2 neutral by 2050. The president plans to invest nearly two trillion dollars in government investment in a decade. The European Union has agreed to tighten its climate goals.

German companies such as Siemens Energy, wind turbine maker Nordex and auto supplier ZF expect billions in business, especially in the United States. “This is an opportunity of the century for suppliers in the field of renewable energy and electrical motion,” said Daniel Cronenwett, strategic consultant Oliver Wyman.

Siemens Energy achieved sales of approximately .5 5.5 billion in the United States in fiscal year 2019/20 – worldwide 27 27.5 billion. By comparison: in China, the Siemens branch came in at just 7 1.7 billion.

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Now that may be a real boost for the company in the United States. “In the long run, of course, we want to increase our sales in the United States,” says team member Holt. But he warns: “Politically, it will be difficult.” There will be many more debates at all levels of politics and society. “You can already see that clearly in big wind projects. It could take a good five years before it leads to significant sales.”

The “American Buy” Order is an issue for Siemens Energy

A problem for Siemens Energy and other foreign competitors: Biden prefers American suppliers. In January he signed the “American Buy” mandate for government contracts. Holt acknowledged that General Electric, a major competitor, had a housing advantage. “But we are considered an American company with 23 factories.” Siemens Energy already has the advantage of having experience in German energy conversion.

With its subsidiary Siemens Gemsa, Docs Group is the global market leader for wind turbines in the high seas. Holt firmly believes: “America will become one of the largest maritime markets in the world.”

Graphic

However, many tenders require local value added. So building a marine plant in the United States would be an option for Siemens Kamsa. “But we need to think carefully about where a local trail within the United States makes sense.” Meanwhile, many states are demanding local production. But one plant cannot be placed in every region.

Holt said that with the launch of its new 5X turbine in the country, Siemens Camza will now be technically competitive in the coastal area as well. “This is the first joint new development.”

Turbine

With the new turbine, Siemens Kamsa also wants to become competitive in the countryside.


(Photo: Reuters)

Siemens Camsa received nearly 20 percent of its total orders in the United States last year. Experts at management consulting Wood McKenzie expect 19 gigawatts per year to be installed in the United States in the next few years and 15 gigawatts in the medium term. Coastal wind farms still dominate there, but by 2023 wind turbines should also be included in the high seas.

The Siemens Group last year floated its low-margin energy technology business as Siemens Energy and floated on the stock market. Since then, the new group has performed well in the stock market. At the end of September the first rate was 22 euros, after which it has risen below 30 euros. Siemens Energy was added to Docs in March. Now all you have to do is get the numbers right. In the last fiscal year 2019/20, Siemens Energy caused a loss of $ 1 billion due to special factors.

Further: Why the Climate Summit might bring real progress

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