Will the wind power industry go out of winter in 2013?

In the current context of power restrictions and the evolving stage of the wind energy industry, the once-enthusiastic narrative of explosive growth between 2005 and 2009 has faded. After two years of stagnation, the question remains: can the wind power manufacturing sector break free from its prolonged slump in 2013, especially with an improving investment climate and ongoing industry restructuring? According to data from the National Energy Administration, new wind power installations are projected to reach 18 GW in 2013—an increase of 50% compared to 2012. This suggests a potential turning point, but whether it will translate into real progress is still uncertain. Meanwhile, the State Council has released 104 lists of administrative approval projects that have been canceled or decentralized, including the transfer of wind power project approval authority to local governments. Two years ago, the central government had reclaimed these approvals to curb excessive local investment and manage overcapacity. Now, by decentralizing the process, the move may encourage more private and regional investment, potentially unlocking pent-up demand in the market. Analysts believe that 2013 marked a bottoming-out phase for the wind power industry, with turbine order prices stabilizing. As revenue and gross profit margins begin to rise, leading manufacturers are expected to see improved performance. Some top companies may experience a 20% to 25% increase in wind turbine sales this year, signaling a possible recovery. However, optimism may be premature. Many power companies are currently facing financial strain, and numerous projects remain delayed or stalled. The issue of "wind curtailment" and grid capacity limits has not been fully resolved. It remains unclear whether the 18 GW target set by the Energy Administration will be met. Moreover, despite a slight rise in turbine orders in 2012, the midstream and downstream sectors continue to suffer from weak demand. This has led to many manufacturers reporting orders, yet actual shipments have not significantly increased. As a result, the overall recovery of the wind power industry remains uncertain. Cai Hesheng, Secretary General of the Wind Energy Equipment Branch of the China Agricultural Machinery Industry Association, predicts that at least 10% of companies in the sector may exit the market entirely. Looking back at the highs and lows of China’s wind power market, the core issues have always been overcapacity and the persistent problem of "abandoned wind"—where wind energy is not fully utilized due to grid limitations. These challenges have hindered sustainable development. The profit-driven nature of many companies has made it difficult to prioritize long-term industry health. With the decentralization of project approvals, the pace of project development could accelerate, potentially leading to an oversupply of wind power projects. Current data shows that the operating rates of wind turbine and component manufacturers in China are below average, with production lines running at only around 60% capacity. If no unified planning or effective oversight is implemented, the rapid expansion of wind power projects could worsen the overcapacity problem, creating long-term risks for the entire industry.

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