Microsoft Develops 10.5 GW, Siemens Gamesa Reports Loss in 2nd Quarter, WEG brings 7 MW Turbine Manufacturing to USA

Microsoft is partnering with Brookfield Asset Management to develop
10.5 GW of new wind and solar, Siemens Gamesa reports a €365
million loss in the 2nd quarter of 2024, WEG will begin
manufacturing their 7 GW turbine platform in Minnesota, and
Canadian Pension Plan Investment Board and Global Infrastructure
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show? Email us! Pardalote Consulting -
https://www.pardaloteconsulting.comWeather Guard Lightning Tech -
www.weatherguardwind.comIntelstor - https://www.intelstor.com Allen
Hall: I'm Allen Hall, president of Weather Guard Lightning Tech,
and I'm here with the founder and CEO of IntelStor, Phil Totaro,
and the chief commercial officer of Weather Guard, Joel Saxum. And
this is your News Flash. News Flash is brought to you by our
friends at IntelStor. If you want market intelligence that
generates revenue, then book a demonstration of IntelStor at
intelstor. com. Microsoft has partnered with Canada's Brookfield
Asset Management to develop new wind and solar farms aiming to
bring 10. 5 gigawatts of generating capacity online. The
partnership is expected to help finance renewable electricity
projects to be built between 2026 and 2030. 30 starting in the U.S.
and eventually Europe. The deal is estimated to cost over 10
billion U. S. dollars, and it highlights the race to meet clean
energy commitments while satisfying the growing energy demands of
cloud computing and A. I. Now, Phil, we all know that A. I. is
going to be expensive in the electricity world. Everybody is
worried about it. Microsoft is trying to hedge their bets at the
minute. Do you expect others like an Amazon to do something
similar? Philip Totaro: Amazon's been up until this deal, once it
officially closes and they actually build and start procuring all
this. This is going to be the biggest corporate renewables
procurement in history. Amazon's been doing their fair share and
was leading up until this point. But this is this is massive. So it
let's put it this way. It looks like, deals like this are going to
finally get the tech sector in the mood to say, all right, we like,
fixed price contracts with, some degree of certainty and, proven
technology now between wind and solar particularly for cloud
applications or AI applications where, it's going to be, power
intensive, I think, the tech sector in general needs needed to, and
is getting more on board with this. Even, my own company builds on
AWS. We've, contributed to them procuring some renewables capacity
as well. And we're taking the benefit of that too. Joel Saxum: It's
nice to see Microsoft getting involved in an early stage here,
right? At the pipe, not even during the pipeline exercise, but
during the pipeline build out of guys, we were going to want this,
we're going to partner with a major developer being Brookfield
Renewables, who has a large capital base behind them, of course.
But at the start of it saying we want to do this because you do see
the virtual PPAs and those on the corporate PPAs being, But it's
usually like when they're about built, of course, along the time,
the sales people from that energy company are shopping them. But
you don't see the agreements happen at an earlier stage like this
very often. So with Microsoft, of course, being a large consumer of
power for, of course, computing, but also the cooling of these
centers is going to be a large cost as well. Being a looking in,
into their crystal ball and seeing that energy usage going up and
up and up, they're getting to getting engaged with a major
developer at an early pipeline stage, I would look to see the next
evolution of this thing being like what RWE did last year and sign
a large deal with a turbine manufacturer to say, hey, we will want
one gigawatts or one, one or two gigawatts of turbines in the next
four years. Can we guarantee our prices on that as well for a
development pipeline? Thanks everyone. Allen Hall: Siemens Gamesa
has reported a 365 million euro loss for the second quarter of
2024. A slight improvement from the 386 million euro loss in the
same period last year. The turbine manufacturer's orders were down
sharply at 881 million euros compared to 3. 6 billion euros the
year prior. Onshore orders were impacted by the pause in sales
activities for the 4X and 5X turbans, and profit continues to be
impacted by quality issues, increased product costs, and ramp up
challenges in the offshore area. Now, Phil, this has had some
ramifications within the management of Siemens Gamesa also. Philip
Totaro: So they've Announce their CEO is leaving and they're going
to be restructuring the company, including layoffs, probably in
core areas within Spain. And they've also announced a couple of
things. One is that they're going to be re evaluating their
presence in markets like India, for instance. You saw GE do the
same thing when they started looking at pulled out of Brazil
because they were looking at margins and profitability and wanted
better financial returns and better financial performance. India
may become a market that is, left to the the Indian players and the
Chinese and Siemens Gomez is going to try and regroup in in core
markets. The other piece of this that came out was that they're
anticipating starting up sales again in August of this year. There
are thereabouts so we all look forward to that and hope that they
can get themselves back on track because unfortunately with this,
350 million euro, or I'm sorry, 365 million euro loss indicates is
that they're still not getting enough services revenue that's
offsetting. Their expenses around having to fix all these blades
and pay out all the liquidated damages and interruptions that
they've had to pay out on as a result of, this quality issue. Joel
Saxum: I think in this quarterly report, the numbers that stick out
to me is that 880 million in orders as compared to 3. 6 million.
Billion from last year. So that's 25 percent of the order book.
That's live right now within Siemens since this quarter last year.
So expect to see them have larger loss numbers. When Q3 or Q4
revenue gets realized as compared to the year before. Now we all
saw this coming. We knew it was going to happen. Of course, when
you stop selling your flagship turbine model on shore you're going
to have some revenue issues, but I think it, it actually extends a
little bit further into the market than just the 4x, 5x platforms.
Example, I had a conversation last week at, or this week at ACP
with an operator. Who said yeah, we're looking at some wind farms.
We regularly either by Vestas or GE. And that's probably what we
will stick with for one thing. We don't work on it. We don't have
any Siemens in our fleet, so we don't work on them. And also at
this point in time, we're not willing to jump into the ring. on
with a company that's having issues. So there's not only not
selling that 4x, 5x, but the feeling around them is that the
operators still aren't looking at them during their RFPs. Allen
Hall: Brazilian industrial machinery manufacturer WEG is to enter
the wind generation market in the United States. The company will
utilize his factory in Minneapolis, Minnesota to manufacture its
seven megawatt wind turbine platform. Like it's not disclosed the
investment figure, but states it is not significant and is part of
the approved capital budget. The Minneapolis plant with 45, 000
square meters and around 200 employees will start supplying
equipment from 2026. In the meantime, we will commence commercial
activities to secure sales contracts and develop the local supply
chain while maintaining its commitment to win. generation in Brazil
and India. Now, Phil, we were just in Minneapolis for American
Clean Power. This is a big discussion on the show floor. Philip
Totaro: Absolutely. And it's actually pretty interesting news for a
couple of reasons. One obviously WEG's been developing turbines
down in Brazil for a little more than 12 years now. And started off
with a license from Northern Power Systems on a turbine, evolved it
into a three and then a four and then jumped up to a seven now
there's plenty of kind of opportunity down in Brazil for. A seven
megawatt turbine because they've got a lot of open space where they
can stick those things. So bringing it to the US market is going to
be interesting to see what the appetite is for a turbine that big.
However, the one thing that came out of the clean power event was
the fact that every. I spoke to said, we want a third option,
knowing that GE and Vestas are dominating the U S market at this
point. And that I don't know what their perception issue is with
Nord X, even though it looks like Nord X actually seems fine. It
might be some issues with their their services division, but their
turbines actually perform pretty well. But like we just talked
about with Siemens Gamesa pulling back from selling. an opportunity
open for companies like Weg to step into the U S market. And it's,
it will be something that's welcomed by the entire market if and
when they can get Something bankable and proven into this market.
So that's going to start with them, getting a prototype site up and
running, getting their, type certification for, that would be
applicable for the U. S. market in place and making sure that the
financiers understand that, they're a third bankable option besides
just GE and Vestas. Joel Saxum: Yeah, interesting thing here is
that to enter the market, you almost have to find a gap in it,
right? So there,