German Wind Turbine Investors Dissolve Operating Company After 13 Years Of Poor Returns, Technical Failures

There are lots of claims on how successful Germany’s renewable energy program has been. Feed-in tariffs mandated by the government guaranteed profits for windpark investors and operators. You couldn’t lose. So it seemed at first.

Unfortunately outputs promised by wind turbine manufacturers and proponents have fallen short of expectations. Moreover, high maintenance costs have in many cases eliminated profits and resulted in losses for investors. As generous as the subsidies may be, profit from wind can be elusive.

So it comes as no surprise when we here how a group of 60 limited partners near Ettenheim southwest Germany have decided to dissolve the wind turbine operating company they had set up in December, 2000. Story in German at www.windwahn.de here. It lost money.

The 60 limited partners unanimously voted on Wednesday to shut down and liquidate the Windpark Ettenheim GmbH & Co. According to Windwahn, the wind turbine had been supplied by Nordex and “did not yield the expected performance“, so says managing director Andreas Markowsky.

Windwahn writes:

It stood still for years, and finally it was taken down in the summer of 2013. In the meantime the concrete pad has also been removed. After the liquidation is completed, the area where the turbine stood will be re-naturalized under the supervision of forest authorities. …The wind turbine did not pay off.”

Windwahn writes that the turbine had been supplied by Nordex and came with a 5-year maintenance contract. But in the end, the turbine remained plagued by technical problems and the 60 partners all had to take a moderate loss on the investment: a bit more than 1000 euros per 2500 euro share.

Markowsky says that the turbine had serious technical problems from the start. For example when winds were strong during stormy weather, the turbine stood still instead of producing maximum output. The limited partners even had to take Nordex to court in bid to be awarded compensation in the amount of 1.8 million euros. Windwahn writes that the case dragged on for 5 years, during which the turbine remained idle and did not deliver any power. Finally, the court awarded the limited partners 1.4 million euros in compensation.

The limited partners had the chance to reduce their losses by taking advantage of the re-powering bonus offered by the German government. Under the scheme turbine operators are paid a bonus to trade up their old turbines for newer, more efficient ones. However, the bonus has been scrapped by the German government, effective August 1, and the offer ultimately was passed up.

The 60 limited partners have had enough of the wind energy business.

 

14 responses to “German Wind Turbine Investors Dissolve Operating Company After 13 Years Of Poor Returns, Technical Failures”

  1. DirkH

    “and the 60 partners all had to take a moderate loss on the investment: a bit more than 1000 euros per 2500 euro share.”

    Moderate? As a percentage that’s what I would call severe. The German windwahn page even calls it a “small” loss. No investors who wrote that.

    1. Marco Bernardi

      Not windwahn wrote “a small loss”. The newspaper was it

  2. Stephen Richards

    He he. At least they seem to have cleared their mess afterwards. That wasn’t the case in Scotland where they were left broken for many years before someone decided they should come down.

    1. DirkH

      Difference between Common Law and Code Napoleon – in Code Napoleon run states everything is regulated. So mandatory clean up was written into the entire wind energy regulations from the start.

      1. Marco Bernardi

        The turbine stood still for some years before it was dismantled. The reason was not the law. The reason was that the turbine was defect and the maker dismantled the turbine.
        The old one, a NORDEX turbine was defect and stood still for 5 years. The limited partners demanded 1.84 million euro from NORDEX. There was a comparison to court and NORDEX paid 1.4 million euro.

        1. DirkH

          Wind turbines must be dismantled after 20 years according to the law though. So the owners of the defect wind turbine knew that they would have to pay for it. Without the law there would be no motivation to pay for the removal.

          1. Marco Bernardi

            In general there is no motivation for the developer to remove the turbine. Only when the the farmer – in this case the lessor- is smart enough to recognize the traps in the lease.
            Right now we are going to make such a lease anonymous and publish it on http://www.windwahn.de.
            The whole financial risk is on side of the lessor.
            Greedy developers know what to do.

          2. DirkH

            That might well be so. I was just pointing out to Stephen that, as always, everything is regulated in German law. As opposed to the UK, where by default nothing is regulated in any area (unless it gets regulated, which is the exception).
            (Well at least before Brussels made the rules for the UK)

  3. Stephen Richards

    But that is not a small loss unless the figures are wrong.

  4. A C Osborn

    “Feed-in tariffs mandated by the government guaranteed profits for windpark investors and operators. You couldn’t lose ”

    Love it, Parasites on the Public Teat can lose.

  5. Mervyn

    I have no objection to renewable energy, so long as taxpayers’ money is not used to subsidise it or is not used to invest in it unless, for example, the technology is proven such as hydroelectricity, which is the largest form of renewable energy in the world, by far.

    If private investors think wind turbines and solar farms are viable, they will invest in them. But at least they have a choice. The unfortunate taxpayers, on the other hand, do not have a choice on the matter. Governments think they can risk taxpayers money as they please and without accountability, just as President Obama did resulting in a loss of taxpayers funds. And I find that highly immoral and objectionable.

    It is time governments begin to understand a simple fact… if it needs subsidising, it cannot be viable.

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