EDP Renewables sees wind turbine prices easing

MADRID Wed Nov 5, 2008 7:36am EST

MADRID (Reuters) - Portuguese wind power producer EDP Renewables expects to pay less for its wind turbines after 2010, Chief Executive Ana Maria Fernandes said on Wednesday, reaffirming the company's growth targets till 2012.

"Wind turbine supply is not so much a sellers market as it used to be," Fernandes said at a news conference in Madrid after the world's fourth-largest wind power generator posted in-line nine-month results [ID:nL5220198].

Wind turbine manufacturers' share prices have recently fallen sharply on turbine demand fears. World No. 2 producer Gamesa recently announced plant stoppages to adjust production to falling demand.

"Although we have our wind turbine needs covered to 2010, we don't have contracts after then and this could be a virtue; producers will be much more flexible with prices in the current environment," the chief executive said.

EDPR's main supplier of wind turbines is Denmark's Vestas, followed by Spain's Gamesa, although the company also has smaller contracts with General Electric and Suzlon.

Fernandes cited talk in the sector that smaller wind farm promoters are cancelling orders for wind turbines amid financing difficulties in the credit crunch.

"We are attentive to any potential offers from smaller wind farm promoters (who might be forced to sell parks in construction) but we have not received any yet," she said.

The chief executive noted however that EDPR is not changing its plans to install an average of 1.4 gigawatts of wind energy per year to reach its target of 10.5 GW in 2012.

"The credit crisis and economic slowdown are not affecting our plans," she said.

EDPR said it continues to focus on eastern Europe and the United States as the areas with most growth potential, highlighting Tuesday's victory for Barack Obama in the U.S. presidential election as a positive factor.

"Obama's election increases the chances that recent positive renewables legislation in specific states is brought into force on a federal level," said EDP Renewables Financial Director Rui Teixeira.

EDPR stocks in Lisbon fell 2.5 percent to 4.73 euros by 1227 GMT after a steep rise of over 10 percent the previous day ahead of the earnings report.

(Reporting by Jonathan Gleave; Editing by David Holmes)