Jan 24 2007
American Superconductor Corporation, a leading energy technologies company, announced that its wholly-owned subsidiary, Windtec(TM), has sold a license in China for its Model WT1650 wind energy system to Zhuzhou Electric Locomotive Research Institute (ZELRI), a division of China-Southern-Loric. The license includes an upfront fee of approximately $2 million to AMSC as well as a royalty payment for each WT1650 system installed, and a right of first refusal for AMSC to provide the electrical components for each WT1650 manufactured by ZELRI. The potential revenue to AMSC from royalty payments and sales of electrical components exceeds $30 million for the first set of WT1650 wind energy systems ZELRI plans to manufacture and install.
Based in Zhuzhou City in the Hunan province of China, ZELRI develops and sells electric drive systems for locomotives and inverter technologies for industrial and civil use.
"China needs more renewable energy sources to power generation to meet the needs of our rapidly-growing, technology-driven society," said Du Jinsong, general manager of ZELRI's wind power business unit.
"To achieve this goal ZELRI aims to become a leading manufacturer of wind energy systems, and Windtec's services and electrical systems are integral to our success in the market. With Windtec's assistance, we plan to demonstrate our WT1650 prototypes late in 2007 and begin full-scale production of the units in 2008."
Under the terms of the contract, ZELRI is gaining rights to manufacture, use and sell Windtec's 1.65 megawatt (MW) Model WT1650 wind energy system in China. Windtec also will provide training for ZELRI's staff and project management services for the company's first two Model WT1650 prototype units.
"We are pleased to be joining forces with another large and well-respected manufacturer to capitalize on China's rapidly growing wind energy industry, which requires that over 70% of the content of wind energy systems come from Chinese suppliers," said Greg Yurek, founder and chief executive officer of American Superconductor. "With nearly 50 years of heavy equipment manufacturing experience ZELRI is a highly respected company that can help meet China's requirement that over 70% of wind energy system content come from local suppliers. The WT1650 wind energy system is an excellent entry point for them into the rapidly growing market for wind energy in China."
According to the Global Wind Energy Council's Global Wind 2005 Report, wind power capacity in China was expected to grow by nearly 60 percent from 1,260 MW in 2005 to 2,000 MW by the end of 2006. "The goal for wind power in China by the end of 2010 is 5,000 MW, requiring an annual increase from 2006 onwards of 800 MW," the report states.
"Looking further ahead, 30 GW of wind power has been proposed by the Chinese government in its long term planning for 2020; this would mean an annual installation level of 2,500 MW over the decade from 2011 onwards."