What counts is the total cost, not purchase cost. This was one of the main themes that was identified at the international IQPC Wind Turbine Supply Chain management conference in August in Germany. Speaking about The Switch agility to meet market demand fluctuations at the conference, Simon Hewitt, Global Sourcing Manager at The Switch, discussed demands for greater manufacturing flexibility, an effective risk management strategy and ways to adapt the wind turbine supply chain to demand fluctuations.
“The three-day conference and workshops had a wide variety of attendees, from component supply chain analysts for single components to offshore wind farm developers, who consider a complete turbine as a component,” Simon says. Despite the variety of speakers at the event, five common themes emerged.
What counts is the total cost, not purchase cost
For example, in case of a generator, the price tag consists of the purchase cost, delivery costs to the nacelle assembly location, assembly costs of the nacelle, the delivery costs of a nacelle to the turbine assembly location, the turbine installation and commissioning costs, storage costs if delivered late, availability once installed, efficiency, maintenance costs during the design life, recyclability of the product at the end of its life… the list is long.
It’s a power plant, not a wind turbine
The target of the whole wind industry needs to be a viable competitor to coal, gas, nuclear and other sources of energy, and encompass all aspects including reliability, predictability, cost and affects on the environment.
Transparency of data is key
As an industry, we should have common measurements of cost, reliability, and availability all measured using the same assumptions.
Localization is growing in importance
This applies to either competing with domestic players who may have cheaper logistic costs or in meeting local content requests.
Industry needs to mature
The wind power industry as a whole is currently still developing from an early-stage industry, and it still needs to mature. Just-in-time logistics, pre-tested products that work when installed, and fast repair and/or predictive maintenance should be the normal practice. We should think about the levels of logistic competence and reliability that has been achieved in the car industry.
Simon Hewitt, Global Sourcing Manager
