Ming Yang Smart Energy Group Ltd. is considering building a wind turbine factory in Spain after the UK blocked Bloomberg Terminal the Chinese company's plans for a facility in Scotland, citing risks to national security.
The wind turbine maker has been hiring in Europe in recent months to build up a local presence and secure orders in a market that's set to grow rapidly in the coming decades. Manufacturing in the region will be key to its ability to secure business there, according to Horatio Evers, chief executive officer of Ming Yang Europe.
"We are talking to many project developers in the market. The request for additional competition in the market is there," Evers said in an interview. "Localization is a key enabler for us to sell turbines in the European market."
The offshore wind market in Europe is primarily served by Denmark's Vestas Wind Systems A/S and Germany's Siemens Energy AG. Ming Yang's entrance would boost competition and potentially bring down the cost of electricity. But it also threatens to shake up the one green power industry served by European firms while China has dominated technologies like batteries and solar panels.
A Ming Yang factory in Spain would potentially produce blades for offshore wind turbines as well as equipment known as nacelles, which contain the main mechanical components of the turbine, Evers said. The company is scouting sites for a facility, but hasn't finalized a location.
Spain's Prime Minister Pedro Sanchez met with Ming Yang Chairman Zhang Chuanwei on a recent trip to Beijing, signaling that the country would be receptive to the firm's investment. But the nation isn't a major market for offshore wind farms, with plenty of land to build cheaper onshore projects.
That means the Chinese firm will need to secure orders elsewhere in Europe, which could prove difficult. Germany would be of interest for the company, but it isn't being pursued currently, Evers added.
With the UK, Europe's biggest market for offshore wind, effectively shut off, the Chinese turbine maker will need to find buyers in places like Germany, the Netherlands and Denmark. It's not yet clear how governments there would respond. Last year, a German developer dropped plans to use Ming Yang turbines in favor of Siemens Energy machines, ending the company's chance for its first major order in European waters.
In March, a spokesperson for China's Ministry of Foreign Affairs responded to the UK decision by urging it to provide a "fair, just and non-discriminatory" business environment for Chinese companies and to avoid turning green cooperation into political or security issues.