Global research and consultancy firm Wood Mackenzie claims that the coronavirus outbreak in China is a “bad news” for the region’s wind energy production as lock downs and closure of manufacturing operations put an unexpected standstill in the production of turbine components.
Since mid-January, China has been plagued by the deadly new coronavirus strain, officially called the COVID-19, and has impacted many of the country’s biggest industries. The firms said that the outbreak had “brought much of China’s wind turbine component production to a standstill in recent weeks.”
Wood Mackenzie also said that this set back in the wind energy production in China also impacts the United States as American wind energy companies depend on Chinese made parts to keep their turbines running. They said that because of the temporary trade and travel restrictions, many developers who aim to finish projects early this year in a bid for government subsidies might be compromised.
“Due to an already tight supply of key components such as turbine blades and main bearings before the COVID-19 outbreak, first-quarter production delays have already reduced annual output of those components by about 10%,” Xiaoyang Li, a senior consultant at Wood Mackenzie, said in a statement.
With more than 1,700 deaths and a total of 70,548 confirmed cases as of February 16, the COVID-19 outbreak has been considered by many analysts and governments as a massive threat to market stability around the world. Nonetheless, Li said that if the infestation is controlled in the next few months, components without pre-existing bottlenecks, like converters and generators, should be able to recover from delays in the first quarter.
“In a best-case scenario, the epidemic is contained, and production resumes by the end of March,” Li added. “In a bear-case, the epidemic could continue to impact the supply chain well into the middle of the year.”