Nabrawind Technologies self erecting tower

Image copyright of Nabrawind

Some years ago I posted an article about a self-lifting wind turbine tower.

The idea was to use using heavy lift strand jacks already available in the market to lift the concrete sections of a wind turbine tower. It's a project developed by Esteyco, a Spanish engineering company.

Well, I just discovered that it’s not the only idea currently under development on this topic – another company (curiously from Spain as well) is studying a somehow different concept with the same objective: avoid using big cranes, above all in areas of difficult access.

The product is called Nabralift - you can read more on the company webpage.

Basically it's a tower with a mixed technology "standard" tubular steel + lattice where the steel section is erected by a standard auxiliary crane (like in the pre-erection of the first section) while the lattice elements are "pushed" little by little from the bottom by hydraulic jacks (this is a similarity with the solution discussed in the other post).

Apparently the solution doesn't use an anchor cage - instead what I see from the pictures look like an adapter between the steel and the lattice section.

The company stated that they are undergoing a 6 months long fatigue test on a full scale model already erected in northern Spain.

Theoretically, there are 3 possible sources of saving here:

  1. Installation cost (no main crane)
  2. Tower cost (the lattice segment is proportionally cheaper than a standard steel one of the same height
  3. Foundation cost (apparently this solution will need a smaller foundation).

Last but not least, the increased stiffness of the lower part could lower the self resonance risk due to the passing blades, frequent in the very high towers currently in the market.

Looking for a tender manager BoP

Looking for a Tender Manager specialized in Turnkey (EPC) wind farms.

Ideally expert in wind farm Balance of Plant (roads, foundations, MV cables, substation) and technical and commercial negotiations for all BoP scope of supply.

Apply on Linkedin or here:

https://nordex-jobs.dvinci.de/cgi-bin/appl/selfservice.pl?action=jobdetail;sid=2ctve7ap88m7y3oy;job_pub_nr=06A416E2-A75E-454C-AB00-5062D288C634;p=homepage;job_pub_type=extern;

The quest for scale: mergers and acquisitions in the wind industry

Mergers and acquisition are not a recent phenomenon in the wind business. My former manager Luis Miguel still remember vividly the merger in ’97 between Nordtank Energy Group (NEG) and Moerup Industrial Windmill Construction Company (Micon) – and the subsequent merger between NEG Micon and Vestas in 2004.

While in ’97 I was still enjoying the Golden Age of University, I had myself the pleasure of experiencing first-hand the merger between Nordex and Acciona Windpower 2 years ago. The same year Siemens merged with Gamesa, creating a new giant in the business. And that was not all, because GE’s completed the acquisition of Alstom.

What’s next?

Well, if you want my two cents on the topic the trend is going to continue in the next years. Wind turbine prices are free falling, and quite a lot of MW are awarded with an auction system were the cheaper takes all.

Every wind turbine manufacturer is working hard to lower the cost of energy, and for sure economies of scales help in the effort. I would say that Senvion is a good candidate for the next M&A: owned by the private-equity firms Centerbridge and Rapid Partners could be a good target for a Chinese manufacturer, for instance.

The acquisition can also be “vertical” in the value chain – turbine manufacturers are purchasing companies producing blades, blade moulds (Nordex with SSP Technology), or even providing Service (Vestas with the Operation and Maintenance company UpWind Solutions).

I see a consensus in the industry that this consolidation process will continue during the next years, somehow similar to the automotive industry.

5 strange things that you might find in a wind farm

Working on a variety of projects worldwide I sometimes see unusual requests from customers that want to complement their new wind farm with some nonstandard feature.
I’m collecting here my personal top 5 of “...are you REALLY sure you want it?”. Even if often this type of requirements can lift considerably the price (and make the project less attractive) customers are often irremovable in their request.

#5 – Reserve main transformer. Sometime also poetically called “cold transformer” this is basically a very expensive spare parts to keep parked somewhere in the substation. With a price tag around 1 million it looks like a very expensive price to pay to have a backup in case something goes wrong with the main transformer.

#4 – Residences for the Service technician. In very big wind farm sometimes it’s a good idea to have someone on site 24/7. If the wind farm is in the middle of nowhere it can be also a good idea to provide fully furnished houses.

#3 – Gym. The same Service technician living in the middle of nowhere will presumably need something to do while they are off duty. A properly equipped gym can provide a good use for their spare time.

#2 – Mosque. With a mosque we are becoming very near to the concept of “wind farm town”. It was also a good opportunity to learn something more about the various requirements of this type of religious building.

#1 – Watchtowers. By far the most unusual requirement ever. Basically, a place where an armed guard can watch from a vantage point who is approaching the wind farm, with electricity (you will need to connect it to the substation somehow) and septic tank.

Itemized sourcing: everybody else is doing it, so why can't we?

Itemized sourcing is the new mantra in the business. Basically, it means that you should split the BoP (Civil and Electrical works) in as many lots as possible, in order to achieve substantial savings. This strategy is the opposite of the “single subcontractor” approach, where you give the full package to a unique contractor or at least few of them.

What are the benefits of itemized sourcing? In addition to the possibility of achieving a lower price you also have more control on the purchase of critical items (for instance the main transformer).

Additionally, our friends in Procurement (for instance my role model Ignacio) can create PowerPoint slides showing huge savings to the rest of the organization.

The untold story is that there is no free lunch. What you are achieving is simply a different risk profile for your project: if the truck driver destroy your transformer against a bridge that is a few centimeters too low or if the foundations are build in the wrong place (believe me, both example are from real projects) you will have an hard time to recover your losses - because you purchased the transformer by yourself, or because you have in your pocket many small contracts with low liquidated damages.

Let’s assume that you split a 10 ML USD contract in 5 smaller contracts worth 2 ML USD each.

You will be able for sure to achieve substantial savings. However several other things will happen as well:

  • You should tender every smaller contract separately. Therefore an additional effort is needed from the Tendering Department and from Procurement.
  • Some big subcontractors will decline the job, because the size of the job is too small for them.
  • You will need to discuss the contract (at least) 5x times – 10x if you have more than one option on your table.
  • Unless the applicable law for your contract is something like Sharia (with dispute resolution in Riyadh) you will not be able to claim more than 100% of the value of the contract (2ML) from them. However your exposure toward the customer will be 10ML plus the value of the turbines. If one of them has a problem your risk will be huge.
  • In the real world is often not so easy to understand who is causing a delay. Sometimes there are concurrent delays, sometimes it was not clear who was expected to do a job, other time a finger pointing game start. The more the subcontractor, the more the risk.
  • Lastly, during construction you will need (at least) 5x more effort from the Contract Manager – and for the Site Manager, Project Manager and all people on site.

Don’t get me wrong – I understand that sometime there is no real alternative to make the project fly. However, before you embrace the itemized sourcing of the BoP as the solution for all your problems, you should keep in mind the additional work (try to negotiate 10 contracts in parallel) and risk that you are taking on board.

I can’t believe they invented it: “factual” vs “interpretative” geotechnical report

One of the things I’d like the most about my job is the fact that I still learn new things, even on topic were I wrongly believe there is not much more new to see.

This week during a telco with my accomplice in crime Eduardo I’ve discovered a new trick that I suspect has been invented by someone in the US (or possibly in the UK) – the split between “factual” and “interpretative” geotechnical report.

In the countries were I’ve worked until today, the geotechnical survey is usually a huge package of documents full of formulas, picture, diagrams and numbers. I’ve been never touched by the idea that part of the content was somehow different.

However, I’ve discovered that somebody (I bet a lawyer) introduced this categorization.

The Geotechnical Data Report (AKA the “Factual stuff”) would be the part including things like:

  • Pictures
  • Boring logs
  • Trial pits logs
  • Field test (SPT, cone penetration, etc.)
  • Laboratory data (water test, CBR, etc.)

This is the type of things that could safely land in a contract and that should be shared and used by the subcontractor.

However, a civil engineer would like to see other information to do his work. He would expect the type of information that should appear in the Geotechnical Interpretative Report (AKA the “don’t rely on me stuff”), with things like:

  • Ground behaviour of geotechnical units
  • Slope stability
  • Seismicity
  • Geotechnical cross sections
  • Construction methods and proposed technical solutions

Basically, nothing connected with design and construction.

Know you know that, wherever possible, you should ask to the geotechnical survey company for the full package (factual + interpretative) but keep them separate – at least if you face a big project with a high geotechnical risk.

Said that, I also want to reiterate my opinion that a good geotechnical survey can make the difference between a successful project (at least for roads and foundations) and a nightmare project with claims and over cost.

It might be difficult to find the budget for this kind of investigation in the early phases of the project but believe me, it’s worth every euro that you will spend on it.

Financial securities: what's that all about?

A financial security is an instrument to give a party (for instance, the buyer of a wind turbine foundation) an assurance that the seller (in this case, the company that build the foundation) will perform according to his obligation (that is, will comply with the technical and commercial requirements).

They can have different names – the most usual are “Bonds” and “Guarantees”.

The main difference between the 2 is that a bond is stronger – you can draw upon a bond simply asking the money to the bank, while with a guarantee you need to demonstrate that there is a breach of contract before getting the money.

An additional problem with guarantees is that they are linked to the specific contract in place. Therefore changes to the contract (and changes during construction happen really often) could potentially invalidate the guarantee.

There are quite a few bonds / guarantees that are usually used in a wind farm construction contract.

The most frequents are usually linked to the following  topics

  • Advance Payment: the subcontractor receive money upfront to start the works, but he has to give a bond in exchange.
  • Performance: this bond is draw upon if something goes wrong during the execution of the contract.
  • Warranty: this will cover the obligation of the subcontractor after the execution of the project.

There are other Guarantees frequently seen in the business – one is the Parent Company Guarantee, that  you are going to ask if you are working with a small company that belongs to a greater industrial group with a more solid mother company and the other is the Letter of Credit, that you are normally asking to a bank to confirm that the buyer of your product (for instance, expensive wind turbines) will pay for it.

Bonds, warranties and similar stuff are not free – you have to ask them to your bank and they will cost money, and obviously the bigger the bond the higher the price. Therefore the value of each security, normally expressed as a percentage of the contract, is usually subject of never ending discussions and negotiations between the parties.

Environmental impacts of wind farms

When I talk about my job with people coming from different businesses I receive often question linked to the “environmental impact” of wind turbines.

This term include various effect related to the construction of a wind farm. They can be summarized in the following categories:

Visual impact

Are wind turbines ugly or not? This is a difficult question. Probably I’m biased, but I think they are beautiful – or at least, better than a nuclear plant, unless you like concrete cooling towers. Some nacelles shape have been designed by artist (like the first Acciona models) or architects, like Enercon’s egg shaped solution. It has been designed by Sir Norman Foster and has been awarded with the Design Council Millennium Products Award, the same prize given to beautiful stuff like the Lotus Elise.

However in several countries a specific study is done to evaluate the visual impact of the turbines. There are several indicator and methodologies, however this is usually done considering the “weighted” average height of the horizon before and after the construction of the wind farms.

Noise generation

New generation turbines use a lot of tricks to keep noise low. Noise is coming above all from the tip of the blade, being the rotating equipment in the nacelle only a secondary source. The “easy” way to limit noise is limit the tip speed of the blade. Other strategies involve special profiles for the blade and software control of the machine to limit noise emission when needed (usually during the night, and/or when the wind is blowing from specific directions).

Electromagnetic interferences

This is easy to measure. In general electricity is generated at a low voltage (around 700 Volt) and MV cables are buried, so this impact is negligible.

Shadow flickering

This is the risk that someone living near the wind farm could experience, for a prolonged length of time, the intermittent shadow of the blades passing in front of the sun. This impact is relatively easy to simulate: there are software that, given the position of the turbines and the meteorological parameters (wind direction, percentage of sunny days) calculate the amount of time an observer located somewhere near the turbine would experience the flickering.

Bird strikes

One of the most discussed issues. You will find quite a lot of studies online, done in countries were wind energy and environmental sensibility is well developed (US, Germany, Spain, etc.). In general my impression is that, compared with other causes of bird death (hunt, high buildings, traffic, etc.), impact with turbine is accountable for a very small percentage.

Additionally modern wind turbines can be equipped with a lot of technology that minimize this risk (bat detectors, LIDAR systems, artificial vision, etc.). I had the pleasure of working at projects were the space between machine was large enough to lower the risk of impact, and additionally the turbines were stopped when migrating birds approaching the wind farms were detected.

 

Key milestones in wind farm development

The development of a wind farm project is characterized by several milestones linked to contractual obligations of the parties.

The most relevant milestones are marked below. They are in chronological order, and some of them could not appear in a specific project (for instance, not all projects have a limited notice to proceed or the payment milestones can vary a lot from project to project).

Limited notice to proceed (LNTP): in this milestone an agreement is reached between the party to perform some works (for instance, to purchase some long lead time item, such as the substation main transformer). It makes sense when it’s necessary to accelerate the project for some reason.

Advance payment: this is a down payment paid by the customer before the start of the works. It is usually done to secure the production slot of the turbines

Commencement date: in this milestones, all condition precedents are met and the contract is activated.

Payment milestones: every contract has different payment milestones (and different percentage of payment associated with each milestone). However, some “standard” milestones are marked below to give you an idea of how they could look like:

  1.                WTG ex works
  2.                WTG shipped
  3.                WTG erected
  4.                WTG commissioned

Mechanical completion: in this milestone, a certificate is issue stating that the wind turbine has been erected following the relevant technical specifications and it’s ready to start Commissioning

Commission certificate: at the end of commissioning (a set of test done to confirm that the turbine is ready for production) the turbine is ready to start trial operations. A certificate is issued to formalize this fact.

Taking over certificate (TOC): this milestone is usually linked to transfer of risk and beginning defects liability period for a specific turbine (the “defects notification period”).

Provisional acceptance: from this point in time, usually an Operation and Maintenance contract for the wind farm start.

Final acceptance: in this milestone the customer formally accept that the wind farm is complete, fully operational and compliant with the relevant technical specifications.