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COVER STORY: Pioneering Leadership, Discussing Wind Energy with Martin Kjærbo, General Manager of Vestas Wind Technology Manufacturing Complex, TEDA
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Pioneering Leadership

Discussing Wind Energy with Martin KjBT 201603 39 Cover storyrbo,

General Manager of Vestas Wind Technology Manufacturing Complex, TEDA

By Penny de Vine

BT 201603 36 Cover story
Following the Climate Change Conference in Paris late last year, Business Tianjin thought it fitting to investigate the renewable energy sector in Tianjin, so we spoke with Martin KjBT 201603 40 Cover storyrbo, General Manager of Vestas Wind Technology Manufacturing Complex in TEDA. The Vestas factory in TEDA was built in 2005, and is the world's largest manufacturing complex for wind turbines.


KjBT 201603 40 Cover storyrbo has over eight years' experience working in the wind technology sector and, prior to coming to China, worked for over ten years in plant management in Europe, amassing vast amounts of experience in industrial engineering. He spoke to us about the wind energy market, both here and abroad, and gave us his perspective on future challenges and opportunities.


Vestas is a global leader in wind energy. Can you give our readers a brief insight into your organization?
We were one of the pioneers in wind energy and have a global reach. Vestas is currently the biggest wind energy company in the world, in terms of what we produce and install, and we have been for several years. We have a presence in well-founded economies like Western Europe and also in emerging economies like China, India and Brazil. Given the rise in climate change awareness, competition is now getting fierce, but Vestas is still the biggest.


You moved to China in May, 2014 - tell us why you decided to move to Asia, and the opportunities and challenges you've faced.
I've been in industrial engineering all my life, and worked for several years in Denmark. I then worked in Eastern Europe, which is considered an emerging economy in Europe. After some time there, I wanted to work in another emerging economy, and I think China is the place to be at the moment. As an engineer, and in an industry like wind energy, China is the place where development is really taking off. It's where the high pace is, and it's very interesting and challenging. With the country experiencing high growth, there are also more jobs and well-founded factories here. On the other hand, Europe is a small and stagnating economy, with no real growth, but in China we still have near-7% growth.


You spent most of your working life in Europe, can you tell us about the similarities and differences in the business environments between Europe and Asia.BT 201603 37 Cover story
Having good connections is extremely important, no matter where you are, and it's always important with a company the size of Vestas to be on good terms with government. You need to have an understanding of where they want to go, and they have to have an understanding of what we want to offer. Particularly when you're working in an emerging economy, your company is very much tied into the regulations of the country, and how these regulations may benefit the company right from the start. It may be costly to establish production, but it's important to see the long-term benefits. When you're building a company, here or in Europe, it's vital to work together with government.


Vestas has offices all over the world - what factors do you think have contributed to your global success?
We were the pioneers in the industry, and we have of course been through ups and downs, but we have a good platform of products on offer. Vestas products can cover very different wind types, and wind sites, and we have excellent knowledge about where to establish wind farms all across the world. Even in emerging economies such as Pakistan and Vietnam, we are starting to get a strong foothold. This is because Vestas has a good brand, consistent world-wide quality levels, and people trust in our products. It's a safe bet for countries to use our products. Instead of gambling with new products, which could be good, people choose to go with Vestas as we have a long track record. If countries are looking for business case certainty in their investments, Vestas has proven for a long time to have a good product.

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Where is your biggest market, and why have these embraced wind technology?
Vestas has the widest reach in the world, and we are present in both emerging and big economies. Since 2010, the US has been our biggest market. It has good support schemes for wind energy and we have a good market share there. We are also making efforts to get into emerging markets like China, India and Brazil, where we are currently building facilities.


What barriers does Vestas face in penetrating the global wind energy markets?

Around the world, Vestas is competing mostly with government-owned energy facilities, so we are always dependent on how support schemes for our products are set up. The wind energy sector as a whole is policy driven, so Vestas is very dependent on politicians creating these support schemes, or at least helping us to compete on a similar playing field as fossil fuels. So some of the barriers include, not only whether the schemes exist, but also whether the benefits are short or long-term. Speaking locally, China has been pretty good at establishing long-term support and has developed the wind industry well over the last several years.


How big a role does wind technology play in China and what factors contribute to that?
Last year, half of the wind turbines that were installed around the world were in China, so that was about 25 gigawatts of installations. Wind energy has a tremendous impact here, but we need to keep in mind that China is a growing economy. The country needs a lot of electricity, as the welfare of its people is increasing, and the amount of people who need electricity is growing. This means that there has been a large increase in energy consumption. Wind energy plays an important role here as you have a fairly quick return-on-investment, and it's completely clean energy. After just six months, our wind turbines produce the same energy as it takes to make a full turbine. So after this short space of time, the turbine is producing completely clean energy.


What challenges does China face to increase its wind energy production?
Definitely what kind of policies the government will continue creating, and whether will they continue with support schemes. For example, in the beginning, the aim of most schemes was to build up as much megawatts as possible, but now they're looking at how many megawatt hours' turbines are producing. This means we need to consider, not just the size of the turbines, but the amount of energy they produce. That's very important for Vestas, as that's where the quality of the products comes in. It's important for us not to just put up the turbines, but also that they actually produce energy. We are focused on making sure people get enough energy, in a sustainable way.



What role can wind technology play in China going forward? Where are the biggest opportunities?
Wind technology is dependent on where the grid connections are being produced and where they open up opportunities for further turbine parks. The technology is also dependent on infrastructure, for example roads being built, so it all has to fit together with what the government wants. Currently we are fortunate that there are more and more gridlines opening up around China which are able to carry the power from turbine parks.


You've been working in the renewable energy sector for just less than 10 years now - tell us some of the changes you've seen.
I started in the industry in 2008, when we had the financial crisis and, of course, that impacted heavily on Vestas. For example, there were fewer wind energy support schemes around the world. So we've had our ups and downs, but now we are seeing major increases in demand for wind energy. With the Paris Climate Change Agreement, the world is seeing more and more that renewable energy is a much needed, viable and competitive change in the energy market.


BT 201603 38 Cover storyWhat do you think the future of wind technology looks like?
Wind energy is one of the most competitive renewable energies. Last year, renewable energy made up 20% of the total global power installation, mainly from the wind sector. So I think this is the way forward.


What is your perspective on the Chinese economy for 2016?
I think it will be a 'new normal' for China. With growth decreasing from 20% to 7%, some may think this is a complete stop but, in reality, it isn't. We are still seeing great amounts of growth, so it's a slow down, but not a full stop in growth. We still have the highest growth in the world in this region.


Do you have any recommendations for new international investors coming to Tianjin?
There are many regions where the government is making the right moves for companies to be established. New investors should look at where they see other international companies, listen to the government, and be clear on what they want from their investment. Even thinking about what an international company can offer local companies, and being a part of building this country is a great approach to take. For example, international companies can help with key business aspects, such as safety training. Investors shouldn't just focus at 'cheap labour' in China, but rather view it as a 'best-cost country'.


How do you feel personally about living in Tianjin? Do you miss anything in particular?
At this time of year, we miss the blue skies and the fresh air. Keeping in contact with relatives on the other side of the globe can also be challenging with the time differences. And there are always special foods you miss that are not so easy to get, but you can buy most foods here in Tianjin, or Beijing.


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