Doosan Heavy Industries & Construction, South Korea’s biggest power plant and equipment maker, is stepping up its shift into renewable energy as orders for traditional power plants continue to fall.
The group, which has spent Won300bn ($260m) on clean energy over the past five years, said it planned to invest an additional Won700bn by 2013 to develop power generation technology with no carbon gas emissions.
The group wants to generate Won1,000bn in renewable energy sales by 2015; accounting for 10 per cent of its revenue from power generation business.
Doosan said it expected the domestic market for renewable energy to grow sharply after 2012, when the government will adopt the Renewable Portfolio Standard – which will require utilities to produce 11 per cent of their electricity from renewable sources by 2030. President Lee Myung-bak’s government has been pushing to encourage private companies to adopt renewable technologies which are seen as “green growth engines”.
Shipbuilders including Hyundai Heavy Industries have announced plans to expand into the renewable energy business to counter falling new orders and a bleak industry outlook. Meanwhile, Samsung Electronics and Hyundai Motor have also said they will increase spending on green technologies to reduce greenhouse gas emissions.
Doosan said its Won700bn investment would be used to develop wind turbines, renewable batteries and biogas turbines and as well as other green technologies that will reduce carbon gas emissions from atomic power plants and thermal power plants.
“We have long thought about future growth engines. And our efforts to develop green energy technology have coincided with the government’s push to cut carbon gas emissions,” said Choe Seung-joo, Doosan’s senior vice-president in charge of developing clean energy. “We think wind power is a good alternative to meet the RPS.” Doosan is a latecomer to the fast-growing market, which is dominated by companies such as Denmark’s Vestas and Siemens of Germany.
But Doosan aims to join the top 10 players by 2020 by generating sales of more than Won1,000bn from the wind power business.
In Asia, China has also been accelerating its investment in wind power. The country became the world’s fourth-largest wind turbine market after more than doubling its total installed capacity last year – growth that put it at more than three times the world market’s pace. Chinese turbine manufacturers are benefiting most, accounting for 75 per cent of newly installed capacity last year.
This year, Doosan acquired Skoda Power, a Czech turbine maker, for €450m ($670m) to become the fourth-largest power-plant equipment maker in the world.
Additional reporting by Kathrin Hille in Beijing