Electronics and electrical engineering company
) recently disclosed its plans to invest $264 million (£160
million) to develop facilities for offshore wind turbines on
U.K.'s east coast. Siemens' infrastructure development project
will be supported by its local partner and port operator
Associated British Ports, which is owned by a group of investors
The Goldman Sachs Group, Inc.
). On its part, Associated British Ports will contribute $247.5
million (£150 million) for the project.
The strategic decision is based on the perception that the U.K.
leads the market for offshore wind energy and is sufficiently
large to attract other major companies for additional
investments. The sector is further enjoying government subsidies
and makes it profitable for Siemens to establish its own local
wind farm, rather than servicing offshore projects from remote
locations like Denmark.
Siemens selected the Hull area on the east coast of England to
set up the wind farms as it is close to other large offshore
projects coming up in the country in the near future. The new
plant is expected to commence production of turbine rotor blades
in 2016. The manufacturing plant and the associated service
center are likely to employ about 1,000 people, thereby
benefiting the local economy through job creation.
The energy produced at these wind farms is primarily expected to
serve the British market. Siemens sees a three-fold increase in
the country's wind-generating capacity to 14 gigawatts by 2020.
Siemens' Energy business segment comprises Power Generation (PG),
Power Transmission & Distribution (PTD) divisions, Fossil
Power Generation, Renewable Energy and Solutions for the Oil and
Gas Industry. The PG division offers services and products such
as the planning and construction of power plants, the manufacture
and installation of components and systems, power plant upgrades,
energy management systems, and fuel cells. It also supplies
turbines, compressors and complete solutions for industrial
plants, particularly in the oil and gas industry.
The PTD Division is a manufacturer, systems integrator and
provider of solutions and services for the power utilities and
industry customers, enabling utilities to transport and
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Siemens presently has a Zacks Rank #2 (Buy). Other players in the
industry worth reckoning include
Universal Electronics Inc.
), both carrying a Zacks Rank #2 (Buy).