Vestas, the world’s leading manufacturer of wind turbines, announced plans to become carbon-neutral by 2030 without the use of any offsets, also stating it will lean heavily on its suppliers to shrink their own emissions.
Denmark’s Vestas said Monday it will slash its carbon emissions 55 percent by 2025 — and zero them out entirely by the end of the new decade. Vestas employs 25,000 people worldwide, with factories spread across four continents, including several in Colorado. In addition to manufacturing, Vestas services a 90-gigawatt operating fleet of wind farms for customers around the world.
Vestas has been powering its factories and offices worldwide with 100 percent renewable electricity since 2013. The challenge now is to push into areas where the company has less direct experience, like heating and transportation, said Lisa Malmquist Ekstrand, head of sustainability.
Vestas will transition its roughly 1,000 company cars to electric vehicles this year, while beginning to replace its 4,000 or so light-commercial service vehicles with renewably fueled alternatives. For its service vehicles, the company is looking at EVs as well as other renewable options, Ekstrand told GTM.
In the near term, the transition could put upward cost pressure on some operations, but the switch to clean fuels will generate savings over the long run, Ekstrand said. “It will also increase our attractiveness to customers as well as future employees.”
Pressure on global wind supply chain
Beyond its internal operations, Vestas is committing to reduce carbon emissions across its global supply chain, settling on a more complicated target of 45 percent per megawatt-hour generated by its turbines by 2030. That covers all Vestas turbines made from 2019 onward over the course of their operating lives, Ekstrand explained.
The external target was set with two things in mind: encouraging carbon reductions and ensuring the continued growth of renewable energy installations, which means costs must be kept down.
There are many potential avenues for change, from greening suppliers’ fuel mixes to adopting lower-carbon materials and practices. “We’re talking to all our main suppliers today,” Ekstrand said.
Wood Mackenzie expects Vestas to maintain its lead in the consolidating global wind turbine industry for the foreseeable future, with nearly 15 gigawatts of new installations in 2020. The OEM competes closely with GE for the top position in the roaring U.S. wind market, which is expected to install nearly 50 gigawatts during the 2019-2023 period.
Vestas is among the largest Danish companies by market capitalization, along with global offshore wind leader Ørsted. Denmark reportedly sourced a record 47 percent of its electricity from wind power last year, compared to 15 percent across the European Union.
Over the course of its 40-year history, Vestas has installed 108 gigawatts of renewable capacity in more than 80 countries. In addition to its onshore turbine business, Vestas is joint owner of offshore wind manufacturer MHI Vestas.