When China opened up in the 1980s, entrepreneur Gabriel Tse’s electrical engineering and deal-making skills put him in a position to act as a liaison for Western electrical and technology companies.
He started with GE Drive Systems, which became part of Toshiba, which formed a joint-venture (JV) with Mitsubishi-Electric. In that period, the Chinese government’s early requirements on Western companies were “getting out of control,” Tse recalled, because the rush to do business in China had overwhelmed a provision intended to temper foreign activity.
Meanwhile, China’s wind industry started emerging in 2006-2007. Tse saw it as “a new frontier” and created GT Advanced Energy (GTAE) to get into the wind business, though he continued to work as a liaison for Western multinationals in other sectors.
GTAE’s first product was a slip ring engineered for wind turbines. Tse’s customers were Chinese wind turbine original equipment manufacturers (OEMs). At its peak, Tse said, GTAE captured 80 percent of the slip ring market. Encouraged by its Chinese OEM customers, GTAE expanded to other products in the wind turbine supply chain.
Tse ended his work with the Toshiba-Mitsubishi Electric JV and took over operational ownership of GTAE about 18 months ago. His background in electrical engineering allowed him to realize, before others in China’s wind industry, that ultracapacitors would soon replace batteries in powering blade pitch control.
Modern wind turbines have the capability to rotate and tilt into or away from the wind’s force and alter each blade’s angle to affect its bite of the wind. The latter is pitch control.
“The market was uncertain at the time,” Tse said. “The battery was the name of the game.” People were more comfortable with the battery, he explained, because it was a familiar, less expensive and more mature technology.
Batteries were typically used for the short bursts of heavy force exertion necessary to alter blade pitch. The superior power intensity of ultracapacitors, along with their shorter recharge cycle, make them more fitted to the task. However, the newer and more sophisticated technology is more expensive.
“The early years were tough,” Tse said, “because ultracapacitor technology was not yet stable.”
In the 18 months since Tse has taken control at GTAE, he has solidified a supply line with U.S. ultracapacitor supplier Ioxus. “We were lucky to stumble across Ioxus in late 2010, just as they were emerging,” he said.
Tse used GTAE’s relationships with China’s first-tier turbine manufacturers to convince the industry’s leaders that ultracaps offer a better way of adjusting blade pitch. He said Sinovel, Goldwind, Dong Fang, and Guodian -- four of the biggest OEMs in the world and key GTAE customers -- are all potential adopters of Ioxus ultracaps. There is also interest, Tse said, among China’s second-tier turbine manufacturers.
“The beginning for ultracapacitors was difficult,” Tse recalled. “It was a hard investment and a lot of people were old-fashioned. They were familiar with batteries and didn’t want to make a change. That was phase one. But we passed that period.
“Starting last year, with the promotion we did with the OEMs we know well, we began to get a response from them that they are ready to do it,” he said. “The trust in ultracapacitors’ reliability was there,” Tse said. “It was only a matter of whether the increased cost was justified.”
And it is justified, Tse explained, because China’s turbine technology is advancing. “The most popular unit has been the 1.5-megawatt turbine. Now, they are going not just to the 2 to 2.5 megawatt turbines but are also jumping very quickly to 3-, 3.6-, 5- and even 6-megawatt turbines.”
This technology advance, he said, is driving a move to more remote sites and to offshore wind, both because easily developed onshore sites are becoming more difficult to find and because “when you look at the coastline in China, it is huge.” Presently, Tse said, there is only one big offshore project. But with larger turbines, that will change quickly.
“In this arena of larger capacity turbines,” Tse said, “the justification for the ultracapacitor is even more solid.”
Any increase in cost from using ultracaps to do blade pitch control is offset, Tse insisted, because, in larger turbines in remote and offshore locations, “ultracaps provide a much, much better performance than batteries.” They offer “greater reliability with lower maintenance needs, a longer maintenance cycle and longer life with less weight.”
GTAE does “roughly $20 million per year,” Tse said. Slip rings remain the dominant product but the Ioxus ultracap is emerging, as Tse expected it would. “For ultracapacitors,” he said, “we are looking at 10 percent of that in 2012.”
Tse has a valuable perspective on the current tensions in the U.S.-China trade partnership. In politics, he joked, there appears to be no right or wrong, only national interests.
The kind of tensions now being worked through were undoubtedly present in trade partnerships between China and other countries, Tse pointed out. “But we never did see that emerge into the open.” His implication seemed to be that legal action is the way it is done in the U.S., whereas a private resolution between involved parties is the Chinese way. But, he said, “it is in the best interests of everyone to resolve this.”