GE, 'Renewable Energy Gamble'... Dedicated Wind Turbine Blade Factory in the UK

Power, Renewable Energy, Aviation, Healthcare... Rebuilding the Group with 'Four Blades'

[Asia Economy Reporter Yujin Cho] General Electric (GE) of the United States is establishing an offshore wind turbine blade manufacturing plant in the United Kingdom. This dedicated production line for turbine blades will supply the UK, which has the world's largest offshore wind power complex. On the 11th (local time), GE announced in a statement, "We have opened a turbine blade manufacturing plant in the Teesside area of northeast England and will begin production in 2023."

Jerome Pecresse, President and CEO of GE's Renewable Energy Division, expressed confidence, saying, "The newly established blade manufacturing plant will contribute to the development of the offshore wind cluster in northeast England." He added, "The blades produced at the new plant will be supplied throughout the UK, including the northeast region, and exports to other European countries are also being considered."

The turbine blades produced at this plant will be ultra-large, with each blade as long as a soccer field. These turbine blades are scheduled to be supplied for the construction of the Dogger Bank offshore wind power complex in northeast England. Dogger Bank, set to be completed in 2026, will be the largest offshore wind complex in the UK, capable of producing enough capacity to supply about 5% of the UK's total electricity demand.

GE's investment targets the UK, which has the world's largest offshore wind power capacity, as a final strategic move in the renewable energy business. As of last year, GE's Renewable Energy Division recorded sales of $15.7 billion and an operating loss of $4.6 billion, making it the only one among the four main business sectors to post a loss.

On the day GE made its announcement, the UK government revealed plans to invest ?95 million (approximately 150.4 billion KRW) to build offshore wind farms in the Teesside and Humber regions. The UK government, focusing on offshore wind power as a key growth engine, plans to meet one-third of its electricity production from offshore wind power by 2030 to achieve net-zero carbon emissions by 2050. In October last year, Prime Minister Boris Johnson cited wind power as one of the strategies to revive the economy from the COVID-19 pandemic during the Conservative Party annual conference speech.

GE did not disclose the cost or financing method for the construction of this manufacturing plant. Struggling with severe financial difficulties, GE has been rebuilding the group around four pillars?power, renewable energy, aviation engines, and healthcare?after years of harsh restructuring. Recently, by selling off its aircraft leasing business, GE has effectively begun winding down its capital business. The aircraft leasing business was a core and profitable division of GE Capital, generating more than half of its $7.25 billion revenue last year.

Founded in 1892 by Edison as an electrical consumer goods business, GE grew into the world's largest manufacturer by expanding into almost every field that electricity could power, including home appliances, medical devices, aircraft and automobile engines, nuclear fuel, and nuclear power plants. Early on, in 1932, GE entered the financial industry and expanded its business through an octopus-like strategy, including its subsidiary GE Capital. However, after suffering irrecoverable losses in the capital business due to the subprime mortgage crisis, GE has been undergoing company-wide restructuring since 2018.

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