Wind energy is expected to account for 20% of global electricity consumption by 2010. Will China indeed become the global wind energy market's supply chain hotspot if current trends persist? What makes China's position in the global wind energy market unique? This GIA white paper, The Chinese Wind Energy Market, outlines developments in the Chinese wind energy market, and discusses the Chinese wind energy market drivers, restraints, regulations and key players. This presentation shows selected slides from a GIA white paper. To download the entire white paper that you are interested in, please visit http://bit.ly/GIAinsightWP

1. The Chinese Wind
Energy Market
Industry Briefing White Paper
September 2009
Global Intelligence Alliance ©2009. All rights reserved.
Contact: Kim Khoo, Manager, Intelligence Services kim.khoo@globalintelligence.com,
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All Rights Reserved ©2009 www.globalintelligence.com

2. Content
This document contains excerpts from GIA’s “The Chinese Wind
Energy Market” Webinar. For the free white paper, please visit
www.globalintelligence.com or email info@globalintelligence.com.
Market overview
Market drivers & restraints
Key manufacturers Not included here
Future trends Not included here
About Global Intelligence Alliance Not included here
This Industry Briefing report provides an overview of the wind energy market in China.The report is provided as is, free of charge and without any
warranty or guarantee. Global Intelligence Alliance rejects responsibility for errors or omissions, or for any loss or consequential loss arising as a
result of decisions taken based on its contents.
©2009 Global Intelligence Alliance. All rights reserved. This report is copyright, however individual pages or portions thereof may be copied
referencing “Global Intelligence Alliance” as the source.
Global Intelligence Alliance (GIA) is a strategic market intelligence and advisory group. GIA was formed in 1995 when a team of market intelligence
specialists, management consultants, industry analysts and technology experts came together to build a powerful suite of customized solutions
ranging from outsourced market monitoring services and software, to strategic analysis and advisory.
Today, we are the preferred partner for organizations seeking to understand, compete and grow in international markets. Our industry expertise and
coverage of over 100 countries enables our customers to make better informed decisions worldwide. For further information please see the About
Global Intelligence Alliance section at the end of this report, contact the author or visit www.globalintelligence.com
China wind energy industry briefing | September 2009 www.globalintelligence.com 2

3. Abbreviations and acronyms
AMSC American Superconductor
A&R Abeking & Rasmussen Rotec
BERR-UK (previously DTI-UK) Department for Business, Enterprise & Regulatory Reform – United Kingdom
CASC China Aerospace Corporation
CHEC China Huadian Engineering Co., Ltd.
CHSTE China High Speed Transmission Equipment
CWEA China Wind Energy Association
CREIA China Renewable Energy Industry Association
DEC Dalian Electric
DHI Dalian Heavy Industries
DTI-UK (now BERR-UK) Department of Trade and Industry – United Kingdom
EREC European Renewable Energy Council
GE The General Electric Company
GW Giga Watt
MW Mega Watt
R&D Research & Development
SAM Stahlturm- & Apparatebau Magdeburg
SHFRP Shanghai FRP Research Institute
SIAG Schaaf Industrie AG.
VAT Value Added Tax
WWEA World Wind Energy Association
XEMC Xiangtan Electric Manufacturing Corporation
YoY Year on Year
China wind energy industry briefing | September 2009 www.globalintelligence.com 3

4. Market overview
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5. Market overview
Wind energy installations worldwide is expected to
grow, with government policy being a key driver
Worldwide wind turbine total installed capacity forecast (MW)
• With increasing wind turbine
capacity, the unit cost of power
generated by wind energy is
expected to decrease¹.
• WWEA forecasts that by
2020, wind turbine total
installed capacity will reach an
estimate 1,500,000MW
worldwide accounting for 20%
of global electricity
consumption. At the end of
2008, wind energy accounted
for 1.5% of global electricity
Source: World Wind Energy Association, 2008 consumption.
¹ Unit cost for wind energy is dependent on many factors besides turbine capacity. There are many variables that may influence the unit cost of
wind energy, for example the site of the wind farm, operation and maintenance costs over the life of the facility, backup unit or units of generation
costs, extra costs imposed on transmission and grid management cost may also vary widely depending on the control area involved, the output
and variability of output from the generator, load on the grid, etc.
China wind energy industry briefing | September 2009 www.globalintelligence.com 5

6. Market overview
At the end of 2008, China overtook India with the
highest total installed capacity of wind energy in Asia
Top ten countries with the highest total installed capacity of wind energy worldwide (GW) and
total installed capacity YoY growth between 2007-2008 (%)
Note: The installed capacity is rounded to the nearest decimal place; growth YoY is generated from the original installed capacity, rounded to the nearest whole number.
Source: World Wind Energy Association, 2008
China wind energy industry briefing | September 2009 www.globalintelligence.com 6

7. Market overview
China’s total capacity is expected to increase rapidly
with more units of higher capacity turbines installed
China installed capacity (GW) and YoY growth (%)
Affected by global economic downturn 60%
60%
33%
Total installed 23%
107%
capacity (GW) and 127%
YoY growth (%)
140%
433%
297%
Breakdown of 14%
12% 17%
installed capacity 34%
293% 146% 35%
(GW) and YoY 9% 7%
309% 198% 28% 24%
growth (%) 308% 161%
14% 10% 4% 4%
78% 55%
Produced by wind turbines of the following capacities:
Note: The installed capacity are rounded to the nearest tenth; the YoY are generated from the original installed capacity, rounded to the nearest whole number.
Source: China Wind Energy Association, 2009, China Renewable Energy Industry Association 2009, GIA estimates 2009
China wind energy industry briefing | September 2009 www.globalintelligence.com 7

8. Market overview
Global players have seized opportunities in China,
rapid advancement also made by local companies
China wind energy activities
Jan 2009 Feb 2009 Mar 2009 Mar 2009
Construction of an industrial China Wind Systems starts GE Drivetrain Technologies Sinovel installs a 3MW wind
park for wind power gearbox production in Wuxi. signs an agreement with A- turbine in the Shanghai East
equipment production is to Supply agreements signed with Power to supply gearboxes and Sea Bridge’s 100MW offshore
start in Jilin Province with Wuxi Lida Gear to establish a JV partnership for wind farm – the Chinese first
capital from Sany Group Manufacturing, Gansu Keyao gearbox manufacturing. pilot offshore wind project.
and Tongyu Asset Electrical Power and
Management. Hangzhou Advanced Mar 2009 Apr 2009
Gearbox. Suzlon Energy signed an Vestas introduces the new
Jan 2009 agreement to supply wind V60-850kW wind turbine.
American Feb 2009 turbines to Inner Mongolia Manufactured in Vestas’ new
Superconductor (AMSC) GE plans to increase wind North Longyuan Wind Power facility in Inner Mongolia, over
receives an order for wind turbine deliveries to Chinese Corporation. 90% of its components are
turbine core electrical customers from 159 units in Chinese made. The turbine
components from China's 2008 to 320 units by 2009, and Mar 2009 design includes innovation in
CSR Zhuzhou Electric 600 units by 2010. Hansen Transmission delivers blade design and temperature
Locomotive Research its first gearbox from its new control system which addresses
Institute, that will be used Mar 2009 facility at the Beichen Hi-tech Inner Mongolia’s harsh climate.
for wind turbines designed CLP Group announces it will Industrial Park, Tianjin. The
by AMSC's subsidiary. acquire 50% equity interest in a gearbox will be deployed in
wholly owned subsidiary of 2.1MW Suzlon turbine.
China Wind Power Group Ltd
for HK$101.3 million.
Note: For reference only; this is not an exhaustive list.
China wind energy industry briefing | September 2009 www.globalintelligence.com 8

9. Market overview
Repeat orders, second orders or an increase in current
contract sizes seen amongst the existing players
China wind energy activities
May 2009 Jul 2009 Jul 2009 Aug 2009
Siemens is building a new Suzlon China receives Suzlon China receives repeat AMSC has received the 2nd
rotor blade and nacelle plant repeat orders of 40 units orders of 39 units of 1.25MW wind order for its D-VAR system for
in Shanghai. The new of 1.25MW wind turbines turbines from Datang Power a Chinese smart grid from
facility is scheduled to take from Honiton Energy Generation. China National Machinery
up operation in the second Group, who has secured Industry Complete
half of 2010, initially with development in Inner Jul 2009 Engineering.
400 employees. The wind Mongolia. Vestas has received an order for 17
turbine plants produced in units of 2.0MW wind turbines from Aug 2009
Shanghai will be for the Jul 2009 China Fujian Wind Energy Construction has started at
Chinese market and for Gamesa and Huadian Company. The contract includes China’s first 10million kW wind
export. have reached an supply and commissioning of the power station in Gansu
agreement for the supply wind turbines, a VestasOnline® province. With 120 billion Yuan
Siemens is investing more of wind turbines totaling Business SCADA system and a two investment, the station was
than EUR60 million in capacity of 300MW. It year service and maintenance designed to have an installed
setting up this new location. includes 200MW to be agreement. capacity of 5.16million kW by
installed at a jointly the end of 2010 and 12.71
developed wind farm in Aug 2009 million kW by the end of 2015.
Inner Mongolia, and AMSC has amended its contract It will be China’s largest wind
100MW for another with Sinovel, to increase its core power facility upon completion.
Huadian project. electrical components to meet
Sinovel’s demand.
Note: For reference only; this is not an exhaustive list.
China wind energy industry briefing | September 2009 www.globalintelligence.com 9

10. Market drivers and restraints
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11. Market drivers and restraints
China has a unique position combining low labour
costs, abundant wind resources and favourable policies
China wind energy market drivers and restraints
Chinese government firm
commitment towards wind
Chinese abundant energy Improvement in Chinese
DRIVERS
Chinese low resources component manufacturing
labour costs technology
RESTRAINTS
Component Global economic
Chinese under-developed supply shortage Relative immaturity downturn
infrastructure in some “Buy Chinese of China’s wind
areas Policy” hinders energy market
growth
Source: GIA 2009
China wind energy industry briefing | September 2009 www.globalintelligence.com 11

12. Market drivers and restraints
Government regulations on renewable energy targets
and subsidies drive Chinese wind energy growth
Chinese government firm commitment towards wind energy
Chinese abundant resources
• China has untapped wind resources. Exploitable wind resources are estimated to represent a potential power
generation capacity at ten metres above the ground of 253GW, whilst ocean-based wind resources represents an
exploitable potential of about 750GW.
Improvement in Chinese component manufacturing technology
• Partnerships or acquisitions between Chinese players and their foreign counterparts speed up technology transfer,
e.g. Goldwind acquired Vensys to facilitate concentration on the development of direct drive wind turbines.
Low labour costs
• China’s comparatively lower labour cost compared to North America and Europe’s, offers opportunities for
cheaper manufacturing cost.
• China’s minimum wages are set locally according standards laid out by the central government. For example in
April 2008, monthly minimum wages in the Tianjin municipality was 820 RMB, whilst the hourly minimum for
non-full-time workers was 7.8 RMB.
China wind energy industry briefing | September 2009 www.globalintelligence.com 12

13. Market drivers and restraints
Protectionist policies towards Chinese made
components in tenders is a market restraint
Component supply shortage
• High demand of wind turbines especially in 2007-2008 caused a supply shortage of wind turbine parts,
particularly for gearboxes and bearings, which was a market restraint in China.
Relative immaturity of Chinese wind energy market
• As a relatively new industry in China, there is a shortage of skilled human resources particularly for the
higher-wattage wind turbines.
Chinese under-developed infrastructure in some areas
• Some areas, notably in the Northern part of China where abundant wind resources are available,
infrastructure is not yet fully developed, hindering the development of full facilities.
• A lack of existing infrastructure also means a lack of grid availability and problems on grid connections.
“Buy Chinese Policy” hinders growth
• As Chinese government regulation rules that at least 70% of wind turbine components in China must be locally
made, foreign players face further difficulties to grow in the Chinese market unless they set up manufacturing
facilities.
• In addition, a recently released edict states that “government investment projects should buy domestically
made products unless (they) cannot be obtained in reasonable commercial conditions in China.
China wind energy industry briefing | September 2009 www.globalintelligence.com 13

14. Market drivers and restraints
Regulation on renewable energy target and subsidies
drive Chinese wind energy growth
Chinese government major regulations on wind energy
• Notice on Wind Power Generation Facility Construction and Management Requirement – July 2005
Specifying the domestic content of 70% or more as one of standards for approval of wind power generation plants and
subjecting imported facilities to tariffs.
• Renewable Energy Industry Development Instruction List – November 2005
List of 88 projects (23 of them for wind power) for utilization of renewable energy and types of relevant equipment in a
bid to promote relevant government at laboratories and enterprises, and instructions on investment and constructions.
• Renewable Energy Law – implemented since January 2006.
The law prioritized energy policy in terms of its development. This included the utilization of renewable energy and
required power utilities to purchase electricity generated with renewable energy.
• Administrative Provisions for Renewable Energy Power Generation – implemented since January 2006
The provisions specify the standards for administration of renewable energy power generation and the roles of power
generation and grid enterprise in the development and utilisation of renewable energy.
• Provisional Administrative Measures on Pricing and Cost Sharing for Renewable Energy Power Generation –
implemented since January 2006.
The provision provides guidance on how to calculate prices and share costs for renewable energy power generation as
approved by the government in and after January 2006
Note: For reference only; this is not a complete list of energy regulations.
China wind energy industry briefing | September 2009 www.globalintelligence.com 14

15. Market drivers and restraints
Policies and regulations built to increase renewable
energy’s share of total energy consumption in China
Chinese government major regulations on wind energy
• Tentative Management Method for Renewable Energy Development Special Fund – implemented since May 2006
The guide offers additional measures to enhance support for renewable energy development. It allows the central
government to provide financial assistance for the development of renewable energy for oil substitution and construction
areas; and of wind power, solar and other renewable energy sources for power generation.
• Medium to Long-term Renewable Energy Development Plan – August 2007
Aims to increase renewable energy’s share of total energy consumption.
• Management Method for Power Grid Enterprises’ Purchasing of Renewable Energy Electricity – implemented
since September 2007.
The method provides the regulatory commission’s supervision and management duties, measures and legal
responsibilities regarding power grid enterprises’ purchasing of renewable energy electricity.
• Energy-Saving Power Generation and Power Dispatch Method (pilot program) – Aug 2007
Gives priority to renewable energy power generations, sets a priority order for power generation methods in accordance
with energy consumption and pollutant emissions. This also places power dispatch priority on methods in the order of
lower energy consumption and pollutant emission.
Note: For reference only; this is not a complete list of energy regulations.
China wind energy industry briefing | September 2009 www.globalintelligence.com 15

16. Market drivers and restraints
In 2009, the Chinese government revised its 2020 target
for wind power generation from 30 GW to 100GW
Chinese government major regulations on wind energy
• 11th Five-Year Renewable Energy Development Plan – March 2008
The plan though is basically in line with the medium to long-term plan, remarkably revised the wind power generation
goal for 2010 onward from 5 GW in the medium to long-term plan to 10GW, and specified sites for and sizes of, wind
power plants for development and other relevant numerical goals. Also, it calls for achieving domestic production of
1,500kW or larger onshore generation units and 3,000kW offshore units by 2010.
• Notice on Adjustment Regarding Import Tariffs for Large-Output Wind Power Generation Units, Their Main
Components and Raw Materials – implemented from January 2008
To refund import tariffs and phase out import value-added-taxes for main components and raw materials for Chinese
firms’ development and production of larger-output (1,200kW or more) wind power generation units and repeal tax
incentives for purchases of certain wind power generation units.
• Note released by Chinese Finance Ministry, Sept 2008
Chinese wind turbine makers can get a payout of 600 yuan ($87.79) per kilowatt for the first 50 units they produce of any
new turbine with capacity of 1 megawatt or more. The subsidy should be shared equally between manufacturers of key
parts and the companies that assemble the finished product.
• Note release by National Development and Reform Commission, May 2009
The National Development and Reform Commission revised the wind power generation goal for 2020 from 30GW to
100GW.
Note: For reference only; this is not a complete list of energy regulations.
China wind energy industry briefing | September 2009 www.globalintelligence.com 16

17. Thank You for Your Attention
These slides are excerpts from Contact Us
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Chinese Wind Energy Market”. For additional information about the
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