Vestas' strong 2016 finish offsets worry over Trump energy policy
By Teis Jensen
COPENHAGEN (Reuters) - A spate of last-minute orders from the United States has put Danish wind turbine maker Vestas on track for its highest contract intake in six years and eased some investors' concerns over U.S. energy policy under the incoming Trump administration.
Vestas Wind Systems VWS.CO and its rivals are benefiting from a new focus on renewables, encouraged by the Paris Agreement on climate change last December and a five-year extension of a key U.S. Production Tax Credit.
But Vestas' share price, which had more than doubled since the beginning of 2016, came under pressure after it early in November warned of a slowdown in the U.S. market next year, coupled with the election win by Donald Trump, who had expressed support for conventional fossil fuels.
The company, however, has announced eight U.S. orders from Wednesday through Friday totaling more than 700 megawatts of new wind power capacity.
Sydbank analyst Jacob Pedersen is "very positively surprised" about the prospect for a new order record, he said in a note, adding that it signaled 2018 could bring progress after an expected slight decline next year.
He said he saw increased uncertainty after Trump's election win but any worsening of the conditions for wind farms would not be of significance until 2020 at the earliest.
"Wind and renewable energy have broad bipartisan support in the United States," Vestas told Reuters by email on Friday. It said wind energy's natural competitiveness against other power generation sources would "help ensure its solid future".
Trump's presidency would "in theory" be negative for the renewables sector, Chief Financial Officer Marika Fredriksson told Reuters just before the U.S. presidential election, but said it was too early to assess as the industry creates a lot of jobs, a main political target for Trump. Continued...