News

June 17, 2009

Clipper Windpower Rallies On Hopes Of Loan Guarantees From The US Government But Technology Concerns Linger

By Rue Swabey

The credit crunch is hurting wind power, as developers fail to secure finance for turbines. One of the affected turbine manufacturers is US-based, Aim-listed Clipper Windpower which has seen clients defer turbine orders into 2010. Deferrals will make cash flow tighter in the coming months so management has cut the headcount by 11 per cent and reduced production levels by one fifth. Management is aiming to reduce operating costs by at least 15 per cent this year in addition to achieving cash flow savings of US$125 million from lower component costs and the implementation of a new working capital model.

In spite of client deferrals Clipper expects to install between 300 and 325 turbines this year - up from 248 in 2008. And management is cautiously optimistic that funding conditions are improving. In fact, since April the company has seen signs that more funding is becoming available for onshore wind. Mr Obama’s plans to double wind generation capacity within three years and the approval of the Stimulus Bill in February are positive factors, although in practice it will take time for funds to...