SGS Industrial Services

1
Dealing with the Risk in Onshore and Offshore
Wind Farm Projects

• SGS Industrial Services

2
Introduction to SGS Group

• Founded in 1878 in Rouen, France
• SGS is the global leader in verification,
  testing, inspection and certification services
• Public listed Swiss company CHF 4,8 bn
  revenues in 2008
• Unrivalled geographic network
• 55,000 employees
• More than 1,000 offices and laboratories
• Present in 140 countries
• Complete independence, transparency and integrity
  are the core values of the SGS Group

3
Our Business Segments
Consumer Testing Services
Government Institution Services
Oil, Gas Chemical Services
Minerals Services
Agricultural Services
Industrial Services
Environmental Services
Automotive Services
Systems and Services Certification
Life Science Services
4
The Wind Energy Market SGS Services

• A Global Market
• Elements related to Sustainable Energy Services
• Other SGS elements and services include
• SGS Climate Change Projects and Services
• Other Renewable Energy Sources e.g.
• Solar Energy and Biomass

5
Global Wind Power Investment 2006-2010
6
Wind Turbines and Wind Farms Quality Issues
7
Main Causes of damages on Wind Turbines and
Foundations

• Poor material quality
• Wrong choice of materials
• Specifications not followed
• Manufacturing faults
• Improper mounting / fastening
• Improper Service and Maintenance
• Unforeseen Loads / Site Specific Loads
• Wear
• Lightening / overvoltage

8
SGS Wind Energy Global Network

• SGS Wind Energy Technical Competence Centre
  located in Hamburg, Germany
• SGS-TÜV Saarland provides testing, inspection and
  monitoring services for wind turbines in Germany
• SGS Wind Energy Inspection and NDT services
  provide from SGS offices in
• Germany,Poland, Spain, Denmark, Sweden, Norway,
  Portugal, France, Italy, Benelux, UK, Ireland,
  Belgium, the Netherlands, Austria, US, China,
  Taiwan, Egypt and India
• Onshore and Offshore Wind Farm Site Specific
  Project Certification including Manufacturing
  Survey, NDT and Inspections. Expediting
  Management.
• Technical Due Diligence for new and existing wind
  farms

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PROJECT LIFE CYCLE SERVICES
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Manufacturing- and Installation Survey (1/2)

• Manufacturing Surveys performed as an integrated
  part of Project Certification
• Approval of Manufacturers based on quality
  management system audits and product
  Manufacturing Survey Arrangements (MSA)
• Verification of Project Quality Plan
• Check that structures are being built and
  installed in accordance with Drawings,
  Specifications, Certificates, Manuals, Method
  Statements etc. Verification of As Built
  documentation.

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Manufacturing- and Installation Survey (2/2)

• Check of material certificates, welders
  qualifications, NDT, procedures and findings etc.
• Assembly survey
• Construction Site Supervision
• Marine verification and warranty survey of load
  out, sea transportation and installation

12
Commisioning Survey

• Survey includes check procedures for initial
  energization of the Wind
• Turbine electrical system and for Wind Turbine
  testing after installation, to
• confirm proper, safe and functional operation of
  all devices, controls and
• apparatus safe start-up, e.g
• Safe start-up
• Safe shutdown
• Safe emergency shutdown
• Safe shutdown from over-speed or representative
  simulation thereof
• Functional test of aerodynamic and mechanical
  braking systems (shall work independently as
  redundancy in the safety system is required)
• Functional test of protection system.
• Proper records shall be kept describing testing,
  commissioning, control parameters and results.

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Technical Due Diligence of Wind Farms

• An evaluation of assumptions, provisions and
• conclusions compared to the issued certificates
• Wind turbulence intensity including wake aspects
• Extreme gust wind speed and extreme wind
  direction change
• Wind shear and slope effects
• Mean wind speed, wind speed distribution and wind
  rose.
• Temperature and air density
• Expected net annual energy production (compared
  with actual operation data) and energy losses
• B) A review of all technical aspects of the
  assumptions and
• inputs regarding to their appropriateness
  and
• completeness.

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Wind Turbines Important Parameters

• Important parameters when selecting the right
  turbine.
• Cost price
• Service and maintenance Costs
• Track records
• Track records on critical components
• Turbine availability (power warranties)
• Type certificate, Project Certification
• Spare parts and delivery time
• Noise
• Buyer obligations
• Turbine suitability for site (Enviromental
  impact)
• Reliability
• Turbine delivery !

15
Impact of Failures on each Component at each
Phase of the Project Life Cycle
16
Cost Breakdown of Failure During The Life Time of
a Wind Turbine

• ISET Report Zuverlässigkeit von
  Windenergieanlagen 2007 and http//reisi.iset.uni
  -kassel.de/
• http//www.eia.doe.gov

17
Average Cost of Wind Turbine Components

• Gearbox US270,000
• Set of Rotor Blades US400,000
• Transformer US80,000
• Generator US100,000
• In total per turbine US1,800,000 (replacement
  of all major components for the wind turbine size
  of 1.669 MW)

• Magazine "Wind Directions - January/February
  2007"

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Benefits of SGS Wind Energy Services - 1

• SGS Wind Energy services can minimise the risks
• That stem from environmental, planning,
  technical, contractual, commercial, construction,
  operational, and energy yield aspects of the
  project
• SGS Wind Energy Services can help to mitigate the
  risks at each phase of the life cycle of a wind
  farm
• Risk mitigation at each phase can minimise the
  potential failures at the consecutive phases
• Phases are
• Design verification and site assessment stage
• Site specific design verification stage for wind
  turbine and foundation
• Manufacturing stage
• Installation stage
• Commissioning stage
• Operations/in-service stage

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Benefits of SGS Wind Energy Services - 2

• SGS input in better project planning, and
  verification of site assessment and design can
  help to enhance the confidence and interest in
  the project for the financial community, which
  may facilitate better funding terms
• SGS services help to assess the risks, which are
  not specifically addressed by the traditional
  risk assessment models employed by the financiers
• Regular inspections conducted by SGS on
  operational wind farms can increase the
  availability of the wind turbines
• SGS independent technical due diligence services
  can
• Boost the robustness of the wind farm project
• Attract better financing and insurance deals for
  the new wind farm projects
• Contribute to higher price when the wind farm is
  sold
• Improve owners balance sheet when the company is
  targeted for acquisition

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Benefits of SGS Wind Energy Services - 3

• SGS services help to manage the wind farm
  project risks that may facilitate to
• Improve the owners financing capabilities
• Reduce the insurance premiums
• Increase the owners internal rate of return on
  investment
• Minimise the risk of injuries and fatalities
  during the manufacturing, transportation,
  installation, commissioning, and operation stages
  of the wind farm projects
• Improve the owners reputation
• SGSs independent design verification,
  inspection, and testing services can overall
  improve the financial viability of the wind farm
  project by
• Mitigating the cost attached to the relevant
  risks at each phase of the project
• Reducing the maintenance cost, and subsequently
  improving the cash flow during the operations

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Conclusion

• Wind farm owner have the burden of additional
  cost such as component cost after the expiry of
  warranty period
• By utilising SGS Wind Energy services throughout
  the six project phases, the project owners may
  save
• Up to 624 days of down time inclusive of
  mobilisation time during the life time of each
  turbine
• Up to US636,000 during the life time of each
  wind turbine by minimising the total down time
  duration
• Combined the cost of brad new grearbox with one
  set of blades, the project owner can save up to
  US1,300,000 per wind turbine

22
The Report Traffic lights, graph and diagnosis
23
The report Overview of all data
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SGS Project(s) Illustration

• Period September- December, 2005
• Project Waardpolder Onshore Wind turbine farm,
  the NETHERLANDS
• Services Technical Due Diligence of existing
  Wind Farm (19 Nedwind N31/3 onshore wind
  turbines)
• Client ING Bank
• Document Review and Site Inspections

25
SGS Project(s) Illustration

• Period September 2005 -
• Project Waardpolder Onshore Wind turbine farm,
  the NETHERLANDS
• Services Technical Due Diligence of existing
  Wind Farm (19 Nedwind N31/3 onshore wind
  turbines)
• Client ING Bank
• Steel construction coating application Rheden
  Steel, Belgium
• Document Review and Site Inspections

26
SGS Project(s) Illustration

• Period September 2005
• Project Gniezdzewo, Municipality of Puck,
  Pomorskie, POLAND
• Services Owners Representative for new Wind
  Farm Project (11 Gamesa G80 onshore wind
  turbines)
• Client Polish Energy Partners
• Project Services (Tender Support, Document
  Review, QA/QC, Inspections, Project Supervision)

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SGS Project(s) Illustration

• Period December 2005 -
• Project Changkong project in the western part of
  Taiwan
• Services Inspection of 23 Wind Turbines Vestas
  V80 in Denmark and 23 Towers in Taiwan for the
  above project
• Client Tai Power Corporation Ltd.
• Project Services Inspections

28
SGS Project(s) Illustration

• Period Januar 2003 -
• Project Several Onshore Wind Farms in Portugal
• Services Technical Control and Construction
  Supervision
• Client Enersis Group
• Project Services Inspections

29
SGS Project(s) Illustration

• Period November 2005 -
• Project Kriegers Flak Offshore Wind Farm, Baltic
  Sea
• Services Project Certification for Kriegers
  Flak Offshore Wind Farm Project, 600 MW
• Client Vattenfall
• Project Certification Services for all Phases
  (Tender Support, Document Review, QA/QC,
  Manufactruring Survey, Installation, Commisioning
  etc)

30
SGS Project(s) Illustration

• Period April 2006-
• Project Q7 Offshore Wind Farm 120 MW/60
  installations. Inspections performed in the
  Netherlands, Belgium, Poland and Denmark
• Services Design Verification, QA/QC Management,
  Verification of Electrical Systems, Inspections
  and NDT of Structural Steel (Primary and
  Secondary), Coating and Corrosion Protection
  Inspections
• Client Van Oord

31
SGS Project(s) Illustration

• Period April 2006-December 2006
• Project Elsams Burbo Offshore Wind Farm 100 MW,
  UK
• Services Coating and Corrosion Protection
  Inspections of 25 Offshore Wind Turbine Mono-Pile
  Foundations
• Client Smulders

32
SGS Project(s) Illustration

• Period July 2004 December 2004
• Project Horns Rev, Denmark
• Services Failure analysis of coating problems
  on 80 offshore wind turbine foundations.
• Main Contractor Elsam Engineering
• Site visits laboratory analysis

33
SGS Project(s) Illustration

• Period July 2004 January 2005
• Project Arklow Bank Offshore Wind turbine farm,
  Ireland
• Services Failure analysis of coating problem on
  7 offshore wind turbine foundations
• Main Contractor General Electric Wind
• Site visits laboratory analysis (in combination
  with US coating lab)

34
SGS Project(s) Illustration

• Period May 2006 -
• Services Expediting, Auditing Inspections and
  NDT on behalf of Vestas, Nordex Energy and Gamesa
  Eolica in China, Spain, Germany, Denmark and
  Portugal
• Clients Vestas (DK), Gamesa (Spain) and Nordex
  Energy (Germany)
• Services Expediting Inspections for wind
  turbine components and wind farm projects. NDT of
  Towers, Machine Frames and Nacelles. Inspection
  of Blades.Auditing of wind turbine component
  sub-suppliers.

35
SGS Project(s) Illustration

• Period February 2008 -
• Services In-service NDT inspections (by
  ultrasonic examination) of 160 rotor blades
  (potentially up to 1018) globally
• Client Gamesa
• Countries currently Japan, Spain and the US
• In addition opportunity for also NDT inspections
  in the work shops in manufacturing phase

36
SGS Project(s) Illustration

• Period May 2006 -
• Global Frame Agreement
• Services Expediting inspections on behalf of
  Nordex Energy
• Client Nordex Energy
• Services Expediting Management and Inspections
  for wind turbine components and wind farm
  projects
• Countries currently Germany, Denmark, Sweden,
  Austria, Czech, Switzerland, Hungary and China

37
Existing and Potential Projects - USA

• Period November 2008 -
• Project Agriwind Wind Farms, USA
• Services Failure Analyses of Wind Turbine Blades
• Client
• John Deere Wind Energy

38
Existing and Potential Projects - USA

• Period July 2008 -
• Project MT Home Wind Farm, USA
• Services In-Service inspections, OSHA
  compliance, Commissioning Inspection
• Client
• John Deere Wind Energy

39
Existing and Potential Projects - USA

• Period July 2008 -
• Project Buffalo Bear and Elkhorn Ridge wind
  farms, USA
• Services Construction supervision, walk-down
  inspections and commissioning inspections
• Client
• Edison Mission Energy

40
Existing and Potential Projects - Europe

• Period October 2008-
• Project Bligh Bank Offshore Wind Farm, wind
  turbine
• Services Technical Consultancy of the Vestas V90
  Wind Turbine, QA/QC Inspections during
  manufacturing, installation and commissioning of
  wind turbines
• Client
• Belwind Offshore Energy

41
Existing and Potential Projects - Europe

• Period October 2008-
• Project Bligh Bank Offshore Wind Farm,
  sub-structures
• Services Consultancy in developing of the QA/QC
  manual, QA/QC inspections during manufacturing,
  installation and commissioing of sub-structures
• Client
• Van Oord

42
Existing and Potential Projects - Europe

• Period February 2008-
• Project In-Service Blade Inspections, Globally
• Services In-Service blade-inspections using
  UT-application

43
Existing and Potential Projects - Europe

• Period November 2008-
• Project Albatros Offshore Wind Farm (80 Tubines)
• Services Project Certification (started with
  Phase I)
• Client
• Evelop Germany/LCO Nature

44
Existing and Potential Projects - Europe

• Period November 2008 -
• Project Cote dAlbatre Offshore wind Farm (21
  Turbines)
• Services Project Certification (started with
  Phase III, Manufacturing Survey of Tripod and
  Tower)
• Client
• PROKON Nord

45
Existing and Potential Projects - Europe

• Period September 2008 -
• Project Gode Wind II Offshore Wind farm (80
  Turbines)
• Services Project Certification (started with
  Phase I) and Development of a Project Fact Book
• Client
• Plambeck Neue Energien

46
Existing and Potential Projects - Europe

• Period September 2008 -
• Project Borkum West II Offshore wind farm (80
  Turbines)
• Services Project Certification (started with
  phase III)
• Client
• PROKON Nord

47
Existing and Potential Projects - Europe

• Period September 2008 -
• Project MEG I Offshore wind farm (80 Turbines)
• Services Project Certification (started with
  Phase III)
• Client
• PROKON Nord

48
Existing and Potential Projects - Asia

• Period October 2008 -
• Project Wind Turbine Blade manufacturing survey,
  Tianjin, China
• Services Manufacturing Survey and Monitoring of
  Rotor Blade manufacturer, Process Quality Audit
• Client
• REpower

49
Existing and Potential Projects - Asia

• Period October 2008 -
• Project Wind Turbine Tower manufacturing survey,
  Korea
• Services Manufacturing Survey and Monitoring of
  tower manufacturer, Process Quality Audit
• Client
• REpower

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SGS Industrial Services Global Competence
Centre Renewable Energy Raboisen 28 D- 20095
Hamburg t 49 40 30 101 236 internet
www.sgs.com/wind email wind_at_sgs.com