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Suzlon to Cooperate With Chinese Firms in Wind Power

According to reports, Indian wind turbine maker Suzlon Energy Ltd. is planning to partner with Chinese utilities to help them invest in wind-power projects abroad, Chairman Tulsi Tanti said Wednesday.

Suzlon already has mandates from Chinese state-owned utilities to look for investment opportunities in Australia, the U.S., Brazil and South Africa, Mr. Tanti said in an interview on the sidelines of the World Economic Forum.

Mr. Tanti visualizes deals whereby Suzlon will build a wind farm in a foreign country backed by Chinese investment capital that sells power to a local grid company. Suzlon would sell the project to the Chinese investor once it is completed, but also collect payments from the Chinese investor for perhaps 20 years to operate the wind farm.

“We are bringing them to the outside because we are already connected to the rest of the world.”

No deals have been signed yet, but Suzlon is in talks with some of the largest state-owned utility companies, Mr. Tanti said, though he declined to name specific companies.

Within China, Suzlon has struggled to match its global market share, as it faces tough competition from local rivals. Mr. Tanti estimates that Suzlon’s wind-turbine market share in China is 2%-3%, compared with around 10% globally.

“Outside China we are either in the top three or top four in every market…here our number is 10. That’s the difference.”

Foreign critics have complained that the bidding process for wind and other alternative-energy projects in China is tilted towards domestic bidders, but Mr. Tanti disagreed, saying “the process is very transparent and there is no issue.”

He attributes Suzlon’s low China market share to the sheer size of the market and the company’s smaller production scale within China compared with domestic rivals.

Suzlon has two production facilities in China, in Inner Mongolia province and the northeastern city of Tianjin, which are running only at 60%-70% of full capacity.

Mr. Tanti said we wants to bring those plants to full capacity before expanding into other provinces. They should reach full capacity in the next financial year starting April 2012, he said.

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