Siemens Energy exits coal; India entity not to see much impact in business
Germany’s Siemens Energy has recently said it would not take up new projects supporting coal-fired power stations in India, following USA’s General Electric in announcing a no-coal strategy globally. Siemens Energy builds steam turbines for power plants, but that business is not big for it in India. Siemens Energy, which is part of Siemens Ltd, said it would discontinue support for the development of new coal-fired power plants.
The company would continue to offer bridging technologies like gas-fired plants and components for efficient combined heat and power (CHP), waste heat, and biomass co-firing projects as also continue its CO2-reducing service and solutions business, it said in a statement issued post the global announcement.
“The decision does not have a material impact on the revenues or profit of gas and power (now energy) business within Siemens Limited as the company currently does not have the competencies to provide utility equipment for new coal-fired power plants,” said the statement. Siemens Ltd’s revenue for the year ended September 2019 was Rs 13,684 crore and profit after tax for the period was Rs 1,088 crore. The revenue of gas and power, which is part of Siemens Energy, was Rs 5,174 crore, while profit from operations was Rs 695 crore.
Siemens Energy owns 67 percent of wind turbine maker Siemens Gamesa, giving it a foothold in sustainable power. Siemens Ltd is also on its own in solar, hydrogen, hydropower, biomass, and wind energy solutions.
Selling turbines to coal-fired power plants globally accounts for less than 10 percent of the company’s sales or around 820 million euros ($970 million) based on 2020 figures. Siemens Energy would still meet existing commitments, including placed bids, and honor service contracts for combined heat and power stations.
The group had in September spun off Siemens Energy from the parent globally though it continued to be part of India entity. The global parent said it would now review the impact of its decision on employees and sites. “With this step, Siemens Energy continues its transformation towards a more sustainable and growth-oriented portfolio,” it said.