Siemens Gamesa chief: 'Europe needs wind – and wind needs Europe'
OPINION | Ahead of WindEurope 2025, Vinod Philip in his first detailed discussion of the sector's prospects spells out what the European wind industry needs to move forward
Europe stands at a crossroads, facing what some might call a 'scale or fail' moment in the global race for industrial competitiveness. Numerous reports indicate that high and volatile energy prices are one of the main burdens on European industry.
In this turbulent landscape, characterised by rising energy demand and geopolitical instability, the critical question arises: is Europe’s ambition to become the first carbon-neutral region in the world jeopardising its competitiveness?
EU decarbonisation remains a catalyst for growth
Energy prices have fallen considerably from their peaks, yet EU companies still face electricity prices that are two to three times higher than those in the US, and natural gas prices that are four to five times higher. Meanwhile, the cost of generating clean power reached record lows in 2024. Renewables have become the cheapest source of bulk generation in almost all European markets.
The expansion of renewables is not a burden on Europe’s competitiveness. Rather, it enables and strengthens it. We need an even more ambitious expansion by further industrialising this key driver of Europe’s competitiveness.
Beyond economic competitiveness, energy has become a crucial bargaining chip in the geopolitical arena. Europe must reduce its energy dependence, and increasing the share of renewables in the energy mix is essential to achieving this goal. Decarbonisation policies offer an opportunity for Europe to lower energy prices, enhance energy security, and take the global lead in clean technologies.
The good news is that Europe has a strong foundation in wind energy. In 40 years, wind power technology has evolved from prototypes to large-scale projects capable of supplying clean electricity to millions of households. We have now reached 285GW of installed wind capacity. Last year, Denmark had the highest share of wind in its electricity mix at 56%. The UK, Ireland, Sweden, Germany, the Netherlands, Portugal, Lithuania, and Spain all met more than a quarter of their electricity demand with wind.
Powering European growth together
The wind industry is doing its homework, investing billions of euros, ramping up factories, and developing a skilled workforce, learning from its experiences to reach a point where predictability, industrialisation, and automation are the north stars for our operations. This has also helped the economy. Wind energy employs almost 400,000 people in Europe and adds around €60bn ($66.6bn) to Europe’s GDP every year.
The road here was not always smooth. External factors, such as the pandemic, the war in Ukraine, disrupted supply chains, and rising costs have affected the entire sector. In addition, wind turbine manufacturers have faced challenges due to a prolonged emphasis on low prices and accelerated product development cycles. The fact that we have reached our current maturity and competitiveness despite overcoming so many challenges is the clearest demonstration of the strength and resilience of the wind industry.
What do we aim for?
There are still challenges ahead. Europe targets 450GW of wind power by 2030. The European wind value chain has already invested and continues to do so to help reach this ambitious target. To ensure we unleash the full potential of wind in Europe, policymakers must focus on what truly brings value.
We urgently need effective solutions to boost electrification and long-term market visibility, using financial de-risking instruments, such as contracts for difference (CfDs) and power purchase agreements (PPAs). Additionally, a fully integrated and robust European energy market is essential. This includes fostering interconnections and ensuring appropriate deployment and long-term planning of energy grids. Lastly, effective policy coordination between EU member states is crucial, along with agile permitting processes that turn targets into reality and a level playing field for manufacturers.
A strong wind sector and a competitive industrial base should not be seen as opposing forces. It is indeed the other way around – they are two integral parts of the same winning equation. Europe’s industrial strength hinges on the competitiveness of its wind industry. Europe needs wind, and wind needs Europe.