Wärtsilä Sees Growth In Scrubber Sales, Opportunities In Power

Wärtsilä painted a relatively optimistic outlook for the rest of 2018 in its half-year results report.

Although the Helsinki, Finland-based company missed profit expectations, CEO Jakko Eskola said the outlook for the company’s Marine segment has improved.

In the marine and the services markets, Wärtsilä said saw a boost in sales of its sulfur scrubbers designed to reduce emissions from ships. Eskola said the company received orders for 109 scrubbers during the second quarter compared to about 80 installed in 2017. Retrofits will become more prevalent in 2019 and 2020, when regulations come into effect, Eskola said.

In the power market, Eskola highlighted an order for a 145 MW fast-track power plant in Myanmar. The gas-fired power plant is a first for Wärtsilä in the country and now it has power projects in 178 countries.

The continued decline in renewable energy prices has made solar and wind power more affordable in many markets, and utilities are assessing how to integrate such energy sources into their asset base, said Javier Cavada Camino, president of Energy Solutions for Wärtsilä.

“There is no single country on the planet that is not aware that renewables are coming,” Cavada said. “Renewables are coming and they need flexibility…we really see growth everywhere.”

Solar and wind make up about 14% of the global power supply now and even the most optimistic estimates see renewable energy making up about 50% of the power supply by 2040, Cavada said.

The U.S., Australia and Middle East countries, where market conditions are the most favorable, are leading the transition. The growing share of renewables increases the need for flexible power generation and storage solutions. In addition to flexible capacity, demand remains strong for new baseload capacity to support economic growth and alleviate power shortages in the emerging markets.

For the 12-month period ending in March, the increased demand for Wärtsilä’s energy solutions supported market share growth, despite declining global power plant investments. Cavada, who will leave the company later this year to become president and CEO of London-based energy storage company Highview Power, said Wärtsilä delivered 3.7 GW of product in 2017. He noted the company’s share of the power generation market went from 8% in 2015 to 21% this year.

Overall, the company saw orders increase by 10% in the first half of the year with net sales at €2.312 billion.

–Jack Burke