GE has reported a 2022 third quarter showing some disparity across its renewable energy and power businesses. The company’s onshore wind turbine revenues were $2.445 billion for the quarter, which ended September 30. That was down from $3.047 billion for the same quarter in 2021. For the first nine months of the year, onshore wind turbine revenue was $6.403 bn also down from the $8.048 bn of a year earlier.
Across its entire renewable energy business, GE reported a quarterly loss of $934 million, considerably more than the $151 million loss recorded for the same period in 2021. For the first nine months of 2022, business segment losses were $1.786 billion, up from the $484 million loss recorded over the first three quarters of 2021.
The company said that equipment revenues during the quarter were down, primarily in its renewable energy business, due to fewer onshore wind turbine sales, and in its power business, due to decreases in gas-powered HA turbine and aeroderivative deliveries, and decreases in steam power equipment on the decline of new-build coal.
In its third-quarter filing with federal securities regulators, the company said it had experienced ‘significant cost inflation’ in materials and logistics costs across the entire business and said those factors impacted both rice and customer demand.
It also said that based on experience across its onshore wind turbine fleet, it was carrying out what it termed repairs and other corrective measures to improve overall fleet quality and availability. This led to higher warranty and related reserves during the quarter. GE is also restructuring its onshore wind business to operate in fewer markets and ‘simplify and standardise product variants.’ However it cited ‘significant demand’ for larger turbines that reduce the levelised cost of energy – such as its Haliade-X units that it expects to start shipping for its first commercial project during the fourth quarter.
On the power side of its business, GE reported third quarter revenues of $3.529 billion. That was down from $4.026 bn a year earlier. Through the first three quarters of 2022, power segment revenues were $11.233 billion, down from $12.242 billion a year earlier.
However its earnings filing stated that during the nine months ended September 30, global gas generation grew in the ‘mid-single digits’ with the greatest demand for its products coming from Europe and the USA. It said the fleet continues to follow growing gas generation, capturing what it characterises as shortfalls from nuclear outages, coal retirements and hydro and supply disruptions.
It cautioned, however, that the power market will likely continue to suffer from overcapacity, continued price pressure to service the installed generating base, and the ‘uncertain timing of deal closures’ owing to financing and other complexities of working in emerging markets. The ongoing impacts of COVID-19 are also a factor weighing on results.
GE said that while greater renewable energy penetration and the adoption of climate change-related policies continue to impact long-term demand, it “expect the gas market to remain stable over the next decade with gas generation continuing to grow low-single-digits.” And continues to believe that gas will play a critical role in the energy transition.