MARKETING ENGINEERING FOR EXCEL  CASE  VERSION 120412

Case
Suzlon Energy: A Quest for
Opportunities
By Navneet Bhatnagar and Kutti Krishnan

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“Ladies and gentlemen, I recognize that the past year has been among the
toughest we have faced, but our industry is in a better position than many
others. Let us focus on the future, which I think is bright. We must be
selective in targeting our efforts toward the most attractive market
opportunities, and make the most of those,” Rajesh Pradhan told his team
members. It was December 2009, and Rajesh was Senior General Manager of
the International Business Unit at Suzlon Energy Limited, the fifth largest wind
turbine maker in the world. He called his team together today to identify
market opportunities across the globe and decide how best to capitalize on
those opportunities. In the past year, Suzlon had gone through tough times
due to the global economic downturn, and wind energy projects worldwide
were being put on hold as businesses and funding for wind energy
development both slowed.
Rajesh enjoyed a challenge and had a penchant for finding silver linings
around even the darkest rain clouds. Ever the optimist, he continually told his
team, “Opportunities don’t come knocking on our doors. We have to go out
there and find them. That’s what we have to do. The stars are aligned to help
us, so go for it!” He was convinced that Suzlon could register good market
growth by focusing on the right opportunities and pursuing them with vigor,
and most of Rajesh’s team did not need any convincing – they were already
infected by his optimism. After all, global warming was a major concern for all
nations, and the world seemed energized by the prospect of clean energy.
Rajesh believed that “Suzlon’s position as a large, established, and well-
integrated global wind energy player has opportunities galore on the horizon.”

Company Background and Milestones

Between 1992 and 1994, Tulsi Tanti, a first generation entrepreneur running a
polyester fiber manufacturing unit in India, was faced with irregular availability

Copyright © 2012 by Indian School of Business. Distributed by DecisionPro with permission of the
Indian School of Business.
 and rising prices of electricity. The situation increasingly impacted his
operations and eroded the bottom-line. Tulsi began seeking out alternative
sources of energy that were reliable and cost efficient. After some research, he
decided to install two wind turbine generators that would allow captive power
consumption.
While completing the project, Tulsi gained important insights into the
advantages and challenges of wind power generation. From the customer
perspective, wind energy promised better control over power availability and
cost, which would significantly improve any business operating in areas like
India with underdeveloped electrical grids, where businesses were starved for
power, and rising prices depleted their profits. In addition, variable costs for
operating and maintaining wind projects were relatively small. On the other
hand, Tulsi saw that wind power projects required huge capital investments
which kept such opportunities out of reach for many companies, even taking
into account India’s government subsidies for renewable energy projects.
He realized that to succeed in the wind industry at large, he would have to
develop an integrated value proposition for potential clients. As such, Tulsi
founded Suzlon Energy Limited in Pune, India in April 1995. In October of that
year, Suzlon entered into a technical collaboration with Sudwind Energy
GmbH, Germany, one of the dominant players in the German wind industry.
Suzlon commissioned its first wind turbine (0.27 MW) for a client in Gujarat,
India in March 1996. Sudwind dissolved in 1997 due to financial problems, and
Suzlon took the opportunity to purchase its operations. It engaged Sudwind’s
entire team and began manufacturing its first wind turbines. This was quickly
followed by the acquisition of the Dutch rotor-blade manufacturer AE Rotor
Holding BV (see Exhibit 1).
In the early 1990s, there was no end-to-end service provider for the wind
energy business that could offer complete project development guidance,
commissioning, operational and maintenance services for its wind farm clients.
Prior to Suzlon’s entry into the industry, India’s wind energy production
consisted of a small number of wind farms owned by industrial houses creating
captive power for their own operations. The small commercial wind market
there was led by an Indo-European joint venture, NEPC Micon, with European
energy companies Enercon and Vestas operating in the capacity of turbine
distribution.
Suzlon’s early operations were largely limited to the nascent Indian market
and the gradual growth associated with a low-infrastructure market. During
these initial years, the company identified service as a key to its ability to
generate business growth. Helping clients identify and negotiate with potential
funding sources played a major role in developing the market and augmenting
its Suzlon’s customer base. Banks responded to Suzlon’s technical analysis of
a project’s long-term financial viability. The company also routinely liaised with
local governments on behalf of clients to secure the permits, land, tax credits,
and infrastructure improvements necessary to execute client and future wind
energy projects.
At the other end of the spectrum, Suzlon’s major clients included utility
companies in developed markets. These clients generated wind power and fed
it into regional or national power grids and therefore needed integrated
solutions that could facilitate stable and hassle-free operations. Suzlon
envisioned an integrated business model that offered comprehensive support
and industry-related consultancy services to all levels of clientele, thereby
establishing itself as an end-to-end wind energy solutions provider.
This vision paid off, yielding positive results for the company. Looking back at
the strategy, Tanti wrote in his letter to shareholders in the company’s annual
report for the year 2007-2008, “Suzlon had recognized the need for vertical

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 integration early on because, on a global scale, demand continues to outstrip
supply and component bottlenecks still plague a large part of the industry.”
By August 2000, Suzlon had produced 100 MW of wind power capacity for
clients. This launched the company into market leadership in India with over
50% market share. In 2001, Tulsi exited from textile fiber operations to
concentrate Suzlon’s resources on building its wind energy opportunity.
Suzlon Energy’s initial public offering (IPO), launched in September 2005,
found itself quickly oversubscribed. Suzlon was soon among the top 25 Indian
firms in market capitalization. Suzlon’s leadership and exploration of an
unexplored business in the early 1990s was now gaining recognition as a
viable business model for wind power in India and abroad.
Most recently, Suzlon was subject to deteriorated customer confidence after
several turbine blades fractured and customers experienced other technical
difficulties throughout 2008.i While every major wind energy equipment
provider had experienced problems similar to these at some point in its
development, Suzlon’s image was nonetheless tarnished because of customer
concerns about the 2008 generation of Suzlon products. Suzlon knew that
2009 growth was a victory in overcoming this decline in customer confidence,
and the company would need to continue to move carefully to ensure near-
perfect client experiences in coming years to make up for prior losses.

Acquisition-Led Growth
Components used in the wind energy industry were unique; only a few
manufacturers in the world could produce the critical components, and of
those, none could produce a majority of those components. Competitors vied
for their share of supplies from the same set of suppliers. This created a
constant supply bottleneck for all wind turbine manufacturers. Suzlon
management had identified the importance of developing an integrated supply
chain to better control its business, and providing end-to-end, customized
solution to meet customer needs. Management believed that achieving vertical
integration for its supply chain was the most important factor in securing
Suzlon’s long-term success. Since Europe led technology in the industry,
Suzlon pursued further control through acquisitions of European wind
technology developers. Having already acquired Sudwind and AE Rotor, Suzlon
was now relatively experienced in overseas acquisitions. In March 2006,
Suzlon acquired Hansen Transmission International NV, Belgium, a leading
manufacturer of gearboxes and drive trains, both of which were key
components of wind turbine generators.
Suzlon had also acquired shares in REpower Systems AG of Germany in May
2007, raising its interests to 66% of the company a year later with an eventual
target of full ownership. REpower was a technology leader in wind energy with
a strong research and development division. In an interview to the Business
World magazine in 2007 (February 26, 2007 issue), Tanti said, “REpower's
management is sound, and the company has strong technology and R&D
teams. Our combined expertise within components at Suzlon and turbines at
REpower will result in more reliable and cost-competitive products for our
clients.”
Through these acquisitions, Suzlon amassed in-house manufacturing capacity
for all critical components including gearboxes, rotor blades, generators and
towers, while improving quality control and supply availability thanks to new
economies of scale. The acquisitions also helped Suzlon to widen its product
portfolio to include large-capacity and offshore turbines, expanded
manufacturing capabilities, and enhanced company presence across more
global markets, especially in Europe and China. By 2005, Suzlon had
transformed itself from a mid-sized Indian wind energy provider to a
prominent global player in the industry.

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 Suzlon’s Business Operations
Overview
Suzlon’s current product range includes wind turbine generators with
capacities ranging from 350 kW to 2.1 MW. Suzlon’s European arm, REpower
makes high capacity turbines ranging from 1.5 MW to 5 MW. Suzlon offers
turbines in customized versions for installation in a variety of climates, ranging
from hot and dry deserts, to humid coasts and near-freezing plains. The
company offers wind turbines in both Megawatt and Multi-Megawatt series.
New additions to Suzlon’s product line include the S52-600 kW and S82-1.50
MW turbines. The 600 kW turbine is specially designed to deliver high
performance in low-to-medium wind areas, which represent the majority of
Indian terrain. The 1.5 MW wind turbine design incorporates advanced
features and innovations that allow it to deliver high performance with high
reliability.
Suzlon has a regionally-oriented organizational structure. Tulsi is supported
by a Chief Operating Officer and five regional market heads for the United
States, Australia and New Zealand, India, China and Europe, and the “Rest of
the World”, respectively. Functional heads for Supply Chain Management,
Technology, Finance, Human Resources, Quality, Public Relations, Investor
Relations, Corporate Social Responsibility, Strategy & Planning, and Legal
departments also report to him.
Suzlon also offers total wind power solutions to its customers in the form of
consulting, manufacturing, operations and maintenance services (see Exhibit
2). The company has design and R&D facilities in Germany, India and the
Netherlands that are able to retrofit blades for clients. The company’s R&D
teams continue to develop cutting-edge technologies; the company filed for 6
patents in 2009 alone. It was also spearheading the Renewable Energy
Technology Centre (RETC GmbH) in Hamburg, Germany at that time, and had
plans to establish international subsidiaries of RETC in the future. It drives its
gearbox technology program in Belgium, engineering in India, turbine
technology development in Germany, and aerodynamics in the Netherlands.
The international sales business of Suzlon is managed out of Aarhus,
Denmark, and its global management office out of Amsterdam. To manage
business risks and balance tradeoffs among internal cost efficiencies,
technology improvements, and faster market penetration, Suzlon maintains
significant presences in over 40 locations around the world, including Australia,
China, Europe, India, New Zealand, South Korea and the United States.
Suzlon’s marketing efforts are constrained by its production capabilities, which
in turn are tied to component availability. Suzlon manages inventory
distribution across regions based on expected levels of production in a given
time period. To improve its efforts, Suzlon undertook three initiatives in 2008:
a. Developing a Central Planning Cell, with the help of world-class consultants
and cross-functional teams, to streamline the Sales and Operations Planning
(S&OP) process.
b. Increasing resource allocations for country organizations to execute projects
and services effectively.
c. Establishing of strategic alliances with suppliers of critical components to
build the firm’s vendor base.

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 Finances
Suzlon had recorded significant sales increases in 2007-2008 (see Exhibit 3),
but the company had also taken on significant debt liabilities to finance the
Hansen and REpower acquisitions. Most recently, the company had lowered its
debt-equity ratio by de-leveraging its balance sheet. For example, after taking
over Hansen Transmission in 2006, Suzlon expanded Hansen operations but
opened the company to public trading in Europe in 2007. This reduced
Suzlon’s stake to 26%. When asked about the company’s plans for reducing
debt burden Tanti stated in an interview1, “We would like to bring our net
debt-equity ratio to no more than 1:1. We are pursuing a three-pronged
strategy to meet this goal: first, by selling nonstrategic assets; second, by
optimizing our value chain to reduce working capital from 40% to 25% in six
months, which will free up cash for operations; and third, by improving
efficiencies.”
Market Strategy
In India, Suzlon has been the market leader for nine years; it had 69% market
share in 2008. India continues to be an important growth market for wind
power. Tulsi intends to grow the Indian business by leveraging its status as
the leading integrated solution provider in wind energy and developing large-
scale wind farm projects. Suzlon has 9% share of the global wind turbine
market (2008).
The company plans to increase its market share by growing overseas
operations. Such reporting positioned Suzlon well to extend its reach further
into key markets.
Suzlon has its eyes on several attractive foreign markets, including the United
States and China, which both have many types of terrain that are naturally
optimal for wind power generation. These countries also provide numerous
governmental incentives to undertake renewable energy projects. Suzlon’s
position in the US market was already strong with orders from new customers
and major repeat business from existing clients. China, where demand for
energy was high and the government was encouraging the development of
renewable energy sources, also offers a high growth-opportunity market. To
galvanize company leverage in China, Suzlon has set up a production facility in
Tianjin, which helps the company to achieve cost competitiveness within the
manufacturing function while meeting the federal Chinese requirement of
localized production and procurement of turbine components for a company
seeking to serve Chinese clients. See Exhibit 4 for a summary of Suzlon’s
revenues from different geographic areas.
Suzlon is also Australia's leading wind turbine supplier. Australia’s terrain
allows for outstanding wind energy production, and its government intended to
encourage a sustainable and internationally competitive renewable energy
industry, which means significant business opportunities for Suzlon’s future
expansion. In Europe, Suzlon has already enjoyed successes in key markets
such as Spain, even though the company is a relatively new entrant there. It
aims to grow in other important markets including Germany, France, Portugal,
Italy and the United Kingdom, which offer the potential for further
development and investment in wind power. Suzlon has even secured
breakthrough orders in several emerging markets such as Brazil, South Korea
and Nicaragua.

1
Interview with R Sridharan of the business news television channel, ET Now on 18 th December2009; Sourced
from the Economic Times website - http://articles.economictimes.indiatimes.com/2009-12-
18/news/27654927_1_suzlon-promoters-stake-sale-hansen-transmissions.

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 Harnessing Wind Power: Determinants of Project Viability
Wind turbine generators convert the wind’s kinetic energy into mechanical
energy, and then into electricity. Each turbine houses a foundation unit, tower,
rotor, blades, and the nacelle or cover for the generator, gear and control
system. The electricity is then transferred to the power grid through a
transformer (see Exhibit 5). Renewability and high availability make wind an
interesting energy source. Wind turbines can be installed anywhere winds blow
regularly, regardless of directional variability.
Besides government regulations over electricity prices and the cost structure,
the feasibility of a wind energy project depends on diverse factors such as
wind conditions at a proposed site, infrastructural and regulatory support for
land procurement, the investment climate of the region, grid connectivity for
companies planning to feed electricity to a regional/national power grid, and
the ability to maintain eco-integrity at the installation site, especially for
migrating birds.
Often, a prospective customer is unable to comprehend and manage the
plethora of diverse issues that would need to be examined while setting up a
wind power project; therefore expert guidance and support were crucial for
successful execution and commercial viability of the project.
Operational Challenges Faced by Wind Turbine Manufacturers
Wind turbine manufacturers are confronted with many challenges. First, a wind
energy producer supplying power to a national or regional power grid must
strictly comply with local grid connectivity requirements for the project.
Understanding the grid infrastructure and its requirements was essential.
Cables have to be laid for connecting the project site to the nearest grid
connection point (substation). Smooth flow of electricity into the grid is
required to be maintained, minimizing fluctuations to a specified narrow range.
Manufacturers’ most critical bottleneck at a daily level is the constrained
supply of components. Though the wind energy industry has witnessed fast-
paced growth over the past decade, component suppliers have not kept pace
with that growth. This has resulted in longer lead times, delivery delays, and
higher prices for most components. Wind turbines require about 1,500
important components, but design requirements and specifications of all of
these components differ from one wind turbine manufacturer to the next.
Moreover, turbine components like rotors, blades, bearings and gearboxes are
each highly specialized, often having extraordinary dimensions and/or
compositions. Suppliers must accommodate all of these specifications in the
production and safe delivery of such components. This is complicated by the
fact that small and medium-sized companies supplied many of these
components and often do not have capabilities and/or interests to expand in
tune with the growth of the wind energy industry.
Logistics and transportation constitute additional challenges for the wind
industry. Specialized transportation is required to move huge components
from manufacturing locations to delivery destinations, which are often located
far apart. Good-quality approach roads with large bending radii are vital to
maneuvering vehicles safely. All components come together for the first time
in their life cycles only at the project site, where the wind turbine is most often
assembled. This means climate conditions, transport regulations, and test
operations during particular times of the year all have to be coordinated
together in order to ensure the success and cost effectiveness of a turbine’s
construction. Even short time delays can prove costly and lead to problems of
storing/protecting the existing material or components at a site from
corrosion, dust, humidity, and damage to electronic components. When setting
up an offshore wind park, these challenges increase manifold.

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 Finally, monitoring and maintenance require constant vigilance. Wind turbines
need to be monitored on a 24/7 basis due to variances in wind conditions and
potential losses due to mechanical malfunctions. Turbine suppliers provide
variable levels of partnership with clients to monitor turbines: this partnership
may include failure analyses, preventive maintenance and/or reliability tests.
Global Wind Energy Markets and Trends
Wind power competes increasingly effectively with traditional power resources,
due to its low maintenance costs and minimal ecological impact. Producing
wind energy carries no direct fuel costs, involves no geo-political risk for a
sponsoring region, and is unlikely to experience market cost fluctuations within
the foreseeable future due to its non-dominant role in the market. In contrast,
traditional resources like fossil fuel are depleting rapidly, and their prices are
highly volatile.
At the UN Summit on Climate Change in 2009 at Copenhagen, world leaders
pledged to reduce emissions and transition toward renewable energy sources.
As wind energy is among the cleanest forms of energy and could be distributed
through existing grids, the business community seemed to favor it over many
other renewable options presented at the Summit. On an annual basis, a wind
farm of 1 megawatt (MW) capacity typically saves 200 megatons (MT) of coal,
prevents annual emissions of 2-3.2 MT of sulfur dioxide, 1-2.4 MT of nitrogen
dioxide, 300-500 MT of carbon dioxide, and 150-280 kilograms (kg) of
particulates like fly ash.
According to their stage of development, world markets for wind power
production may be classified as: (i) leading markets with mature
infrastructures for promoting wind power (USA, Germany, China and India),
and (ii) developing markets that have potential for future growth (Spain, UK,
Poland, Brazil, Uruguay, and Argentina). The four leading markets had a share
of more than 66% of new wind power capacity installed in 2008 (see Exhibit
6). In addition to these, a few new entrants are in the very early phase of
wind power generation (e.g., Pakistan and Mongolia) where policy framework
and infrastructure are yet to evolve. However, one major issue that has arisen
recently for all turbine manufacturers is that several European countries are
reducing “feed-in tariffs,” or rate guarantees per wind- or solar-powered kWH,
which have subsidized wind projects in Spain, Germany, and elsewhere.
Nonetheless, the global wind energy market grew at a compounded annual
growth rate of 25% during the last five years. The World Wind Energy
Association (WWEA), in its World Wind Energy Report 2008, estimated that the
total installed capacity of wind turbines worldwide reached 121,188 MW in
2008 (See Exhibit 7). This accounts for 1.5% of global electricity
consumption. Wind power has risen to meet the electricity needs of more than
25 million households. Between 2005 and 2008, wind turbine installations
across the world have more than doubled. The market for new wind turbines
increased by 42% between 2007 and 2008.
As far as regional growth, US wind installation capacity surpassed that of
Germany in 2008, claiming the first position in the world with 25,170 MW.
Spain followed Germany in third place at 16,740 MW. China also surpassed
India, claiming fourth position with 12,210 MW installed. Total installations in
India were at 9,587 MW making it the fifth largest market by 2008.
Importantly, the US and China together accounted for more than half of
world’s wind turbine sales in 2008 and represent two of the fastest growing
markets. Finally, the market growth rate as a whole is rising steadily, from
23.8% in 2005 to 29% in 2008 relative to installed capacity of the previous
year.
Carbon credits represented one reason for installing wind energy generators.
Wind energy markets are driven by factors such as environmental concerns,

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 regulatory policies and tax incentives, security of existing power supplies, and
long-term economic benefits (see Exhibit 8). According to estimates by the
Global Wind Energy Council (GWEC), the power sector accounts for about 40%
of CO2 and 25% of overall emissions on earth. All large markets have national
or regional wind industry associations or councils that lobby for wind-friendly
policies, especially since wind energy is among the most environmentally
friendly renewable power source available. In addition, wind energy continues
to grow thanks to favorable policies and tax incentives. These factors have all
contributed to wind power’s emergence as the second largest renewable
energy source behind hydroelectric power.
Some trends are also clear in the market acceptance of wind turbine projects.
First, demand for large-capacity turbines has increased in recent years due to
the cost efficiency of these machines. Second, demand for offshore wind farm
installation has also increased, due to the higher potential of harnessing wind
power on the seas. Third, the replacement of aging wind turbines with more
cost-efficient ones, called proven “repowering” in the industry, has emerged as
another driver in the global wind turbine market, especially in Europe.
Market Forecasts
While trends are favorable for the wind energy industry, the actual
opportunities remain highly dependent upon the investment climate. Like
other industries, this industry has also been significantly impacted by the
global financial crisis. Business confidence had dampened across the world,
putting decision-making processes into a ‘wait and watch’ mode. At the same
time, many traditional channels of funding have reduced their offering as
banking and financial systems were shaken to the core. Though the underlying
fundamentals of the wind sector have remained strong, external forces have
limited market growth. Nevertheless, the wind industry has shown resilience
and is expected to bounce back at the economy’s first signs of recovery.
A prominent consultant in the wind sector, BTM Consult ApS, forecasted that
by the 2013, global wind turbine sales will reach $103 billion with annual
installations of approximately 58,500 MW, nearly double the expected levels
for 2009. BTM also projected additional wind industry revenues to reach $407
billion from the manufacture of turbines, construction, grid connections, and
related services. The market for wind turbines alone was estimated to be $285
billion. For the longer term, BTM estimated that by 2030, nearly 2,500,000
MW of wind power capacity, 17% of total projected electricity demand, would
be available for consumption.
Major Competitors
The wind turbine market is dominated by ten suppliers who collectively
accounted for 85% of total global supply in 2008 (see Exhibit 9). Suzlon’s key
global competitors within this cohort include Vestas, GE Energy, Gamesa,
Enercon and Siemens, all large global companies with considerable business
experience, product ranges, revenues, and financial backing (see Exhibits 10,
11, 12 and 13). In addition, Suzlon competed increasingly with other players
who had succeeded in their respective emerging markets and were now
expanding globally. The biggest of these were Sinovel and Goldwind. Both
based in China, these firms had initially dominated the Chinese market and
had now registered impressive market share growth in many foreign markets.
All of these firms competed for the strategic acquisitions and consolidations,
and Suzlon would have to keep particular watch on the large, multi-megawatt
turbines segment serving 2.5 to 4 MW-turbine customers.
Strategic Capital within Suzlon
With the expected continued growth of the wind energy sector in the
intermediate to long term, Tulsi believed that Suzlon was poised to gain

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 market share. Considering the $285 billion projected market for wind turbine
makers in 2013, even if Suzlon maintained its current 9% share globally, it
could expect revenues of more than $25 billion by 2013. Though its
competition continued to intensify, both from the large players and the new
Chinese entrants, the growing market base ensured enough room for all
players. Better technology, superior customer service, market expertise,
integrated solution and control over supply chain were differentiating factors
that would decide the fate of wind turbine makers in the future.
Suzlon had adopted a multi-pronged business strategy to capitalize upon
market opportunities. Tenets of the company’s strategy included:
 expanding its presence in international growth markets.
 maintaining a strategic focus on the Indian market.
 expanding and integrating manufacturing capacity in domestic and key
international markets.
 expanding its wind turbine product line and improving existing models.
 growing the business through strategic acquisitions and alliances.
The company identified its key strengths in such areas as: (1) management of
time, cost, and quality controls, (2) long-term service support to customers,
(3) turbine technology integration (in-house technology and design
capabilities), (4) global production platform and access to an integrated
manufacturing base, (5) faster product rollout, (6) a track record of executing
large-scale wind power projects, (7) a strong management team, and (8)
operational and maintenance expertise. The company believed that these
factors would help keep it ahead of competition.
Additionally, Suzlon focuses on customer relationship management. Better
understanding of customer requirements and ability to package a customized
solution attractively gives Suzlon a unique advantage to increase growth.
Suzlon has thereby fared better than many of its competitors in terms of
market share growth (see Exhibit 14). "Suzlon is a relationship-driven
company,” Rajesh noted at a presentation he made to a foreign parliamentary
committee. “We understand the customer requirements very well, and this
puts us in a unique competitive position to partner with clients. Our objective
is to provide the best cost per kilowatt hour throughout the entire life cycle of
the turbine."
Finally, Suzlon was highly experienced in balancing short- and long-term
growth. Well-developed markets were easier to enter and facilitate fast
growth, due to the preexistence of policy frameworks and the various
infrastructures needed to execute wind power projects. However, these
markets tended to be highly competitive since all major wind turbine
manufacturers sought their business in order to generate significant short-
term revenues. Fortunately, Suzlon had a strong reputation globally and could
compete for business in these markets. These revenues also allowed the
company to continue making inroads into growing emerging markets, which
required considerable efforts in concept-selling, promotion of wind energy to a
country’s policymakers, and proactive partnerships to catalyze infrastructure
development. Suzlon looked to these emerging markets for 20-year yield
horizons, which allowed for less intense competition but great opportunities to
strengthen the company’s position in the long term.
Building a Strategy for the New Millennium
Today’s meeting at Suzlon’s corporate office in Pune, Maharashtra was
designed to be a marathon brainstorming session. Rajesh wanted to see how
the senior leadership team would evaluate Suzlon’s competitive advantages
and how it would define attractiveness in potential target markets. He listened

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 9/25

 to them all morning arguing toward greater precision of how to define these
elements. He trusted them to maintain a sense of urgency, even though
Suzlon’s books looked great. As of January 2009, Suzlon had a healthy order
book position of $2.3 billion. Though these orders were distributed globally, a
large share of them came from the United States (52.9%) and China (24.6%)
(see Exhibit15). This was significant for two reasons. First, it would secure
Suzlon’s place in two high-growth regions of the wind energy market. Second,
it represented strongholds in both developing and developed markets. The
company believed it could achieve success in these two highly competitive
spaces because of its integrated strategy. In his letter to shareholders in the
annual report for the year 2007-2008, Tanti posited, “We have also embarked
on an aggressive expansion plan which will see our global manufacturing base
reach 5,700 MW from the existing level of 2,700 MW by Q4 FY09. The
backward integration will get accentuated by the Company's in-house capacity
to manufacture casting and forging components. Suzlon, we believe, has now
attained the critical mass to compete with other established players in this
segment and emerge as a fast growing industry leader.”
It was noon now. After a great deal of argument, discussion, and increasing
agreement, Rajesh saw energy winding down and the team’s eyes looking
gaunt. He sent everyone away to lunch. When the war room had emptied, he
shut the door and surveyed the conference table. He looked through the
team’s notes that were now strewn across it. He shuffled some additional
reports into the mix. Some reports were internal Suzlon reports, and others
were analyses from industry consultants and wind energy associations. One
report focused on competitive rankings for wind firms by degree of integration
in a manufacturer’s operations. Another elucidated near-term attractiveness of
major wind energy markets based on detailed calculations of country
attractiveness indices (see Exhibit 16). There were other reports as well that
summarized trends regarding how major wind energy markets would move in
the near future.
Surely these would be enough to point to holes in Suzlon’s own understanding
of the opportunities ahead of it. As he placed the documents he thought, “Let’s
see if they keep seeking…”
About an hour later, the team filed back in, revived and talking shop again,
and already preparing for whatever the boss might suggest next. Rajesh
remarked that it made the most sense for Suzlon to target markets where
growth opportunities were high and where Suzlon would enjoy distinct
competitive advantages that would allow the company to realize maximum
benefits from any marketing efforts it pursued. He also suggested that the
team synthesize a set of parameters that define a wind turbine manufacturer’s
competitive advantages and rank-order major players based on those
parameters, and identify a set of dimensions that would make a region or
country an attractive target market for each of these competing companies.
The team set to work creating metrics that could be used to understand a
country’s relative attractiveness and then attempting to map Suzlon’s
competitive strengths against those markets, but no one looked at table notes
from the morning. After considerable deliberation, the team settled on two
sets of metrics, one for competitive strengths and one for market
attractiveness. Factors contributing to competitive strengths were identified to
be marketing and customization capabilities, diversity of product portfolio,
customer relationship management (CRM) and service maintenance, the
degree of an organization’s vertical integration, vendor relationship
management, and capability of raising finances (see Exhibit 17).
The team also examined the data compiled by Suzlon’s consultant,
GreenPlanet Research Partners. GreenPlanet used its expertise to keep eco-
progressive industries abreast of trends and opportunities, and Suzlon’s

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 10/25

 executive office had commissioned a study by GreenPlanet which Rajesh
hoped would help his team to identify the most important factors for Suzlon to
consider as the company moved forward in target markets. The factors
GreenPlanet identified for regional consideration included a region’s wind
power-harnessing potential (wind resources mapping and energy output
estimation), demonstrated commitment toward renewable energy (political
vision and long term goals), regulatory frameworks and incentive mechanisms
(progressive policies, tax credits, preferential tariff etc.), infrastructure and
grid supports (appropriate infrastructure and conducive grid conditions for
setting up commercial scale wind farms) and financing facilities (presence of
and support from financial institutions/high net-worth investors) (see Exhibit
18).
The team was beginning to outline a strategy from the patterns in the data,
and from the insights provided by GreenPlanet, but Rajesh thought the team
was getting too comfortable after only a few hours of looking at reports.
Suzlon did not become a world leader in energy by being uninquisitive. He
called a recess and walked across the hall to his office to retrieve the annual
market reports of prominent wind energy associations. These reports
highlighted the developments and latest growth trends in different countries
(see Exhibits 19 and 20). It was now 4:00 in the afternoon, and he could
hear his team waxing enthusiastically about positioning Suzlon to challenge
the most competitive strongholds. Still, no one had looked hard at the reports
he had slipped onto the table over their lunch break, and no one had
questioned any of the assumptions of the external consultants’ research. They
also had not reviewed one another’s notes to compile a record of the key
issues discussed during their meeting. Instead, they were so excited that they
wanted to skip immediately to the task of evaluating Suzlon and its rivals,
hoping that the Portfolio Matrix they were developing would help optimize
business efforts going forward.
With their chirps in the background, Rajesh felt it was time to offer direct
guidance. He quietly interjected, “Aren’t we biased in doing this type of
analysis?” Even his whisper commanded great respect, and it now interrupted
both conversations and coffee gulps. “What if we are rating ourselves better
than we actually are? And, what if we inadvertently swayed our consultants’
results through biases in the data we gave them as starting points? Perhaps
we should use someone else to take an independent look at our data. If they
come to similar conclusions and recommendations, then we would have
additional support for our data. But if they have conflicting insights, surely that
should make us pause to reconsider how we move forward.”
He left the room. When he came back, he added as an apparent afterthought,
“I am going home. Please organize all these papers into something I can use,
before you go.” He tossed the annual market reports in with the other
documents no one had yet touched. “Oh, don’t forget to take a good look at
the data from GreenPlanet. Give me a solution that I can live with.”
The team was dumbstruck as Rajesh took a gulp of coffee, turned on his heels
and breezed out of their sights. By morning, he expected to have taught his
team the shrewdness required of an optimist in business.

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 11/25

 EXERCISES
1. What are the salient aspects of Suzlon’s strategy to be a top player in the
global market for wind energy? (Hint: try to apply a standard strategy
framework – e.g., Porter’s five forces theory, or any other framework that
you think might be useful here).
2. Which aspects of its strategy provide Suzlon a relative advantage over its
main competitors in different markets? Why? (Hint: It would be
appropriate to use the GE-McKinsey matrix analysis to "position" Suzlon
relative to its major competitors).
3. Do you agree with the set of factors that Suzlon’s management has
identified for assessing whether a particular market would be attractive for
it to pursue? If so, how much weight do you feel each should have in
making a market entry decision? If not, recommend and justify an
alternate set of factors for Suzlon to consider.
4. Rank-order different countries in terms of how attractive they are for
Suzlon to pursue over the next five years.
 Explain how you determined the rankings.
 Recommend specific strategies for Suzlon for targeting the top
three countries in your targeted list.
5. What should Suzlon do next? (Consider additional information and needed
analyses, as well as specific business actions)

Note: Navneet Bhatnagar and Kutti Krishnan prepared this case as basis for
class discussion under the guidance of Professors Arvind Rangaswamy and
Gary L. Lilien. This case is based on publicly available information. The case
does not intend to serve as endorsement, source of primary data, or
illustration of effective or ineffective handling of a managerial situation, but to
illustrate a business situation based on real events. It does not purport to
represent the actual situation facing Suzlon or the decisions made by the
company.

Copying or posting is an infringement of copyright. Any form of reproduction,

storage or transmission without the permission of the Indian School of
Business is prohibited. To order copies or to request permission to reproduce
materials, email ctlc@isb.edu or call+91 040 23187299

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 12/25

Exhibits

MILESTONES OF SUZLON ENERGY LIMITED

April-95 Suzlon Energy Limited (SEL) becomes operational
October-95 SEL enters into a Technical collaboration with Sudwind Energy GmbH, Germany
Suzlon commissions its first 0.27 megawatt (MW) wind turbine at Dhank (Gujarat,
March-96
India)
August-00 Suzlon crosses the 100 MW mark
April-01 Acquisition of AE Rotor, Germany
October-01 Formation & commencement of operations of Suzlon Wind Energy Corp, USA
November-01 Formation of Suzlon Energy Gmbh, Germany
September-03 Entry into China: Suzlon Energy Limited opens representative office in Beijing
Formation & commencement of operations of Suzlon Energy Australia Pty Ltd.
January-04
Australia
August-04 Suzlon commissions 2 MW Wind Turbine Generator
August-04 Formation of Suzlon Energy A/S, Denmark
BTM Report - 2004: ranks Suzlon 6th on the Top 10 manufacturers list for the 2004,
March-05
a leap from 9th place the prior year
March-05 Suzlon crosses the 1,000 MW (1 gigawatt) installation mark
Suzlon Energy Limited makes Initial Public Offering (IPO) for 29.34 million shares;
September-05
issuance is quickly oversubscribed
March-06 Inception date of Tianjin Manufacturing Facility in China
Suzlon announces the strategic acquisition of Hansen Transmission International
March-06
NV, Belgium
Suzlon ranked #5 among WTG manufacturers in terms of capacity installed in 2005,
March-06
capturing 6.1% of the global market (Source: BTM Consult ApS)
Suzlon captures 50% market share, retaining #1 position in India for the 8th
March-06
consecutive year
Suzlon enters the Portuguese and Italian wind markets, breaking into the important
July-06
#1 regional market - Europe
July-06 Suzlon crosses the 2000 MW (2 gigawatts) Domestic installation mark in India
January-07 Suzlon commissions its first wind turbine generator (WTG) in China
May-07 Suzlon acquires Repower Systems AG, Germany
September-07 Suzlon surpasses 3 GW of domestic installations in India
Suzlon was awarded M&A of the Year Global Renewable Energy Award by
October-07 Euromoney and Ernst & Young in recognition of the successful acquisition of
REpower
August-08 Suzlon enters Sri Lanka market
October-08 Suzlon commissions its first wind turbine generator (WTG) in Brazil
Exhibit 1: Milestones of Suzlon Energy Limited
Source: Compiled from Company Milestones Document of Suzlon Energy Limited.

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 13/25

Exhibit 2: Suzlon’s Integrated Business Model
Source: Suzlon Energy Limited, Annual Report 2007-2008
http://www.suzlon.com/images/investor_annual_result/1_AnnualReport0708.pdf

In millions USD FY 2008 FY 2007

Sales (in Mega Watts) 2,311 1,456
Sales 3,410.50 1,990.90
Raw Material Cost -2,211.50 -1,193.80
Manpower -260 -166.60
Other Operating Expenses -459.20 -307.50
EBIDTA 479.80 323.10
EBIDTA margin 14.10% 16.20%
Financial Charges -132.60 -62.90
Depreciation -72.10 -42.80
Other Income 65.90 24.10
Taxes -49.70 -25.80
Profit After Tax (PAT) 291.30 215.60
PAT margin 8.50% 10.80%
Net Fixed Assets 1,226.73 940.21
Net Working Capital 1,250.76 765.64
Total Assets 5,312.32 3,386.41
Net Debt 2,215.11 1,568.11
Shareholders’ Funds
(Capital and Reserves) 2,039.07 910.27
Net Debt/Equity Ratio 1.09 1.76
Return on
Capital Employed % 11.77 18.89

Exhibit 3: Consolidated Financials of Suzlon Energy Limited

Source: Suzlon Energy Limited, Annual Report 2008 and Suzlon Factsheet. (Exchange rate: $1 USD = INR 40.11)

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 14/25

 FY 2007-08 FY 2006-07
Geography
Amount MW Amount MW
India 1,388.93 975.70 1,027.42 954.60
USA 570.68 592.95 396.66 374.35
China 113.44 133.75 74.79 100.00
Europe and rest of the
785.59 609.00 29.42 27.30
world
Total 2,858.64 2,311.40 1,528.30 1,456.25

Exhibit 4: Suzlon’s WTG Revenue by Geography (in millions USD)

Source: Suzlon Energy Limited, Annual Report 2008 (Exchange rate: 1 USD = 40.11 Indian Rupees)

Exhibit 5: Wind Turbine Components

Source: HowStuffWorks.com accessed on August 16, 2009

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 15/25

Exhibit 6: Country Share of New Capacity Installed in 2008
Source: World Wind Energy Report 2008, World Wind Energy Association (WWEA)
http://www.wwindea.org/home/images/stories/worldwindenergyreport2008_s.pdf

Exhibit 7: World’s Total Installed Capacity, 2008

Source: World Wind Energy Report 2008, World Wind Energy Association (WWEA)
http://www.wwindea.org/home/images/stories/worldwindenergyreport2008_s.pdf

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 16/25

Exhibit 8: Wind Industry Growth Dynamics
Sources: Investor Presentation (Jan. 2010) of Suzlon Energy Limited.
http://www.suzlon.com/pdf/investor_p/Suzlon_Energy_Limited_Investor_Presentation_12Jan10.pdf

Exhibit 9: Global Market Shares of Wind Turbines Manufacturers, 2008

Source: Annual Report (2007-08) of Suzlon Energy Limited (quoting BTM Consult ApS’ World Market Update
2008) || http://www.suzlon.com/images/investor_annual_result/1_AnnualReport0708.pdf

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 17/25

Countries #1 Mkt. Mkt. #2 Mkt. Mkt. #3 Mkt. Mkt.
Rank share share Rank share share Rank share share
in 2008 2008 2007 in 2008 2008 2007 in 2008 2008 2007
USA GE Wind 44.5% 40% Vestas 12.9% 19.5% Gamesa 11.3% 7.9%
Germany Enercon 53.5% 48.3% Vestas 27.8% 24.1% REPower 5.8% 12.8%
India Suzlon 69% 59.6% Vestas 13% 8.8% Vestas RRB 9.6% 8%
China Sinovel 21.9% 18.8% Goldwind 17.7% 23.3% Dongfang 16.4% 6.2%
Spain Gamesa 36.6% 48.5% Vestas 24.5% 18% Acciona 10.5% 15%
France Enercon 24.4% 20.9% Vestas 20.4% 16.1% REPower 15.7% 20.7%
Canada Siemens 33% 0% Vestas 31.4% 29.9% GE wind 30.3% 27.4%
UK Siemens 53.3% 32.5% Nordex 26.2% 27.4% Vestas 9% 21.8%
Portugal Enercon 56.9% 65.9% Gamesa 11.6% 2.7% RE Power 10.5% 2%
Italy Vestas 35.3% 38.5% Enercon 15.9% 10.8% Nordex 15.3% 8.7%

Exhibit 10: Top 3 Wind Turbine Suppliers in Leading Markets, 2008 and
Their Market Shares
Source: Compiled by case authors from World Market Outlook 2008, BTM Consult ApS and reports of wind energy
associations of respective countries.

SUZLON’S MAJOR COMPETITORS COMPARED

Vestas GE Energy Gamesa Enercon Siemens

Country of Origin Denmark USA Spain Germany Germany

Wind Turbine Business
30 years 24 years 16 years 25 years 29 years
Experience
33,500 10,000 10,000 15,000 7,800
Wind Turbines Installed
turbines turbines turbines turbines turbines
(Capacity)
( 32000 MW) (15000 MW) (16000 MW) (18500 MW) (9,000 MW)
Product Range (Turbine 850 kW to 1.5 MW to 850 kW to 330kW to 2.3 MW to
Capacity) 3 MW 3.5 MW 2 MW 2.3 MW 3.6 MW
Offshore Capability Yes Yes Yes No Yes

Exhibit 11: Suzlon’s Major Competitors Compared

Source: Compiled by case authors from annual reports of respective firms.

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 18/25

 US Dollars (Millions) Vestas Gamesa Siemens GE

TOTAL REVENUES 6999.84 5250.52 111350.88 182515

Cost of Goods Sold 5811.84 3816.14 81048.96 83772

GROSS PROFIT 1188 1434.38 30301.92 62896

OTHER OPERATING EXPENSES,

TOTAL 515.52 1135.29 25210.08 41949

OPERATING INCOME 672.48 298.94 5091.84 20947

Interest Expense -18.72 -112.03 -1200.96 -2153

Interest and Investment Income 20.16 9.5 1388.16 -

NET INTEREST EXPENSE 1.44 -102.52 187.2 -2153

EBT, INCLUDING UNUSUAL ITEMS 637.92 229.1 4138.56 19782

Income Tax Expense 218.88 3.16 1461.6 1052

NET INCOME 419.04 223.2 2445.12 18014

Exhibit 12: Financial Figures (Abridged) of Suzlon’s Major Competitors (FY

2008)
Source: Adapted from the annual reports of respective firms

Notes:
1. Enercon is a privately held company and does not disclose financial data.
2. Figures for Siemens and GE are consolidated (all business units/divisions) for all wind power business.
3. All conversions are made at the exchange rates of 1 Euro = $1.44 USD.

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 19/25

i. Vestas- Based in Randers, Denmark, Vestas led the global wind turbine market with more than 19%
share of installed capacity in 2008. During the second oil crisis of the 1970’s, Vestas began examining the
potential of the wind turbine as an alternative source of clean energy. In 1979, Vestas delivered its first
wind turbine, and the company has since developed from a pioneer firm with a staff of 60 in 1987, to a
high-tech, global market leader with a team of over 20,000. It has installed more than 33,500 wind
turbines in 63 countries and claims to be have installed a wind turbine every three hours. Vestas reported
revenues of over $6 billion in 2008. Having developed many in-house capabilities over the years, Vestas is
a prominent competitor in the wind industry. Vestas has made wind turbines ranging from 850 kW to 3
MW. The 3 MW wind turbine is capable of being installed in both on- and offshore locations. The firm also
offers a range of project planning, installation, operational and maintenance services. Vestas operates in
Europe, the Americas, and Asia Pacific.
ii. GE Energy- GE Energy (a division of General Electric) is the world's second largest wind turbine
supplier, and is the market leader for US wind energy. GE Energy has been in the wind business for more
than two decades and has installed over 10,000 wind turbines worldwide, for a total of 15 GW of capacity.
GE Energy has manufacturing and assembly facilities in Germany, Spain, China, Canada and the United
States. Its current product portfolio includes wind turbines with capacities ranging from 1.5 to 3.5 MW
each. Its 3.5 MW turbine can be installed at on- or offshore locations, and the company offers support
services ranging from development assistance to operation and maintenance. In 2008, GE Energy earned
$21.8 billion in revenue and employed more than 40,000 employees. These figures represent totals
including wind and all other sectors of GE Energy.
iii. Gamesa- Gamesa of Spain is the world’s third largest wind turbine manufacturing company with 12%
market share and revenue of more than 5 billion USD. Gamesa is the market leader in Spain. Gamesa has
installed wind turbines of more than 16,000 MW capacity in 20 countries spread across four continents. It
offers wind turbines ranging from 850 KW to 2 MW, and in 2008, it has five R & D centers in Europe
working with a collective research budget of 30 million euros. The company is working on an ambitious
research project to manufacture wind turbines of 10 MW capacity. Gamesa has set up a generator
component manufacturing facility in China and blade-making facility in the USA. With branches in 13
countries, Gamesa is well positioned to serve global markets.
iv. Enercon- Founded in 1984 by German engineer Aloys Wobben, Enercon is the market leader in
Germany. With 10% global market share, Enercon is the fourth largest player in the wind turbine industry.
The company began with a small team of engineers that developed a wind turbine of 55 kW. In 1992,
Enercon innovated within the industry by developing the first gearless turbines. Enercon has a strong R&D
set up that comes out with path breaking technology (eg. in drive systems; distinctive, drop-shaped
generator housings; lightning protection; improved rotor blade design and equipment for grid stabilization
and system control). Enercon has installed more than 15,000 wind turbines, with a total generating
capacity exceeding 18.500 GW. Except turbines for offshore projects (which Enercon’s management
deems unviable), Enercon is present in all turbine categories ranging from 330 kW to 2.3 MW. Enercon
became embroiled in patent violation disputes with GE Energy and Vestas, claiming it was a victim of
intellectual espionage by the both companies. As a result of the litigation, US authorities prohibited
Enercon from exporting its turbines to the United States until 2010 due to alleged patent infringements.
Enercon has now settled these disputes through mutual agreements with the defendant companies.
v. Siemens- The German multinational firm, Siemens enjoyed 6.9% market share of wind turbines
installed in 2008 and followed just behind Suzlon as sixth largest wind energy provider in the world.
Siemens has capabilities to deliver robust wind power solutions to onshore, coastal and offshore sites.
Siemens had revolutionized the market in 1991 by setting up world’s first offshore wind farm. It had
installed more than 7,800 turbines with a total installed capacity of around 9,000 MW. Siemens supplied
2.3 MW turbines for onshore installations and 3.6 MW turbines that could be installed either on- or
offshore. The company also offered integrated solutions and services that met the demands of the entire
wind energy conversion chain. Siemens Wind Power had service teams to help clients run the turbines
optimally throughout their entire lifecycles. The company had implemented some very challenging
offshore wind farms and proven itself to be a competent supplier of large, complicated projects.
Exhibit 13: Suzlon’s Competitors
Source: Compiled by case authors

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 20/25

Exhibit 14: Suzlon’s Comparative Performance with Competitors
Source: Annual Report (2007-08) of Suzlon Energy Limited.
http://www.suzlon.com/images/investor_annual_result/1_AnnualReport0708.pdf

Exhibit 15: Suzlon’s Order Book Position for Wind Turbine Generator by
Geographic Region
Source: Annual Report (2007-08) of Suzlon Energy Limited.
http://www.suzlon.com/images/investor_annual_result/1_AnnualReport0708.pdf

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 21/25

 Rank 1 2 3 4 5 6 7 8 9 10
Country USA China India Spain Germany UK France Italy Canada Portugal
Wind
Index 83 78 56 51 51 49 47 47 46 42

Exhibit 16: Near Term Wind Index – A Measure for Country Attractiveness
Source: Ernst & Young, renewable energy country attractiveness indices, August 2009
Note: Index value accrues via factors such as investment commitment, market growth, wind capacity, and others. The
higher the index value, more attractive is the market.

Major Global Competitors

Factors for Competitive GE
Advantage Suzlon Vestas Wind Gamesa Enercon Siemens
Marketing and Customization
8 10 7 6 4 4
Capabilities
Diversity of Product Portfolio 4 10 6 7 5 9
CRM and Service Maintenance 9 6 10 7 9 8
Degree of Vertical Integration* 10 8 5 8 7 5
Vendor Relationship Management 8 10 8 6 8 8
Capability to Raise Finances 5 9 10 7 6 7

Exhibit 17: Factors for Assessing Competitive Advantage of Wind Turbine

Manufacturers
Source: Compiled by case writers based on publicly available information, including Merrill Lynch, Renewable Energy:
Industry Overview, August 2007(*).
Note: Ratings are on a scale of 1 to 10, with10 being the greatest relative competitive advantage.

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 22/25

 Leading
Developing Markets
Markets

GERMANY

PORTUGAL

CANADA
FRANCE
Market Attractiveness Factors

CHINA

SPAIN
INDIA

ITALY
USA

UK
Wind Power Harnessing Potential
9 9 6 7 7 6 8 6 5 8
(Wind resources mapping & energy output estimation)
Commitment To Wind & Other Renewable Energy Sources
8 9 10 7 9 5 6 6 6 7
(Political vision and long term goal)
Regulatory Frameworks & Incentive Mechanisms
8 9 9 5 6 7 7 8 6 7
(Progressiveness of policies, tax credits, preferential tariffs, etc.)
Infrastructure & Grid Support
(Appropriateness of infrastructure and conducive grid conditions 7 7 9 5 7 7 9 9 6 8
for setting up commercial scale wind farms)
Financing Facilities
10 4 7 8 7 7 8 7 6 7
(Presence of and support from high networth investors)

Exhibit 18: Factors for Assessing Market (Country) Attractiveness

Source: Data compiled by GreenPlanet Research Partners.
Note: Rankings are on a 1-10 scale, where 10=greatest level of synergy with a category.

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 23/25

Country Major Developments/Issues
Grew at record-breaking rate; to see lower growth due to financial crisis; favorable govt.
policies expected; production tax credit will positively incentivize additional wind energy
USA
production; Department of Energy (DOE) objective of 20% power from wind by 2030;
adequate infrastructure support available; fundamental growth drivers very strong.
Growing rapidly; planning 6 projects in excess of 10 GW each; need to invest heavily in
transmission and grid construction; administered pricing of national concession projects
China
makes them unviable; local manufacturing of wind turbines components is a mandatory
requirement; intense competition among local and global players.
Has set target of 30% renewable electricity by 2030. New feed-in tariffs; priority for grid
Germany
access; designation of new sites; onshore re-powering; 23 offshore wind parks coming up.
Great wind potential; has country wide network of wind monitoring stations; steady market
India growth; targets set; favorable policy framework; preferential grid connection; tax incentives;
large turbine manufacturing base.
Positive regulatory changes in 2008; highest in contribution of wind energy sector relative to
Spain
national GDP; following EU target of 20% electricity from renewable sources.
Pace of growth increasing after a slow start; quota system now requires power producers to
produce part of power from renewable sources; government provides green certification,
Italy
priority access to grid; inhibitors to growth include uncertainty due to political changeability and
complex approval procedures to produce wind energy.
High-potential, as wind power is nation’s fastest-growing energy source and government has
earmarked dedicated wind power development zones; significant hurdles include slow
France
authorization procedures, wind-restricted zones, grid connection problems, and no framework
for offshore development.
Government formulated Renewable Energy Strategy proposing onshore and offshore wind
projects of 14 GW each; leader in offshore wind through regulation of the Marine bill; new
UK
energy act promotes small-scale deployment of wind projects; huge public support for wind
energy.
Substantial market; growing to achieve 10 GW capacity by 2020; utility companies investing in
Portugal
wind energy; policy framework improvements in progress
Growing at more than 28% with wind energy making its way in all its regions; 650 MW of new
capacity expected to be installed within an year; provinces have set targets for new wind
Canada energy development; Government though supportive yet to aggressively push for wind energy
which has huge potential in Canada; long term procurement policy needs to be formulated;
investment in developing transmission capacity is required.

Exhibit 19: Country Specific Developments & Issues Influencing Wind Power
Generation
Source: Compiled by case writers from Global Wind Energy Outlook 2008 and Global Wind Report 2008, Global
Wind Energy Council (GWEC)

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 24/25

 Total Total
Total Capacity Capacity
Capacity Added Growth installed installed
installed Capacity Rate (end (end
Country end 2008 2008 2008 2007) 2006)
[MW] [MW] [%] [MW] [MW]

USA 25,170 8,351.20 49.7 16,818.80 11,603

Germany 23,902.80 1,655.40 7.4 22,247.40 20,622

Spain 16,740.30 1,595.20 10.5 15,145.10 11,630

China 12,210 6,298 106.5 5,912 2,599

India 9,587 1,737 22.1 7,850 6,270

Italy 3,736 1,009.90 37 2,726.10 2,123.40

France 3,404 949 38.7 2,455 1,567

UK 3,287.90 898.9 37.6 2,389 1,962.90

Portugal 2,862 732 34.4 2,130 1,716

Canada 2,369 523 28.3 1,846 1,460

Exhibit 20: Global Market Growth Rates

Source: World Wind Energy Report 2008, World Wind Energy Association (WWEA)
http://www.wwindea.org/home/images/stories/worldwindenergyreport2008_s.pdf

i
Johnson, Keith. “Wind Breakers: Suzlon shudders after wind turbine accident,” Wall Street
Journal, October 24, 2008.

SUZLON ENERGY: A QUEST FOR OPPORTUNITIES CASE V120412 25/25