Citing slow growth, low profit and high cost, Siemens AG announced it is selling its solar energy business as part of a larger strategy to focus its renewable energy efforts in the wind and hydropower sectors.
“Due to the changed framework conditions, lower growth and strong price pressure in the solar markets,” Siemens said in a statement yesterday, “the company’s expectations for its solar energy activities have not been met.”
Already in talks with prospective buyers, Siemens unveiled a plan earlier in October to develop an optimized infrastructure through cost reduction and the strengthening of its core activities.
Currently, the company’s conventional hydroelectric efforts include a joint venture with Voith Hydro, while the company also announced it had bought the majority share in ocean energy company Marine Current Turbines Ltd. (MCT) in February.
Michael Suess, member of the managing board of Siemens AG and chief executive officer of its energy sector, said, “the importance of renewable energies in the global power mix will continue to grow and hydropower and wind energy will remain the major renewable contributors. Our renewable energy activities will be focused on these two areas.”
Ingo-Martin Schachel, an analyst with Commerzbank AG in Frankfurt, told Bloomberg that the reasoning behind the decision by Siemens to divest its solar business activities was “obvious” and added: “Solar is no core business and no core competency of Siemens. The growth prospects for these markets have deteriorated such that there is really no reason to remain active here.”
HydroWorld.com reported in July that Siemens’ hydro group was part of a consortium being considered by BC Hydro for the design and construction of a replacement for British Columbia’s 126-MW John Hart hydropower plant.