Tata Steel bags wind power contract in Europe

Tata Steel’s efforts to build a business catering to the wind energy sector in Europe, got a boost, as it secured a multi-million pound contract from engineering giant, Siemens.

The deal to supply 25,000 tonnes of high quality profiled steel plate for 150 wind turbines to Siemens Wind Power was worth an unspecified eight figure pound amount, Tata Steel said Wednesday. The company said it anticipated that the deal would lead to further opportunities to supply other products used in the production of wind turbines such as hot rolled coil.

“The agreement we’ve negotiated with Siemens Wind Power is a strategic customer alliance that will help in our objective to be a key supplier in the offshore wind power market,” said Phil Knowles, commercial manager for power generation at Tata Steel. “Demand for steel in the renewable energy sector will continue to grow, and we’re ideally placed to help our customers tap into this important opportunity.”

The European Wind and Energy Association estimates that wind energy will triple its power output by 2020, from 5.5 per cent of total EU demand in 2010, to around 15.7 per cent of demand. Tata Steel has been making other moves into the renewable energy space, including creating a supply base for steel products used to make the casing structures for wind turbines.

The Siemens deal comes at a time of growing pressure on Europe’s steel industry, which has forced companies to scale back production. In the second half of 2011 production at Tata Steel’s European operations fell to between 80 and 85 per cent of capacity, as the firm mothballed a blast furnace in Scunthrope and a hot strip mill in Llanwern in Wales.

In Britain, there is speculation of redundancies at Tata Steel’s plant in Corby, Northamptonshire, which currently employs around 700 people. Regional paper, the Evening Telegraph quoted the local MP Ms. Louise Mensch as saying she was holding meetings with Tata Steel to seek assurances on the work force.

“Employees at Tata Steel’s Tubes business at Corby received a regular briefing late last week in which the challenging economic circumstances faced by the business were discussed,” said a Tata Steel spokesman. “Employees have been assured that management and unions are working to explore solutions to further sustain the business.”