Windflow faces $1m turbine bill

WTL

1.320

0.00

0.00%

Click for a detailed chart

Relevant offers

Market Data

Exporters, risk appetite behind kiwi recovery Investors eye potential Greece rescue Oil rises above US$73 on Greek bailout hopes Market continues to lose ground Dollar halts downward slide ASX heads south, takes Wall St cue NZX slips at open Stocks to watch: Feb 9 Dollar down ahead of Key speech Deutsche eyes NZ's Craigs Investment

Windflow Technology could face a bill of nearly $1 million for repairs to turbines it has sold to NZ Windfarms.

An independent expert's report on repairs or retrofits to Windflow Technology's turbines estimate the total cost at just over $966,000 for repairs excluding replacing blades and any consequential failures.

Windflow has released a statement about the report.

"The Expert has estimated the total liability that would arise if all the identified issues resulted in a requirement to repair [or a decision was made to implement a pro-active retrofit, where applicable] to be approximately $966,200 [excluding blades or any consequential failure]."

Inspection costs to monitor the potential risks were estimated at about $12,000 a year when the work was performed in conjunction with scheduled maintenance.

A copy of the expert's report has been made available to NZ Windfarms, the only customer of the Windflow turbines and a former subsidiary set up to buy and test the turbines.

NZ Windfarms said it had nothing to add at this stage about what was in the expert's report. It had been supplied a copy by Windflow.

NZ Windfarms asked three months ago for an independent expert to be appointed to assess the differences between the turbines Windflow had supplied to it for its Te Rere Hau wind farm in the Manawatu from the design being submitted for International Electrotechnical Committee certification.

The two companies have been in dispute about whether IEC certification was a requirement of the supply contract. Windflow has been seeking certification for three years.

NZ Windfarms has argued certification was required and had until recently withheld $4.1m of payments to Windflow, but paid $1.8m of that 10 days ago.

Windflow chief executive Geoff Henderson said Windflow had made 17 design changes relevant to certification of its 500-kilowatt turbine supplied to NZ Windfarms.

Some of the design changes had been incorporated into some of the turbines supplied to NZ Windfarms but not all, he said.

So far 65 of the 97 turbines ordered have been supplied to NZ Windfarms.

Henderson said 44 of the turbines at Te Rere Hau had blades that were butt jointed. Two of that construction had failed during IEC fatigue tests done in 2007.

A redesigned blade had passed IEC fatigue testing and the redesign had been incorporated in the subsequent turbines supplied.

It had been established that the test blades that failed were loaded to a higher level than intended or calculated at the time.

The expert had determined that the cycles required to pass the test were exceeded at the test load actually applied. That reduced the degree of concern over the blades.

On the basis of new calculations the expert determined the blades would not now be expected to fail but recommended that blades be visually inspected every six months.

The replacement cost of a single blade was about $40,000.

The expert had recommended a monitoring programme for 49 turbines at Te Rere Hau. The estimated cost of replacement of one bearing assembly with an upgraded one was about $16,200.

Thirty-five turbines had unmodified gearbox casing feet that could be at risk of distortion under extreme loads. They also have a bolted flange joint in the gearbox at risk under cyclic pressure.

Some risk of failure of the brake adaptor on the turbines had also been identified and the expert considered those could be incorporated at a cost of $3100 a turbine.