Record demand for gas turbines has pushed Siemens Energy’s order book to an all-time high as well, amid soaring electricity demand that, it appears, cannot be entirely met with new wind and solar.
The German major reported an order increase of over 30% in the first quarter of its fiscal year, bringing total orders to €17.6 billion, or almost $21 billion. Siemens Energy’s fiscal year runs from October 1 to September 30 the next year.
“Gas Services delivered its strongest quarter ever in terms of order intake, booking 102 gas turbines. 12 gigawatts were converted from existing reservation agreements, at and the same time 12 gigawatts of new reservations,” Siemens Energy said.
It added that 40% of its new gas turbine orders came from the United States, with another 35% coming from Europe and the remainder originating in the Middle East and China. The numbers are evidence that demand for gas-fired electricity generation is strong in all key markets.
Siemens Energy also reported upbeat results for its grid technology division, saying “Growth was driven by robust demand across both products and solutions. The US contributed with several data-center-related orders amounting to a high triple-digit-million-euro volume. Globally, customers are accelerating investments in transmission capacity to integrate rising power capacities and strengthen grid stability.”
The German major’s wind and solar division, meanwhile, was in the red although it said the earnings numbers had improved, with the loss shrinking from a year earlier.
Earlier this month, Siemens Energy announced investment plans of $1 billion to boost the production of grid equipment, as power generation and transmission become hot investment areas right now. This is thanks to the strong growth in electricity demand driven by the fat growth in data center construction to power artificial intelligence rollout. Indeed, some have warned there may be a gas turbine shortage on the horizon due to the imbalance between demand and supply.
By Irina Slav for Oilprice.com
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