COPENHAGEN Electricity generation from wind turbines could become profitable even without government subsidies in the next decade if more large-scale developments are allowed, the world's top turbine maker Vestas said on Wednesday.
In Denmark, the company's home country, the minister of climate and energy earlier this week outlined plans to end its green subsidies before 2030.
"Our ambition is very well in line with the minister's" Vestas' spokeswoman Gry Moger Poulsen told Reuters, adding that allowing large project developments to take place would be key for power producers to operate without state funding.
She declined to give an exact time for when Vestas' turbines could be expected to compete on a subsidy-free basis with traditional forms of power generation.
Sweden's Vattenfall [VATN.UL], which is rapidly increasing generation from wind, said in September it hoped to develop at least some subsidy-free projects by the end of the decade, while the more expensive projects involving offshore installations will take longer to become profitable.
On Monday, a Danish public commission recommended to Energy and Climate Minister Lars Christian Lilleholt that subsidies should gradually come to an end.
"The cost (of renewable energy) is declining steeply. It is the technology that has driven this," Lilleholt told Reuters.
Denmark has a target to generate at least 50 percent of its energy from renewable sources by 2030.
Danish energy firm DONG surprised markets earlier this month when it won a tender for two German offshore wind parks with zero subsidies on top of the wholesale electricity price, an industry first.
However DONG said that the German auction differed from the norm in that construction is still seven years away and that the electricity transmission system was not part of the project's scope.
Earlier this month, Sweden and Norway said they would extend a joint subsidy scheme for renewable energy by a decade to 2030, although Norway will stop adding new projects to the system after 2021.
(Additional reporting by Nerijus Adomaitis, editing by Terje Solsvik and Louise Heavens)