Periodic Reporting for period 1 - 3D-COMPETE (Mini Factories for 3D printing of Large Industrial Composite Structures)
Berichtszeitraum: 2017-02-01 bis 2017-05-31
CAIZAM is a Spanish SME specialized in advance manufacturing of composite components for industrial applications. Thanks to the extensive knowledge in composite manufacturing brought to the company by the founding team and to the close cooperation with the wind blade industry, we have identified a remarkable business opportunity presented as the 3D-COMPETE project. The final goal we seek in this project is to become the first company worldwide offering a solution based on 3D-printing for the industrial fabrication of wind blade components. Next, we explain the reasons that make this project a clear business opportunity.
WIND ENERGY SECTOR CHALLENGES:
The increasing global demand for renewable energy utilization sets a positive growth scenario for the wind energy sector. Indeed, it is predicted that the global wind power capacity at 433 GW at the end of 2015, will reach 618 GW by the end of 2020. This scenario is a good one in Europe, placed second in the global wind power installed capacity with more than 148 GW and where there is a legislation in force (Renewable Energy Directive 2009/28/EC) that requires the EU to fulfil at least 20% of its total energy needs with renewables by 2020. However, despite the growth potential, the wind energy sector faces several challenges that might endanger its long term sustainability. These challenges refer mainly to the industry competitiveness, which is increasingly affected by the price reduction of other energy alternatives (e.g. price of solar PV has gone down from 0.25 to 0.07 €/kWh) and because the most profitable (windiest) places are already occupied, the available free space is less profitable in terms of bulk energy generation, as well as a progressive reduction in government level subsidies. This results in strong price sensitivity for the wind energy sector, for which the only alternative goes through a significant reduction of bulk power costs. Considering that the price of wind turbines accounts for more than 80% of the total costs of a wind farm (2M-4M€/turbine), it is clear that reducing wind turbines prices is the only meaningful solution for the long-term sustainability of the sector.
DIFFICULTIES ENCOUNTERED IN ACHIEVING COST REDUCTIONS:
Achieve price reduction of wind turbines is not trivial because raw materials (steel in the tower and composites made of glass fibre and epoxy/polyester resins in the blades) are standard commodities that cannot be made cheaper. Therefore, the only possible solution is to reduce manufacturing costs for those components that currently represent the main cost burden in wind turbine fabrication. In a wind turbine, the tower and the blades are the costliest components together accounting for over 50% of the total cost. Within a blade, the costliest components are the heaviest and also those most critical to the structural integrity and durability of the blade, namely the root and the caps (figure 1). Currently, the industrial manufacturing of wind blades is performed manually, which is suitable for the simpler blade sub-components in terms of cost (<2,000€/ton) and quality, but it is extremely problematic and expensive (>4,000€/ton) for critical components (the root region and the caps). These components account for 70% of the blade´s fibre weight content and drive a proportional amount of final blade cost (€75K-€110K/blade). Additionally, extra costs are derived from the low reproducibility of manual fabrication, which leads to low quality blades that have to be discarded at a very high cost (2% of blades fail and individual replacement cost of over €1M).
3D-COMPETE SOLUTION & IMPACT:
3D-COMPETE will provide the wind energy sector with a low cost robotized solution for manufacturing these critical blade components. The proposed innovation is the use of an additive manufacturing process (3D printing) to enable the automation of the process. Our solution will reduce the manufacturing costs for these components by 40% (from 4,000€/ton down to 2,400€/ton), and will bring our customer (wind blade manufacturers) savings that can range €3.5M/year (for smaller clients that produce ≈400 wind blades/year) up to €26M (for larger clients that produce ≈3,000 blades/year). These impressive savings have attracted huge interest of the end user community in 3D-COMPETE. Considering that the wind blade raw material market is worth at least €2 billion with >50.000 blades/year manufactured worldwide and that the market is growing at a 8.3% CAGR, the expected turnover by year 2022 solely from the commercial exploitation of 3D-COMPETE will reach €33.4M equivalent to a realistic 5% share of the applicable global market.
3D-COMPETE: OBJECTIVES OF THE ACTION
The final objective we sought for the 3D-COMPETE project during the Phase 1 was to build up the roadmap to reach the ready-to-market stage keeping in mind all perspectives: commercial, technical and financial perspectives. In that Phase 1, we designed a number of tasks, covering the three previous perspectives, to be performed in order to achieve this final objective. With this plan in mind, the specific objectives for the action were as follows:
OBJETIVES OF THE COMMERCIAL FEASIBILITY ASSESSMENT:
To initiate negotiations with launch customer (wind blade manufacturers) and suppliers.
To validate our business model: the Mini factory concept.
To define our IP Protection Strategy for our project.
To perform a market analysis of the wind composites sector.
OBJETIVES OF THE TECHNICAL FEASIBILITY ASSESSMENT:
To determine the technical requirements (product specifications) in collaboration with our launch customer/s (those engaged as part of the commercial feasibility assessment).
To analyse the certifications and international standards we must achieve to reach the market and based on it, to define a technological plan to achieve them.
To develop a robust Work Plan for the years to come, including a risk analysis and a mitigation and contingency plan.
OBJETIVIES OF THE FINANCIAL FEASIBILITY ASSESSMENT:
To calculate the required investment to achieve our 3D-COMPETE business plan.
To calculate a 5-year’s business plan.
WIND ENERGY SECTOR CHALLENGES:
The increasing global demand for renewable energy utilization sets a positive growth scenario for the wind energy sector. Indeed, it is predicted that the global wind power capacity at 433 GW at the end of 2015, will reach 618 GW by the end of 2020. This scenario is a good one in Europe, placed second in the global wind power installed capacity with more than 148 GW and where there is a legislation in force (Renewable Energy Directive 2009/28/EC) that requires the EU to fulfil at least 20% of its total energy needs with renewables by 2020. However, despite the growth potential, the wind energy sector faces several challenges that might endanger its long term sustainability. These challenges refer mainly to the industry competitiveness, which is increasingly affected by the price reduction of other energy alternatives (e.g. price of solar PV has gone down from 0.25 to 0.07 €/kWh) and because the most profitable (windiest) places are already occupied, the available free space is less profitable in terms of bulk energy generation, as well as a progressive reduction in government level subsidies. This results in strong price sensitivity for the wind energy sector, for which the only alternative goes through a significant reduction of bulk power costs. Considering that the price of wind turbines accounts for more than 80% of the total costs of a wind farm (2M-4M€/turbine), it is clear that reducing wind turbines prices is the only meaningful solution for the long-term sustainability of the sector.
DIFFICULTIES ENCOUNTERED IN ACHIEVING COST REDUCTIONS:
Achieve price reduction of wind turbines is not trivial because raw materials (steel in the tower and composites made of glass fibre and epoxy/polyester resins in the blades) are standard commodities that cannot be made cheaper. Therefore, the only possible solution is to reduce manufacturing costs for those components that currently represent the main cost burden in wind turbine fabrication. In a wind turbine, the tower and the blades are the costliest components together accounting for over 50% of the total cost. Within a blade, the costliest components are the heaviest and also those most critical to the structural integrity and durability of the blade, namely the root and the caps (figure 1). Currently, the industrial manufacturing of wind blades is performed manually, which is suitable for the simpler blade sub-components in terms of cost (<2,000€/ton) and quality, but it is extremely problematic and expensive (>4,000€/ton) for critical components (the root region and the caps). These components account for 70% of the blade´s fibre weight content and drive a proportional amount of final blade cost (€75K-€110K/blade). Additionally, extra costs are derived from the low reproducibility of manual fabrication, which leads to low quality blades that have to be discarded at a very high cost (2% of blades fail and individual replacement cost of over €1M).
3D-COMPETE SOLUTION & IMPACT:
3D-COMPETE will provide the wind energy sector with a low cost robotized solution for manufacturing these critical blade components. The proposed innovation is the use of an additive manufacturing process (3D printing) to enable the automation of the process. Our solution will reduce the manufacturing costs for these components by 40% (from 4,000€/ton down to 2,400€/ton), and will bring our customer (wind blade manufacturers) savings that can range €3.5M/year (for smaller clients that produce ≈400 wind blades/year) up to €26M (for larger clients that produce ≈3,000 blades/year). These impressive savings have attracted huge interest of the end user community in 3D-COMPETE. Considering that the wind blade raw material market is worth at least €2 billion with >50.000 blades/year manufactured worldwide and that the market is growing at a 8.3% CAGR, the expected turnover by year 2022 solely from the commercial exploitation of 3D-COMPETE will reach €33.4M equivalent to a realistic 5% share of the applicable global market.
3D-COMPETE: OBJECTIVES OF THE ACTION
The final objective we sought for the 3D-COMPETE project during the Phase 1 was to build up the roadmap to reach the ready-to-market stage keeping in mind all perspectives: commercial, technical and financial perspectives. In that Phase 1, we designed a number of tasks, covering the three previous perspectives, to be performed in order to achieve this final objective. With this plan in mind, the specific objectives for the action were as follows:
OBJETIVES OF THE COMMERCIAL FEASIBILITY ASSESSMENT:
To initiate negotiations with launch customer (wind blade manufacturers) and suppliers.
To validate our business model: the Mini factory concept.
To define our IP Protection Strategy for our project.
To perform a market analysis of the wind composites sector.
OBJETIVES OF THE TECHNICAL FEASIBILITY ASSESSMENT:
To determine the technical requirements (product specifications) in collaboration with our launch customer/s (those engaged as part of the commercial feasibility assessment).
To analyse the certifications and international standards we must achieve to reach the market and based on it, to define a technological plan to achieve them.
To develop a robust Work Plan for the years to come, including a risk analysis and a mitigation and contingency plan.
OBJETIVIES OF THE FINANCIAL FEASIBILITY ASSESSMENT:
To calculate the required investment to achieve our 3D-COMPETE business plan.
To calculate a 5-year’s business plan.
During the Phase 1, we performed an in-depth assessment of the feasibility of the 3D-COMPETE project. The work performed and the main achievements are the following:
COMMERCIAL FEASIBILITY ASSESSMENT:
We have analysed the main players of the Wind Energy sector, and we have advanced in the negotiations of an agreements with one of the biggest ones (name not disclosed due to confidentiality issues) for the validation of our technology and the Mini factory concept in the 3D-COMPETE project.
We have closed agreements with two important suppliers.
We have validated our Mini factory business model, proved by the interest shown by potential clients.
We have performed a freedom to operate (FTO) analysis and defined a technology watch process, in order to assess the patentability of the project and our IP strategy. This analysis has allowed us to conclude that there is no public patent that represent a risk for our 3D-COMPETE project and business plan.
We have analysed the wind composites market sector, emphasizing the market drivers and the main barriers and challenges we must overcome for the commercial exploitation of the 3D-COMPETE project.
TECHNICAL FEASIBILITY ASSESSMENT:
We have determined the main characteristics and requirements of the components we are going to manufacture (root and caps), and preliminary validated the quality of the pieces by mechanical testing.
We have defined the certifications required for commercialization of the blade components we are planning to manufacture (International Standards for the Wing Turbine Certifications), and defined the process we must follow to achieve these certifications.
We have defined a Work Plan for the achievement of 3D-COMPETE project objectives in the most efficient manner. This work plan has been divided in several work packages, each of them with different tasks to be performed and key milestones. Additionally, a risk analysis has been performed, which has allowed us designing a mitigation and contingency plan.
FINANCIAL FEASIBILITY ASSESSMENT:
We have carefully calculated the investment requirements needed for the 3D-COMPETE project and allocated the budget to each work package.
We have developed a 5-year business plan. For that purpose, we have determined the financial projections for three different scenarios (base case, pessimistic and optimistic), including the determination of the return of investment (ROI) and the cash flow for each of them.
COMMERCIAL FEASIBILITY ASSESSMENT:
We have analysed the main players of the Wind Energy sector, and we have advanced in the negotiations of an agreements with one of the biggest ones (name not disclosed due to confidentiality issues) for the validation of our technology and the Mini factory concept in the 3D-COMPETE project.
We have closed agreements with two important suppliers.
We have validated our Mini factory business model, proved by the interest shown by potential clients.
We have performed a freedom to operate (FTO) analysis and defined a technology watch process, in order to assess the patentability of the project and our IP strategy. This analysis has allowed us to conclude that there is no public patent that represent a risk for our 3D-COMPETE project and business plan.
We have analysed the wind composites market sector, emphasizing the market drivers and the main barriers and challenges we must overcome for the commercial exploitation of the 3D-COMPETE project.
TECHNICAL FEASIBILITY ASSESSMENT:
We have determined the main characteristics and requirements of the components we are going to manufacture (root and caps), and preliminary validated the quality of the pieces by mechanical testing.
We have defined the certifications required for commercialization of the blade components we are planning to manufacture (International Standards for the Wing Turbine Certifications), and defined the process we must follow to achieve these certifications.
We have defined a Work Plan for the achievement of 3D-COMPETE project objectives in the most efficient manner. This work plan has been divided in several work packages, each of them with different tasks to be performed and key milestones. Additionally, a risk analysis has been performed, which has allowed us designing a mitigation and contingency plan.
FINANCIAL FEASIBILITY ASSESSMENT:
We have carefully calculated the investment requirements needed for the 3D-COMPETE project and allocated the budget to each work package.
We have developed a 5-year business plan. For that purpose, we have determined the financial projections for three different scenarios (base case, pessimistic and optimistic), including the determination of the return of investment (ROI) and the cash flow for each of them.
The objective of the 3D-COMPETE project is to replace the manual process in blade manufacturing by a fully automated manufacturing process, called Automated Fibre Placement (hereafter AFP), in order to avoid the extremely problematic manufacturing of critical components of a wind blade, like low reproducibility, low repeatability, high level of waste, low productivity and high overall cost.
The key issue in our project is that we propose to integrate the 3D-COMPETE solution in our customers’ serial production lines, avoiding logistic and transporting costs, by an innovative business model that we call “Mini Factories”. The client won’t have to invest in purchasing the new machine, integrating it in their production line and training workers, because CAIZAM will do it. With these advantages, we try to overcome the main barrier of the project: the client acceptance. The uniqueness of the 3D-COMPETE solution make us the only company worldwide being able to offer a solution based on AFP for industrial manufacturing of wind blade components, as we hold and exclusive secret knowhow (Intellectual property) on a novel AFP process. For this purpose, CAIZAM has invested substantial efforts for more than two years in the adaptation of the AFP process from the aeronautical sector to the wind blades manufacturing.
The expected impact of our 3D-COMPETE solution will be derived by a significant reduction of the manufacturing costs of wind turbine blades: the customer savings are expected to be of 40% in the manufacturing costs. This savings could range from €3.5M for a small size wind blade manufacturer (≈ 400 blades/year) up to €26M for larger manufacturer (≈ 3.000 blades/year). As an automatized process, 3D-COMPETE will significantly reduce the human errors of the current process, which in turn will reduce the costs of discarding the defective blades (over a 2% of the manufactured blades). Also, our solution will contribute to reduce waste (glass fibre residues) as our APF process will require a lower amount of raw materials to achieve similar and even improved quality for the blade components we will manufacture, with reduces human errors and avoidance of process inefficiencies regarding the use of raw materials. Finally, our process will increase the production of wind blades, by reducing at least by 10% the manufacturing times.
The key issue in our project is that we propose to integrate the 3D-COMPETE solution in our customers’ serial production lines, avoiding logistic and transporting costs, by an innovative business model that we call “Mini Factories”. The client won’t have to invest in purchasing the new machine, integrating it in their production line and training workers, because CAIZAM will do it. With these advantages, we try to overcome the main barrier of the project: the client acceptance. The uniqueness of the 3D-COMPETE solution make us the only company worldwide being able to offer a solution based on AFP for industrial manufacturing of wind blade components, as we hold and exclusive secret knowhow (Intellectual property) on a novel AFP process. For this purpose, CAIZAM has invested substantial efforts for more than two years in the adaptation of the AFP process from the aeronautical sector to the wind blades manufacturing.
The expected impact of our 3D-COMPETE solution will be derived by a significant reduction of the manufacturing costs of wind turbine blades: the customer savings are expected to be of 40% in the manufacturing costs. This savings could range from €3.5M for a small size wind blade manufacturer (≈ 400 blades/year) up to €26M for larger manufacturer (≈ 3.000 blades/year). As an automatized process, 3D-COMPETE will significantly reduce the human errors of the current process, which in turn will reduce the costs of discarding the defective blades (over a 2% of the manufactured blades). Also, our solution will contribute to reduce waste (glass fibre residues) as our APF process will require a lower amount of raw materials to achieve similar and even improved quality for the blade components we will manufacture, with reduces human errors and avoidance of process inefficiencies regarding the use of raw materials. Finally, our process will increase the production of wind blades, by reducing at least by 10% the manufacturing times.