Endurance Wind Power bankruptcy spreads to UK

Falling pound, renewable power subsidy cuts blamed for company's collapse
In 2014, Endurance Wind was on such a growth spurt that it moved into a new 40,000 square foot plant at the Campbell Heights North business park in Surrey.  | Rich Lam
The recent bankruptcy of Surrey-based Endurance Wind Power is now being felt in the UK, where the company’s British subsidiaries are also now being forced into creditor protection.

Endurance Wind Power filed for bankruptcy sometime around early November and placed under trust with Grant Thonrton, after its bank called in its loan.

In 2014, Comerica Bank provided Endurance with a U$10 million revolving credit facility. Court records show Comerica is now suing Endurance for US$6.9 million.

British media are now reporting that Endurance’s UK subsidiaries – Endurance Wind Power (UK) Ltd. and Endurance Manufacturing (UK) Ltd. – have also been placed under administration with Grant Thornton’s UK division, putting 45 jobs there at risk.

No one at Endurance could be reached to comment on job losses at its Surrey plant. The company’s B.C. was 160 in 2014.

A former executive, who did not want to be identified, told Business in Vancouver that the company “got into a tough spot and I guess the bank got a little bit nervous and decided to exercise their rights.”

It appears Endurance Wind Power is one of the more recent victims of a weak British pound and reductions in renewable energy subsidies in the UK, which was its biggest market for wind turbines.

Endurance Wind Power was one of the darlings of B.C.’s renewable energy space. Founded in 2007, the company started out as a wind turbine manufacturer. By 2014, the company had a local workforce of 160.

In 2012, the company changed its business model from being strictly a wind turbine manufacturer to a wind power developer as well – a move that now appears to have been fatal.

To accommodate its rapid growth, the company opened a 40,000 square foot plant in the UK, where its biggest market was, and in 2014 moved into a new 40,000 square foot plant at the Campbell north business park in Surrey.

Endurance did not build wind turbines for large-scale wind farms. It had cultivated a niche market: building smaller wind turbines for the distributed power market.

Unlike utility-scale wind farms, distributed power is small in scale. In the UK, feed-in tariffs prompted businesses, individuals and farmers to invest in wind turbines, which could be used either to provide on-site power, or add power to the grid. 

A typical customer would be a dairy farmer who would buy one or two wind turbines and then collect revenue from public utilities for the power it generated.

In early 2015, the UK government cut its feed-in tariffs by 65%, according to the Guardian newspaper , which in April reported a sharp drop in new solar power installations as a result of the cuts.

The Express & Star newspaper also cites the plunge in the British Pound’s value as a contributing factor in the company’s collapse.

Endurance Wind Power is the second B.C. renewable energy company to go under since in the last five years. In 2012, Day 4 Energy – which made photovoltaics for the solar power sector – went bankrupt. It was one of several North American PV companies to fold in the face of competition from China, which has seriously cut into both the

Endurance’s bankruptcy is something of a cautionary tale for cleantech and renewable energy companies that become overly reliant on subsidies, which can end overnight with a change in government or government policy.

“It’s super unfortunate – great little company,” said Jonathan Rhone, chairman of the BC Cleantech CEO Alliance. “But it just really underscores the fact that these feed-in tariffs are not designed to be in place forever.  They’re designed to initiate a transition with a reduction over time of the tariff to allow these technologies to get into the market, get established and then achieve scale.

“That is really key for people to realize – that this is not the forever program, these tariffs.”

nbennett@biv.com

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