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Suzlon will compensate customers John Deere Wind Energy and Edison Mission Energy for output losses because of cracked turbine blades, news agency Bloomberg said today, quoting Chief Financial Officer Kirti Vagadia of the Nomura Asia Equity Forum in Singapore.
"We have made a cumulative provision of Rs 590 crore in the balance sheet as of March 31, 2008. We are giving availability compensation to John Deere and Edison under the contractual terms,'' the agency quoted the official.
Suzlon is yet to make any official announcement on the issue. According to recent reports, Suzlon's turbines installed at wind farms of John Deere were not producing enough power due to technical issues such as inability to adapt to the US power grid. Suzlon had supplied over 250 wind turbines to John Deere and Co. So far, Suzlon has not commented officially on this issue.
Edison Mission Energy reported to its investors in January 2008 that some of the blades wind turbines supplied by Suzlon were cracking.
Suzlon confirmed this in January 2008 and wrote off Rs 19 crore in the third quarter of the last year for replacement of 34 blades of its 2.1-mw turbines installed in the US that developed cracks.
Later Suzlon provided for a further provision of Rs 100 crore in the next quarter to strengthen 1,251 blades. Edison also cancelled an order for supply of 315 mw in 2009, numbering about 150 S88-2.1 mw turbines.
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