The energy transition's hardware: turbines, inverters and electrolysers made in Germany
Wind turbines from Aurich and Rostock, solar inverters from northern Hesse, electrolysers from Dresden and grid equipment from Siemens Energy. Who builds the physical kit of decarbonisation.
Decarbonisation is often discussed as a policy problem. It is also a manufacturing problem. Every gigawatt of wind or solar capacity requires turbines, inverters, transformers and cables, and every tonne of green hydrogen requires electrolysers. Germany has companies across much of this chain. Their fortunes have varied, but their products are central to Europe's energy plans.
ENERCON: the gearless pioneer
ENERCON was founded on 23 July 1984 in Aurich, East Frisia, by Aloys Wobben. Its defining technical choice came in 1993 with the E-40, its first gearless wind turbine. A conventional turbine uses a gearbox to step up the slow rotation of the blades to the speed a generator needs. ENERCON's direct-drive design instead uses a large, slow-turning ring generator, removing the gearbox, a common source of maintenance problems. In 2012 Wobben transferred the company to the Aloys Wobben Stiftung, a foundation that is now its sole shareholder. ENERCON concentrates on onshore turbines; its newest top model is the E-175 EP5.
Nordex: onshore at scale
Nordex was founded in 1985 and is headquartered in Hamburg, with nacelle production in Rostock. The company focuses on onshore wind. Its flagship N175/6.X is aimed at low- and medium-wind sites, which are common in inland Germany, and it builds hybrid towers with hub heights up to 199 metres. Taller towers reach steadier winds, which matters in regions where the best coastal sites are already in use.
SMA: the inverter specialist
Solar panels produce direct current. Grids use alternating current. The inverter in between also manages output, monitors performance and increasingly supports grid stability. SMA Solar Technology was founded in 1981 as a spin-out from the University of Kassel and is headquartered in Niestetal in northern Hesse. Its product lines run from the Sunny Boy for homes to Sunny Central for utility-scale solar parks, and it also supplies battery storage systems. SMA has been listed on the Frankfurt Stock Exchange since 2008.
Sunfire: electrolysers for industry
Sunfire, founded in 2010 and headquartered in Dresden, makes electrolysers that use electricity to split water into hydrogen and oxygen. It is unusual in offering two technologies. Its solid oxide electrolysis (SOEC) technology, developed after acquiring Staxera in 2011, runs at high temperature and can use industrial waste heat to improve efficiency. Its pressurised alkaline electrolysers, which came with the 2021 acquisition of Switzerland's IHT, are a more mature technology suited to large installations. Production sites include Dresden and Solingen. The target market is heavy industry, such as refineries and chemical plants, where hydrogen is already used and could be made with renewable power.
Siemens Energy: grids and turbines
Siemens Energy, headquartered in Munich, was spun off from Siemens in 2020 and listed in Frankfurt on 28 September 2020. Its businesses span gas services, grid technologies, industrial transformation and wind power through Siemens Gamesa. Grid technology, including transformers, switchgear and high-voltage direct current links, has become especially important. As more renewable power is generated far from where it is used, grids need to be expanded and stabilised, and that equipment is in short supply worldwide.
How the pieces fit together
These products form a system. Wind turbines and solar parks generate variable power; inverters and grid equipment feed it into networks and help keep frequency and voltage stable; electrolysers can absorb surplus electricity and turn it into hydrogen for industry. The more renewable power a grid carries, the more the value shifts from generation alone to flexibility and transmission. That is one reason why grid equipment makers have attracted so much attention, and why inverter makers like SMA increasingly describe themselves as providers of grid services rather than simply of power electronics.
The common challenges
Cost competition
Chinese manufacturers have scaled rapidly in solar, wind and electrolysis, putting pressure on European prices and margins.
Permits and demand timing
Manufacturers depend on project pipelines that are shaped by permitting speed, auction design and interest rates. Order books can swing sharply.
Hydrogen uncertainty
Electrolyser makers face the question of how quickly industrial customers will commit to large green hydrogen projects.
Ownership and patience
Ownership structures differ markedly. ENERCON belongs to a foundation, SMA and Nordex are listed, Sunfire is venture-backed and Siemens Energy is a large listed group. Foundation ownership can give a manufacturer room to ride out weak years, while listed companies must manage investor expectations through volatile order cycles.
Why it matters
- Domestic manufacturing gives Europe some control over the hardware its climate targets depend on.
- Technical choices such as ENERCON's direct drive or Sunfire's dual-technology approach are genuine differentiators, not branding.
- Grid equipment may prove the tightest bottleneck of all.