Okay. Distinguished investors, good afternoon. I would like to welcome you to join us for the Goldwind 2021 Q1 result release. First of all, we are very honored to have our executives to join you for the discussion. They are our CEO, Mr. Cao Zhigang, and our Vice President and Board Secretary, Madam Ma. Well, today we'll also have Madam Ma to walk you through the Q1 performance, the market dynamics, our performance, and our financials, and then we get into the QA. I'd like to remind all the investors, please pay attention to the instruction of raising questions. Madam Ma, please.
Thank you. Distinguished investors, good afternoon. I welcome you to join us for the Goldwind [2021] Q1 release. Last night, we published our Q1 performance and indicator end report. We also would like to share with you a PowerPoint slide.
Well, today, I would like to give my presentation with three parts, our financials, our operation. Please go to page three. Let me just brief you on the 2020 global wind power market. In 2020, the new installation was 69.7 GW, up by 53.3%, and the growth comes from China and the U.S., and it's being impacted by the tax reason, so there's huge increase. According to the data, in Q1 2020, China recorded 5.26 GW of the new grid-connected wind power, an increase of 122.9% YOY. At the end of Q1 2021, China's cumulative grid-connected wind power capacity totaled 286.6 GW, taking 12.9% of the power mix. Solar took 11.6%. Thermal power declined to 56.5%. Let's also say that from in Q1 2020, China's total power consumption was 1,921.9 billion kW, up by 21.2% YOY.
173.7 billion kW of the wind power production represent an increase of 15.6%, and the penetration ratio is 9%. Wind average utilization was 690 hours in Q1, increased by 69 hours. Please go to page five. I can say that in Q1 of this year, domestic public tender market totaled 40.2 GW, up by 182% YOY. By the end of March, average bidding price for 3S series turbine was CNY 2,860 per kilowatt in March, and the 4S series turbine was CNY 2,940 per kW. This page shows you the state policies, including the requirement on the subsidy factor that, as well as the proposals and the guiding principles for the energy work of 2020, in order to optimize the structure to promote the healthy and sustainable development of the wind power industry.
On the right side, it shows the NEA's responsibility quota of the 2020 for the suggested non-hydro renewable power consumptions. Compared with the 2020, the quota was listed by 20%. In Hunan, Guizhou, and Henan, the quota was exceeded 50%. Let's also see business review. Please go to page eight. In Q1 of this year, company recorded 1,091 MW of the wind turbine sales, up by 28.8%. The 1.5 MW turbine totaled 4.7 MW, accounting for 0.4%. Sales of the 2S platform turbine totaled 582 MW, accounted for 53.3%. The 3S/4S platform turbine totaled 380 MW, accounted for 29.1%. The 6S/8S platform turbine totaled 187 MW, accounted for 17.1%. Let's talk about the order backlog. By the end of Q1, the company's order backlog is 15.9 GW, and 40.5 GW are external orders. 3.3 GW are for successful bids.
For the 3S/4S series turbine, booked 6.7 GW external order and improved to 47% in the order mix. The 2S series turbine took 41% of the external order, and the 6S/8S series turbine took 12%. By the end of Q1, overseas order totaled 1,986 MW, mainly in Vietnam, Chile, Kazakhstan, Pakistan, and Philippines. On page 10, it shows us the power generation business. By the end of Q1, company's domestic and overseas attributable grid-connected wind power projects totaled 5,604 MW. 31% are in northwestern part of China, 29% are in East China and the southern region. In Q1 of this year, company added 160 MW of the attributable grid-connected wind power capacity in home and abroad, 40 MW domestically here in China. By the end of Q1, company's attributable under-construction wind capacity at home and abroad is 2,740 MW.
28 are in North China and the southern part, 25% in North China, 40% in Northeast, 7% in Northeast, and 25% for overseas market. In Q1, our offshore wind farms recorded 710 hours of utilization, up by 29.8%, 91 hours higher than the industry average. Let's take a look at financials. On page 12, it shows in Q1, our revenue increased by 24.8% YOY and booked at CNY 6,822 million. You can see that our GP margin increased by 6.9% to 28.4%. At the same time, in Q1, the recurring net profit was up by 8.8% to CNY 970 million. The net profit attributable to the owner of the company increased to CNY 972 million. Let's also take a look at the operational cash flow and the working capital.
In Q1, the cash conversion cycle shortened by 25 days to 81 days, among which, early in the first quarter of 2020, the net profit cash flow totaled CNY 3,682 million. The inventory turnover days shortened by 37 days to 71 days. Receivable turnover days being decreased to 121 days. Payable turnover shortened to 111 days. On page 40, you can also see that in Q1 of this year, our financial index are pretty healthy, including the debt service index. We also see that our net debt was decreasing. The net gearing ratio is 53%. That's our Q1 performance. Okay, thank you.
Thanks, Madam Ma, for your introduction. Now let's leave the time for the investors who raise the question. Please be reminded, in order to improve the efficiency for Q&A session, please identify yourself before raising the question. We give two opportunities for each investor. Thank you. Now let's welcome the operator to get the first question in.
Okay, thank you. Ladies and gentlemen, now is Q&A time. If you have any questions, please press star one to wait for your name to be called. We only support the cell phone Q&A, please raise your questions. Let's welcome Wu Bufa from Yangtze River Securities. Please raise your question.
Okay. Thanks for the executives. I come from Yangtze River Securities. I have two questions. The first question is that, as we can see from December last year on to the Q1 of this year, the total bidding and the tendering volume was up a lot, even go back to a very high level as what we used to experience. What's your outlook of the total instruments of this year? Is there any change compared with the guidance? According to your release, I find out actually there are more opportunities in the wind power industry, how you're going to comment on that, especially the need from the industry.
My second question is that we can clearly see that in Q1 of this year, our net profit ratio is being greatly improved. Regarding the turbine and the farm operation, what would be the GP margin? We can also see that the raw material price was up a lot. Is this going to impact the GP margin? Thank you. One for industry and one for your business. Thank you.
Okay. Let me say a few words for the industry. In Q1, the bidding and the tendering volume or the size is closely related to the mass innovation strategies made by the central government. You can say that from the developer perspective, they are very enthusiastic to do the bidding and the tendering. That's why we say the bidding and the tendering volumes are up in the industry. Well, regarding the installation of this whole year, the installation capacity would be still around 35- 40 GW. There will be no major changes. Here, there are two reasons to back up this judgment. The first one is that the bidding tendering volume and the execution pace would be different from what we forecasted.
For the bidding and tendering volume, it clearly shows that for developers, they really want to further deep dive into the renewable energy, and especially to make sure the project will be well executed, where at the same time, we can clearly notice, say, that within the grid and the local penetration in the power mix, and still there's some so-called mismatch. That's why for this year, in the tendering and the bidding projects, majority of them will be installed or executed in 2022, while some of them could be actually installed in 2021. That's what I say for the pace of the installation or execution. Another factor I'd like to mention is that recently we joined many tendering the bidding projects.
Even if some of those projects are within the national master plan, but there are still some projects that have not yet been fully approved by the government, and especially the grid connection approval has not been done. The land usage application has not yet been approved by the government. As far as we can say from NEA and from NDRC, and those projects are within the master plan. Regarding the project execution, there are still some projects who failed to finish all the procedures for government approval. That's the reason, in 2021, I say this is going to be a big challenge. In 2020, we see a peak of the installation capacity, and that's why many of the clients, some of those projects being approved by the government has already be installed in 2020 because of the subsidy reason.
Especially, last year is going to be so different from the past few years. Regarding the tender and the bidding volume, I think for the whole year of [2021], it's going to be kept at a very high level. Well, for sure, there are some positive signals to us. It can see that in 2022, we're probably going to see an early turning point to make sure the industry is going to be up again. It will also be decided by multiple factors. Recently, the NEA and NDRC also issued the opinion notice, especially regarding the policy changes of the renewable energy industry. As well as I say that from the government, they still want to keep an eye on the approval to speed up the approval procedure. The approval is on the approval of the projects being applied.
I say that those policies is going to accelerate the development of the whole wind power industry. Well, the second question is regarding the GP margin. In Q1, the GP margin of our product compared with Q4 of last year, and it was up. In Q1, the GP margin for turbine product is around 15%, while for the wind farm, the GP margin is around 17%. You can say that's all been improved compared with 2020.
Thank you. Mr. Cao, a follow-up question. We found out the price was up in the whole industry, but from Q2 of last year on, it seems that the bidding price was down a little bit. We still improved our GP margin. What's the reason?
On one side, the component and the raw material price were up, and in Q1 of this year, it pressured our business to some extent. At the same time, you can see that in China, the economic growth rate is, as far as I believe, better than what we saw last year. This year we're going to see some pressure from the raw material and the components price up. To be frank, we see that in 2020, there are some so-called price distortions. Because many companies trying to install the capacity last year, the upstream is seeing the demand over supply. That's why the price was up aggressively last year. This year, the price was down, and also the raw material price, it was up. This is somewhat forming a hedging. That is going to impact the GP margin of the whole industry.
Besides those factors I mentioned, it is also going to be closely related to the business structure changes. As Madam Ma has already mentioned in the presentation, currently, the price per kilowatt of our turbine product is also going to further improve our GP margin of 2021.
Okay, thank you. One follow-up question. Regarding the first question I asked just now, it seems that the price was decreased due to the tendering and the bidding of this year. It seems that no subsidies from the government for those projects. Some of the so-called projects for this year would be delivered earlier, and well some of those high-priced projects from last year would delay the kind of delivery.
Well, from the fundamentals perspective, that won't happen. As far as I mentioned, in 2020, many of the approved projects have already been installed. In 2021, for all the developers, a big concern is to further improve the project connected to the grid. They still need to execute the project in their hands in the backlog. Well, for some projects, probably because they have some problems for the grid connection, they will be delayed. All in all, I say that there won't be too many projects being delayed for this year. For the projects that go through the tendering and the bidding this year, some of them will be executed this year or some will be installed in next year.
Okay, thank you. Thank you very much. That's all for my questions.
Thanks for Cao Zhigang for your answer. Now let's welcome the operator to have the second question, please.
Next question comes from Shenwan Hongyuan Securities, Mr. Chen Minyu. Now please unmute yourself.
Thanks for the executives. I have two questions to our executives. The first question is still regarding the domestic market. You can see that for this year, the bidding scale was up, especially the onshore wind farms. They are actually adopting the platform above 4S turbine. In the near future, whether the turbine product is going to march towards the large size of development, according to the order backlog or the order in your hands for this year, for the whole year, I mean, are we going to see that some high power turbine business is going to be up this year? My second question is that, regarding our long-term market share target. As far as I can see that according to the report, our market share is relatively stable. Do you have any kind of target for the long-term market share? Thank you.
Let me answer the first question. From the tendering and the bidding process. You can say that the clients are adopting more high-power turbine products. This is not the new trend of this year. Last year, we already saw the structural changes. For the turbine, above 3 GW, they are growing very fast. For this year, a clear signal we can see from the market is that among all the bidding and the tendering projects, in some low wind speed areas, they're going to use larger blade products and a low power turbine product. In regard of the low turbine, it is still going to be 3.6 GW, and the length of the blade will be 170 m. The diameter, the same as the offshore wind farms around two to three years ago. Even the capacity of the turbine is quite limited, but they adopt large blades.
Where in northern parts of China or in those areas with abundant wind resources, the capacity would be around 4 GW or even sometimes 5 GW being adopted. Megawatts. I also see that some of the projects are actually adopting those large capacity turbines above 4 MW. That's the so-called high power or high capacity trend in the tendering and bidding process. If you follow the wind power industry for quite long period of time, you may clearly notice during the 12th Five-Year Plan. Many of the turbine products are for those small blade, yet high capacity bird turbine. During the 13th Five-Year Plan in China, and because of the so-called red and orange alarms, there's no big development for the wind power industry. At that time, we started to see larger blade, yet small capacity turbines being adopted.
Because it actually provide a relatively low levelized cost of electricity for those areas with less wind resources. In the 14th Five-Year Plan, we have the market for the low wind speed area and also the market for the high wind speed area. They are going to adopt a different product after the 13th Five-Year Plan. Now at the first year of the 14th Five-Year Plan, we're going to see some new developments. Different region, they may have different need over the turbine product. You see that high capacity turbine product will be adopted in northern part of China with abundant wind resources. That's one factor I'd like to mention. Another factor or a good signal I'd like to mention is that during the tendering and the bidding process, in the past, we have a small amount of the client.
They, in the past, and only do the price quota, where now they also have the design certification to make sure the product can get into the tendering bidding process. From this year, they started to be more interested in to get into those new turbine products with the design certification. This can support the new technology and the new product that could be applied in the new project. That can help to further reduce the LCOE. A big risk this trend also may generate is that in recent months, for the whole market, I think it is overheated. Even from the emotion perspective, it's being overheated. Many investors, many companies, they are too excited over the cost as well as the business volume in the near future.
Because every year after the peak installation period, in 2010 and in 2015, we have already experienced two rounds of the peak installation. One year after the peak installation, a certain problem will happen because the market is being overheated. It will also lead to some so-called quality instabilities. Recently in the media, and also see some installed new projects last year, some of them encounter severe quality risks. With such a backdrop, on one side, we need to make sure that we do prototyping and to the mass delivery. It's not easy. You have to shorten the process. It really need a company to have a very robust capacity for testing and commissioning. That's our judgment over this market.
That's also for the past 18 months, we invested 500 million to build the 60-MW project to make sure that how can we leverage the technology to make sure the new product could be commissioned as quickly as possible. Right before the mass commission, we still need to do the physical test, the physical certification to help to reduce the quality risks while we're expanding the market share. Actually, in our annual report and in our roadshow, we have clearly passed on the information to the investors. Our forecast of the market share is still going to be 25% in 2021. It may take two to three years to see more fluctuations, and then the market will get into a new environment, and the market share would be stabilized. Thank you.
Thank you. A very clear answer. Thank you.
Thanks. Thanks for Cao Zhigang, and thanks for Chen Minyu. Next question, please.
Next question comes from Citibank, Liu Xianda. Please raise your question.
Executives, thanks very much for having us for the call. My first question. Last year, the 2.0 and the 2.5S a platform or series turbine, including 2.0 and the 2.5S series turbines would be down in this year. In Q1 of this year, I would like to know the profit of the wind product. Thank you.
Actually, with our existing product, we took the platform strategy, and for 2.0 platform, we have 2.50 and 2.5S series turbines. Well, for this year, we don't have any decommission of the wind farms.
Okay, thank you.
Thanks. Thanks for the answer. Let's have the next question, please.
Next question comes from Goldman Sachs. Ji Chao, please.
Thank you. Thanks for having me here. I have one question. Regarding the H2 of this year and next year, what would be the bidding price for the turbine product in the market? Well, with the carbon neutrality for the wind electricity and the wind turbine product, what measures are we going to take in order to further reduce the cost? Thank you.
Well, for H2 of this year, the bidding price, I think you may pay attention to the bidding price in the market. There are some sharp decrease. You know that different producers or the company, they have a huge range for the product fluctuation. In the past, the gap of the price is only RMB 100-RMB 200, now, as far as I can see, some lowest price would be RMB 2,400 per kW. For some high price one, it would be around RMB 2,800, RMB 2,900 per kW.
We believe this may also tell the range for the second half of this year for the bidding price in this market. The price would kind of fluctuate in such a range. That's my forecast of the bidding price for the wind electricity. This will, to some extent, also impact our consideration on the cost side. Regarding the cost reduction measures in the past, I mentioned some technical ways of reducing the cost. You can see that there are so many measures being taken. Many of the upstream component producers, they may have a more common language to share the numbers with the industry. We're adopting the new material and the new technology adoption.
There are some new ways for us to further improve the work. For example, at the bearing production stage in the past, for the upstream, bearing-like component is a standard bearing-like component. With the new cost pressure, the suppliers started to develop the new solution, which means that it's going to follow the trajectory of the bearing, then to help to provide the corresponding solutions for the post-processing of the raw material. It can provide a similar shape of the finished product for metal bearing and for forging. In this way, it can help to reduce 10% of the raw material consumption, or in other words, it actually improved 10% of the raw material utilization rate. From the processing time perspective, it can also help to shorten around 60% of the processing time. That's just one part or one segment of the processing.
From the technical perspective, I say that at a different stage of the history, we may see some breakthrough technologies, and it will help to contribute to the cost reduction and raw material utilization improvement. On the other side, I also mentioned in 2020, the price of the market, because of the demand over surpassed the supply a lot. The price was up greatly. For this year, we see that the price is recovering. This can actually help to hedging the pressure for the raw material cost improvement. We're also working with the upstream suppliers to make sure that we can do more work for the raw material price forecast, especially when we're taking care of the sourcing price for the commodities. We can leverage the scale effect.
We're going to leverage a few enterprises together to form a centralized sourcing that we can help to reduce the cost to some extent. That's the idea we have regarding using technologies, the business ways to help to reduce the cost. For sure, those are for the so-called direct cost. Well, for the indirect cost, we still need to improve the electricity generation capacity of the turbine to reduce the LCOE, to embrace the challenges in the market. Thank you.
Okay. Well understood. Thank you.
Okay. Thanks for Mr. Cao. Let's have the instructions of dial in , to have the next question.
Ladies and gentlemen, it's already QA time. If you'd like to raise a question, please press star and one, queue for your name to be called. We only support the question from the telephone side. Thank you. Next question come from CICC International, Nelson. Now you can raise your question.
Good afternoon. I have two questions. The first question comes regarding the shipment. In Q1 of this year, the shipment was up by 29% to 1.1 GW. And also share with us for the whole year, and probably it would be around 35 GW-40 GW, and for the whole year development. Is there going to be any changes for our 10 GW shipments of the whole year? Second question is regarding the financials. We can say that in Q1 of this year, the profit before tax was up by 90%, but our income tax was almost being doubled. I'd like to know the reason. Thank you.
Well, regarding the shipment, we forecast it going to be 12 GW. That has already been put into our annual report of last year. The new grid connection would be 12 GW, and that's from the size perspective. Second question is regarding the tax, revenue and the tax or regarding the income tax. To a great extent, it's because our business capacity is being further improved, and we changed the business structure. We pay more tax, and that's the reason, and the tax paid is being doubled. Thank you.
Thanks for Madam Ma for your answer. Let's have the next question, please.
Okay. Ladies and gentlemen, now it's QA time. If you have any questions, please press star and then one, and queue for your name to be called. Thank you. Next question comes from the Yangtze River Securities, Yang Xiao. Please unmute yourself.
Good afternoon. I come from Yangtze River Securities. I have two questions regarding the Q1 release. The first question is that along with the previous speaker, in 2021, our sales is around 1.1 GW, where for the whole year it will be around 12 GW. From Q2 to Q3, what would be the sales plan? My second question is that, talking about our operating cash flow, you can see that in Q1 of this year, and because the sales revenue as well as the raw material cost improvement, we have a less operating cash in Q1 of this year. I'd like to know what would be the situation for the material sourcing, and what would be the plan to confirm the payment. Thank you.
Regarding the wind power industry, a feature is that we have very high seasonality. The wind power farm construction risen in Q1 and Q2, and many work will be on the wind farm construction in Q3 and Q4, and it will work on the delivery of the turbine product and confirm the payment. These two issues are related to the seasonality of this industry. In Q1, we have less operating cash flow because we have some legacy projects that need to be installed in this year. Well, for the whole year, I think we can fit the sales of 12 GW. Compared with the more than 40 GW this year, we're going to see a decrease in sales. From the total installation perspective, this year, the whole industry is going to see a downtrend. That's why our sales is going to be reduced by another 2 GW.
In Q1 also see a slight bounce back. From Q2 to Q3, jointly speaking, we're going to deliver less GW compared with last year. Regarding the development, this year would be called a normal year because last year is a peak installation year. In Q3 and Q4, you're going to see more installations being made, where in Q1 and Q2, jointly speaking, it's going to be lower than Q3 and Q4. Regarding the cash flow, you can see that regarding the operating cash flow, in Q1 it would be a negative number, where for last year due to the peak installation, we have a very good payables and receivables. That's why last year we have a positive operating cash flow. Last year is quite special, where for other years in Q1, the operating cash flow would be negative. It's normal for this year for the operating cash flow to be negative in Q1.
Well, in Q3 and Q4, it's the peak time for the receivables to be made. So I think this year we're going to follow the normal trajectory of the development. Q3 and Q4 would be the peak season for payment to be confirmed. For the whole year, we're going to see positive operating cash flow. I would like to make one more point. The new grid connection wind power would be 12 GW, where the sales would be around 10 GW. Besides 2019 and 2020 for the two peak installation years, in normal years, in H1 and H2, H1 can confirm 35% of the payment, where H2 can confirm 65% of the payment. That's the normal payment ratio we have in H1 and H2. H1 35% and H2 65%. This year we're going to see this ratio again. Thanks.
Thanks for your answer. Let's have the next question, please.
Okay. Next question comes from Ping An Securities. Please.
Good afternoon. I come from Ping An Securities. I have two questions. The first question is regarding the GP margin of the turbine product in Q1. It's 15%. Compared with Q4 last year, is it an increase or decrease? Also, we see some new orders in Q1. It will be around 1 gigawatt. In the near future, are you going to change your strategies of having more orders? The second question is that recently we see the wind power price was down a lot. What's the reason? Is it because the fearless competition or is it because of the technology development lead to the cost reduction and then lead to the price reduction? In Q1, you have many bidding and tendering process, and the projects will be installed next year.
It may take one year, there are so many uncertainties for the bidding and tendering process. How do you consider the bidding price and especially the profitability when you deliver the installation to the client? Thank you.
Okay. In Q1 of this year. The GP margin for turbine is around 15%, the same as H2 of last year. Well, from the order perspective, because for this year, generally speaking, and the tendering, bidding process in the markets was up, especially in terms of the volume. Some of the projects are still waiting for the tendering and the bidding. For the company, we still want to keep our product being competitive in the market and seek for certain profitabilities to stabilize the development. That's our strategy. You also asked about the second question. There are some fluctuations or the price down for the wind power.
We have a few kind of judgment. First of all, we saw it's probably due to the sense of anxieties. This year, China released the peak carbon emission and carbon neutrality goals. Each developer, they have some aggressive plans for the new installation. All in all, they will need to make sure those plans could be delivered. For the new installation and the grid connected project, because for this year, many projects are start from scratch, from approval and to commissioning. This may let people feel pressured for market competition, because we have some legacy projects need to be executed for this year. Well, regarding the total delivery of last year, because last year in H1, the market is being impacted by COVID-19, so many of the installations were done in H2.
If we double the installation for the second half of this year, the whole industry may have a potential of 70 GW. That's a pure mathematic problem. Regarding the 70 GW, a theory number, from a production management perspective, we can already help to hit 70 GW for the whole industry, but still some production lines need to be adjusted. The 2S turbine production lines being switched to high-capacity turbine products. We need to build new capacities and new production lines. In the near future, we foresee that the production capacity won't be a big constraint factor. At the same time, the government can also feel that if there's any kind of technology that is preventing the industry for further development, for example, in the automotive industry, they have the chip shortage and also the localization of the battery.
This will help to improve the market size and volume because we have a new market entrance that can help to break down the traditional technical threshold. Recently, I find out the wind price being reduced on one side is because of the industrial competition. Another reason is because the technical advancement has been clearly foreseen, and based upon such a forecast, and the market was down to some extent, or the price was down to some extent. Thank you.
Thanks for the question. Let's have the next question, please.
Okay. Next question come from Merchants Bank. Xiaoxiao Qi, please. Please unmute yourself.
Good afternoon. Thank you. I have a few questions. We heard about for this year, you have some forecasted installations. Are you going to change your guidance for this year for the new installation? I also heard that during the bidding and the tendering process, some of the projects, they haven't been approved yet, but they started a bidding and a tendering process. Is it mean that the owner of the project, they are worried about the price may go up in the near future? I also would like to see, we switch from a 2S- 3S and 4S turbines. For the wind farms, and is it possible for them to further reduce the cost? How much of the cost would be reduced by switching to the high-capacity turbine? Thank you.
For the owners I'm sorry, I didn't hear the second question very well. Can you repeat the question again?
The second question is that some of the project owner, the project has not yet been 100% approved. It means that they started early in the bidding process before the project being approved. It's because they are worried about whether price is going to be up in H2 of this year or not.
Okay. Three questions. I'd like to answer them one by one. For the new installation, they are going to be 33 GW- 40 GW, and that's the general situation in China. No big changes compared with our previous guidance. Where it's hard for us to see why some owner, they start a bidding and tendering process before the project's been approved. I think there are many reasons in the market. For some of the projects, some of them has already been approved, and some of them are in the queuing base for NDRC to be approved. Where for some projects, they are not 100% being approved by NDRC yet. We see that for the project owner, they probably be more positive for the future market development. It's probably not because the price is going to be up again in the near future.
Well, that's just my judgment and my assumption. They also mentioned about switching to the high-capacity turbine, how it's going to help to reduce the cost. Where we can see some latest product or the cutting-edge product, and they were being built into one platform, and the platform can actually be extended further. Which means it can accommodate larger blades, and the power capacity of the turbine would be further improved. Also they can also accommodate some small blades with higher capacity. From a 4 MW turbine, it can actually be extended to 5 MW turbine, because the platform can accommodate the capacity extension. This can help to reduce R&D cost for the wind farm owner and also provide us a good cost advantage. You say that for the past, many of those platforms, they won't be able to improve the capacity that much.
For example, 2 GW turbine. At that time, we also did the 2+ turbine, and the capacity can only be improved by 50% from 2 MW- 2.2 MW or 2.3 MW. They won't be able to increase to 2.5 MW. The capacity extension is not that good compared with the existing 3S or 4S platform or turbine. When we have a high-capacity turbine, and we can leverage such a trend to help to provide the owners with a very scalable capacity. When the blade is not large enough, it is going to face some of the problems, to make sure that the electricity may not be sustained. We're going to take care of this technical issue.
Next question comes from Ma Keyun from CSCC. Please unmute yourself.
Executive, thanks for the opportunity. Two question from me. First question. This year is also the peak season for the offshore wind farms. What would be the volume for the grid connection? I also would like to confirm with you, because for the new 6S turbines, we have 1.7 GW of the orders. Are those orders being delivered within this year? My second question is that for our whole year, GP margin for the turbine.
Thank you. Well, for the offshore wind farms, the grid connection volume would be around 8-10 GW. For Goldwind, we're going to take care of 2 GW of that. That's our forecast. Well, regarding the offshore wind farms, the order backlog we have need to be delivered within this year. I think other competitors may say the same situation, but for 8 GW-10 GW. I think the tendering bidding of the offshore wind farms installation will be higher, because it seems that market believes this year we're going to have more peak installations for the offshore wind farms. For us, what we can say that from 2020, for the offshore wind farm bidding and tendering and for the production capacity forecast, we believe in the market. The backlog would be delivered within this year.
We talk about the GP margin for turbine products, the same as the previous years, around [18%]. Thank you.
Thanks for the question, and thanks for everyone. Due to the time reason, we would like to have the final question, please.
Okay. Next question would be the final question for the release. Now let's welcome Zhang Jiayu from Guosen Securities.
I have two questions. The first question, we do the wind farm development. I'd like to know the cost for the wind farm development. Are there going to be any difference for north and the south part of China? Well, for the grid parity, what about the IRR? Secondly, the wind farm bidding price was down a lot. How about the turbine product in the grid parity market? Thank you.
Let me share with you my comment on the first question. You can see that we have to leverage the so-called LCOE. For some regions, it can be reduced to RMB 0.1 per unit, where in northern part of China, it can make the LCOE as around RMB 0.2 per unit. Still, there are some difference. You see that in China, we also have some difference. Some plateau areas and mountainous areas for the LCOE, the price can be reduced to RMB 0.3 per unit or even just around that price. In mid and southern part of China, we have a lot of wind resources. LCOE is relatively higher than the northern part of China. That's the number I have. Well, regarding the revenue, compared with the subsidy age, you see that the price was down for the offshore wind farm bidding price.
Also the existing policy will also impact what is going to be in the near future. There are two reasons. First of all, what are the reasonable hours? Within the reasonable hours, generally speaking, we're going to take a leverage price to do the settlement. If it's more than the reasonable hours, then we have to adopt the market-oriented electricity price. For each province, they are quite different. This will also impact the ROI. During the 14th Five-Year Plan, there's also going to be a big change for some high energy consumption enterprises to some extent. They are also going to work with some areas with abundant wind resources. In the past, we talk about the long-term electricity transportation from north to east or from south to north.
In the near future, we're going to do more work and to make sure we will have some long-range transportation of the electricity to take care of the unevenly distributed wind resources. Where at the same time, there are also going to be some high energy consumption areas to relocate our business in the wind abundant area. In this way, it can also help to reduce the energy cost during the transportation stage. The company may benefit from lower LCOE. From the revenue perspective, as I mentioned in different region, that might vary. It would be as low as 6% for the ROI, where some higher one would be more than 8% or even 9%. That's the IRR for the investment, where for the financing cost, it will be different for different company. It actually varies.
Regarding the future trend, on one side, we pay attention to the project owner to see the price change they have because LCOE changes or LCOE reduction would be a certain trend. With the new industrial structure, we're going to see different pricing model at a different time of the day. We may have different power generation capacity. The better it works and for those ones with less accurate forecast, that may lead to the electricity price to be up. Gradually speaking, in the past, 100% are for the leverage electricity price. Other parts are coming from the market-oriented price. I'm not sure whether the market-oriented price would be the mainstream in the near future. In the near future, we're going to just see more market-oriented pricing trends.
With such a backdrop, we can also see that LCOE is also impacting the CapEx and maintenance cost of the wind farms, combined with 2020 and for this year, we're going to see a downward trend. Recently, I see the price level was down because of the shrink. Another part is that I think many of the project owners, they used to see a high price in 2020, and in 2021, the price was down. This will make the price fluctuates. In the longer time, stabilization of the LCOE is a direction we're surely going to hit. Regarding the product building or reducing the LCOE, we will just follow the market-oriented approach to do so. Thank you.
Thanks for the questions, and thanks for the answers. Here comes to the end of the release. For other materials, we will upload them to our official website. Thank you again. Thanks.