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United States: Small Wind Power — Finding Its Place in the Renewables Market

Published at: Dec 12, 2011
source: http://news.thomasnet.com/green_clean/2011/12 ...
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Certainly big wind is making impressive strides. But another less-visible trend is emerging, embedded in that burgeoning capacity — the installation of small wind systems.

 

As wind energy expands its market penetration around the world, the projects that get the most press are the “big wind” installations — the Roscoe Wind Farm in Texas, with its 627 turbines and its 781.5-MW (megawatts) capacity; the Clyde Wind Farm in Scotland, 152 turbines, 548 MW; the Macarthur under construction in Australia, with 140 turbines at 420 MW.

Wind is growing rapidly: Global installed wind capacity topped 194 GW (gigawatts) in 2010, according to the Global Wind Energy Council (GWEC). (Photo: Installing a small wind turbine at a factory, Indianapolis, Indiana. Credit: Rob AnnisCC BY 2.0.)

Certainly big wind is making impressive strides. But another less-visible trend is emerging, embedded in that burgeoning capacity — the installation of small wind systems. The American Wind Energy Association (AWEA) defines a small wind turbine as one with nameplate capacity of less than 100 KW (kilowatts). The adoption of small wind systems is being driven by several factors, including greater awareness of wind power as a renewable alternative, government incentives, and recognition of the opportunity offered by wind power in particular communities where utility rates are high and wind is abundant.

Global Small Wind Adding 152 MW Per Year by 2015

Pike Research, a firm specializing in clean technology markets, says its recent research shows that, globally, small wind power generation “is an increasingly important part of the broader market for renewable distributed energy generation.” In a company announcement, the firm forecasts that

[T]he global market for small wind systems will more than double between 2010 and 2015, rising from $255 million to $634 million during that period. Within the same forecast horizon, small wind system installed capacity additions will nearly triple to 152 megawatts, and average installed prices of small wind systems will decline to just over $4,150 per kilowatt.

Pike sees the expansion of small wind as part of a larger trend toward distributed power generation, characterized by smaller generation sources more widely distributed, especially the kinds of sources it calls “RDEG,” renewable distributed energy generation. The firm’s research report says that

The global electric power industry is evolving from a financial and engineering model that relies on large centralized power plants owned by the utilities to one that is more diverse — both in sources of generation and ownership of the generation assets. Concerns about global warming and finite fossil fuel supplies are creating demand for clean, sustainable energy supplies. Small wind and other RDEG technologies represent a growing part of the new model for the electric power industry…

Small wind and other RDEG technologies contradict the traditional one-way power supply, as well as the traditional relationship utilities have with their customers. The transition to a more distributed system of power generation will require the evolution of both technologies and business practices.

Pike’s company announcement outlines the chief market drivers for this trend:

[G]rowth in the industry is being driven by increased government incentives and an expanded awareness of small wind technologies as an alternative source of electric power. Other market drivers include the desire for customer and community ownership of power generation and the recognition that investment in small wind turbines can be an enduring source of economic development for the rural locales in which they are typically deployed.

The research report also highlights high electricity prices as a driver for small wind adoption, as well as the inherent opportunity that arises when local consumers and businesses in well-situated communities recognize that they enjoy favorable wind conditions that make generation feasible.

 

Pike identifies “community ownership” as an important trend in small wind turbine deployment. Under this model, local farmers, businesses, municipalities, or other end-user groups create an entity that enters into a power purchase agreement (PPA) to sell power to the local utility. This model is common in some European countries and is emerging in the U.S. Midwest, especially Minnesota and Iowa. (Photo: Launch of the Hepburn Community Wind Farm, Victoria, Australia. Credit: Hepburn WindCC BY 2.0.)

Pike’s senior analyst Peter Asmus, one of the report’s authors, says that “The payback period for a small wind system can be 5 to 10 years in a region with adequate wind resources,” and that “Small wind turbines are currently more efficient than solar photovoltaic (PV) systems and, therefore, more economical from a levelized cost of energy perspective.”

U.S. Small Wind Reached 179 MW in 2010

The AWEA’s “2010 U.S. Small Wind Turbine Market Report” says that the U.S. small wind turbine market installed more than 25 MW in 2010, bringing the total installed capacity for small systems in the country to 179 MW. The market is growing quickly. The 25 MW represented a 26 percent increase over 2009 and a 12-fold increase in annual sales revenue just over the past five years. 144,000 small wind turbines are now operating in the U.S.

 

While the AWEA and Pike researchers consider a small wind turbine to be anything 100 kW capacity or smaller, in reality most small turbines are considerably smaller than that. Barely 4 percent of the small turbines sold in 2010 were larger than 10 kW. However, AWEA emphasizes that the trend is toward larger, grid-connected units. The report says that 1,074 roof-top (or “urban”) small wind units were sold in 2010. This is a fast-growing market area as well.

AWEA points to some of the same market drivers for the U.S. as Pike identifies for the world market. Particularly important are government incentives:

The primary market drivers for all renewable energy resources, including small wind, are federal, state and utility financial assistance programs: rebates, tax credits, grants and other incentives… These federal incentives, when combined with state rebates, grants, tax credits and favorable financing, dramatically improved the economics of smaller-scale wind generators in the U.S.

Rising electric rates are making wind power more competitive in some markets. In other markets, the rising rates, while still lower than the cost of renewables, are making businesses and consumers nervous:

A fear that rates will continue to climb has many citizens looking for ways to generate their own power — or at least a portion of it. Some larger users such as municipal government operations, schools, and factories view a long-term investment in a wind turbine as a way to lock in their energy costs for the life of the turbine, which is typically 20 to 25 years.

Configuring Small Wind Systems

The nameplate rating of a wind turbine tells you how much power that turbine generates at a certain wind speed. So if a turbine is rated 100 kilowatts (kW) at 30 miles per hour (mph), that turbine will generate 100 kW, but only when the wind speed is 30 mph. The nameplate only provides a rating; that rating doesn’t say how much power the turbine will generate at any particular site.

 

A small-wind system can be either grid-connected or off-grid. The U.S. Department of Energy (DOE) says that a grid-connected system can be practical in an area with average wind speed of at least 10 mph. Such a system can be cost-effective if utility-supplied electricity is relatively expensive, say 10 to 15 cents per kWh (kilowatt hour), and if the cost of connecting to the grid is not prohibitively expensive. It also helps if the current situation offers good incentives for purchasing a turbine or for selling excess electricity to the grid (i.e., net metering).

DOE says an off-grid small-wind system can be practical if average wind speed is at least 9 mph and if grid connection is not available or would be too expensive. (Running power lines to a remote area can range from $15,000 to $50,000 per mile.) A stand-alone wind-power system like this will require additional “balance-of-system” equipment, which could include things like storage batteries, a charge controller, power conditioning equipment, meters, and instrumentation.

The AWEA report says that small wind systems typically have rotor diameters of up to 70 feet, or 21 meters (for a 100 kW turbine), which would describe a swept area of 350 square meters. Towers are usually less than 150 feet tall, or 46 meters. Such systems “are primarily used for on-site generation at homes, farms, public facilities (e.g., schools) and businesses.”

AWEA surveyed turbine manufacturers about system costs and found that installed costs average $5,430 per kW. Operations and maintenance costs seem to vary considerably, ranging from .5 cents to 5 cents per kWh, depending on the manufacturer. Some manufacturers estimate costs on a yearly basis. Residential-scale turbines are estimated at $200 to $700 per year. Larger 100-kW units are estimated at $2,500 to $3,500 per year.

 

 

 

 

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