Distributed wind power taking off in USA

A new report from the Pacific Northwest National Laboratory of the US Department of Energy analyses the market and opportunities for small and medium scale windpower applications. According to the report, 68% of all wind turbine installations in the US in the last ten years fall into this “distributed power” category. Distributed power, in the context of wind energy, describes turbines that provide electricity to the owner or to operations close to the installation rather than commodity electricity to the grid. By the end of 2012 there were 69,000 turbines in distributed applications with an installed capacity of more than 812 MW across all 50 states.

Industry leaders cited the desire to reduce utility bills as the primary motivation for 2012 domestic small wind turbine sales, along with related concerns over future utility rate increases caused by rising gas and coal prices, and the availability of state incentives. The value of onsite wind generation in providing a hedge against future fossil-fuel price uncertainty was recognized across applications: households, schools, farms, and municipal. To a lesser degree, interest in being environmentally responsible and reducing pollution (including carbon) were cited as reason some customers installed small wind turbines.

The installed costs for small turbines covers a range of $1,500 to $27,500 per kW, with a capacity-weighted average cost of $6,960/kW. The range for mid size turbines is somewhat less broad, ranging from $2,400 to $3,350 per kW with a capacity-weighted average installed cost of $2,810/kW. Assuming a turbine provides power at its rated capacity for 35% of the hours in a year, each kW of turbine capacity will provide 3066 kWh per year. If electricity costs 12 cents per kWh, a turbine will provide $368 worth of electricity each year. Ignoring maintenance costs, this means that a turbine with an installed cost of $2,810 will be fully paid for in less than 8 years, interest not included. While not yet a great return on investment, this is reaching the level of a reasonable ROI.

The 62 page PNNL report provides a wealth of information especially for those thinking of getting into distributed wind power as investors, users, manufacturers, or distributors. It can be found at http://www1.eere.energy.gov/wind/pdfs/2012_distributed_wind_technologies_market_report.pdf

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