|October 23, 2007|
Renewable Energy: Blowing in the Wind!
|Vancouver, Canada (GLOBE-Net) -- With a 32% increase in global capacity in 2006, high market demand, and low operating costs, wind power, one of the world's largest sources of renewable energy, has an enticing dollar value for equipment manufacturers, wind energy suppliers and for the end user. In 2006, global capacity in wind power increased to 15,197 Mega Watts (MW), enough to supply energy to 22.5 million homes, and is expected to increase to 171,000 MW by 2015. Despite an industry wide backlog of large wind turbines, wind energy has been described as a hot market. This article is the second of a GLOBE-Net series on renewable energy -- focusing on wind energy, its advantages and disadvantages. |
Worldwide, countries are endorsing the increased use of renewable energies, with wind power leading the way. The urgent need to deal with climate change impacts and the rising costs of fossil fuels have positioned wind power as a cleaner and more cost competitive alternative, providing energy at an operational cost of approximately 10 cents per kilowatt hour (kWh).
Currently, 65% of wind power generation is in Europe. The United Kingdom has initiated the London Array Project (LAR) which will make the U.K. owners of the largest offshore wind power farm. The project is intended to generate 20 gigawatts (GW) of power, supplying 17% of the energy demands of the country and to help the U.K. achieve green house gas emission targets. With five existing offshore wind farms in the U.K., the LAR has begun creating ten additional farms and plans for eight more are in development. The project is a 4 billion dollar investment in wind power by the U.K. government.
Germany and Spain, the top two markets for wind energy in 2006, are showing rapid growth. By reaching the 2,000 MW thresholds in wind energy, these two countries achieved in seven and five years what took Denmark 16 years to achieve. Currently 10.2% of Germany's power is generated by renewable energy with the intent to increase it to 21% by just 2010. Wind power in Spain currently contributes 9% to annual power generation.
China, which intends to generate 14% of the worlds wind energy by 2020, added a new innovation to the wind power market in 2006 by revealing the first Maglev wind power turbine. Maglev wind turbines, which boost power generation 20% over traditional turbines and reduce operation costs by up to half, can generate power in winds as slow as 1.5 km per hour. The technology has the potential to expand the use of wind power to regions of a low average wind speed, creating a larger market for wind farm development.
In Canada, $736 million of its GDP was generated from the wind power industry in 2005, a 65% growth over 2004. Canada currently has over 1,200 MW of wind energy capacity and, according to the Canadian Wind Energy Association, 1,200 jobs in the wind energy sector. By 2015 Canada's capacity is expected to reach 10,000 MW.
Although Alberta is the current Canadian leader in wind power generation due to strong support from the oil industry, it will soon by passed by Ontario and Quebec. In Ontario, 415 MW are generated from wind power farms with another 5000 MW proposed for operation in 2015. Ontario has plans to achieve 15,700 MW in renewable energy capacity by 2025. The province of Quebec plans to add 2000 MW by 2015 investing over $3 billion into the project.
Prince Edward Island is working towards 200 MW of capacity from wind power by 2010 and generating 30% of its power needs from renewable energy by 2016. Similarly, New Brunswick is moving to achieve 400 MW of wind power capacity by 2010 and one third of energy from renewable sources by 2016.
Through the Wind Power Production Incentive, the Canadian government plans to subsidize one cent per kWh to the providers of wind energy in its first 10 years of use.
With many projects in the works and having one of the best wind resources on the planet, Canada has been named one of the top ten countries for attracting investment in wind power with big deals being made. Ireland's Airtricity Inc. purchased the Toronto based Gale Force Energy, which is in the midst of developing 4,000 MW of capacity nationwide. The Canadian Hydro Company purchased Vector wind energy, creating Canada's largest wind energy firm.
The global demand and investment in the wind power market is no different. It has experienced rapid growth, climbing 42% in 2005, 30% in 2006 and 25% expected in 2007. However with wind power expected to double by 2011, there pressure on the supply chain. The high demand for wind turbines is causing a shortage of parts such as blades and gearboxes. Many manufacturers are securing parts orders early to ensure projects can be completed upon approval.
The current wind market appears very stable, with 10 companies representing 95%, there is little chance of new contenders. The backlog, reaching into 2009 ensures a steady client base, with new orders continually coming in.
The money in wind power is not just contained to large scale wind generation projects and big business. Land owners are cashing in, leasing property for wind farms. Small wind generators for residential use are also making headway, generating revenue for suppliers and saving money for the end user. Canadian companies like Plastiques Gagnon and Entegrity Wind Systems are major players in the domestic market.
With an installation cost of $8,000 to $10,000, a small wind generator can pay itself back in 5 to 12 years depending on wind conditions of the area. A personal wind generator can save $800 or more per year for homeowners by generating power during periods with adequate wind speed. During of no wind, electricity would be supplied by the utility company as per usual.
Periods of no wind are an issue that is being addressed. This is important for Canada's wind energy development as wind patterns are unpredictable. Maglev wind turbines are a step in the right direction, but there are some other creative solutions.
Two facilities exist in Iowa which store pressurized gas to be released in periods of inadequate wind. Several companies are thinking of combining hybrid vehicles with wind power, by having the vehicles hooked into the grid when not in use (estimated at 95% of the time). There is also the option to store surplus energy from wind and solar until needed.
What was once thought to be an energy source with many limitations, wind power is showing no lack of innovation and no sign of slowing down. It is looking to be the most significant player in a sustainable energy future with only problems in the supply chain to slowing it down.
More information on Maglev wind turbines.
To view a list of financial articles on the wind energy market.