Public Power - January/February 2009 - (Page 28)

■ Grand Ambitions for Wind Power would have been dismissed out of hand, but today, given the urgency of climate change and the rapid emergence of a global supply industry for utility-scale wind turbines, the idea is taken seriously. “The 20 percent goal is not unreasonable and is being driven first and foremost by the need to diversify the generation fuel mix for electricity in the United States,” said Jennifer Tripp, principal and executive consultant of R.W. Beck, Inc. Ed DeMeo, president of Renewable Energy Consulting Services, and one of the key contributors to the DOE report, sums things up: “The 20 percent target is achievable, but not guaranteed. There are four major questions. First, is there enough wind around the country? Yes, plenty. Second, can the country afford it? Yes, it might be marginally more expensive than expanding our conventional fuel mix, but that’s before recognizing reductions in natural gas prices for all gas consumers and savings in likely costs for carbon emissions. Third, can the transmission system handle it? Not readily. Improved access for renewable power sources is also a critical issue. And fourth, can the power system handle the uncertainty and variability of wind? With operational adjustments, almost certainly so, based on European experience and recent analytic studies here and abroad.” The 20 percent wind scenario would require U.S. wind capacity to increase from around 17 GW today to over 300 GW by 2030, based upon EIA’s projected growth in electricity demand of 39 percent between 2005 and 2030. The DOE report, “20% Wind Energy by 2030”, shows a graph with a steeply climbing ramp of capacity additions to reach the 2030 target. By 2014, for example, the United States would need to add around 10 GW per year of new wind; by 2016, nearly 14 GW; and by 2018, it would level out at around 16 GW per year through 2030. This means that within 10 years we would need to add the equivalent of today’s total installed wind capacity every year. Achieving this sounds implausible, but actual installations through 2008 are ahead of this theoretical curve. The potential benefits of this much wind power are manifold. According to the analysis in the DOE report, it would reduce 28 January-February 2009 “The 20 percent goal is not unreasonable and is being driven first and foremost by the need to diversify the generation fuel mix for electricity in the United States.” electric sector carbon dioxide emissions by 825 million tons annually. It would reduce water use by the electric sector by 8 percent. It would create new income streams for rural landowners and tax revenues for local communities. And it would create more than 250,000 new jobs in financial services, manufacturing, engineering, construction and transportation. While wind resources and markets are inherently local, the wind turbine business has become a thriving global enterprise. Vestas, a Danish company with more than 35,000 wind turbines installed worldwide, is the global leader in manufacturing. GE Energy is second in capacity installed, but is the only U.S. company among the top 10 internationally. Germany has three in the top 10, Spain two, China two, and India one. Those from China, Goldwind and Sinovel, as well as Suzlon from India, are relatively new players. Most of these companies have set up satellite manufacturing facilities in other countries, including the United States, to serve local markets and to avoid the added cost of transporting large components, such as 120-foot long turbine blades, to the installation sites. Domestically, according to DOE’s Annual Report on Wind, GE Energy remains the dominant player in the wind turbine business with 44 percent of the U.S. marketplace for utility-scale turbines. They accounted for 2,342 MW of additional wind capacity in 2007. Vestas from Denmark was second in the United States, with 18 percent of market share, followed by Siemens of Germany with 16 percent, Gamesa Energy from Spain at 11 percent, and Mitsubishi of Japan with 7 percent. Component manufacturing by all of these players is now widely dispersed throughout the United States, with more than 100 facilities actively involved, according to the American Wind Energy Association. Longer term, AWEA estimates more than 15,000 U.S. companies have product lines, ranging from polymers to bearings, relevant enough to diversify into the wind energy business in the future. Globalization would seem to answer one of the key questions looming over the DOE 20 percent scenario: whether turbine production keeps up with surging demand. Bottlenecks for some components and component assemblies, such as gearboxes, large bearings and large castings, are already apparent, and the rapid growth in demand has created a seller’s market leading to price escalation in recent years. Randy Becker, a senior director at R.W. Beck, said there has been a five-fold increase in the number of utility-scale turbines installed in the last five years and that vendors are looking at two possible strategies to secure their supply chains. “Some are pursuing vertical integration, buying up gearbox manufacturers, blade factories, forging factories, etc., while others are pursuing more traditional supply chains, trying to contract with a limited number of suppliers,” Becker said. The bottlenecks seem short-lived, given the burgeoning opportunities now drawing entrepreneurial talent and finance. “Newer manufacturers tend to come in on the smaller end of the wind turbine business, oftentimes with innovative machines, such as vertical-axis ‘egg-beater’ machines, downwind machines, and two-bladed machines,” Said Becker. At the other end of the scale, Ed DeMeo pointed to a new entrant, a California-based company named Clipper that is now developing some of the largest machines in the United States. “They are Public Power

Table of Contents Feed for the Digital Edition of Public Power - January/February 2009

Public Power - December 2008 Contents Perspective 10 Questions Heat or Eat? Achieving Excellence in Nuclear Operations Training Grand Ambitions for Wind Power Visions of Green Carbon Trading Across The Pond Reliability Green Energy Customer Service DEED Hometown Connections Parting Shot

Public Power - January/February 2009

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