By Nick Blitterswyk, CEO, UGE International.
Nick Blitterswyk, the founder and CEO of UGE International.
A group of Senators recently urged the US Department of Energy to continue funding programs for the domestic distributed wind energy industry. The bipartisan group, led by Sen. Al Franken, wrote a letter highlighting the clear potential for distributed wind power to “contribute many gigawatts of electricity similar to other renewable technologies.” Reactions have been mixed, and that’s understandable. The distributed wind industry has faced a good deal of critique (some of which is warranted). Nevertheless, the Senators are correct: Distributed wind is a useful technology, with useful applications, and stands to benefit from the increasingly attractive economic conditions for distributed generation.
Choppy beginnings
When distributed energy took off over the last five years, small wind got caught flat-footed. The reason was primarily because it hadn’t reached a level of maturity where it could take advantage of the changing tide. As a result, there were several cases of companies manipulating incentives and hawking shoddy products on unsuspecting customers (and lest this become an anti-China argument, virtually all such products came from US and European companies). One of the better known examples was DyoCore, which made lofty claims about the power of its SolAir turbine in order to game California’s Emerging Renewables Program. California actually received so many complaints about the company that it cancelled the entire program.
Early failures like these were possible because standards and certifications hadn’t yet been established in the distributed wind industry. And though the DyoCores of the world eventually failed, these early companies and their stories damaged the reputation of even the best small wind products on the market, greatly holding back the industry.
2011 was when the wind started to come out of the industry’s sails (and yes, pun intended). The economy had tanked, and solar prices were gaining economies of scale, making small wind expensive by comparison in a market where customers were holding their wallets more tightly. But just like with solar, distributed wind has continued to evolve and innovate. The technology and business models have continued to advance, the industry has consolidated, and as the senators noted in their letter, the distributed wind power industry is at the threshold of rapid commercialization.
The future of small wind: Worth investing in
Economic conditions are increasingly attractive for all distributed generation. In just a few short years, distributed wind has changed dramatically. There are fewer players, and the standards are much tougher as the SWCC, in the US, and comparable certification programs around the world, have reached maturation. The technology has advanced — and has a wide variety of applications. You’re not going to find distributed wind atop 20% of rooftops, like you will already with solar in Australia, but you will find that the modern technologies from the companies that remain in the industry — the strongest, best run ones with the best technology, and with better economies of scale — will start gaining a resurgence.
Distributed wind has particularly great potential in applications such as:
- Farms: A 10kW or larger turbine can be installed in windy locations and produce energy at a rate less than that available from the grid, or in farms in remote regions with difficulty accessing the grid.
- Northern and Southern regions, from Scandinavia to Patagonia: There are limitations to solar resources during the winter months at the poles, but wind is a great resource in most of these areas.
- Hybrid installations: Particularly in off-grid situations, a mix of energy sources adds resiliency and lowers the cost of energy.
This list also doesn’t include the many forward-thinking businesses and consumers who want to support and benefit from the technological advancements in the industry, and who have also been a key customer base for distributed wind turbines. Many of these projects, from Lincoln Financial Field in Philadelphia to Whole Foods in Brooklyn, inspire greater interest in sustainability and emerging technologies that shouldn’t be overlooked.
The importance of investment
The small wind industry began its life far too dependent on incentives and government funding. But limiting or eliminating development of the industry would be a huge mistake. R&D has developed the technology significantly in the past several years, and with certifications and standards in place, as well as new business models that remove financial barriers and mitigate performance risks, there’s additional efficiencies to explore. The US has a strong advantage in the field, and the DOE’s support will be essential for distributed wind to “cross the chasm” and find its footing amidst Cleantech 2.0 — an era with much promise for new business models and advanced distributed generation. A group of senators understands this — I hope the rest of the industry will follow suit.
About the Author: Nick Blitterswyk is the CEO and founder of UGE International, a leading developer of distributed renewable energy solutions for business and government, with projects in over 90 countries, including several for Fortune 1,000 companies.
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