Birger T. Madsen, Managing Director of BTM Consult Aps (Denmark), a leading consultancy group specializing in wind power
On a wind farm near Muppandal, Tamil Nadu (India) women dry their saris in the breeze.
The prime motors of expansion are increasing environmental awareness and political commitments to reduce greenhouse gas emissions made under the Kyoto Protocol of 1997. Wind is free and supplies of it are inexhaustible, and when it produces energy it doesn’t release heat or greenhouse gases.
There is enough wind to provide twice the expected global electricity demand for 2020
Wind energy is rapidly
developing as an environmentally sound and cost-effective option for power generation.
Here, one of its champions describes an industry with wind in its sales
It takes
a stiff upper lip not to smile when Don Quixote almost falls off his horse in fright
after mistaking a windmill for a giant. But perhaps the unlikely hero of Cervantes’
literary masterpiece can be credited with foresight. Today’s windmills, dubbed wind
turbines, dwarf their predecessors, as their steely arms slice through the air at
heights of up to 100 metres. More and more of these giants sprout on land and at
sea, and they are gaining new ground in the marketplace. And while at present wind
power provides just 0.15 per cent of the world’s total electricity, it has become
the fastest growing form of energy production.
The basic principles of wind energy have been known for many centuries. The earliest
references to windmills date back to 7th century Persia, but for many the image most
closely associated with wind power is that which gave Don Quixote such a fright:
a picturesque timber tower supporting four long cloth-covered sails rotating in the
wind. Today’s wind turbine consists of a giant propeller fixed on top of a tall metal
pole. When it rotates, the propeller drives a generator which churns out electricity
that can either supply nearby users, possibly in an isolated rural community, or
alternatively be sent down a cable hooked up to a central energy grid. One problem
is that no way has yet been found of storing electricity to enable the wind’s “ups
and downs” to be evened out. The trend is for wind farms to move offshore, where
their appearance and the sound of whirring propellers won’t bother local communities,
and strong and steady sea winds will keep the turbines turning at full force.
For the past 25 years, manufacturers have been streamlining components and installing
on-board computers to tilt the propeller blades, for example, to suit particular
wind conditions. In the early 1980s, the average turbine was 20 metres high with
a 26-kilowatt (kW) generator and a rotor diameter of 10.5 metres. A typical turbine
today may be perched 55 metres high, have rotors with a diameter of around 50-60
metres and a capacity of up to 1,650 kW. The amount of energy it can produce is equivalent
to that consumed by about 350 European households.
Since 1992, more commercial wind farms have been installed in more countries than
ever before. There are now 40,000 turbines in 40 countries, and the world’s wind
energy capacity is growing at nearly 27 per cent annually. In 1998, it topped 10,000
megawatts (MW), about the total energy producing capacity of a country like Denmark.
The 1999 figures are not all in, but we know that 1998 was a boom year for the wind
power industry. Equipment sales topped $2 billion and there were 35,000 jobs in the
sector worldwide. Growth is expected to continue at about 25 per cent a year.
The prime motors of expansion are increasing environmental awareness and political
commitments to reduce greenhouse gas emissions made under the Kyoto Protocol of 1997.
Wind is free and supplies of it are inexhaustible, and when it produces energy it
doesn’t release heat or greenhouse gases.
The European Union has taken the lead in rolling out the “green carpet” by introducing
tax breaks and investment plans aimed at developing renewable energy sources such
as wind power. There are plans to install 40,000 megawatts by the year 2010. Denmark,
the wind energy pioneer, covers 10 per cent of its electricity consumption from wind
power, delivered from an installed capacity of some 1,700 MW. Germany is quickly
catching up, and is now the wind sector’s fastest growing market (see article page
11). Spain, with its ample grazing lands and steady winds, is also soon likely to
be attracting investment.
Rolling out a
green carpet
The climate
in the U.S. has been more volatile. Every two years, a congressional battle erupts
around the renewal of an important tax credit to spur the industry. The same tumult
rattles state legislatures that have their own credit schemes. According to U.S.
energy secretary Bill Richardson, wind power should provide five per cent of the
nation’s electricity demands by the year 2020, compared to the current 0.1 per cent.
For the up and coming energy giants, notably India and China, interest in wind power
has less to do with environmental awareness than with economics. These countries
where broad swathes of the rural population are without electricity are keen to take
advantage of wind investment plans offered by Denmark, Germany and the Netherlands.
With nearly 850 MW installed capacity, India ranks first among developing countries
and fourth in the world after Germany in the wind power league table. About 600 turbines
are churning out 260 MW in China.
Asia and the Pacific used to be considered the coming hot spot for wind power. However,
the region’s financial crisis of 1998 knocked many energy investment plans off course,
with the notable exception of New Zealand’s Tararua Wind Farm–the largest in the
southern hemisphere with a capacity of 12 MW.
Turbines are few and far between in South America, aside from a few installations
in Costa Rica, Argentina and Brazil. Danish manufacturers are making some inroads
into North Africa: Morocco recently installed 50 MW and Egypt 30 MW. The rest of
the continent is in the doldrums, an unfortunate state of affairs given the tremendous
need for renewable energy, especially in rural areas.
While the world’s richest wind resources are found in North America, China and the
former Soviet states, particularly those in Central Asia, we believe that wind power
could provide at least 20 per cent of every continent’s energy needs. There is enough
wind to provide twice the expected global electricity demand for 2020. Even if only
10 per cent of energy needs were met by wind power, the world would be spared about
10 billion tons of carbon emissions (out of a total of 60-70 billion tons). To achieve
this goal, 120 times more wind capacity would have to be installed than there is
today. The initial investment required would be very high, but operation and maintenance
costs would be marginal.
Manufacturers today are building bigger and better turbines, and as a result wind-power
prices have been falling at about 20 per cent over the past four years. In Denmark,
for example, electricity generated by wind power cost almost 17 cents per kilowatt
hour (kWh) in the early 1980s. The figure, which covers all costs (equipment, labour,
interest on loans, operation and maintenance) fell to 6.15 cents by 1995 and has
since dropped to about 4.6 cents. Meanwhile, electricity produced by the installation
of a new coal-fired power plant would cost 5 to 6.4 cents kWh, 4 and 5.7 cents kWh
in the case of a gas-fired plant, and 4.6 to 6.5 cents kWh in a nuclear facility,
according to calculations by UNIPEDE, the European Utility Association.
But while the cost of wind-powered electricity will continue to fall in the future,
competitive prices are not enough–there must be a political will to develop the
market. Developing countries often find it difficult to raise the capital to cover
the steep start-up costs of installing wind turbines. This is the downside of wind
power. The initial costs of installing coal-fired plants, for example, are relatively
cheap but fuel then has to be imported and in the long run this carbon-based energy
will cost more than wind energy. If these countries are to develop an environmentally
sound energy sector using wind power, they will need help in finding the initial
investment.
The situation is radically different in North America and Western Europe, both of
which have enough installed energy capacity to meet demand. In these countries the
market for wind energy is driven by environmental considerations rather than economics.
If governments do not adopt “green policies” requiring utility companies to close
down classical power plants and switch over to renewable energy sources, the market
for wind power will not be very dynamic.
Green parties are stepping up the pressure on governments to promote clean energies
by helping to fund R&D costs, for example. Other measures that could be taken
include subsidizing electricity payments or offering tax credits and low-interest
loans for manufacturers. The “polluter pays” principle might also be applied, with
a special tax being levied on carbon-emitting energy producers, as opposed to a clean
energy source such as wind.
A ‘doped’ market
Some argue that
a truly promising energy source should not require government support. Others maintain
that subsidies will do more harm than good by distorting the energy market and artificially
boosting what remains an unpromising alternative. I would argue the contrary–that
gas, coal, oil and nuclear energy have been “doped” on state subsidies from the start.
Many power companies using these fuels began as state monopolies protected by national
legislation. They control the power grids. Often they bar new energy producers from
the grids or impose rules which oblige newcomers to sell their energy at unfair prices.
The development of wind power has also been hurt by the absence of legislation. For
example, the UK has the best wind resources in Europe, but commercial attempts to
set up wind farms in the last three years were stymied when local authorities failed
to issue permits for turbine construction. Had the national government set up guidelines
and policies inciting local authorities to co-operate, there might be more wind farms
in Britain today.
The two notable champions of wind power are Denmark and Germany. Ferociously anti-nuclear,
the public in both these countries studied their energy options before giving wind
a “green light”. Their diligence is now paying off at home and abroad, as their turbines
blow a fresh breeze into global energy production.
