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SUSTAINABLE ECONOMY WINDPOWER – AN OVERVIEW Wind energy is becoming a booming industry around the world, wherever supportive policies are put in place. Global capacity is increasing by 30% a year, and the prospects for offshore wind are enormous. Global Overview In 1999, the world required 3.1 terawatts (3.1 million MW) of generating capacity to produce the electricity it needed. 62% came from burning fossil fuels, 19% from hydro, 17% from nuclear, and 1.5% from renewables - solar, wind, biomass and geothermal. Over the last 5 years, global wind energy production has grown by an average 30% per year. At the end of 1998, global capacity was 10,000 MW. By 2001 it had reached 24,000 MW. In 1998, the European Wind Energy Association published Wind Force 10: A Blueprint to Achieve 10% of the World’s Electricity from Windpower by 2020, which allowed for a projected doubling in global electricity demand. To reach the 10% goal, the Association set a wind energy target of 1.2 million MW – a 50-fold increase over the 2001 level. Comparative Costs The cost of onshore wind energy has fallen by 80% since 1990 to 2 –4p/kWh, comparing favourably with electricity from natural gas (3 – 3.5p) and coal (2.5 – 3.8p; if environmental and health costs are included, this rises to 3.8 – 5.8p/kWh). Most of the cost of wind energy occurs during installation, after which the energy is free, so a ‘levelized’ cost is calculated to include the capital terms, interest rate, construction, institutional factors, and operations and maintenance, divided by the estimated lifetime output over 20 years. A turbine’s output depends on location and wind speed. Europe’s best on-land resources, where wind speeds reach 8 – 10 metres/second, are in upland Ireland and UK, Greece, parts of Spain, and the Canary Islands, followed (7.5 m/s) by west Denmark and coastal Germany. Cost decreases with scale. Electricity from a 3 MW wind farm may cost 4p/kWh, falling to 2.5p/kWh from a 50 MW farm. The cost has fallen by 15% with each doubling of worldwide capacity, due to technology improvements, efficiencies of scale, increased energy production per unit, larger machines, and the falling cost of capital as investors gain confidence. The new 2 MW turbines are 100 metres high, with 70 metres diameter blades turning at 20/30 rpm. A 4.5 MW turbine is on its way from the German company Enercon. Wind Energy Around the World Denmark developed the technologies, policies, and grassroots support which laid the foundations for the wind energy revolution. The Danish Wind Turbine Guilds (LEDIS E203) overcame many obstacles in the late 1970s and early 1980s before the government established the policies that gave investors the price stability they needed, enabling the industry to take off. By the end of 2001, Denmark had installed 2400 MW, supplying 18% of its grid. This will rise to 21% by 2003. Danish companies export 55% of the world’s wind turbines, creating 17,000 jobs; Denmark’s goal is for wind energy to supply 50% of the grid by 2030; on some winter nights in western Denmark it already supplies 50% of the grid. However, the new right-wing government which came into power in 2001 moved the Ministry of Energy from its home in the Ministry of Environment to the Ministry of Economics and Industry, cancelled plans for 3 new offshore wind farms which were to be built from 2004-2008 (arguing that Denmark was ahead of schedule), and withdrew all funding for climate and energy-related NGOs. Denmark’s energy policy is still intact, but the signs are not good. Germany leads the world in wind energy production, having adopted Denmark’s successful policies. In 2001, they added 2,650 MW, for a total of 8,750, meeting 3% of the grid. Their goal is 25% by 2025, the majority of which is to come from offshore resources. Argentina is planning 3000 MW of wind energy for Patagonia over the next 10 years; China plans to install 2500 MW by 2005, and has the potential for 253,000 MW, chiefly on the Mongolian plateau, 100 km north of Beijing. In the USA, where production has been supported by a 1p/kWh Production Tax Credit, activity is expected to jump following the renewal of the credit for another two years. Installed Capacity, 2001 Germany 8,750
MW Economic Development Manufacturing and installation creates 6 jobs per MW, so each 100 MW project produces 600 full-time jobs; for each direct job created, an additional job is created in associated sectors (planning, etc). Ongoing operations and maintenance create another 1-5 jobs per 5 MW, Germany has created around 44,000 jobs in its wind energy sector. In Europe, where 90% of the world’s turbines are manufactured, wind energy was a £600 million business in 1998. In the USA, it has been estimated that wind energy creates 27% more jobs per kilowatt hour than coal, and 66% more jobs than natural gas. A 100 MW installation may typically generate around £350,000 in local purchases. Most wind energy projects are financed by big investors, but Denmark has shown that a different model is possible, through the formation of local guilds, non-profit partnerships of wind turbine owners. By pooling their capital, guild members invest in local wind turbines. In 1999, 50% of Denmark’s 3,200 turbines were owned jointly by 67,000 guild members, bringing significant economic benefit to Denmark’s rural areas. The other 50% were individually owned, A similar model may emerge in North America, where prairie farmers stand to gain by becoming direct or cooperative investors. North Dakota, South Dakota, Kansas and Texas have enough wind energy to provide 25% more electricity than the entire US grid, while in Canada, southern Saskatchewan and Alberta have similar potential. If farmers lease their land to wind plant investors, they can earn £1,050 - £1,400 annually for 30 years for each large-scale turbine on their land. A 1,000 acre farm with 10 turbines will earn up to £7,000 a year for the loss of 25 acres of farmland, compared to £700 an acre from crops. A Southwest (Minnesota) Regional Development Commission study found that the local ownership of 100 MW of turbines, compared to leasing, would create 25 – 150 more jobs and add £500,000 to £3 million to the local economy. In Iowa, where the Elementary School at Spirit Lake is powered by a 250 kW turbine, the local school board earns £17,500 annually from the sale of excess power. If the farmers invested directly, instead of leasing, they could reap this kind of dividend for themselves. Offshore Wind The biggest wind energy story, however, lies offshore, in water depths up to 50 metres. A 2000 study by the German Wind Energy Institute found that Britain, Belgium, Holland, Germany and Denmark have an offshore wind resource in the North Sea that is three times larger than their total electricity consumption. The technology is ready (large 1.5 - 3 MW turbines), turbulence is lower, and the wind blows more persistently over water (9 hours a day vs. a typical 6.4 hours on land), providing 30% - 40% more energy per turbine, making up for the added cost of installation and underwater grid connection. Offshore wind parks can also be larger, and the turbines lower, so the price of energy may fall from the current 5p/kWh to 3.5p/kWh. 87 MW of offshore wind energy has been installed in Europe, and 5,000 MW is planned or under construction. Ireland is planning a 520 MW wind farm in the Irish Sea which will provide 10% of Ireland’s electricity needs; Belgium is planning a 100 MW farm between Ostend and Zeebrugge; Britain has granted 18 offshore leases to wind farm developers, and is projecting a minimum 3,250 MW by 2010; Holland has two projects proposed, for 220 MW; Denmark is planning 4,000 MW by 2030. The European Wind Energy Association forecasts the development of 50,000 MW of offshore capacity by 2020. Europe’s offshore wind potential has been estimated at equivalent to the entire EU electricity consumption. Canada is also getting into the act, with a planned 700 MW wind farm on the west coast, east of the Queen Charlotte Islands. The way to realize the resource, according to Soren Krohn, President of the Danish Wind Turbine Manufacturers Association, is to put offshore wind farms out for public tender on long term purchasing contracts. Policy Measures There are many barriers to the successful development of wind energy, including prejudice, misinformation, and opposition from vested interests. When the right policies and supports are in place, however, the market takes off, as Germany, Denmark and arguably the UK show. Looking at Europe’s collective experience, the "best policies" include: (a) Comprehensive
wind-mapping, research and development; Environmental Concerns Where there is good public consultation with regard to siting, concerns about noise and visual pollution have generally proven unwarranted; if siting is poorly planned, due to inadequate consultation, noise can becomes a problem, and local objections will arise. Concerns about bird deaths have largely disappeared with the larger turbines, slower blade speeds, and proper site consultations with ornithological societies. Danish offshore projects which were researched by biologists revealed a large increase in fishing yields, attributable to the fact that the turbine foundations act as artificial reefs, attracting marine flora and fauna. Wind and Climate Change If wind replaces coal-fired power generation, 1 MW of wind energy will eliminate 2,260 tonnes of CO2. Denmark estimates that wind energy can deliver 33% of its 22% CO2 reduction target by 2005; if Britain, Belgium, Holland, Germany and Denmark use just 1% of the North Sea’s offshore potential to displace coal until 2012, this will reduce 186 million tonnes of CO2 a year, equal to 10.3% of their current emissions. The Future As global concerns about the costs of climate change rise, and the economics of wind power continue to improve, it is reasonable to expect that wind energy will take off all over the world. The accepted wisdom has been that since the wind does not blow all the time, no more than 20% of a grid’s energy can come from the wind. As the number and spread of wind farms increases, however, the intermittency is spread over a larger number of turbines, lessening the problem. Surplus wind energy can also be stored in hydro-electric dams, or converted into hydrogen for use in the world’s future transportation fleet. The European Wind Energy Association’s goal for wind energy in Europe is 60,000 MW by 2010 (5,000 MW offshore), and 150,000 MW by 2020 (50,000 MW offshore). Their goal for the world is 1.2 million MW by 2020, generating 10.85% of the world’s electricity. So far, all of their goals have been met ahead of schedule. (1884 words) For further information contact : British Wind
Energy Association Fax: 020 7402
7107 Written by Guy Dauncey, Victoria, B.C., Canada, author of "Stormy Weather: 101 Solutions to Global Climate Change" (New Society Publishers, July 2001, distributed in the UK by Jon Carpenter Books, Oxford) |