[pagebreak:A Balloon in the Wind (Market)]

[Editor’s note: This story is part of a six-article series about small wind. Click here, here, here, here and here to read the rest.]


Pierre Rivard stands inside a metal airship hanger nearly three football fields long, looking on as helium is pumped into a prototype of his company’s floating wind turbine.

“This is an historic moment,” says the CEO of Magenn Power, a 200-foot-high ceiling above him.

The Canadian startup is attempting to dramatically shift how wind energy is captured, and the TCOM flight-test facility in North Carolina – a WWII-era building that Rivard calls “the Mecca of big airships” -- is the only place large enough to conduct an indoor test of the Magenn Air Rotor System.

The system, carrying the acronym MARS, is a ground-tethered and oddly designed blimp that generates electricity by spinning on a horizontal axis in the wind. Rivard, during a cell-phone interview at the test site, described it as a floating white sausage mounted with riverboat blades.

The sausage in question is designed to float between 600 and 1,000 feet above ground. When fully commercialized, it will have power capacities ranging from 10 kilowatts to several megawatts, the company claims.

“This is a world’s first, there has never been a rotating airship test done before,” said Rivard, taking in the moment. After a 12-year stint at fuel-cell developer Hydrogenics, the soft-spoken executive joined Ottawa-based Magenn in August to become its president and chief executive officer.

“As I talk to you, this whole envelope in the past 20 minutes has formed,” he enthused. “It’s almost totally formed now, like the birth of a new child.”

Rivard’s job is to help that child grow. In October, the company raised $5 million from California-based Quercus Trust, an investment vehicle for mathematician-turned-philanthropist David Gelbaum.

The reclusive multimillionaire has been on a greentech investment spree lately, buying up stock in alternative-energy companies and throwing tens of millions of venture dollars into clean-energy startups – a list that includes algae-to-biofuel developer LiveFuels and solar-hydrogen generator Nanoptek.

Despite Gelbaum’s generous investment, Magenn already has its eyes on a second $12 million round later this year. At TCOM, the push is on to finish testing the prototype before the company moves the system to a remote outdoor location, where it will be demonstrated later this month to a broader audience.

“We would like to bring in customers and investors who have already expressed an interest in seeing it,” said Rivard, who wants to finalize agreements to raise more capital by the summer.

This will be followed closely by four demonstration projects, each at a unique site. The first will be an industrial project, likely with a big mining company using wind to replace the diesel that currently is flown in, Rivard said. Other locations under consideration include a Caribbean island, a national park and a farm community.

The MARS can be filled with any lighter-than-air gas, including hydrogen, methane and argon, to lift it above the tree line. The company will come out of the gates with a 100-kilowatt model aimed at remote industrial sites, such as offshore oil rigs and mining operations, before expanding into commercial markets.

Eventually, Magenn hopes to make mass-market models that people can take camping or use at their cottage, or which developing countries can use for rural electrification projects. “But that’s on the backburner for now,” Rivard said.

He’s not promising a system that’s cheaper than conventional wind turbines – at least not right away – but hopes to sell the MARS based on its superior performance.

“With a conventional turbine, you typically have a utilization ratio of 20 to 25 percent," he said, "but with us, because we go higher, you have more constant and stronger winds, so the utilization ratio is more like 50 percent.”

Magenn wouldn’t be the first company to pursue such lofty heights. California’s Sky WindPower Corp. and Kite Gen Research of Italy have also designed “high-altitude” wind systems that are tethered to the ground. Another California venture, Makani Power, raised $10 million from Google.org in 2006 to help develop a kite system that taps winds in the jet stream.

[pagebreak:Continued: Balloon]

“Some of these will come through,” said Joshua Magee, a wind analyst with Emerging Energy Research. But he said he doubts they’ll get much consideration from the conventional wind-turbine manufacturers, which have settled on a standard design that leaves little room for improvement.

The industry, Magee added, is more focused these days on deployment and keeping up with demand. “That’s not to say there’s not room for a radical new technology, potentially in the near future, but ultimately the global wind game at this time is one of implementation.”

Magenn was founded in 2004 by Fred Ferguson, 58, a leading authority on airship engineering and past consultant for Lockheed Martin Corp. and the U.S. government’s “Star Wars” defense program. It was during the 1970s and ’80s that Ferguson invented and eventually patented the Magnus Airship, a blimp designed to rotate as it moves forward in the air. This rotation allows the airship to gain lift, a phenomenon known as the Magnus Effect.

“It’s very much what you see with golf balls and baseballs,” Rivard said.

It wasn’t until 2002 that Ferguson realized his airship concept, in addition to improving the mobility of blimps, could be used as a way to produce renewable power by tapping the faster and more consistent wind speeds at higher altitudes. Electricity generated by the spinning motion of the blimp would be transmitted to the ground through its conducting tether. Ferguson researched the idea, and two years later Magenn was formed.

Skeptics initially dismissed the company’s idea as nothing more than neat pictures on a cool Web site, even as Ferguson and then-chief executive Mac Brown touted their first product release for late 2006. They wondered how, for example, such a device could be floated so high without getting in the way of airplanes, or what would happen if a hurricane or some other high-wind storm hit. There also was no evidence of a working commercial prototype. 

The 2006 date came and went with no product launch, and Magenn’s Web site grew out of date, fueling even more skepticism.

“Individual investors should stay away from this company” warned Jack Uldrich, in his recently released guide called Green Investing. “Magenn offers nothing other than a promising idea.”

But the Quercus Trust funding, followed by the hiring of a seasoned and disciplined executive like Rivard, has given Magenn a second wind, with Brown now chief marketing officer and Ferguson remaining chief technology officer.

Rivard figures he’ll need to be creative to gain initial traction in the market. He’s considering the possibility of a MARS fleet deployed and owned by Magenn, which would use a power-purchase-agreement model to sell the electrons to its first customers. He envisions floating wind farms similar in scale to what we see today on the ground. “One thing that excites me is the megawatt-plus potential of this technology.”

And he’s not too concerned about raising the capital to do it.

“We get approached by a lot of investors, so we’re quite blessed,” he said. “There’s a lot of interest in California where IT money is being recycled into cleantech, and that seems to be where most of our leads come from.”