Wind power is an important part of the U.S. renewable energy mix. And it's about 2.5 percent of the total U.S. electricity picture.
It's a $20 billion U.S. market -- although 2010 was a rough year for the U.S. wind industry, as might be 2011. The U.S. has installed more wind energy generating capacity than any other nation, although China will soon inherit that mantle.
The lion's share of that wind market belongs to industrial giants like GE, ABB, Vestas, Gamesa, etc., with massive wind turbines in megawatt sizes.
There is also a nascent small wind industry (less than 100 kilowatt turbines) and the U.S. market for small wind is estimated at $80 million, with suppliers such as Southwest Windpower, Marquiss Wind Power, and FloDesign. The stimulus bill includes a credit of up to $4,000 for small wind systems through 2016. Small wind is an important niche but seems more like the domain of gentleman farmers, but without intense subsidies and high electricity prices, it's hard to see small wind as being convincingly economic.
Between those two extremes in scale lies medium wind -- a wind turbine size that a VC-funded startup, Optiwind, is pursuing.
Instead of the massive 3-blade turbines you might envision on the prairie, Optiwind is distributed wind for commercial customers, big box stores, schools, healthcare facilities, or government offices.
Optiwind's towers are about 180 feet tall compared to 400 feet for big wind. They don't need a crane to be erected -- they use a hydraulic system to raise the tower. And instead of blades, there is a series of 5-bladed fans mounted around a cylinder. The cylinder acts to accelerate the wind and allows lower wind speed areas to potentially enjoy the advantages of wind power as well.
David Hurwitt, the VP of Business Development, told me that the cost is currently in the $2.50-per-watt range and can get down to $2 per watt. The lower price stems from a design that doesn't need a gearbox, pitch control or complicated lightning structures. Hurwitt estimates that the price at $2.00 per watt works out to 8 to 10 cents per kilowatt-hour.
The fan blades are injection molded, which reduces the blade cost an order of magnitude, according to Hurwitt. And the shroud around the fans keeps things relatively quiet.
Optiwind’s wind turbines make sense if:
- There is good wind (class 2 or better wind at the site)
- The customer spends between $40,000 to $200,000 per year on electricity.
- There is enough room (depending on local zoning laws, there might be a need for up to 3.5 acres of land beyond the existing structure)
The startup has built and installed its first unit, which is now generating power on a dairy farm in New England. Sites for the next four units have already been permitted.
The business model currently has Optiwind selling the turbine to the end user as opposed to engaging in any project development or power purchase agreements.
The firm started development in 2007, received its original VC funding in 2008 from Charles River Ventures, and is currently looking for investors for its Round B.