I heard a news story the other day about the growth of the small wind industry. It reminded me of a short paper I wrote for one of my graduate courses last year. My goal for the paper was to do a simple techno-economic analysis of one of the latest small wind devices marketed to home owners. The short conclusion - small wind is not yet economically attractive to the average home owner. The following is the full paper. MS Word isn't the best at converting to HTML, so pardon the shabby formatting.

Abstract

The small wind industry in the US grew by 15% in 2009 [1], helped in large part by a new renewable energy tax credit (up to 30% of total installed cost) [2]. Over 100 MW of small wind capacity is now installed throughout the US [1]. To find out what all the fuss is about, this report takes a look at the state of the art of small wind technology. It contains analysis on how the technology differs from conventional wind turbines, and evaluates the merits of small wind based on economic analysis.

This report focuses on the Honeywell WT6500 2.2 kW wind turbine as a subject of study. This turbine has a multi-blade patented design that allows it to generate electricity at very low wind speeds (as low as 1 m/s) [3]. The idea behind the design is that residential wind speeds are usually very low and conventional wind turbines cannot generate electricity at those low wind speeds – thus the WT6500 can fill the residential market niche. Since the author is from Michigan, a wind profile from a nearby weather station is used along with the turbine power curve to calculate energy output estimates for four turbine heights: 10 meters (corresponding to the manufacturer-suggested rooftop mounting), 18 meters (mounted on an off-the-shelf pole, 30 meters (mounted on a higher off-the-shelf pole), and 43 meters (mounted on an off-the-shelf lattice tower).

It was found that the WT6500 had a capacity factor of 6.3% at the lowest height (10 m) and 11.3% at the highest height (43 m). In the low wind speeds of central Michigan, the WT6500 is not able to produce enough electricity to be economically attractive. The lowest levelized cost of electricity was calculated to be $0.340/kWh with the 30-meter pole. Even though more electricity is produced at the higher 43-meter height, the larger guyed lattice tower is much more expensive and significantly increases the levelized cost. The average wind speed that would be required to generate enough electricity for the WT6500 to pay for itself over its 20-year lifetime is approximately 8 m/s at 30 meters. In the US, this average wind speed is only available in a very small percentage of on-shore locations and otherwise only available offshore.

While small wind electricity generation may be attractive to some environmentally conscious people or off-grid applications, it is not currently a good investment decision for the vast majority of Americans. This assessment is unlikely to change anytime soon unless installed costs decrease substantially or new technology allows for significantly increased energy output in low-speed wind regimes.

1 Introduction

1.1 Trends in Residential Small Wind

Small Wind in the US [1]

· The industry grew 15% in 2009

· Over 10,000 small wind turbines totaling over 20 MW of capacity were installed in the US in 2009

· Half of the world market share of small wind is in the US

Small residential wind turbines (generally those less than 20 kW) are used for a variety of applications in varying environments. The most common uses are to generate residential electricity in both on-grid and off-grid locations, charge batteries, and pump water. There is now over 100 MW of small wind capacity installed in the US, 99% of which are conventional 3-blade horizontal axis design [1]. The table above presents several other facts about the small wind industry in the United States.

1.2 Goal and Scope

The purpose of this report is to present findings from a simple techno-economic assessment of a small residential wind turbine. For a specific location, the author calculated the amount of energy produced from the turbine at various hub heights. Cost information is presented and a corresponding levelized cost of electricity was determined for the various heights considered. Problems with small wind are discussed, including what might be needed for cost-effective operation of a small wind turbine.

1.3 Wind Turbine

In order to analyze the state of the art of small wind technology, the author endeavored to find a recently designed wind turbine made by a reputable manufacturer. There are over 90 small wind turbine manufacturers in the US, with a large majority being start-ups [1]. The Honeywell WT6500 wind turbine, rated at 2.2 kW, was selected for this study. The turbine is shown in Figure 1.

Figure 1 – Honeywell WT6500

2.2 kW wind turbine

The WT6500 was designed in partnership with WindTronics, Inc. The manufacturer claims that its unique multi-bladed design and novel technology will create more electricity at lower levelized cost than similar-sized turbines. Legitimacy is given to these claims by several other reputable organizations – The United Nations Industrial Development Organization, Edison Awards, Popular Mechanics Magazine, and Handy Magazine have all given awards to the WT6500 for innovation. And though no turbines have yet been installed, it was scheduled to be available for sale across the US at major hardware stores starting in August 2010.

The idea behind the WT6500 is that residential wind turbines are usually at low heights with relatively low wind speeds. In order to take advantage of a broader range of wind speeds and thus generate more electricity, the WT6500 is designed to have a much lower cut-in speed than a conventional turbine. Whereas most conventional small wind turbines have a cut-in speed of around 3-4 m/s, the WT6500 can start generating electricity with wind as low as 1 m/s with the help of 10 blades. The power curve of the WT6500 is shown in Figure 2.

Figure 2 - Power curve for the Honeywell WT6500 wind turbine

The WT6500 is also unique in that it does not have gears or a generator in the central hub. Instead, each nylon blade is tipped with a magnet. As the blades rotate, DC current is generated in the ring that encases the blades. This design reduces overall mechanical resistance. The WT6500 is a relatively small 1.8 meters in diameter and weighs only 77 kg [3]. It also contains a passive yaw design (side flaps) that allow it to always face the wind. The WT6500 has a designed lifetime of 20 years and a retail price of $5995 USD.

The wind turbine is marketed as a “rooftop” turbine, and comes with a roof-mounting kit. However, it can also be mounted on a tower. Three towers intended for this purpose, and sold online at Bergey.com, were priced and selected as options for mounting this turbine [4]:

· 18 meter galvanized steel pole with guy wires & raising kit: $2,230 USD

· 30 meter galvanized steel pole with guy wires & raising kit: $3,080 USD

· 43 meter galvanized steel guyed lattice tower & raising kit: $17,200 USD

The WT6500 also comes with a “smart box” which contains a controller, inverter, battery management system, wind measurement system, and a communication port that can be used to feed data to your computer. Although batteries can be used to store excess energy, they are not included in the scope of this assessment since a net-metering arrangement is assumed.

1.4 Location

The author selected his home town in Shiawassee County, Michigan as the location to place the wind turbine. The software program RETScreen^® provided monthly average wind speed data at a height of 10 meters from a nearby weather monitoring station. The table at right shows the average wind speeds for this location. The average residential electricity price in Michigan is $0.118/kWh, slightly above the national average [5]. The average home in the region uses 10,479 kWh of electricity annually [6].

Michigan has a net-metering law that applies to renewable energy sources less than 20 kW. Utilities credit the consumer’s monthly bill according to the previous month’s electricity generated. This credit applies up to 100% of the household’s total annual electricity consumption [7]. For this reason, it is assumed that all electricity generated from our turbine will be used or sold to the grid at the same retail rate. Furthermore, the United States has implemented a renewable energy tax credit, which essentially rebates a consumer 30% of the total installed cost of a residential renewable energy system [2]. This credit is included in the analysis of this turbine.

2 Analysis

2.1 Wind Speed Data

The wind speed data obtained from RETScreen^® is ok to use for the 10-meter “rooftop” analysis, but the wind speed for the other heights had to be calculated using the following wind shear formula:

Where v_ref is the wind speed at 10 meters, z is the desired height, z_ref is the reference height (10 meters), and z₀ is the roughness length [8]. The roughness length is determined by defining the roughness classification of the surrounding terrain. Roughness class is a scale from 0 to 4 with general landscape descriptions as a guide. Roughness class 2 is described as “Agricultural land with some houses and 8 meter tall sheltering hedgerows with a distance of approximately 500 meters” [9]. This description most closely resembles the location of the wind turbine. Roughness class 2 corresponds to a roughness length (z₀) of 0.1 meter. Wind speeds were calculated for each height.

2.2 Power & Energy Calculations

The power curve data from the turbine manufacturer was combined with the wind speed data calculated above to obtain the corresponding average power output and annual energy converted to electricity at each hub height. As expected, the energy output increased with hub height. The lowest “rooftop” height resulted in an annual production of 1223 kWh, or about 12% of an average US household’s consumption. The highest hub height resulted in an annual production of 2178 kWh, or 21% of an average US household’s consumption. Figure 4 shows the calculated electricity production at each of the 4 studied hub heights.

Figure 3 – Annual electricity production at 4 studied hub heights

2.3 Economic Analysis

In order to analyze the economics of the WT6500 installation, the price data of the turbine and towers was used, along with the estimated installation cost (including turbine installers and electrician). These costs as well as some other key assumptions are listed in the table above.

First the total upfront cost was calculated for each hub height scenario. This amount was annualized over 20 years using the capital recovery factor. And finally the annualized amount was divided by the annual energy production of each scenario to obtain the levelized cost of electricity production for each hub height. Figure 5 shows the results of these calculations. As expected, the upfront cost increases with increasing hub height.

Figure 4 - Up-front installation costs and levelized electricity costs for
various installed hub heights.

Notably, you can see how the cost increases substantially on the highest hub height. This is because the guyed lattice tower is much more expensive than the steel pole towers. The corresponding levelized cost for the 43 meter height is accordingly very high at $0.695/kWh. The levelized cost is about the same for the 10 meter and 18 meter heights, at about $0.380/kWh. The lowest levelized cost occurs at the 30 meter height with $0.340/kWh. Compared to the current electricity price of $0.118/kWh in Michigan, the lowest levelized cost is almost three times higher.

2.4 Problems with Small Wind

The most obvious problem with small wind is cost, as shown above. The lowest levelized cost scenario is about $3400/kW of installed capacity. Compare that to large commercial wind turbines, which can be installed for as low as $1200/kW [10]. Further, residential turbines must function in lower-speed wind regimes because of height limitations. Since available power is a function of the cube of wind velocity, the available energy is drastically lower. Higher costs combined with lower energy production puts small wind at a significant disadvantage in the marketplace.

Another problem with the small wind industry is that there is no official scheme for independent testing of devices. Large commercial wind turbines are rigorously tested and rated before they can be sold to utilities, but no such protection exists for small wind. With many new manufacturers and rapid industry growth, consumers run the risk of buying low-quality equipment that doesn’t last, or equipment that does not perform as claimed by the manufacturer.

Lastly there is the problem of measuring available wind energy wind speed in residential areas. Many small wind manufacturers, like the Honeywell WT6500, are marketed to be installed on the rooftop of a home. In reality, using wind data from an equivalent height is not necessarily accurate. The flow and turbulence of wind flowing around a house with sharp corners is not easily measured, and good measurements are essential in order to predict energy production and evaluate a potential investment. Engineers have found the Computational Fluid Dynamics (CFD) software can successfully model the airflow on a house, but this is a complex and expensive process [11]. Overall, the accurate measuring of wind speed is a significant hurdle in evaluating an investment in a rooftop turbine.

2.5 How Can Small Wind Work?

In order to better understand the conditions under which small wind could be economically attractive, the author looked at two hypothetical scenarios that affect the levelized cost. The first scenario is changing the wind speed to find out what type of wind regime would be necessary for the investment to make sense at its current price. The second scenario is to lower the cost to find out how much the WT6500 would need to cost in order to lower the levelized cost to grid parity.

For the first scenario, the author used MS Excel^® to determine what average wind speed would cause the levelized cost to reach $0.161, which is the average projected price of electricity over the next 20 years, assuming 3% inflation. If the cost reaches that amount, that means the investment will approximately pay for itself over the 20 year life of the turbine. This is the break-even point at which the investment may start to make sense to more people. It turns out that the average wind speed needed at a height of 30 meters to reach this target is 8.05 m/s. This corresponds to a wind speed of 8.77 m/s at 50 meters and wind class of 7 (the highest). The next step is to find what regions of the United States have that much wind. Figure 5 shows a wind resource map of the United States, divided into wind classes [12]. As you can see, the blue regions of class 7 wind are very small, and include small regions of Wyoming, Montana, and Alaska. Installing the WT6500 wind turbine in one of these high-wind areas would be required in order to reach the break-even point over 20 years.

Figure 5 - Wind Resource map of the United States [12].

The second scenario is lowering the turbine cost. In order to hit the same break-even point over 20 years using the Michigan wind data, the total installed cost would have to go down to $2593 USD. At $1179/kW, that’s roughly on the same order as large commercial wind turbine installations. That is a 65% reduction in price. So either the manufacturing cost has to drastically decrease (either through mass production or improved methods) or subsidies have to drastically increase in order for make small wind to make better economic sense.

3 Conclusion

Small wind technology, and specifically the Honeywell WT6500, can and does fulfill niche markets for the environmentally conscious and for off-grid environments. However, it is not an economically attractive option. Based on the wind data obtained for Michigan from RETScreen^®, the best option for installing the WT6500 turbine is on a 30-meter pole at a cost of $7472 USD. In this scenario, the turbine will generate 1916 kWh of electricity annually, at a levelized cost of $0.340/kWh. From a cost perspective, the author recommends not installing this turbine at any height.

The main problems with small wind turbines are relatively high cost, lack of consumer protections, and difficulty in measuring or estimating residential wind speeds. In order to make the investment in the WT6500 installation break even over its 20 year life, the turbine would either have to be placed in a class 7 wind regime, or have the turbine price reduced by 65%. Unless large technology improvements drastically increase energy conversion or bring down manufacturing costs, the unattractive economics means small wind will likely remain a relatively small niche market for the foreseeable future.

References

[1] Inside Renewable Energy. 2010. Small Wind: Evolution or Revolution? Renewable Energy World. [Online] March 31, 2010. [Cited: June 23, 2010.] http://www.renewableenergyworld.com/rea/podcast/play/small-wind-technologies-an-evolution-or-revolution.

[2] DSIRE. 2010. Federal Incentives/Policies for Renewables & Efficiency. Database of State Incentives for Renewables & Efficiency. [Online] February 18, 2010. [Cited: June 21, 2010.] http://www.dsireusa.org/incentives/incentive.cfm?Incentive_Code=US37F&State=federal%25C2%25A4tpageid=1&ee=1&re=1.

[3] WindTronics. 2010. WT6500 Wind Turbine. EarthTronics. [Online] 2010. [Cited: June 21, 2010.] http://www.earthtronics.com/honeywell.aspx#videos.

[4] Bergey. 2010. Products and Prices. Bergey. [Online] 2010. [Cited: June 21, 2010.] http://www.bergey.com/.

[5] USEIA. 2010. State Ranking 12. Electricity Residential Prices, March 2010. US Energy Information Administration. [Online] June 24, 2010. [Cited: June 24, 2010.] http://tonto.eia.doe.gov/state/state_energy_rankings.cfm?keyid=18&orderid=1.

[6] USEIA. 2009. 2005 Residential Energy Consumption Survey - Detailed Tables. US Energy Information Administration. [Online] January 2009. [Cited: June 24, 2010.] http://www.eia.doe.gov/emeu/recs/recs2005/c&e/detailed_tables2005c&e.html.

[7] DSIRE. 2010. Michigan - Net Metering. Database of State Incentives for Renewables & Efficiency. [Online] May 27, 2010. [Cited: June 22, 2010.] http://www.dsireusa.org/incentives/incentive.cfm?Incentive_Code=MI15R&State=federal&currentpageid=1&ee=1&re=1.

[8] DWIA. 2003. Roughness and Wind Shear. Danish Wind Industry Association. [Online] June 1, 2003. [Cited: June 24, 2010.] http://guidedtour.windpower.org/en/tour/wres/shear.htm.

[9] DWIA. 2003. Roughness Classes and Roughness Length Table. Danish Wind Industry Association. [Online] May 12, 2003. [Cited: June 24, 2010.] http://guidedtour.windpower.org/en/stat/unitsw.htm#calc.

[10] Windustry. 2010. How much do wind turbines cost? Windustry. [Online] 2010. [Cited: June 24, 2010.] http://www.windustry.org/how-much-do-wind-turbines-cost.

[11] Watson, SJ. 2007. Predicting the yield of micro-wind turbines in the roof-top urban environment. Warwick Wind Trials. [Online] December 11, 2007. [Cited: June 23, 2010.] http://www.warwickwindtrials.org.uk/resources/Microwind.pdf.

[12] NREL. 2008. Wind Resource (50m) of the United States. NREL. [Online] December 12, 2008. [Cited: June 21, 2010.] http://www.nrel.gov/gis/images/map_wind_national_lo-res.jpg.

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Saturday, March 26, 2011

Small Wind Energy System Characteristics