The Business of Harvesting Wind Energy

Imagine a farm that grows nothing but pure green energy.

 
While haunting Associated Content, Fuel Ghoul was struck down by an article penned by Chrissy Coleman about the business of owing and operating a wind farm in California. Entitled ‘Eco-Friendly Windpower in Calfornia's San Gorgonio Pass’, this article takes a fresh perspective on alternative energy;  Chrissy outlines the economics of owning a wind farm, the costs, the technology, and the business in California.

Readers here in Canada will remember that Enbridge Inc. plans to start construction this summer on a major wind-power project in Bruce County (now that the Ontario Municipal Board has overruled residents fearing noise and unsightliness). In fact the Ontario Municipal board just ruled in favour of the project this week. The 182-megawatt project, one of the largest wind farms in Canada, is expected to be completed by the end of next year.

 
With that development in mind, let’s look at Windtec, nestled in the Coachella Valley just southwest of Palm Springs. Here the San Jacinto Mountains form a natural wind tunnel that powers 4,000 windmills collectively producing enough electricity on the average to power a city the size of San Francisco. Chrissy Coleman’s article interviews Jack Norie, of Windtec, who reports that electricity generated by wind turbines in the San Gorgonio Pass is sold to Southern California Edison at the rate of 6 cents per KwH.

The size of the property dictates how many windmills can be placed on the farm for maximum power and profit generating efficiency. Each windmill is spaced 4 wind blade diameters apart (~700 feet) to maximize the wind power so that each windmill does not steal wind from the next one, similar to the way a sailboat can steal wind power from a boat in front of it.

"Make no mistake about it, wind farms are a business. Once the original investment is paid off, it's pure profit," explained Norie. The cost of a modern windmill is approximately $1.5 million per turbine but the investment cost breaks even between 4-6 years of operation. The average life of a windmill is about 25 years. Once installed, the only additional cost is semi-annual maintenance to grease and wash the blades and any unanticipated repairs. He estimated Windtec's annual profit margin to be roughly between $350,00-400,000.

 
Everyday the eight plus wind farms in the valley sell electricity to the city – everyday these ‘farmers’ watch their dials and gauges and calculate their ROI. The goal of wind power generation design is aerodynamic efficiency and total cost of return. Unlike classical Dutch designs, or the Spanish versions that Don Quixote tilted, modern wind turbines have just three blades. Norie notes, ‘[that] is the best way to capture wind power." He added, "A fourth blade could be better for generation, but the cost of maintaining it exceeds the cost of investment." Fuel Ghoul finds the math fascinating.

Chrissy's article highlights the newer wind turbines that have variable pitch changing blades that rotate slightly to face upwind to maximize wind efficiency and minimize instability that places extra force on a windmill's 200-foot tower and its 80-foot implanted foundation. The anemometer, or wind speed sensor, senses adequate velocity and direction of incoming winds and will adjust the blades to maximize power generation. The first and second-generation models of stable blades were only 60% efficient on capturing wind power compared to the third and fourth generation variable pitch blade turbines, Norie said.

Other times, the wind may be too strong and the anemometer will cause the blades to slow down, or in extreme winds, to shut down completely. Too much wind can burn out a wind turbine's generator and place too much force on the tower. Over time, this can lead to repair costs.

Likewise, the choice in materials is based on return of investment. Windmill blades are made out of fiberglass because it is relatively inexpensive compared to other materials like Kevlar and Titanium that could generate more power. "A set of three blades made out of fiberglass costs ~$60,000 while a set composed of other materials can cost up to ten times as much. The profit return is just not feasible at that point," Norie explained.

 
Fuel Ghoul found Chrissy's article very revealing. He now asks, why doesn’t Ontario Hydro license independently owned wind farms in this province? ANSWER - They do. But its not something that's advertised or actively encouraged at any level... Here is Wikipedia’s list of ten wind power installations run outside of Ontario Hydro that contribute over 500 MW daily,

1. Prince Project  (Owned by Brookfield Properties).                     189 MW
2. Erie Shores - Port Burwell, (Clean Power Income Fund)                99 MW
3. Melancthon I,                                                                        67.5 MW
4. Kingsbridge - phase 1 (Owned by EPCOR)                                39.6 MW
5. Huron - Kincardine,                                                                 9.0 MW
6. Ferndale,                                                                                1.8 MW
7. Pickering                                                                                1.8 MW
8. WindShare, Toronto waterfront,                                              0.8 MW
9. Port Albert, (adjacent to Kingsbridge)                                      0.7 MW
10. Tiverton,                                                                              0.6 MW

 
Fuel Ghoul’s message to readers – if you have one hundred million dollars to spend, build a wind farm north of Toronto and sell power directly to Brampton and Barrie, two of the fastest growing cities in Canada. If readers would like to discuss this proposition, please join the discussion 'How will rising gas prices affect society?' at Wonder Cafe.ca.

Comments

[scruss]

I think that one of the main reasons that Ontario Hydro doesn't promote these wind farms is that Ontario Hydro hasn't existed since 1999.

Its successor organizations are all over it: OPA (http://www.powerauthority.on.ca/Page.asp?PageID=924&SiteNodeID=234), IESO (http://www.ieso.ca/imoweb/marketdata/windpower.asp), Hydro One (http://www.hydroone.com/en/electricity_industry/renewable_tech/). OPG only has one wind farm (Huron Wind, co-owned with Bruce), as they are prevented from competing in the provincial process. Even the Ministry of Energy is in there (http://www.energy.gov.on.ca/index.cfm?fuseaction=renewable.wind).

It would be very hard to sell power directly to a city in this province's energy market. Gotta share it.

[Rob Campbell]

You are right Scruss. All of the points you raise are valid. 'Details, details'

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Wonderful post. Very informative, indeed! Keep it up!

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