Earth and Industry » wind energy

John Deere Backs Out of Wind Energy Business

Timothy B. Hurst — Tue, 07 Sep 2010 12:00:32 +0000

Deere & Co., (NYSE: DE) the parent company of John Deere, said last week it would be selling off its energy division.

Deere said it will sell its wind power division, called John Deere Renewables, including all of its farms in eight states, to energy giant Exelon Corp (NYSE: EXC) for $900 million. The deal calls for $860 million now, plus an additional $40 million once all of Deere's projects currently under construction are completed. The purchase of the wind farms will be bring an immediate source of revenue to Exelon as 75 percent of the electricity generated by the wind farms are already contracted out via power purchase agreements.

Exelon's acquisition of John Deere’s wind power projects is the utility's first foray into wind farm ownership.

Exelon, known more for its focus on nuclear power, currently owns more nuclear generating capacity than any other company in the U.S. The company's 10 plants and 17 reactors represent a full 20 percent of the country's entire nuclear fleet.

Photo: Some rights reserved by johnnyalive

Indian Wind Energy Giant Suzlon Could Invest $1.6 Billion in UK Factory

Mridul Chadha — Wed, 04 Aug 2010 15:46:10 +0000

India's largest wind turbine manufacturer Suzlon Energy is in talks with British officials to invest $1.57 billion to build a wind turbine manufacturing facility.

While the details about the talks are still stretchy, such an investment makes perfect sense for the company. Sulzon Energy (NSE:SUZLON) bought European wind energy major RePower in December 2009 to expand its presence in developed countries. The acquisition helped Suzlon grab almost 10 percent of the global market share and made it the third largest wind turbine manufacturer.

Suzlon is already the market leader in Asia. Founded in 1995, Suzlon has pioneered in manufacturing low-cost turbines and has expanded operations in North & South America, Europe, Asia and Australia. Over the years, the company has made several acquisitions in order to build an integrated supply chain to provide complete wind energy solutions.

Suzlon has made the most from the consistent growth of wind energy infrastructure development in India and the company continues to hold a strong order book. However, the company did face problems as it ventured into new markets like the United States. In 2008, the company suffered a major setback when several instances of blade failures were reported in the turbines it had exported to the US. Consequently, the company saw many orders cancelled or truncated and its stock took a steep plunge. Suzlon invested more than $100 million to retrofit these blades.

The company has been facing fierce competition from the Chinese manufacturers which have sprouted during the last few years. Chinese companies now look to buy domestic wind turbines which cost then a fraction of what Suzlon offers. Since Europe is the hub of cutting-edge wind energy technology, the move to invest in a manufacturing hub in UK seems to be a wise move. The company would have access to the lastest testing facilities and expertise in Europe.

Wind tunnel testing of wind turbine blades is a crucial aspect in the wind turbine development. Suzlon has no wind tunnel testing facility of its own in India and rents such facilities from government institutions which are not readily available, leading to delays. Europe has several wind testing facilities which can come handy for research and development of new designs.

The company would also look to grab a share in the rapidly-growing British wind energy market. Wind energy market grew by a whooping 31 percent as compared to 20 percent growth in the overall renewable energy sector. The British and Scottish governments have ambitious renewable energy targets and look to increase the wind energy's share in their energy mix.

The move to build a manufacturing facility in UK is another step in a series of strategic deals around the world. Such moves would help the company grap crucial share in the new and developing markets and help it develop high quality products using better R & D facilities.

Hat Tip: Bloomberg
Photo by nateOne/Flickr/Creative Commons

The views presented in the above article are author’s personal views and do not represent those of TERI/TERI University where the author is currently pursuing a Master’s degree.

Google Energy Inks Wind Farm Deal, Now Officially a Utility

Timothy B. Hurst — Tue, 20 Jul 2010 21:10:38 +0000

Google says buying 114-MW directly from Iowa wind farm will free up renewable energy developers for new projects.

When Google was first given the go ahead by the Federal Energy Regulatory Commission to buy and sell electricity in February, we knew they were planning something big in the clean energy space, we just didn't know what it would look like. Today, we're beginning to see the plan unfold.

Google announced today that it will begin a 20-year Power Purchase Agreement to buy 114 megawatts of wind energy generated at NextEra Energy Resources' Story County II facility in Iowa. The agreement, set to begin on July 30, is the first by Google Energy LLC and it allows Google to buy the renewable energy directly from its source, rather from a retailer in the form of renewable energy credits (RECs). Because Google cannot use the energy directly, it is reselling it back to the grid in the regional spot market and retiring RECs associated with the power.

"We depend upon large quantities of electricity to power Google services and want to make large actions to support renewable energy," writes Google's Urs Hoelzle, Senior Vice President for Operations, at the Official Google Blog. "As we continue operating with the most energy efficient data centers and working to be carbon neutral, we’re happy to also be directly purchasing energy from renewable resources."

The energy purchased in the new deal is enough to power several data centers, according to Hoelzle.

Google is in an excellent position to give the wind industry a much needed boost right now. With the capital to dive-in to long term power purchase agreements for electricity the company needs now and knows it will need more of in the future, Google believes the move will free up capital for the developer to build more wind projects.

In May, Google invested $38.8 million into two wind farms already operating in North Dakota. The three wind farms generate a total of 183.5 megawatts of electricity and are part of Google's clean energy strategy to invest directly in the research, development and deployment of clean energy and energy efficiency technologies that will ultimately make renewables cheaper than coal.

Follow Tim Hurst on twitter @ecopolitologist

US Bank Forces Indian Firm to Build 250-MW Solar and Wind Power Plant to Offset Coal Emissions

Mridul Chadha — Mon, 19 Jul 2010 01:01:47 +0000

One of India's leading power generation companies, Reliance Power, has agreed to set up a 250 MW solar-wind energy power plant in exchange of a $600 million loan from the US Export-Import Bank.

The power plant which is expected to come up in the western coastal states of Gujarat and Maharashtra would be a mix of solar and wind farms. The plant would be set up in accordance to an agreement reached between the US Ex-Im Bank which is required to review the environmental impact including the carbon footprint of the project they provide financial help for.

Reliance Power will set up a 3,960 MW coal-fired power plant at Sasan, Madhya Pradesh with an investment of more than $4 billion. The Ex-Im Bank is required to study the environmental impacts of the projects they are going to finance before approving the loans. Since the coal-fired power plant is an ultra-mega power project the carbon emissions from it will be highly significant.

Reliance Industries, then, not only had to agree to to cap the carbon emissions per kWh to 850 grams but also build a 250 MW power plant to offset at least a part of the plant's carbon footprint. The deal would also help a Wisconsin based company, Bacyrus International which will provide mining equipment to Reliance Power. The deal would save about 984 jobs in 13 states across the United States.

Coal-fired vs. Renewable-based Power Plants

Ultra-mega power projects are the need of the hour for India as it struggles to keep its economy on the path of accelerated growth. Since these power plants work at extremely high temperatures as compared to conventional coal-fired power plants their efficiency is higher, that is, more power for even unit of coal used. Additionally, coal is among the cheapest sources of power generation in India.

Even though the size of the renewable energy power plant is less then ten percent of the coal-fired power plant, it has several advantages of its own.The company would be free of forge Power Purchase Agreements with transmission companies and power exchanges. This would enable the company to charge a premium for power generated from the solar-wind power plant.

Coal reserves in India are of poor quality and are in short supply and many companies are looking for imported coal. However, the Indian government, which maintains are stronghold over coal mining and coal export-import, would avoid becoming dependent on foreign fuel supplies. On the other hand, fuel availability for a renewable energy power plant is infinite while the fuel cost is nil.

And while the coal-fired power plant would attract taxes, including the coal tax, the renewable energy power plant is likely to earn tax incentives from the government. The coal-fired power plant would also be required to meet efficiency standards as the government would attempt to honor its commitment to reduce the country's carbon intensity.

The coal-fired power plant could also be roped in for the energy efficiency certificate scheme which would work in a manner similar to the cap-and-trade scheme.

All in all, the setting up of a renewable energy power plant of such a large size would bring benefits not only to the environment but also to the company. This is a significant development for international energy cooperation as well given that the United States had opposed the financing of coal-fired power plants in developing countries.

Given the fuel supply constraints, tax liabilities for the coal-fired power plant and the tax benefits and flexibility power sale, the tariffs from renewable energy power plant could become more attractive in the long term.

Hat tip: Business Standard
Photo Credits: f/stop at Flickr/ Creative Commons; © Jan Cerovsky | Dreamstime.com

The views presented in the above article are author’s personal views and do not represent those of TERI/TERI University where the author is currently pursuing a Master’s degree.

India’s Tata Planning a ‘Nano’ Wind Turbine to Boost Distributed Power Generation

Mridul Chadha — Tue, 06 Jul 2010 14:46:55 +0000

Tata, one of the largest business groups in India is planning to launch innovative clean energy technologies in rural areas as it plans to grab the opportunity of India' rapidly expanding power sector.

The Tata Power Company, a subsidiary of the Tata group, plans to test a 2 kW wind turbine which would generate enough electricity to meet the basic demands of an small rural home. With several thousand villages still not connected with the national grid this micro turbine could prove highly beneficial.

The 2 kW turbine which can be mounted on rooftops would be enough to power multiple ceiling fans (rated 60 W) and bulbs/lights (rated 40 W). Even more appliances if battery systems are coupled with the wind turbines.

The Tata's have been investing heavily in clean energy technologies and distributed power generation. Another of its subsidiaries, Tata BP Solar has setup pilot projects to test and demonstrate power evacuation technology to main grid from rooftop solar panels.

Need for (Clean) Distributed Power Generation

India needs tremendous amounts of energy resources not only for rural electrification but also to meet the rising demands in the big cities. Coal reserves are in short supply, with limited domestic gas reserves India is heavily dependent on imports which are mostly entangled with strategic tug-of-wars be it the case of losing oil & gas blocks to China or ditching plans for energy partnership with Iran under pressure from the US. Nuclear energy expansion, too, has many roadblocks – concerns about safety, waste disposal & civil liability and fuel shortages.

Although dwindling, indigenous coal reserves are still the backbone of India's power generation sector with more than 70 percent of power generated by coal-fired power plants. The Indian government has been opposing mandatory emission reduction targets arguing that it needs to provide cheap, coal-fired power to its millions of villages.

Now India already has a voluntary goal to reduce its carbon intensity by 20 to 25 percent by 2020 from 2005 levels and it will have to agree to mandatory and absolute emission reduction. Therefore, it is India's own interests that it seriously considers renewable energy technologies which can take up a substantial burden of the power generated in the country in the medium to long term.

Advantages of Distributed Power Generation

Distributed power generation has several other advantages in the case of India. Being a large country it is difficult to expand transmission lines to the remote places. Distributed power generation makes redundant the various parameters that an independent power system needs to match with the central grid for efficient power evacuation. An article by Grist's David Roberts sheds light on the advantages of distributed power generation.

The effectiveness of intelligent grids will be enhanced by new ways of storing electricity at the building and neighborhood levels. It is energy storage coupled with the smart grid, Alford says, "that enables grid security, grid stability and power quality."

Shifting of power generation of centre from traditional power plants to homes and communities would ensure reduction in losses due to power theft and would also improve the stability of the grid. India lost a staggering 88,327 MW due to power theft in 2007-08.

Power generation through localized clean energy technologies would not only reduce India's carbon emission output but could also reduce power wastage as people would possibly value this resource more when them produce it 'themselves', at their homes.

One benefit of energy localism that is difficult to quantify but nonetheless significant is that it engages a city's residents in a more active civic role: People sort their trash, they manage their power consumption, they get involved.

Local involvement at the most fundamental level of the society could initiate and fuel a sustainable revolution in the power generation sector.

Lastly, the entry of one of the largest companies in the country in a dormant sector boosts confidence in the investors and opens countless avenues of employment generation for millions. Investment thrusts from the private sector, supported by government-backed incentives and international cooperation could eventually transform India's power sector into a profit-making sector that would fuel competition, accelerate clean energy revolution and bring the best quality services to the customers.

Photo Credit: Secretlondon (Wikimedia Commons)

The views presented in the above article are author’s personal views and do not represent those of TERI/TERI University where the author is currently pursuing a Master’s degree.

Walmart Files Gripe over Proposed Cape Wind Electricity Rates

Timothy B. Hurst — Sat, 19 Jun 2010 13:31:43 +0000

Electricity from the Cape Wind offshore wind farm could cost double the current Massachusetts residential rate.

A contract between the Cape Wind offshore wind farm -- which won final approval from Interior Secretary Ken Salazar in April and is expected to begin generating electricity in 2013 -- and the utility purchasing the energy, National Grid, would settle on an energy price that is twice current residential rates.

Massachusetts has passed a fairly aggressive renewable energy standard that requires utilities to get at least 15 percent of their power from renewable sources by 2020. The Cape Wind project will provide a significant portion of that requirement.

Electricity rates in Massachusetts are already among the highest in the country. Residential and commercial customers both pay over 15 cents per kilowatt hour (EIA, March 2010), only Connecticut and Hawaii pay higher electricity rates.

Bill Wertz, a spokesman for the retailer, says Walmart “supports the intent of the Cape Wind project.’’ But they have issues with National Grid’s cost estimates, as well as how those costs will be transferred to customers, the Boston Globe reports.

But electricity rates have been rising statewide long before the dream of Cape Wind became a reality.

Accounting for the bulk of the price increase in the proposed contract is a premium of 6.1 cents/kwh Massachusetts requires utilities to pay for renewable energy, a provision designed to stimulate clean energy investment in Massachusetts and create a new industrial sector around it. Economists and supporters of the policy mechanism believe that developing a clean energy sector will eventually bring electricity prices back down.

Is Walmart internally conflicted over renewable energy?

Some renewable energy advocates say Walmarts' challenge to the contract raises questions about the retailer’s commitment to clean energy.

Dan Bakal, director of electric power programs for the green investment coalition Ceres in Boston, told the Boston Globe that it is typical for large companies to express concern about electricity rates. Wal-Mart’s filing was surprising because of the company’s previous high-profile focus on environmental issues. Continued...

GE Lands Turbine Order for US’ First Freshwater Wind Farm

Timothy B. Hurst — Tue, 25 May 2010 04:33:32 +0000

As the well publicized race to win approval for the first offshore wind farm in the United States seems to have been won by the Cape Wind project off the coast of Massachusetts, the race to build the first freshwater wind farm in the United States is still undecided.

But on Monday, the nonprofit Lake Erie Energy Development Corp inched ahead in that race by signing a deal to buy five of GE's 4-megawatt offshore wind turbines for a freshwater offshore wind farm on Lake Erie in Ohio. If all goes as planned, the order will be the first of many.

Lake Erie Energy Development Corp has a long-term goal of building out freshwater wind energy to have a capacity of producing 1,000 megawatts of electricity by 2020.

Exactly where the turbines will be located has yet to be determined but the turbines will be placed 3-5 miles offshore in the Ohio waters of Lake Erie.

GE has estimated that offshore wind turbines could grow to become a $3 billion to $5 billion business for the company.

The announcement was made at the American Wind Energy Association's annual WINDPOWER Conference in Dallas.

Google Wind? Big Search Invests $38 Million in Big Wind

Timothy B. Hurst — Tue, 04 May 2010 17:39:10 +0000

Google's latest clean energy venture: the Ashtabula II Wind Farm in North Dakota (Photo: Google)

Google has officially jumped into the utility-scale renewable energy sector and diversified its clean energy portfolio with an investment of $38.8 million into two North Dakota wind farms, generating a total of 69.5 megawatts of electricity.

Thus far, Google's clean energy endeavors have mostly been in research and development of innovative technologies like PowerMeter, the home energy management platform, and early-stage clean energy companies like eSolar and AltaRock.

But where the Ashtabula Wind project differs from most of Google's other clean energy projects is that it is already up and feeding electricity to the grid. And more importantly, it has proven itself as an economically viable bread-winner.

"Smart capital includes not only... early-stage company investments, but also dedicated funding for utility-scale projects," writes Rick Needham, Green Business Operations Manager at the Official Google Blog. "To tackle this need, we’ve been looking at investments in renewable energy projects, like the one we just signed, that can accelerate the deployment of the latest clean energy technology while providing attractive returns to Google and more capital for developers to build additional projects."

In February, one of the company's newest subsidiaries, Google Energy, won federal regulatory approval to buy and sell electricity as a utility.

Sam’s Club Opens On-Site Micro-Wind Farm

Timothy B. Hurst — Thu, 29 Apr 2010 18:52:55 +0000

17 micro wind turbines now adorn the parking lot at a Sam's Club in Palmdale, California.

Anyone who has followed my writing with even a modicum of regularity knows that I kind of have a thing for wind turbines. It doesn't matter if they're giant wind turbines, floating wind turbines, micro-wind turbines or vertical axis wind turbines, if it spins and generates energy, I'm usually fascinated by it. And when it's part of a broad clean energy strategy undertaken by enormous private sector players like Walmart, I take special interest.

A Sam's Club store in Palmdale, California has become the first retailer in the country to install a mini-farm of micro-wind turbines on a parking lot. The 17 Skystream 3.7 micro wind-turbines will provide an estimated 76,000 kilowatt-hours (kWh) of energy annually (which is roughly enough to power for six average American homes for a year) or about 3%-5% of the store's energy needs.

The Palmdale site was selected for the pilot project among all of the Walmart-owned properties in the U.S. because of the excellent--and consistent--wind resource at the edge of the desert in southern California.

"We are thrilled to be the first to demonstrate micro wind turbines in a retail environment and pleased this project complements other wind and solar installations in California,” said Paul Stone, senior vice president, West Division, Sam’s Club.

The completion of this project bolsters the company’s renewable energy portfolio in California, including solar installations at 28 Walmart and Sam’s Club sites and fuel cell installations at two Walmart stores.

Sam's Club parent company, Walmart Stores, has a short-term goal of reducing carbon emissions across its supply chain and a long-term goal of being completely powered by renewable energy.

"We are optimistic that this exciting micro wind turbine project at the Palmdale Sam’s Club and another pilot location will be successful and that the micro turbines will be installed, operated and maintained while helping to lower our operating costs,” said Kim Saylors-Laster, vice president, Energy at Walmart . “With each new project we learn more that can be applied to help us achieve our goal to be supplied by renewable energy.”

Sam's is working with Massachusetts-based DeerPath Energy which provides turn-key micro-wind energy support, including the permitting, installation, finance and maintenance of micro-wind turbines. Similar installations are also planned for a new Walmart store in Worcester, Mass., as well as other locations moving forward.

Offshore Wind Industry Holds Breath for Cape Wind Decision

Timothy B. Hurst — Thu, 14 Jan 2010 17:50:18 +0000

Experts estimate that over 1,000 GW of wind energy could be built off the East Coast of the United States alone. And while there are no offshore wind farms currently in operation (or even under construction) in the US, there are a number of projects in the development pipeline, the most famous of which is the proposed project off the coast of Cape Cod, known as Cape Wind.

Well, the nine-year battle to permit the best known of the lot, Cape Wind, inched closer to a conclusion yesterday as Secretary of the Interior Ken Salazar called the interested parties together for a series of meetings he hopes will produce a compromise -- and the global offshore wind industry is paying close attention.

The Secretary set forth a March 1 deadline for stakeholders to come to a compromise or he would do it himself, he said.

On a phone call yesterday with reporters, Cape Wind CEO Jim Gordon said that he is "convinced that when Secretary Salazar has the complete record before him that the verifiable public benefits of creating jobs, greater energy independence, cleaner air and mitigating climate change will far outweigh any perception of negative impacts."

"The offshore wind industry is watching," said Gordon of the wait-and-see stance offshore wind developers are taking on projects in the U.S.. With no precedent of the U.S. regulatory system actually approving a site for an offshore wind farm, wind farm developers are rightly concerned to invest in U.S. offshore projects.

In Europe, however, it's a whole different ballgame. By the end of 2009, total installed offshore capacity in Europe was approximately 2,000 MW. And the share of European offshore wind generation is expected to grow substantially in the coming years, where up to 55,000 MW are anticipated to be installed by 2020.

"We're 20 years behind Europe," added Gordon. "If a project like Cape Wind can't be built it will send a message to the offshore wind industry."

And that message won't be a positive one.

Follow Tim Hurst on twitter @ecopolitologist