REW: Renewable Energy Generation with Small Wind Systems Dennis Scanlin

Appalachian State University Wind Application Center Funding from DOE, NC State Energy Office, TVA, Wind Industry Goals – Test & Demonstrate turbines – Technical Assistance – Workshops – Presentations – Resource Assessment – Anemometer Loan Program – Wind for Schools wind.appstate.edu Call or for a consultation – –

Workshop Schedule November 2 – 4: Intro to Wind Wind Resource Assessment Techniques Met. Tower Installation November 9 – 11: Turbine Technology Energy Production Estimating

Wind Resource Assessment Workshop Agenda – Friday, November 2 nd 8:30 – 8:45 Introductions 8:45 – 10:00 Intro to Wind Energy 10:00 – 10:15 Break 10:15 – 11:30 Wind Resource Assessment 11:30 – 12:30 Wind map Activity 12:30 – 1:30 Lunch 1:30 – 3:00 Met Towers & Sensors 3:00 – 3:15 Break 3:15 – 4:30 Laying out, building and setting up a met tower 4:30 – 5:30 Met Tower layout activity

Wind Resource Assessment Workshop Agenda – Saturday, 11/5 8:30 – 9:30 Review tower construction & raising 9:30 – 11:30 Tower Raising 11:30 – 12:30 Sensors & data loggers 12:30 – 1:30 Lunch 1:30 – 3:00 Installation of sensors & data logger 3 – 3:15 Break 3:15 – 4:30 Analyzing Wind data 4:30 – 5:30 NRG Symphonie Data Retriever Software – Sunday, 11/16 8:30 – 10:00 Met Tower takedown 10:00 – 11:00 Windographer Software Intro 11 – 12:30 Windographer activity

Wind Energy Intro

Wind Energy Benefits 1.Economically competitive 2.Valuable crop of the future for farmers and ranchers 3.Unlike most other energy sources, wind turbines don’t consume water 4.Indigenous, homegrown energy source that contributes to national security 5.Inexhaustible and infinitely renewable 6.Many environmental benefits 7.Reduces the risk of volatile fossil fuel prices 8.The fuel of today and tomorrow 9.Can be used in a variety of applications 10.People want renewable energy

Wind Power has become the least expensive and fastest growing source of electricity in the world Annual average growth rate over last ten years more than 30%; 24% in 2011 Currently close to 250,000 MW installed Powering nearly 75 million homes 10% world’s electricity by 2020 if current trends continues (DOE estimate) Global Wind Energy Council (GWEC) –

Why such growth…costs! 1979: 40 cents/kWh Increased Turbine Size R&D Advances Manufacturing Improvements NSP 107 MW Lake Benton wind farm 4 cents/kWh (unsubsidized) 2011: 5 cents/kWh 2000: cents/kWh

Annual & Cumulative Installed World Capacity in MW, 2011

World PV Capacity, 2010 Installed Wind capacity is 6 times larger than PV

2010 Cumulative Installed PV Capacity

2011 US Energy Consumption by Source

6.8 GW of wind power added in 2011 in U.S., 31% higher than in 2010 $14 billion invested in wind power project additions Cumulative wind power capacity up by 16%, bringing total to 47 GW Wind Power Additions Increased in 2011, but Remained Below 2008 and 2009 Levels

Wind Power Comprised 32% of Electric Generating Capacity Additions in 2011 Wind power in 2011 was again the 2 nd -largest resource added (after gas, and for the 6 th time in the past seven years)

Despite Ongoing Proliferation of New Entrants, “Big 3” Turbine Suppliers Gained Market Share Increase in number of turbine vendors serving market since 2005, but top three (in aggregate) have gained market share since installations by Chinese and South Korean manufacturers included: Sany Electric, Samsung, Goldwind, Hyundai, Sinovel, and Unison

U.S. Lagging Other Countries in Wind As a Percentage of Electricity Consumption Note: Figure only includes the 20 countries with the most installed wind power capacity at the end of 2011

California Added the Most Wind Capacity in 2011; Six States Exceed 10% Wind Energy At end of 2011: Texas continued to lead in cumulative capacity, by a large margin 20 states had >500 MW of capacity (8 had >2000 MW) 2 states had the ability to provide >20% of total in- state generation from wind (6 states >10%, 14 states >5%)

Average Turbine Size Increased in % of turbines installed in 2011 were > 2.0 MW, up from 28% in 2010, 24% in 2009, 20% in 2008, 16% in 2006 & 2007, and just 0.1% in previous years

Sizes and Applications Small (  100 kW) Homes (Grid connected) Farms Remote Applications (e.g. battery charging, water pumping, telecom sites, grid-tie) Intermediate (100 kW – 1MW) Village / Farm Power Community Wind Large (1MW-5MW) Wind Farms Offshore Wind Generation

Average Hub Heights and Rotor Diameters Have Increased Over Time On average, since , hub heights are 25 meters (45%) higher and rotor diameters are 41 meters (86%) larger

Utility Project Ownership Increased in 2011, but IPP Ownership Remained Dominant Utility ownership jumped to 25% in 2011 (up from 15% in 2009 and 2010) on the back of nearly 600 MW of new capacity built/owned by MidAmerican

Cost Trends

Lazard COE Analysis 2009

Wind Turbine Prices Continued to Decline in 2011, After Rising from Recent turbine price quotes reportedly in the range of $900-1,270/kW, with more-favorable terms for buyers and improved technology

Though Slow to Reflect Declining Wind Turbine Prices, Reported Installed Project Costs Finally Turned the Corner in 2011 Note: 2012 sample of 20 projects totaling ~2.6 GW is preliminary, but suggests lower costs for 2012 projects

Economies of Scale Evident At Least At Low End of Project Size Range

Newer Projects Appear to Show Improvements in Operations and Maintenance Costs Capacity-weighted average O&M costs for projects built in the 1980s equal $33/MWh, dropping to $23/MWh for projects built in 1990s, and to $10/MWh for projects built since 2000 Note: Sample is limited, and consists of 133 wind power projects totaling 7,965 MW; few projects in sample have complete records of O&M costs from ; O&M costs reported here DO NOT include all operating costs

Average Capacity Factors Have Improved Over Time, But Leveled Off in Recent Years General improvement reflects increase in hub height and rotor diameter Drop in 2009 and 2010, and rebound in 2011, driven in part by: (1) inter- annual wind resource variation, and (2) wind power curtailment

Cumulative, Sample-Wide Wind Power Prices Continued to Move Higher in 2011 General trend of falling and then rising prices consistent with the project cost trends shown earlier, but cumulative nature of figure results in a smoother, less-responsive curve that lags the directional changes in cost trends

Low Wholesale Electricity Prices Continued to Challenge the Relative Economics of Wind Power Wholesale price range reflects flat block of power across 23 pricing nodes across the U.S. Recent wholesale prices reflect low natural gas prices, driven by weak economy and shale gas

State Policies Help Direct Location and Amount of Wind Development, but Current Policies Cannot Support Continued Growth at Levels Seen in the Recent Past 29 states and D.C. have mandatory RPS

US Small Wind Capacity

Small Wind Capacity Turbines up to 100 kW Cumulative Installations Sources include EFO, AWEA & DWEA; estimated capacity scaled from actual data and sales reports collected from numerous manufacturers, NREL, USDA, U.S. Treasury and 30+ state agencies < 1 MW MW MW MW MW 200 MW Total US Installed Capacity Year > 20 MW Puerto Rico and USVI 2011

Small Wind Turbines Installed with Federal, State, Utility & Local Funding Assistance Number of Units Installed

2011 U.S. Small Wind Market Highlights The 27 small wind turbine manufacturers from North America and Europe responding to AWEA’s survey reported total 2011 worldwide sales of $397 million USD, totaling more than 21,000 units and 64 megawatts (MW) U.S. manufacturers’ combined domestic sales and exports were 33 MW, up 13.4% over 2010 Total U.S. cumulative sales (including imports) reached 198 MW, representing 151,300 total units installed in the U.S. in 2011 (annually displacing 178,000 metric tons of CO 2 ) As a result of the poor economy and inconsistent incentives in 2011, the U.S. small wind market declined by 26%, with 19 MW of new sales, representing 7,303 turbines, and $115 million in installed system revenue; sales revenues declined by 17%, with units sold down by 6.5% 54% of U.S. manufacturers’ sales capacity went to overseas markets, reflecting a dramatic increase (from 7.8 MW in 2010 to 17.7 MW in 2011)

2011 US Small Wind Market Highlights 11 international manufacturers (including 4 from U.S.) reported total sales exceeding 1 MW Domestic sales by U.S. manufacturers accounted for an 80% share of the 2011 U.S. market Sales of turbines in the U.S. for on-grid installations remained dominant, with a 91% market share of sales capacity, continuing the 2010 trend 27 manufacturers with a U.S. sales presence, including those from Europe and Canada, reported sales of 57 wind turbine models The average installed cost of small wind turbines in the U.S. in 2011 was $6,040/kW, an 11% increase from 2010

2011 Small Wind Industry/Market Developments U.S. economy remained sluggish, residential market especially affected; ag and commercial markets for >10 kW turbines remained good U.S. state incentive markets in turmoil (e.g., CA, NJ, WI, OH, NV) Innovative state policies in several eastern states showed promise First two turbine models certified to the AWEA standard by Small Wind Certification Council (SWCC); an additional 26 were in testing Interstate Turbine Advisory Council (ITAC) formed to address state incentive qualification guidelines and turbine performance requirements U.S. small wind industry represents 1,600 full-time equivalent jobs U.S. manufacturers maintained 80-85% domestic content

U.S. Small Wind Industry Challenges Inconsistent, erratic state incentive programs Non-certified turbine entrants Planning & Zoning ordinances (height, setbacks, sound) State RPS solar set-asides & solar RECs Competitive economics (PV, rural tariffs) Financing Utility resistance Site performance prediction USDA REAP program dramatically reduced USFWS guidelines* Public loss of energy/environment focus

No Offshore Turbines Commissioned in the U.S., But 10 Projects Totaling 3.8 GW Are Somewhat More Advanced in Development Two projects have power purchase agreements (PPAs): Cape Wind (MA) Deepwater (RI) Nation’s first offshore wind power PPA cancelled in 2011: NRG Bluewater (DE)

Public Attitudes Towards Wind Energy 6 NC Wind Surveys since 1982 Mod-1 Survey in Survey by Dennis Grady of the Appalachian State University Energy Center 2003 Survey by Dennis Grady of the Appalachian State University Energy Center March 2010 Survey by Elon University Survey April 2010 Survey by PPP, Taylor, Scanlin & Kersey of Appalachian State University May 2010 Survey of Watuaga County by Marcus Taylor of Appalachian State University In every survey the majority of respondents indicate support for wind energy

1982 Mod -1 Survey 73% felt turbine had a positive impact on surrounding area 81% felt wind energy had potential in western NC 90% indicated that the wind turbine never adversely affected them in any way

2002 Survey in Western NC 75.3 % wanted to see more wind energy used 63.5% felt turbines should be permitted on ridge tops in western NC 79% indicated that single turbines would be permitted in western NC on privately owned land 57.3 indicated that clusters of wind turbines on ridge tops should be permitted 50.5% supported the installation of wind turbines in National Forests

Elon March 2010 NC State Survey 79.5% supported the construction of wind turbines in the mountains of North Carolina

Spring 2010 PPP Wind Survey 75.3% indicated “more” in 2002 survey

Spring 2010 PPP Wind Survey

Turbines on Mountain Ridges

Comparison of 2002 & 2010 Results

2010 Watauga County Survey

2010 Watauga Survey

Policy & Wind in NC Renewable Energy and Energy Efficiency Portfolio Standard (REPS), % State Tax Credit 30% Federal Tax Credit Accelerated depreciation deduction for commercial projects NC Green Power Program Netmetering Mountain Ridge Protection Act Wind Permitting Bill Model Wind Ordinance

Renewable Energy and Energy Efficiency Portfolio Standard (REPS) August 2007 First state in the Southeast 12.5%by 2021 from renewable energy resources or energy efficiency measures. Rural electric cooperatives and municipal electric suppliers are subject to a 10% REPS requirement Approx 20,000 Million KWH/year

Model Ordinance for NC 3 size classifications – Under 20 kW – 20 kW to 100 kW – Over 100 kW Setbacks from 1.1 to 2.5 times height of turbine Includes standard definitions, permit application recommendations, noise & shadow flicker maximums & decommissioning

Mountain Ridge Protection Act of 1983 “No building, structure or unit shall protrude at its uppermost point above the crest of the ridge by more than 35’ “ Exemptions to Ridge Law Water, radio, telephone or television towers or any equipment for the transmission of electricity or communications or both. Structures of a relatively slender nature and minor vertical projections of a parent building, including chimneys, flagpoles, flues, spires, steeples, belfries, cupolas, antennas, poles, wires, or windmills “ The Legislature in 1983 had in mind, the traditional, solitary farm windmill which has long been in use in rural communities, not windfarm turbines of the size, type, or certainly number proposed here…” NC Attorney General’s 2/4/2002 letter to TVA

Permitting of Wind Energy Facilities House Bill 809; Senate Bill 1068 > 2 MW Permitting requirements defined $2,000 fee Public hearing(s) required Proposes a modification of ridge law exemption for windmills Exclusion Zones being discussed

Original SB 1068 Windmills, including wind turbines for the generation of electricity having less than 100 KW rated capacity and wind turbines of 100 KW capacity and above to the extent allowed by a city or county ordinance regulating the siting of wind turbines

Substitute Bills #1 & #3 Windmills, when the windmill is a solitary structure and is not used to generate electricity for the public consumption Windmills, if the windmill is associated with a residence, the primary purpose of the windmill is to generate electricity for use within the residence, and the windmill is no more than 100 feet from the base to the turbine hub