With the rise in the price of conventional fuels (namely oil and natural gas) earlier this year, there was a shift to look at different energy alternatives. Many people have pointed to the need for green energy, while others have talked about the U.S. dependency on foreign countries for oil. Whatever the reasons may be, alternative energy sources are going to become a growing part of our lives.
Today's post will be the third in a series of four posts discussing four different alternative energy sources - nuclear, solar, wind, and ethanol. While none of these sources to be discussed are new, the importance of each over the next 10+ years should grow.
We have already discussed nuclear and solar energy, so this week will be wind power.
Wind Power
Since the 1870's, the U.S. has been using wind power in some capacity. During that period, there were two companies producing windmills. They were used mostly in rural areas that allowed a farmer or rancher to pump groundwater to the surface for use. The windmill has been credited with helping to open the plains and west up for farmers and ranchers. In fact, one of those companies, Aermotor, is still making the exact same windmills today. However, on their website they have a disclaimer - "No. Water and electricity don't mix," so sorry no energy production.
Fast forward to today, and we have just started to realize exactly how abundant wind is as a resource. In the U.S., wind power accounts for 48 billion kWh of electricity a year which will serve approximately 4.5 million households. While that sounds very good, that is only about 1% of the current electricity demand in the U.S.
If we look around the globe, we begin to see how far behind we are in the utilization of wind power. In Denmark, over 22% of the nation's electricity comes from wind power. Germany and Spain come in second with both countries harnessing about 16% of their electricity from the wind. With only 1%, the U.S. has far to go to catch up.
Unless you have been sleeping the past two months, you have probably seen T. Boone Pickens in one of his many commercials talking about the "Pickens Plan". As a man that has literally amassed a huge fortune being an oil man, it is interesting seeing him switch to other forms of energy. His first comment on a current commercial is "Drill, Drill, Drill...(for oil)," and then he goes on to discuss wind and natural gas. His point, much like Joe's, is that we need to increase domestic oil production while moving toward alternatives. Of the alternatives, his favorite idea is wind.
His "Pickens Plan" proposes building wind facilities in the corridor that stretches from the Texas panhandle to North Dakota which is estimated to be able to produce at least 20% of the nation's electricity. Pickens has already started this move toward wind with Pickens' Mesa Power building the largest wind farm in the world in the Texas panhandle.
The huge windmills are actually now "wind turbines" and stand up to 410 feet tall with blades that stretch 148 feet in length. They are usually white, and if you have ever been near one, you hear the low "swoosh" of the blades as they turn.
The costs to move to wind power are not cheap. About 70% of the cost to harness wind power is the turbine. Over 75% of the market for turbines is effectively controlled by four companies (Vestas Wind Systems of Denmark, Gamesa of Spain, GE, and Siemens Power Generation of Denmark). Three of the four are from Europe which makes sense considering the capacity to which they currently use it.
The way utilities in Denmark, Spain, and Germany pay for the wind turbines is through government subsidy programs and wind power that is sold at above-market prices on the grid. The hope is the U.S. will be similar. If Congress will continue the wind generation subsidies, then the utilities will definitely see the advantages of moving toward the abundant resource.
Interestingly, due to the current utilization in European countries, the U.S. should be able to learn from those countries and make any transition easier. Also, since many countries do not have the space or wind that the U.S. has, the U.S. looks poised to be the next growth venue for wind power (30% per year over the past 6 years). There should be a pick up in manufacturing plants and electricity plants for wind power. This could spark renewed interest in rural America with rural cities suddenly growing.
It is not all positive for wind energy though. The sites must be suitable with a minimum and maximum amount of wind plus there are the environmental concerns (birds mainly), neighbors to worry about, and construction and transmission cost to get to the grid.
Also, wind does not exactly follow a supply/demand model. When the wind blows, the turbine turns. When it does not blow, the turbine doesn't move. Pretty easy to understand, but the wind does not pay attention to the energy demand as to whether or not it blows. Thus, someone will need to come up with ways to "store" the energy when the wind blows and the excess power is not needed.
I know T. Boone Pickens will be working on these issues...
Sources: The Pickens Plan, Janus
Today's post will be the third in a series of four posts discussing four different alternative energy sources - nuclear, solar, wind, and ethanol. While none of these sources to be discussed are new, the importance of each over the next 10+ years should grow.
We have already discussed nuclear and solar energy, so this week will be wind power.
Wind Power
Since the 1870's, the U.S. has been using wind power in some capacity. During that period, there were two companies producing windmills. They were used mostly in rural areas that allowed a farmer or rancher to pump groundwater to the surface for use. The windmill has been credited with helping to open the plains and west up for farmers and ranchers. In fact, one of those companies, Aermotor, is still making the exact same windmills today. However, on their website they have a disclaimer - "No. Water and electricity don't mix," so sorry no energy production.
Fast forward to today, and we have just started to realize exactly how abundant wind is as a resource. In the U.S., wind power accounts for 48 billion kWh of electricity a year which will serve approximately 4.5 million households. While that sounds very good, that is only about 1% of the current electricity demand in the U.S.
If we look around the globe, we begin to see how far behind we are in the utilization of wind power. In Denmark, over 22% of the nation's electricity comes from wind power. Germany and Spain come in second with both countries harnessing about 16% of their electricity from the wind. With only 1%, the U.S. has far to go to catch up.
Unless you have been sleeping the past two months, you have probably seen T. Boone Pickens in one of his many commercials talking about the "Pickens Plan". As a man that has literally amassed a huge fortune being an oil man, it is interesting seeing him switch to other forms of energy. His first comment on a current commercial is "Drill, Drill, Drill...(for oil)," and then he goes on to discuss wind and natural gas. His point, much like Joe's, is that we need to increase domestic oil production while moving toward alternatives. Of the alternatives, his favorite idea is wind.
His "Pickens Plan" proposes building wind facilities in the corridor that stretches from the Texas panhandle to North Dakota which is estimated to be able to produce at least 20% of the nation's electricity. Pickens has already started this move toward wind with Pickens' Mesa Power building the largest wind farm in the world in the Texas panhandle.
The huge windmills are actually now "wind turbines" and stand up to 410 feet tall with blades that stretch 148 feet in length. They are usually white, and if you have ever been near one, you hear the low "swoosh" of the blades as they turn.
The costs to move to wind power are not cheap. About 70% of the cost to harness wind power is the turbine. Over 75% of the market for turbines is effectively controlled by four companies (Vestas Wind Systems of Denmark, Gamesa of Spain, GE, and Siemens Power Generation of Denmark). Three of the four are from Europe which makes sense considering the capacity to which they currently use it.
The way utilities in Denmark, Spain, and Germany pay for the wind turbines is through government subsidy programs and wind power that is sold at above-market prices on the grid. The hope is the U.S. will be similar. If Congress will continue the wind generation subsidies, then the utilities will definitely see the advantages of moving toward the abundant resource.
Interestingly, due to the current utilization in European countries, the U.S. should be able to learn from those countries and make any transition easier. Also, since many countries do not have the space or wind that the U.S. has, the U.S. looks poised to be the next growth venue for wind power (30% per year over the past 6 years). There should be a pick up in manufacturing plants and electricity plants for wind power. This could spark renewed interest in rural America with rural cities suddenly growing.
It is not all positive for wind energy though. The sites must be suitable with a minimum and maximum amount of wind plus there are the environmental concerns (birds mainly), neighbors to worry about, and construction and transmission cost to get to the grid.
Also, wind does not exactly follow a supply/demand model. When the wind blows, the turbine turns. When it does not blow, the turbine doesn't move. Pretty easy to understand, but the wind does not pay attention to the energy demand as to whether or not it blows. Thus, someone will need to come up with ways to "store" the energy when the wind blows and the excess power is not needed.
I know T. Boone Pickens will be working on these issues...
Sources: The Pickens Plan, Janus
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