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United States

A NEW START

Wind's reputation will undoubtedly suffer in the short term from Kenetech's filing for bankruptcy, but the company's crash could mark the beginning of a new era. There is an emerging market for clusters of wind turbines in the Great Plains and utilities are increasingly looking to small renewable projects to meet customer demand for clean energy. Smaller projects would also give Americans the chance to become familiar with wind and give wind a chance to become part of the ordinary man-altered landscape.

The filing for bankruptcy of Kenetech Windpower in late May may seem an unlikely sign for an improving US wind market. But the signs are there that despite Kenetech's highly public fall from grace development will progress even in the short term -- both in an emerging market for "clusters" of turbines in the vast Great Plains of the Midwest and as a choice for utilities and other buyers sensitive to customer interests in clean power (see market survey 32-40).

With Kenetech so blinded by its own rhetoric that mega size was the only goal -- and with the legacy of both the US government and most large utilities also thinking only in terms of huge projects -- clusters have just never been considered worthy of much attention in America. Now may be the time for a new direction in wind development, although wind's reputation will undoubtedly suffer in the short term because of Kenetech's crash.

What was once the world's largest wind company is finally going belly-up after years of boasting it would build numerous utility scale mega projects producing electricity for a nickel or even less a kilowatt hour. And now the demise, at least temporarily, of Kenetech will be watched by proponents and sceptics alike. The danger is that America's top newspapers, the Wall Street Journal and New York Times, as well as financial lenders and utility planners will interpret the Chapter 11 filing as proof that wind does not work, at least with America's lower electricity prices and cheap natural gas. For them, if Kenetech was symbolic of wind's success, then its demise must point to what conventional energy backers always warned out of self interest -- wind is an empty promise that wastes money and time. But as Randy Swisher of the American Wind Energy Association points out, Kenetech's failure should in no way be taken as a failure of the wind industry as a whole.

Indeed, a closer scrutiny of the US market reveals that wind is far from being thrown out. The US Department of Energy is, for the first time, about to fund a cluster approach as an end in itself, rather than the first step to a mega project. It seems almost propitious that the only wind proposal on AWEA's lists of upcoming installations that looks as if it will actually go ahead in the US this year is Green Mountain Power's relatively small plant in Vermont. And in California, the Sacramento Municipal Utility District is still looking seriously at wind -- even after cancelling the major part of its Kenetech project -- because of customers' environmental concerns (page 21). In Oregon, too, it is customer interest driving the city authorities in Portland to pay a surcharge for wind power, even though there are no wind plants yet to supply them (Windpower Monthly, May 1996). No wonder, with all this interest, that the Utility Wind Interest Group is gaining new members apace (page 21) in another sign that wind in the US is far from dead.

Kenetech Windpower, if it does not emerge from Chapter 11, will be missed for its willingness to spend money on environmental problems, such as bird kills. No other company in the wind business spent a fraction of Kenetech's million-plus dollars on the study of avian mortality. But its fall can also be seen as a clearing of the decks that could open the way for a more benign scale of development. The company's arrogance and adamance that its competitors were a distant second in market realism and in keeping costs down

would now be laughable were it not for the sad fact that its bankruptcy is bound to sully the entire industry's reputation.

The downfall of what was once the world's largest wind company is a salutary reminder of the shortcomings of projects that are always scores of megawatts in capacity and that march across the very wilderness hills seen as untouchable by vocal outdoors and environmental activists. It is perhaps time for a breath of fresh air, for the end of an era, and for a new direction that differs fundamentally from projects where money was made mostly in the financial wheeling and business dealing before anything was in the ground, regardless of whether the turbines actually worked.

The potential of cluster developments may seem too minuscule to the American way of thinking, where big is better. Yet small developments add up. In Europe last year some 1000 MW of wind power capacity was installed in small or medium projects under 50 MW, more than ten times the amount installed in the US.

Mega style projects can work sometimes. The word, right at the very end of May, that one of Kenetech's disputes with Northern States Power in Minnesota -- which has been holding up a 100 MW project by Zond -- may be closer to resolution does seem like good news, assuming that Zond's Z-40 turbine operates better than does Kenetech's KVS-33. But given the recent history of wind in America, smaller developments could help give the US wind industry a fighting chance by allowing more ordinary Americans -- even as oil and natural gas prices stay so unnaturally low -- to become familiar with wind, while also giving wind a chance to become part of the ordinary man-altered landscape.

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