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Millennium musings

One adjective repeatedly springs to mind when summing up the state of the global wind power business--complex. Gone are the days of neatly structured subsidy programs, stimulating controlled market growth in one or two countries. Enter a future where wind is just one of a number of commodities fiercely traded in a market with a whole new look and three distinct identities. In just two decades the wind business has reached a level of maturity which is sucking it into the complicated world of commerce--with all its risks and rewards.

at the start of the last year of the old millennium, summing up the state of the global wind power business is no easy task. There is, though, an adjective which repeatedly springs to mind -- complex. Gone are the days of neatly structured subsidy programs, stimulating controlled market growth in one or two countries. Enter a future where wind is just one of a number of commodities fiercely traded in a market with a whole new look and three distinct identities.

For wind to have reached such status is a remarkable achievement. In just two decades the business has reached a level of maturity which is sucking it into the complicated world of commerce -- with all its risks and rewards. Wind power stations are becoming major business undertakings, requiring major financing, witness the 100 MW projects going up in Canada (page 32) and in the US Midwest. At the other end of the size scale, the wind energy pioneers of Germany, Denmark and the Netherlands, those who put their household savings into wind turbine ownership, are looking to become green power traders, with all the complexity of power exchanges, third party sales and green credits (pages 18-19).

Never before has there been so much activity on so many different fronts. This business is on the move -- and fast. More wind turbines are being erected in more countries than in any period so far. Major development is ongoing in New Zealand and Japan (30-32), in China and India, in a string of European countries, in Central America and Canada, and, not least, in the United States -- see The Windicator for details (page 42). New markets are springing up and old ones are in flux, with wind being swept along in a tide of liberalisation and deregulation. More mature wind markets have outgrown their early stimulation programs and are in transition to frameworks for long term growth. Politically, there is mounting recognition of the need for action on climate change and the fact that wind is a good place to act. Technically, the industry is gearing up its technology for deployment in conventional-sized power plant -- offshore (page 27). And on the economic front, as the costs of climate change continue upwards, electricity prices continue downwards in a contrasting spiral of frighteningly dirt cheap power where the cost of pollution is stubbornly ignored. Wind, aiming at this ever moving price target, is showing itself to be a good shot. We'll be revealing some heartening figures on price in the next issue.

The job ahead

All this complexity requires the global wind lobby to keep a clear head and a firm grip on its goals. Complex issues all too often lead to fuddled legislation -- the last thing needed right now. It will be up to the wind lobby to clarify the issues so that politicians can make the right decisions. That will require precise focus on the right goals and strict discipline to prevent lobbying efforts from being sidetracked. The broad task of helping governments to re-orient energy policy towards sustainability is monumental. That responsibility can now be passed to others. Fortunately for the wind energy associations of the world, big-fist help is at hand. The arrival of Greenpeace as co-campaigner is not to be underestimated. In less than a year of working for wind, Greenpeace has strongly influenced the UK government into launching its offshore program, it has been a major force behind a wind law in Argentina, it was largely responsible for wind energy's relatively high profile at the Buenos Aires climate summit in October, and it is now leading negotiations on grid access for small independent power generators in Germany (page 18). The chances are that other major environment groups will follow Greenpeace's lead and also take up the cause.

With the broader scene taken care of, the wind lobby can concentrate on the complex background issues -- and on feeding the right messages to the right organisations at the right time. To do this requires a crystal clear understanding of the shape of each national market and its level of maturity. It is also requires keen and intuitive observation of the changing business of electricity supply. A new market needs powerful stimulation policies, a maturing market needs policies to strengthen its growth and stabilise it, a mature market needs a framework for the long term, where renewables become a major and integrated part of electricity supply. These are simplified statements of complex issues, but clarity is a great aid to political focus.

Just as vital for future good health is timely recognition of the shape of the emerging electricity business -- and the ability to pinpoint wind's role in it. Instead of feeding electricity into an amorphous grid, it looks as if the wind business will be serving three distinct markets: a gigawatt market to meet the demands of big industry and major conurbations, where large amounts of power are fed into the bulk transmission system (offshore projects); a megawatt market for serving townships and light industry, where embedded generation is both wanted and welcome (the major potential for wind); and a kilowatt market of localised self-help power generation (of most potential for passive solar and PV). Wind is facing this future firmly wedged into starting blocks forged by dint of hard work in the past two decades of the old millennium. It now has a year in which to get set for the new.

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