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Market development

ISOLATED SYSTEMS

The following description of the development of the market for isolated systems follows the division shown in Off-grid Applications.

The market for very small systems represents the most active sector for wind off-grid systems, especially due to the boat and caravan market (thousands of units per year).  The use of WHS for rural electrification is far from the generalised use of SHS, but some current developments can be noted.  For example, the use of WHS is a traditional practice in Inner Mongolia, where around 250,000 SWTs (adding up to 64 MW) have already been installed, with a manufacturing capability of 40,000 units per year.  Apart from this huge local market, another interesting project is PERMER in Argentina where, after a pilot phase of 115 WHS, an implementing phase of 1,500 WHS (in two configurations, 300 or 600 W) has been approved.

The market for hybrid systems is widely spread in single system configurations throughout the world. Experiences of planned global rural electrification programmes that include hybrid systems are:

• China, where wind/PV hybrid stations were included as an option, with the participation of some of the existing hybrid systems’ developers and manufacturers (such as SMA and Bergey).  
• The Rural Electrification Program in Chile, which included hybrid systems mainly for small islands; this programme is still running, and some systems are still being developed.

The Asian Development Bank (ADB) is launching some pilot projects for the “Effective Deployment of Distributed Small Wind Power Systems in Asian Rural Areas”, within their “Energy for all” initiative. ADB estimates that by 2020 small wind energy systems will serve at least 2.5 million poor people.

Finally, the market for W/D systems is closely related to the cost of producing power with diesel engines.  As mentioned above, the recent fuel price increases open a new era for this solution.  There is experience with W/D systems all over the world, with Alaska, Canada and Australia as the main near-term markets, varying from low-penetration to high-penetration systems.  Until now, high-penetration W/D systems have been installed mainly in cold climates, where the surplus energy can be used for heating.  Chile has also included the W/D systems solution in its electrification programme.

GRID-CONNECTED SYSTEMS

Different markets exist in the world for small wind turbines, depending mainly on the current state of development of the country and household characteristics, as affected by the residential or built environment.

Europe has an extensive electric grid, so there is little need for off-grid wind energy systems.  However there is some potential for small grid-connected systems, which many Europeans would find attractive.  The high concentration of population in urban areas provides a great opportunity for onsite distributed generation from wind power by installing small wind turbines on rooftops, even though the roughness of the urban environment can mean a reduced and more turbulent wind flow.  Because of this, distributed generation based on small wind energy in residential and industrial areas is under development, and urban wind integration seems to be an emerging application that gives a solution for electricity power demand reduction.  Some countries have policies for the promotion of these applications.

The UK is the European leader on micro-generation, which includes small wind energy as one of the important contributors to national targets for renewable energy.  The British Wind Energy Association (BWEA) claims that it would be possible to install enough micro and small wind turbines by 2020 to generate up to 1,200 MW.

Currently in the UK there are over fifteen companies manufacturing commercial small wind turbine models.  Most of them are horizontal axis wind turbines (HAWT) and some are vertical axis wind turbines (VAWT), for installation on or around buildings.  The market is very dynamic, with over 3,500 micro and small wind turbines installed in 2008 alone, and high expected domestic and export market growth (more than 120 forecast for 2007-2008).  The on-grid/off-grid market share ratio was 67/33 in 2008, showing  a strong increase in the grid connected sector over the past few years.  The building-mounted/free-standing total market share ratio was 20/80 in 2008. 

BWEA has adopted a standard for performance, safety, reliability and sound emissions to which small wind turbines will be tested in order to be eligible for incentive programmes.  Little information on actual as-installed performance is currently available.

From April 2010 on, a new law with feed-in tariffs for micro-generation including small wind (up to 5 MW!) will be active, defining different tariffs for the different power ranges. It is expected that this scheme will be a reference for other European contries.

Also in the UK, Proven Energy has launched a project called WINDCROFTING™, available to any landowner with a grid connection.  In return for a 25-year lease, the landowner will receive rent on turbines installed on their land, and may also buy a subsidised turbine at the same time to provide electricity.  A subsidiary company installs, operates and maintains the SWT.

The Netherlands is conducting studies on SWTs for grid-connection:

• In the field of local attitudes, testing turbines for one year, at the end of which the owner will be able to buy the turbine for 50 per cent of the retail price; and
• In the field of actual performance, measuring the performance of 12 SWT with a maximum power of 5 kW.

Portugal passed a new law in 2007, with feed-in tariffs for micro-generation systems below 3.68 kW, which includes small wind.  This new law encourages renewable energy self-consumption, limiting the maximum amount of energy for which a premium price is paid to 4 MWh/year.  The first target of the plan is 10 MW, and the duration of the support is 15 years. Other countries in Europe have already or are about to pass similar laws with incentives for small wind generation connected to the grid, like Ireland, Italy or France.

Spain is promoting the SWT sector through different initiatives.  Currently, the SWT market is covered by three domestic manufacturers, but new manufacturers are working on larger SWT developments and wind turbines for urban environment integration.  In addition, a working group has been created inside the Association of Renewable Energy Producers (APPA) devoted to SWT generation issues.  The objectives of this working group are twofold:

• to inform the public about this technology; and
  
• to act as the voice of the SWT industry to public and private entities, trying to achieve the necessary favourable conditions for the development of the technology, both from the financial and the legal points of view.
  

The US is the main market for small wind turbines in the world, with more than 100,000 small wind turbines in operation in the 90 W to 100 kW size range, totalling more than 80 MW.  During 2008, more than 10000 SWTs were sold, 98 per cent by US manufacturers.  The US SWT market grew at  78 per cent in 2008, and the industry projects 30-fold growth within as little as five years, despite a global recession, for a cumulative US installed capacity of 1,700 MW by the end of 2013. The market has become dominated by grid-connected units and will likely continue in this trend, with Tax Credits available for this technology since 2008. By 2010, most US states will require turbines to be Small Wind Certification Council (SWCC) certified in order to be eligible for their incentive programmes, and the certification will be made against a recently adopted national standard, similar to the UK’s.

The Canadian SWT market is also significant, with between 1.8 and 4.5 MW installed, and approximately CAD 4.2 million in annual sales (2005).  There are net metering policies in several provinces, and a feed-in tariff of CAD 0.11/kWh available in Ontario.  At least 17 manufacturers are based in Canada: these are working on a new product certification programme adapted to Canadian interests from the existing US and UK certification programmes.