Cape man markets mini wind turbines (Mass.)

[jpak]

http://www.capecodonline.com/apps/pbcs.dll/article?AID=/20080309/BIZ/803090302

For more than two decades, Brian Braginton-Smith has had big dreams for wind energy on the Cape.

Originally, he envisioned a vast array of towering wind turbines in the waters of Nantucket Sound, a concept that eventually evolved into the proposed Cape Wind project.

Though no longer involved with that venture, Braginton-Smith's hopes for wind power on the Cape have not diminished. The turbines he expects to use, however, have gotten considerably smaller.

The alternative-energy entrepreneur is now selling Swift turbines, small-scale devices that are designed to be mounted on top of buildings.

<snip>

Community Wind Power charges $10,500 for a Swift turbine; for $22,000, a customer can get a turbine and a small electric car with a 40 mile range. The company will also help customers navigate the turbine permitting and installation process.

<more>

[suziedemocrat]

1. I want one of these!

[kristopher]

2. Let's look at this...

Using their figures of $10,500 and maximum production of 1.5kW/h. Most terrestrial wind at that height has really low yield, but since this is on the Cape we'll give the pro side the benefit of the doubt and assign a capacity factor of 40%. We'll also err on the pro side in the price of the electricity from the grid and assign a moderately high level price of $0.20/kWh. Multiplying this price by the production we get a production value of $0.30/kWh.
The incentives for installation are not included because they lack enough specificity to allow their inclusion.

10500/.30 gives us 35,000 hours to payback if the turbine is producing at maximum capacity 100% of the time. Since we are assuming a capacity factor of 40% we now have 35000/.4 to arrive at a break even point of 87,500 hours. This translates to a 9.98 year payback.

Now that's best case. My realistic assessment is that even without considering battery storage costs required for an individual home system, the price of the grid electricity is going to be slightly lower and the capacity factor is going to be significantly lower, directly one the beach may get 30-35% but all others will be nearer to 20%

That pushes the payback to between 15-20 years.

On the flip side, if grid stability is an issue that is motivating the buyer, there may be back up power considerations that have a great deal of value not included in this analysis.

[Finishline42]

3. Pretty Negative estimate there

But according to Wind Energy Resource Atlas, Cape Cod rates a 6, which is about as high as it gets. Your numbers would be more for a 2 or 3 rating.

http://rredc.nrel.gov/wind/pubs/atlas/maps/chap3/3-21m.html

So instead of 15-20 yrs, cut that in half. Cost of electricity leaves out the two main advantages of buying Windmills/PV panels. The first being that it is a one time purchase and once the payback is reached, the power cost drops to near zero. Windmills and PV panels have long service lives, windmills 30 to 40 yrs and PV panels over 50 yrs. The second advantage is that the purchase locks in power cost. I don't know anybody that thinks electricity is going to get cheaper in the future.

[kristopher]

4. Ok, let's take a look

Your resource map is published by NREL. They are pretty good but for good wind records you are usually better off with the private sector. They have the resources to do the sampling. The best data would be from the wind data tower that Cape Wind LLC set up for a couple of years in the middle of Nantucket Sound, but that is proprietary. However, I think we can refine this a bit with what we can get for free.

We're going to need something besides the map you've provided as it is missing both horizontal and vertical detail. Go here and click on the first 30M link in the box at the bottom.

http://www.mtpc.org/renewableenergy/Community_Wind/wind_maps.htm

That is a more detailed map and shows us the altitude. Remember the cube in the power equation for wind. A graph plotting wind speed across the bottom of the planetary boundary layer would read altitude up the left axis. Get down to lawn grass level and the wind is dragging across the land so the curve might look like a broomstraw when you are pressing down hard and sweeping from left to right. There is very little wind worth measuring below 30M. The turbines on top of the house are maybe 10m. There is a dramatic decrease in wind speed to the 10m level and an even larger loss of power because of the cube in the power formula.


The Truewind map rates the winds at from 5 to 6.5 m/s at 30m. At house top level (10m) one or more rows of home back and you are probably at 3-4 m/s.

To give some confirmation compare the truewind map speeds at 30 to the wind speed chart for the the map you offered based on NREL data. http://rredc.nrel.gov/wind/pubs/atlas/tables/1-1T.html
You can see that the hub height is clearly different. You first map is probably at 50m, so you can see the difference with the 30m map. As you drop lower the curve flattens to 0 as it intersects the ground.

AS to the economic argument, yes you are right to a point. Most wind turbines I know of are usually considered to have a life of 20 years. So if you have a house on Nantucket Island that faces the ocean, then you might have a payoff in 10 years, bu it is highly unlikely. Anyone in a house sitting even a little back from the beach-front row is going to do worse.

As to locking in an energy price, again, not exactly. You can calculate the price of your electricity in two ways. One is an arbitrary measure where you say I will consider the wind electricity from that turbine to be worth 0.X/kWh and when it has produced Z kWh then it is 'worn out'. Such a strategy might be used based on life expectancy and be designed to cover a depreciation schedule for the machine.
The more common way to value the production, however, is by looking at avoided costs. You figure what you don't buy from the utility and that is the value of the electricity. This ties it to the greater energy prices. If energy costs continue to rise, then the value of the electricity continue to rise. It can also drop. Not to be expected, but possible.

My number was 20 cents a kWh. The price there now is about 15-16 cents kWh there know, I believe. There will be several years below $0.20 kWh and then several years above $0.20 kWh for an overall average of about 20. I think that's close enough for this effort.

I'm not passing judgment on this system, it may be just what you want. I'm just crunching some numbers.

Some unaccounted for items include any subsidies that might be offered.
Does the price include storage? How long will the storage last. Batteries age.
How much maintenance will be required?
Warranty?
And the really big one is the future value of the money you spent today. How much interest would the money you spend earn if you didn't spend it.
And perhaps for some people, they finance it instead of paying from their cash reserves. 10,500 for 5 years would probably cost about 1600 in interest with a good rate.

So let's speculate:
10,500 intial system
2,000 Batteries over 20 years.
38,440 unearned interest on 10,500 @ 8% for 20 years.

50,940 Total cost

I was giving you the sales pitch before. This is the actual cost. If you finance it the price will be higher yet.



Interest rate calculator
http://www.csgnetwork.com/compoundsavingsintcalc.html

[Finishline42]

5. Good points - but...

I responded to your post before I looked up the referenced system. Not sure how effective that system will be or how long it will last. Bergey Windmills advertise 30 years on system life. It's not if they last that long, its how much power that they still produce as time goes on. Some maintenance would be required (just like your furnace - how much does that cost?) but also improvements or component replacement would extend the lifespan.

Your point on hub height is a good one, the higher the better. Too bad many communities have issues with windmills. When the wind blows at an average over 10mph, there's going to be a lot of noise from trees and trash being blown around. And too bad that along with a cell tower, the permit to build them required wind gauges at different heights with the info collected going into the public domain.

Impossible to predict future increases in electricity, but it is almost a guarantee that it's going up. Did you see we exported more coal in the first 2 months this year than all last year? And with coal being the predominate power source for electric utilities, we will see the results monthly.

In your cost analysis, you forgot a couple of things. You did not include the money saved on utilities. Also, any system on Cape Cod would be connected to a grid and so you would not need storage. You also forgot that there is $3.6 million per year in rebates in MA (first come/first served basis) and a 1.5kw system is eligible for $3375 with other possible adders.

Where are you getting 8% compounded interest on savings? Who would finance $10,500 over 20 years? So if you financed the total at 8% over 5 years the true economic cost is that in the first year your utility bill went lower, you made payments of $3085 ($257 a month) with a rebate of $3375. Your hypotheticals show that you don't want it to work.

The truth is that the more windmills that are installed, they will get cheaper and they will make less noise. I laugh every time someone complains about having to look at a windmill. I mean, how many great painters used a windmills as an object in their paintings?

[kristopher]

6. I don't want it to work?

Let's take your points one by one:

I responded to your post before I looked up the referenced system. Not sure how effective that system will be or how long it will last. Bergey Windmills advertise 30 years on system life. It's not if they last that long, its how much power that they still produce as time goes on. Some maintenance would be required (just like your furnace - how much does that cost?) but also improvements or component replacement would extend the lifespan.

I don't dispute the possible life spans that some units might achieve, but 20 years is pretty much a standard figure used for this type of analysis regarding turbines. It's like a car, it might last 300,000 miles but the chances are the lifespan of the vehicle is going to be closer to 140,000.

Your point on hub height is a good one, the higher the better. Too bad many communities have issues with windmills. When the wind blows at an average over 10mph, there's going to be a lot of noise from trees and trash being blown around. And too bad that along with a cell tower, the permit to build them required wind gauges at different heights with the info collected going into the public domain.

I'm sorry but I don't understand this portion.

Impossible to predict future increases in electricity, but it is almost a guarantee that it's going up. Did you see we exported more coal in the first 2 months this year than all last year? And with coal being the predominate power source for electric utilities, we will see the results monthly.

We agree.

In your cost analysis, you forgot a couple of things. You did not include the money saved on utilities. Also, any system on Cape Cod would be connected to a grid and so you would not need storage. You also forgot that there is $3.6 million per year in rebates in MA (first come/first served basis) and a 1.5kw system is eligible for $3375 with other possible adders.

Actually I did. It is in the first post I made and it's shown as how much the electricity produced by the home turbine is worth. I did make a mistake though. I labeled it as being $0.30/kWh when I should have labeled it $0.30 per hour of full operation. Remember this isn't a cost, this is the value of the electricity that is established by the electricity you didn't buy from the grid.
It isn't necessary to know how much your electric use declines, because we are looking at the problem from the other direction - how much is the machine capable of producing and thus, capable of replacing on your electric bill.

It is assumed that this is offsetting electricity you would otherwise have to buy. I mean, where else is the 30 cents per hour of operation going to come from? Is there going to be someone sending you a check? No, the 30 cents/full operating hour is the money you are going to save on your electric bill. That is how you get the $$$$ into your pocket.

As for the rebates, true I didn't look them up. That varies by state and I was doing a demonstration analysis. I did point out that I had omitted them from the analysis. If you want to account for this, then you'd deduct it from the $10500 and go from there. Everything else stays the same.

Where are you getting 8% compounded interest on savings? Who would finance $10,500 over 20 years? So if you financed the total at 8% over 5 years the true economic cost is that in the first year your utility bill went lower, you made payments of $3085 ($257 a month) with a rebate of $3375. Your hypotheticals show that you don't want it to work.,

First, I didn't say finance anything for 20 years. That is how long I calculated the EARNED interest on the original $10500.

What if, instead of paying $257 a month for a turbine, you deposited that money? You'll note that I pointed out that when you finance the cost was higher, right? Any time you do one thing with money, that means you can't do something else with it. So, in the case of paying cash, you take out money that was earning interest. You are not going to get that interest on that $10500 anymore, right? That is a cost. A large cost.

In the finance case the same thing applies: Instead of spending your money on the machine and interest, you decide to deposit the payment amount. The first month your savings account would have $257. At the end of 5 years you'd have 15420 PLUS the interest that has started accumulating from the day you made your first deposit. If you only want to put in $10,500 you'd stop at less than 40 months.

Ok, but let's say you do buy the machine on credit and the payment is $257 a month. It is a trade off between how much your money would have earned if you put the payments in savings every month versus how much the interest on the loan would be. We already see that the cost of the turbine has risen 50% due to interest paid on the loan, right? Since that is $15420-10500 or $4920 more that you have paid out and are not going to be collecting interest on, the final figure, even with the rebate considered, is going to be worse than my original. There is going to be an even larger loss of interest income over the entire period the turbine is being used.

So anyway this concept is called 'opportunity cost' and is a standard part of any comprehensive analysis. You may not like the results I offered, but they are correct within the parameters I listed. I didn't omit anything that I didn't address.


To go back to the amount you will save. Here is a breakdown using the figures in my first post.

If the unit is producing at full capacity for 30% of the time, in one month (720 hours x 30%) we can figure it is going to produce 1.5kW for 216 hours in one month. That equals 324 kWh of electricity per month at $0.20/kWh. 324 x 0.20 = $64.80 / month

64.80 x 240 (months in 20 years) = $15,552.

Now, you could assume you are going to put that $64.80/month into the bank and earn interest on it. If so, then you could count that interest in to offset the lost interest on the initial outlay. I don't think it would be enough to make the outcome radically different, but to be fair, you could do it. I would do it now but since is is a little more complicated and since I don't feel like looking for the right tools to do with at this time of the morning, I will let it slide.


Did you buy one or something? You seem sort of worked up. If you have anymore questions, happy to help. Feel free to PM me if you like.

[TreasonousBastard]

10. Both of you guys are talking about what you save, when...

power companies are buying your surplus power. So, it's not just what you save, but what you earn.

After the losses, 1.5 kwh barely runs my microwave, much less refrigerator, water pump and furnace. But, with efficient appliances and judicious energy use, I have plenty of times when I would have surplus power to sell back. I know of several people around here who have solar panels and rarely have electric bills over 10 or 20 bucks a month when the average is well over a hundred. I see no reason why windmills can't be equally "profitable" although exactly how equally can't be calculated, though, just observed if anyone around here manages to put one up.

If, after rebates, you can put one of these things up for around $7,000 and net a hundred bucks a month back, payback is around five years. If you really want to get particular about lost savings or financing costs, there's that hundred bucks a month or in your pocket from month one that covers a lot of it.

Even 7 grand is a ridiculous price for these gizmos, though, when you can buy a little 3kw gasoline generator for a few hundred bucks. Replace the gasoline engine with a propellor and that adds thousands? Watch prices drop like a rock when mini-windmills become popular.

[JohnWxy]

7. Not many people have the confidence to forecast the cost of natural gas more than

5 years out.

[kristopher]

8. ???

[phantom power]

9. does this remind anybody else of a Happy Meal?

Buy two and get free toy car!