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Wind Energy


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Wind energy is becoming a widely acceptable means of generating green power alongside solar energy. This report covers companies manufacturing and developing technologies to harness wind power to generate electricity. Some of the companies covered here include companies that help in the development of wind farms, sell electricity from the wind farms and turbines.


Situation


Wind energy as a sector involves wind farms and the use of individual wind turbines which are coupled to an electric power distribution network. The two types – onshore and offshore have been in competition with coal and gas plants because of its inexpensiveness. Offshore wind is stronger than onshore wind but the cost of constructing and maintaining wind farms are higher in comparison. Denmark generates more close to 40% of its electric power from wind energy and more than 83 other countries have used wind power in their electric grids. Annual wind energy production is expected to grow extensively as more people become aware of the potential and cost effectiveness. More countries are keeping abreast of establishing greener sources of energy and there have been a 16% global increase in the wind energy production. According to a report by the AEG (2008), it was noted that South Australia was the only state (in Australia) that reduced its greenhouse effect due to an increase in her wind energy investment.


There are numerous advantages and problems associated with wind energy but the current climate suggests that the sky is just the starting point and the focus on reducing global warming has directed numerous researches into the usefulness of this sector in the long run. According to the Global Wind Energy Council, the quantity of wind generation that is estimated to be installed will exceed 500GW, this will signify a fivefold increase from the 94GW of 2007. In the report, wind energy will reduce the global CO2 emission by 731 million tons. The prospects for companies that are interested in CSR and bioinspired commitment has never been better.


Problem and Implication


Variability of Wind: This is the major problem that wind farmers and investors enunciate on. Wind doesn’t blow often and on days when it doesn’t the turbines do not generate power. As the cost of electricity storage falls, this would increase the use of intermittent energy sources and make them competitive.


Technical Problems: Based on the variability of the wind, additional reserves for the required capacity are needed to compensate variations that are being recorded. Due to limited forecasting in correlation to the high demands of cold and heat which also relates to seasons of low wind, there is a need for an increase in high voltage grid infrastructure.

Noise problems: It has been noted that turbines (in some situations) can be heard at distances as far as 2.5km. People have complained of the annoyance that they have felt, with some people complaining about sleeping problems and other health problems. Although there has not been academic studies that correlate these noises to personal health problems, the implication of this problem has reduced the importance of wind farms among certain parts of the population. These individuals have formed groups that protest the building of wind farms.


Perception of Wind Farms and Anti-Technology Views: Some people view turbines as anti-aesthetic to the environment and there are perceptions that they occupy acres of land that could be used for other purposes, yet there are other perceptions about the degree of viability of the sector in comparison with solar energy and other fossil based fuels, this perceptions are based on miseducation among the populace and it has also been noted that wind farm developers have not always been transparent to the people surrounding the farms. Miseducation causes people to be anti-wind farm and the developments in this sector.


Need Payoff


There have been 744 companies in the sector, 151 funded in last 5 years, $5B invested in 2016/17 (YTD). The most active investors include Climate-KIC, Demeter Partners, IFC, Actis, GE, Omnes Capital, US DOE etc. There are 5 categories here:

  1. Independent Power Producers: The companies here focus on developing wind energy projects and selling the power to users on a regular basis. There have been 80 companies founded in the last 8 years, with a total investment of $14.3B. The 3 subsectors here are:

Utility: Companies generating wind power and selling them under PPAs to utilities.

Distributed: Companies that develop wind power solutions and sell them to C&I or Residential customers on a long term/short term PPA.

Horizontal: Companies that develop wind power solutions and sell them to C&I or Residential customers on a long term/short term PPA.

  1. Hardware Developer: This includes companies developing and manufacturing hardware for the wind industry. Some of the components includes wind turbines and other components. There have been 182 companies founded from 2008 to 2016 with an overall investment of $4.5B. There are 5 subsectors here:

Turbines: Companies manufacturing wind turbines of various types including onshore, offshore and airborne wind turbines.

Other Components: Companies manufacturing the various internal components of a wind turbine apart from the generators, such as rotors, control systems, electricals etc.

Generator: Manufacturers of various types of generators for wind turbines.

Blades: Manufacturers of wind turbines blades.

Wind Towers: Manufacturers of wind towers used to mount wind turbines.

  1. Service Providers: This includes companies currently providing operation and maintenance support and EPC support for developing wind farms. There have been 91 companies founded in the last 8 years with an overall funding amount of $1.1B. There are 4 subsectors here:

Project Developers: Companies which develop end-to-end projects for windfarm owners. These companies provide solutions for financing, engineering, EPC, etc.

EPC: Engineering procurement and construction companies.

O&M: The companies here are operations and maintenance providers.

Planning and Management: Companies providing engineering, planning and project management solutions for developing wind project.

  1. Technology Enabler: The companies in this categories are involved in developing technology specific solutions for the development and maintenance of wind power projects. There have been 37 companies founded in the last 8 years with an overall investment of $64M. There are 3 subsectors here:

Monitoring & Analytics: Companies developing solutions to monitor and track electrical and nonelectrical parameters to enable optimum generation from the wind turbines.

Energy Management: Companies developing products which deliver overall wind farm management, for both electrical and non-electrical parameters.

Project Development Tools: Companies developing solutions to help project developers identify efficient wind project sites and deliver wind assessment data.

  1. Financing: Innovative financing solutions for developing small and large wind farms. With an overall investment of $456M. There are 3 subsectors here:

Alternative Investment Fund: These companies provide funding for various renewable energy projects in forms other than regular cash, stocks and bonds.

Lenders: These are finance entities that lend debts and other forms of similar interest holding advances to wind energy companies.


Crowdfunding platform: Companies which provide crowdfunding for wind energy players.


Conclusion


As the potential for wind energy increases and millennial get green focused, certain areas of this sector need more investments. More research has to be done in this sector and technological innovations are needed in order to increase the viability of wind turbines. If more of this is done, alongside proper education of people about the importance of wind energy, investors and new entrants into the sector stand to gain.


References

The WWW

Tracxn Report

GWEC Global Wind Statistics 2014

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