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Published on June 8th, 2009 | by Jeff McIntire-Strasburg

17

Home Wind Energy: Will it Survive Your Own Cost-Benefit Analysis?

wind turbineThinking about installing a wind energy system, but not sure if the payback period on your investment meets your financial needs? I began thinking about this question last week when our old friend (and my real old friend) bobbyb sent me an article about a couple who’d installed a wind turbine at their home in Great Britain. He noted that the numbers provided in the article (a £20,000 initial outlay for £500/year energy savings) didn’t make financial sense: “That’s a forty-year payback period!”

He’s right… that kind of cost-benefit analysis doesn’t really work. If you’re going to put up tens of thousands of dollars for a wind system (or a solar energy system), you probably want to see a return on that investment in years, rather than in decades. I got so interested in the topic that I wrote a post about things you should consider before putting your money down on a renewable energy system at SUNfiltered. Wind energy systems have their own requirements, so here are a few of the things you’ll want to take into consideration.

Will wind energy work on my property?

As with any renewable resource, some areas are better than others for home wind energy. Some of the questions you’ll need answers for include

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Am I located in an area with ample wind resources? Just as solar will be a better deal in the Southwest than the Northwest, certain parts of the country have better wind resources. As you can see on the US Department of Energy’s Wind Resource Maps, the central corridor and offshore locations have the best wind availability; the Southeast generally has the worst. You can also use tools like 3Tier’s FirstLook, or Renewable Solutions’ Modern Energy Plan to find specific information on wind resources for your property.

Is my property suited to harvesting wind? In order to adequately harvest wind, you have to be able to build a tall tower that will rise above treelines and buildings surrounding your property. I’d guess that’s why the turbine built by the British family above wasn’t generating significant energy savings: it was only 40 ft. tall. According to the Mick Sagrillo, an expert who answers small wind harvesting questions on the American Wind Energy Association’s web site,

Installing your wind system on a tower shorter than the area’s tree line, or, worse yet, on top of your roof, is akin to floating in a sheltered cove of a river: you may occasionally bob a bit but there will be little forward progress. There is simply little energy in low winds that you can convert into usable electricity. Do you want kinetic yard art or a wind electric generator?

If building a tower with sufficient height isn’t an option, you probably want to consider investing your money in something other than a wind system.

Are there financial incentives and options available for wind energy?

Wind systems are expensive, so unless you’re sitting on a pile of money burning a hole in your pocket, you’ll likely want to check into incentives and financing options. These can include:

  • Local, state, and federal tax incentives: You may be able to write off a portion of the money you spend on a wind turbine — check the Database of State Incentives for Renewables and Efficiency (DSIRE) for information on incentives for which you’re eligible.
  • Net metering: Is net metering available in your location? Probably: 42 states and the District of Columbia have laws on the books that allow renewable energy producers to sell excess power back to their local utility at the retail rates. DSIRE is the best source of this information, also.
  • Financing options: Traditionally, you’d look at a source like home equity to finance a wind power system, but other instruments such as energy improvement mortgages or property tax financing may be available to you (though many of the latter programs seem to focus more on solar energy systems).

Is wind energy right for you?

We definitely need more people acting on their environmental concerns, so if you’re serious about installing a wind turbine, that’s commendable. Just make wind energy works not only for meeting your environmental goals, but also fits your family’s financial needs… you don’t want to set yourself up for disappointment when the energy savings aren’t as high as you expected.

For more information, check out:

Image source: skyseeker at Flickr under a Creative Commons license



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About the Author

Jeff McIntire-Strasburg is the founder and editor of sustainablog. You can keep up with all of his writing at Facebook, and at



  • http://www.yahoo.com Bobby B.

    Why did Jeff skip the part about the local council ordering the homeowners to shut down their noisy windmill? Consideration for others – especially one’s neighbors – is also important in a civil society.

    Additionally, neither the source piece nor this piece gives any mention to maintenance. Though not as extreme as on the large 1.5MW windmills, a homeowner will incur considerable costs when his windmill needs attention. Let’s look at a few possibilities:

    1. Basic Oil Change and Blade Cleaning:
    a. Who owns an extension ladder tall enough to reach the power head of a typical home windmill? The picture of the windmill in question seems to lack climbing pegs. Would the average homeowner risk the inherent instability of such a long ladder?
    b. You could spend a small fortune on scaffolding to work at that elevation to improve the instability issues, but you still have to climb those ladders to get to the work platform.
    c. If out of extension ladder reach or uncomfortable on scaffolding, you could rent an all-terrain manlift. However, don’t forget to add the costs of delivery and pick-up, getting trained in its use, renting a fall prevention harness, and provided fuel for the thing.
    d. Speaking of falls, most of us in industry know that falls are typically the leading cause of major injuries and deaths in the workplace. Armed with that bit of information, how many average homeowners would be comfortable working at windmill heights?
    e. Oh yeah, be sure to dispose of that used oil and/or your cleaning rags properly.
    f. Maybe a few of us should buy some equipment and start a home windmill services business…

    2. Gearbox Service and/or Blade Replacement:
    The large windmills have a planetary gearbox that increases the RPMs from the slow turning blades to a higher RPM (3600 in the US) at the generator that matches the frequency of the electricity on the grid. Although most home systems would not be wired directly to the grid and need such an elaborate gearbox, it stands to reason that there is something atop the tower that will eventually fail. When this occurs, you need to consider everything in #1 plus add the costs for an appropriate crane, rigging, and a crew to do the job (typically one operator and two riggers). If you do not own a pick-up truck or a flat-bed trailer to transport the unit to a reputable shop, you will have to rent one of those too; or hire a carrier. Oh, and don’t forget, you have to account for both the trip to the shop and the trip home from the shop. Even if you live in fantasy land and the electro-mechanical portion of your windmill is maintenance free, at some point the blades will lose their aerodynamic properties from impacts with airborne objects and/or degradation from the sun’s unending assault on its protective coatings, which means this scenario is inevitable.

    3. Battery Replacement
    Most home systems take wind power to a block of batteries for storage and use within the home. Unfortunately, even the most technologically advanced batteries require replacement within a few short years. The cost of a bank of batteries will likely increase well beyond the original purchase price. Not only will inflation come into play, but the push to convert automobiles from gas guzzlers to electricity guzzlers will have a ripple effect. As the demand for the precious metals used in high-tech batteries increases, so shall the price. Alloy metals increased by nearly a factor of ten between 2000 and 2008. If this occurs again, will the average homeowner be able to withstand such an outlay of cash?

    Jeff does make some great points about evaluating your location. However, when it comes to doing a cost-benefit analysis, he (like most people) ignores the “hidden” costs in favor of focusing of the initial outlay versus the avoided cost of not purchasing a portion of one’s energy. Tax incentives can pretty much be ignored since they are one-time breaks at the time of purchase. Mentioning net metering was also a bit pointless since few homeowners will invest in the extra equipment needed to convert DC battery power into AC grid compatible power. Even if they do buy the right stuff, it is unlikely that they will generate excess power for sale to the utility. No matter how you slice it, we just don’t have any cost-effective solutions that preserve our present lifestyle. If we each go back to a single room shanty with a single CFL hanging in the middle of it, green energy is ready to do the job.

    To close, I am not trying to discourage anyone from spending his money on green technology. We all spend money on things that don’t pay us back just because those things make us happy. If erecting a windmill in your backyard makes you happy or improves your self image, have at it. You can’t take that cash with you when you’re gone. Just realize that you are very likely to have a non-working conversation piece towering over your backyard in a few years.

  • russ

    Hi Jeff – An important point is the rating of the turbine. This is referred to in the paragraphs:

    1. Am I located in an area with ample wind resources?
    2. Is my property suited to harvesting wind?

    If you look at the power curve for most residential turbines the output is only a fraction of what the companies advertising claims. Most residential type are rated for wind speeds of 25 plus mph wind which is highly unusual.

    At 10 to 12 mph wind speeds the output is minimal in most areas. You end up getting watts rather than kilowatts.

    Most people would do better investing in a wind farm operation rather than installing their own turbine.

  • http://sustainablog.org Jeff McIntire-Strasburg

    Bobby and russ — appreciate your input.

    Bobby — I didn’t bring up the noise issue because it really wasn’t relevant to this discussion (and you didn’t bring it up either when you emailed me… it was all about payback). I’m glad you brought in info about maintenance, as those are important considerations for a home/property owner looking at wind systems.

  • http://www.yahoo.com Bobby B.

    I hope that I wasn’t too verbose. I just think that most environmentally conscious homeowners fail to understand that erecting windmills and/or solar panels transports them – to a large degree – into the realm of industry. The downstream costs of maintaining any industrial structure have to be evaluated on many levels. It also requires some specialized skills and equipment that are beyond the reach of the average do-it-yourselfer. Green technology may become viable for small scale use in the future, but it’s just not there today.

  • http://www.poweringanation.org Anna

    I wonder what the percentage of homeowners is that have installed wind or solar energy systems – and the percentage of homeowners that would consider installing this kind of system if it were more cost effective? I would guess (though I certainly don’t know for sure) that the upfront costs and the infrastructure requirements (especially for wind) would be the more prohibitive factor, rather than payback time? Certainly on the margins, anyway.

    A really interesting contribution – thanks for outlining these factors!

  • http://greenoptions.com/author/susan Susan Kraemer

    Don’t tar solar with that scary industry stuff Bobby. Solar Installers guarantee work for ten years (don’t wind installers?)

    All you need to do is aim a hose up onto the roof once a summer, but just like an oil change, its ok if you don’t.

  • http://aperfectstormcometh.blogspot.com ccpo

    I must file a complaint! Why is it that nowhere on the web, or anywhere else, is wind discussed in a real-world way? By that I mean in contexts that the vast number of inhabitants of the planet will and do encounter.

    I mean, hey, this is “Sustainablog,” fer cryin’ out loud!! Of course these huge turbines that cost tens of thousands of dollars are losers. The primary reason is that they are available to a tiny fraction of the planet. I’m fairly middle class and couldn’t afford one no matter how I twisted my finances.

    What I *can* afford, however, is to hang out in my garage with some friends and/or neighbors for a week and build my own 1kw (a la Hugh Piggot, et al.) windmill. And what I *must* do, anyways, for climate Change and Peak Oil is reduce my consumption to a fraction of what it currently is. So, if I go to a very low carbon footprint and spend $1k US on a windmill system, what is my ROI? Far better.

    I don’t know enough about utility rates and wind generator output to figure this out, but you two probably do. Why is it not included? As I said already, what is shocking to me in the renewable energy debate is a complete write-off of micro, DIY energy systems even though there are people all over the planet successfully using them.

    No, instead we have article after article about how we need 3ks wind generators so we can power our McMansionville existence.

    Maybe another way is needed: http://aperfectstormcometh.blogspot.com/2008/03/build-out-grid-vs-household-towards.html

    C’mon, guys, impress us. Let’s see the calcs for some of the successful DIY systems.

    Cheers

  • russ

    CCPO – Not interested in impressing you. Don’t bother thinking that the ‘calcs’ are going to support some pie in the sky concept – it ain’t there!

    When you build your own 1000 USD wind turbine (possibly from instructions for sale on the net) and it possibly fails to work at all and never generates enough power to bother with you will understand.

    Forget the Gorific ‘perfect storm’ stuff. If you really believe that the only solution is religion.

    Wind turbines follow the laws of science – you are not going to find any freebies with them.

    The commercial operations, wind farms & solar CSP, have a chance to be successful.

    The small scale home type will make it with a few energetic and knowledgeable do-it-yourselfers.

    Probably 90% of the residential units being spread around will not be in service in 5 years time – if that long.

  • http://www.yahoo.com Bobby B.

    @Susan – I have tried to wash the dust off of my car many times with just a garden hose. It does not work. Even after a thorough cleaning and the application of a super-slippery coat of wax, dust continues to accumulate and it still requires elbow grease for proper removal. A PV cell’s efficiency is directly linked to its cleanliness. You will suffer losses if only hosing off annually. You got to get access and clean manually if you want peak performance. Oh, and there are no batteries currently carrying a ten-year guarantee; save for a couple of watch batteries. Your installer will only guarantee the quality of his work. The equipment will be guaranteed separately – and for a shorter time period – by the equipment manufacturer. The law only requires electronic and electrical devices to carry a 90-day warranty.

    @ccpo – Let’s run some numbers for your theoretical homebuilt windmill:

    BEST CASE
    Capital Outlay: $1,000
    Peak Output: 1 kw (you always get less, but let’s ignore that reality to inflate the numbers in your favor)
    Daily Peak Output: 1 kw * 24 h = 24 kw-h (assuming the wind generates peak output continuously)
    Average Cost of Grid Electricity: $0.09/kw-h
    Daily Cost Offset by Windmill: 24 kw-h * $0.09/kw-h = $2.16
    Return On Investment: $1000 / $2.16 per day = 463 days or 1.3 years
    Conclusion: Not Bad

    LIKELY CASE
    Capital Outlay: $1,000
    Peak Output: 1 kw
    Estimated Efficiency: It’s a homebuilt, but let’s be generous and say 60% efficiency
    Wind Availability: Assume 8 hours at peak, 8 hours at 50% peak, and 8 hours dead calm
    Daily Output: (1 kw * 8 h) + (0.5 kw *8 h) = 12 kw-h
    Daily Output at 60% Efficiency: 12 kw-h * 0.60 = 7.2 kw-h
    Average Cost of Grid Electricity: $0.09/kw-h
    Daily Cost Offset by Windmill: 7.2 kw-h * $0.09/kw-h = $0.65
    Return On Investment: $1000 / $0.65 per day = 1538 day or 4.2 years
    Conclusion: Still Not Bad

    REALITY CHECK
    If you generate at peak output of 1 kw, what appliances can you power with that energy? Let’s look at some of the lesser energy hogs:

    Small Refrigerator Energy Use: 120 V * 15 A = 1800 w = 1.8 kw (Not Even Maybe)
    Hair Dryer: 1200 w = 1.2 kw (Not That Either)
    Microwave Oven: 1000 w = 1 kw (Just Maybe)

    You can forget the air conditioner, the heater, the hot water heater, the laundry machines, and a host of other common appliances. However, take heart, you could run a few CFL’s, a laptop, and a LCD television.

    Again, I am not trying to dissuade anyone from making such an investment. Doing so can certainly provide the buyer with other intangible benefits.

  • http://aperfectstormcometh.blogspot.com ccpo

    Bobby B: Thank you! Excellent response. You didn’t mention battery back-up, but I wouldn’t have one without that, and the build costs can include battery back-up. I doubt you could be grid tied for that, though.

    It’s important to remember I *am* including large, but to my mind positive, behavioral changes that make micro, DIY serviceable for some. This is even more true when you include other elements such as some solar power, heat pumps, etc., depending on funds and circumstances.

    It is also possible to build DIY solar panels (can’t remember the output) for 1k. So, you could have two windmills and 3 solar panels for $5k, for example.

    Yo, Russ! What the heck is your problem? I’ve re-read my post and see nothing offensive there. Why be an arse?

    BTW, there are people living off-grid with DIY systems, so don’t know what to say except that you are demonstrably wrong.

    Cheers

  • http://www.yahoo.com Bobby B.

    @ccpo – One important thing to remember is that no matter how much you do “right” you will never do enough for “real” environmentalism. For every correction an individual, a corporation or a government makes, mainstream environmentalism is touting two more shortcomings that will – without a doubt – cause the planet to die. Creating crises is how the movement survives. Worshipping a dying planet is how they breed disciples.

    Nonetheless, if going off the grid doesn’t work out, we on-griders will gladly welcome you back. ;-)

  • russ

    Hi ccpo – Your lead statement repeated for you.

    “I must file a complaint! Why is it that nowhere on the web, or anywhere else, is wind discussed in a real-world way? By that I mean in contexts that the vast number of inhabitants of the planet will and do encounter.”

    The big turbines work and are commercial – the small ones built on the cheap are far from green – most are just a waste of money & resources.

    Being ‘positive’ means nothing if the science is not there. Look at http://www.homepower.com – these guys are real and not shysters selling plans to do it under 1000 USD.

    Look at the ‘encraft wind trials final report’ actual experiences documented in the UK.

    Consider real wind speeds – the 1 kW you see in home power is usually at 25 plus mph winds which aren’t available. Try 10 to 12 mph at most locations. A turbine rated at 1000 watts at 25 mph will reliably provide maybe 150 to 200 kW per month with 12 mph winds.

    The small high speed, light weight or roof mounted units are a bad joke. For 1000 watts you would need something like 50 ft2 of swept area. You need a tower to get up into the wind.

    Sure people are living off the grid – three types:
    1. spent the bucks
    2. are damned handy
    3. decided they didn’t really need much power so it doesn’t matter if it doesn’t work.

    For small you don’t have too much choice except with batteries – then you can connect downstream if you install the equipment.

  • http://www.yahoo.com Bobby B.

    @russ:

    “The big turbines work and are commercial…”

    They are commercial because they are very costly. They work where and when the wind blows.

    However, the “erect it and forget it” promises put forth by their proponents are not turning out to be true. Use a search engine to research the following topics regarding wind turbines: reliablity, planetary gear wear and/or failure, bearing failure, lubrication problems. The industry thus far has done a mediocre job of predicting the effects of hanging a huge propeller off of a shaft supported by bearings coupled to a gearbox. And no one likes to discuss the amount of energy that must be expended to dismantle and reinstall the components that sit atop those tall towers.

    I recently had a vendor who manufactures gears and repairs gearboxes say that they steered clear of a substantial amount of work repairing wind turbine gearboxes. The owners of the wind turbines wanted them to warrant their repairs for 10 years when the OEM equipment had failed after just 2 or 3 years. They opted out on the realization that such a formula could only lead to economic disaster.

    Now, I will qualify the aforementioned shortcomings with an admission that I have read articles about manufacturers working to develop components that increase a large wind turbine’s reliability. So, their lot is likely to improve.

  • russ

    @ Bobby B – It seems silly to me that the mfgs can not overcome such problems easily. A speed increasing gearbox is a rather routine thing.

    Top 10 wind turbine manufacturers by megawatts installed worldwide in 2007 from Wikipedia:

    Vestas (Denmark) 4,500 MW
    GE Energy (United States) 3,300 MW
    Gamesa (Spain) 3,050 MW
    Enercon (Germany) 2,700 MW
    Suzlon (India) 2,000 MW
    Siemens (Denmark / Germany) 1,400 MW
    Acciona (Spain) 870 MW
    Goldwind (China – PRC) 830 MW
    Nordex (Germany) 670 MW
    Sinovel (China – PRC) 670 MW

    Many of those are well known names and should be able to engineer the solution without problem.

    I guess that part of the problem is that the days of ‘over engineering’ (NASA style is an extreme) an item seem to be over – they may want to do the minimum only.

  • http://www.yahoo.com Bobby B.

    @russ:
    Speed-increasing gearboxes are relatively common, but by no means routine. You actually see many more speed-reducing gearboxes in routine applications. Now it’s been several years since I have done the calculations, but gearboxes basically fall into two categories:

    1. Speed reducing, torque increasing
    2. Speed increasing, torque reducing

    At work, we have a series of gearboxes connected to a tank agitator that reduces the speed of a 5 horsepower, 3600 RPM electric motor to one revolution per hour. The resultant torque is enough to move a 100-foot diameter rake through a dense solution. The small motor, if connected directly to the agitator, would overload and trip because it lacks the torque necessary to do the job by itself. Plus, mixing the aforementioned solution at 3600 RPM is impractical.

    With regards to windmill gearing, Wikipedia offers the following:

    “The gearbox in a wind turbine converts the slow, high-torque rotation of the turbine into much faster rotation of the electrical generator. These are much larger and more complicated than the PTO gearboxes in farm equipment. They weigh several tons and typically contain three stages to achieve an overall gear ratio from 40:1 to over 100:1, depending on the size of the turbine. For aerodynamic and structural reasons, larger turbines have to turn more slowly, but the generators all have to rotate at similar speeds of several thousand rpm. The first stage of the gearbox is usually a planetary gear, for compactness, and to distribute the enormous torque of the turbine over more teeth of the low-speed shaft. Durability of these gearboxes has been a serious problem for a long time.”

    What Wikipedia fails to mention is that the output torque of the gearbox must be sufficient enough to exceed the load (brake horsepower) of the generator to which it is connected. Taking the low speed, high torque input from the windmill’s propeller and converting it into high speed, low (although still substantial) torque to turn a generator is quite a feat. Engineering the gearboxes and bearings to support the weight of that huge propeller, to handle the thrust of the propeller pushing against the works, to handle the torques induced on the shafts, and to steal some of the available energy to keep everything lubricated automatically is where the corrections are necessary. Over-engineering would inhibit the effectiveness of wind energy. Adding weight to the various components in an effort to gain strength will only add load to the structure and reduce the windmill’s efficiency. Even though I am not a wind proponent, I am confident that the engineer’s will overcome these obstacles to improve the technology. Unfortunately, the push to get more wind up-and-running as soon as possible may prohibit waiting for these solutions.

    BTW, I think that we have gone off the topic of the home wind cost analyses. ;-)

  • Mitch

    The author stated:

    “Installing your wind system on a tower shorter than the area’s tree line, or, worse yet, on top of your roof, is akin to floating in a sheltered cove of a river.”

    It is this kind of staid, traditionalist thinking that keeps the “marses on their arses” regarding wind as a viable energy source. Methinks the author hasn’t spent much time on the rooftops!

    Nothing venturi’d nothing gain’d

    Peace

  • Michael Frank

    The economics is so damn ignorant as to make me sick. So, I will work the numbers backwards for my house, 2 story 4 bedroom all electric, that averages 4,000 KWH per month or $400 at 10 cents per KWH.

    Were I really smart and could build my own, which I can, I would plan on two 10 KW at a budget of $5,000 each. I’ve seen home ones done at $3,500 but I am always in a hurry. Budget $10,000 and I want all my money back not in 3 years. But as I do not believe in FREE ANYTHING, my $400 times 24 months is about $10,000 so I might have a 2 year payback and free electricy from then on, less maintenance and storms.

    Ok, Commercial Wind Generators put out far less than their max numbers. Why, the wind does not blow all the time at max speed. So, What do the best get? A 180KW comercial unit on a wind farm in Spain ran 20 years averaging 400,000 KWH per year!!!!!! What does that mean to me? Well, if I were 10 percent of that I would be OK. 18KW and 40,000 KWH per year is $4,000 gross per year. So, my two 10KW home built units do have a chance if the PRICE is totally controlled to only $5,000 per unit. BUT, MY LOCATION and WIND and INSTALLATION must be as good as SPAIN. NO roof tops!!! No short TOWERs, GOOD WIND and a GOOD proven tested design.

    So, bottom line WIND POWER does make sense if YOU are smart and in control. Michael Frank

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