Governors' Wind Energy Coalition

With the American wind market showing record growth and offshore wind farms gaining support, a new report commissioned by the Department of Energy shows that the bulk of this increased capacity is coming from a small-scale, local, decentralized sector known as distributed wind power.

The report, prepared by DOE and the Pacific Northwest National Laboratory (PNNL), takes stock of the growth in distributed wind power in 2012, which is used independently of utilities to power smaller facilities like farms, small businesses and homes.

According to the report, about a third of all wind turbines installed in the United States in 2012 were distributed wind turbines, representing about 3,800 turbines that can generate 175 megawatts combined. And while the total number of distributed wind turbines installed in 2012 declined by nearly half, the amount of power those new turbines could potentially produce increased by 62 percent, as more Americans install larger turbines for their distributed wind projects.

With government and media attention fixed on large-scale wind farms, particularly the offshore variety of late, the significant contribution of distributed wind power can be easily overlooked, according to Alice Orrell, a PNNL energy analyst and lead author of the report.

“The public often pictures large wind projects with long rows of turbines when they think of wind power,” she said. “This report provides detailed data that shows this image is incomplete. Many of the nation’s turbines are for distributed, not centralized, wind projects.”

Small turbines suffer

This was the first year DOE has taken a detailed look at distributed wind capacity, and the deep dive came at an interesting moment in wind power growth. While towering, commercial-scale wind projects are proliferating — with distributed wind users even turning to larger turbines — small turbine production has experienced a sharp decline. Southwest Wind Power, one of the largest suppliers of small wind turbines in the country, abruptly closed its doors in February of this year.

The situation is even more worrisome given the fact that 91 percent of small turbines installed in the United States last year were built domestically, according to Mike Bergey, president of the Distributed Wind Energy Association (DWEA).

“We were somewhat shellshocked,” said Bergey, describing when Southwest shut down. “It’s an industry and a market that we want to try to nurture back to health.”

Bergey said the recession and rock-bottom solar prices helped cripple the small turbine market, but government regulation hasn’t helped. State subsidy programs have all but disappeared, he said, and last year saw the expiration of the U.S. Treasury Section 1603 program, which allowed companies to get upfront grants totaling 30 percent of the investment and production tax credits they would have been eligible for and provided 75,000 jobs and $44 billion in economic output during its three-year life span, according to CleanTechnica.

“I think there was lot of developers rushing to get their projects eligible to get the cash grant by the end of 2012,” Orrell said. “We’ll have to wait and see if there’s a drop-off in installation in 2013 because it’s gone.”

Bergey said 1603 was especially helpful to those with distributed wind systems generating less than 100 kilowatts, because they then didn’t qualify for other subsidy programs like the popular renewable energy production tax credit.

“The cash payment is very helpful for that type of customer, and losing them has definitely affected the industry,” he said.

Still, distributed wind capacity is still growing and creating jobs. Bergey estimated that around 70 percent of larger wind turbines were built in the United States.

“The industry in general is bullish,” he said.

Rewriting the zoning laws

As distributed wind capacity grows, it has been clashing with municipal zoning laws across the country that weren’t written with giant metal windmills in mind.

“Often, cities never permitted something like small wind turbine,” Orrell said.

Help is being provided by outside organizations, however. The DWEA and the National Association of Counties, for example, have released model wind ordinances that municipalities can follow in applying their own permits.

Orrell said proper siting is crucial in making sure the towering metal structures, often installed in close proximity to population centers, are safe.

“There aren’t many safety concerns when [turbines] are put in right place and are given enough space,” she said.

Orrell said their report hadn’t investigated the effects of distributed wind systems on wildlife, an issue that has attracted a lot of attention for larger systems.

But larger systems — taking up much more space, often on previously undeveloped land — probably pose more dangers to wildlife than smaller systems on developed land where humans have been living for years, Bergey said.

“While we can’t say that they are completely safe for wildlife, the studies have shown very, very little, if not zero, impact,” he added.

An annual occurrence

According to Orrell, DOE commissioned a separate distributed wind report after redefining distributed wind power from simply the use of small wind turbines to the broader application of all wind power for on-site facilities.

Orrell said the report, like the department’s “Wind Technologies Market Report,” will be released every year.

“This is the first year we’ve looked at all this data at this deep a level of detail,” she said. “So we don’t have all ‘whys’ and ‘whats’ right now.”