The Growing Pains of Small Wind: Part II

2011 was a tough year for small wind incentive programs. Over the past 12 months, California, Oregon, New Jersey, Wisconsin, and Minnesota all experienced some kind of suspension or significant reduction of their incentives for wind turbines. While fluctuating incentives often have been the norm for clean energy, it’s usually because of the “on again, off again” nature of public funding. What was significant about the belt-tightening of several of these programs was that they were tied to technology concerns, not budget.  California and New Jersey suspended their programs in response to illegitimate product claims and reliability concerns, and they aren’t alone in their worries.

Fortunately, the distributed wind industry has begun to respond, and the outlook for 2012 is improving.  Work by organizations such as the Interstate Turbine Advisory Council (ITAC) and the Small Wind Certification Council is helping to ensure that the experiences of California and New Jersey aren’t repeated.

Inexperience and Naiveté

In California, things went awry when DyoCore, a small turbine manufacturer making highly optimistic power and production claims, brought itself to the attention of the California Energy Commission’s (CEC) Emerging Renewable Program. When the majority of customer incentive applications turned out to be tied to this turbine, and the company’s overzealous power claims were resulting in incentives that covered almost 100% of the project costs, the CEC suspended the program to reassess their program requirements.

As I discussed in a previous post, overzealous and unverified production claims are regrettably common in the world of small wind. Product certification and rigorous oversight has become an obvious necessity. However, the California example points to another, more elemental weakness within the small wind industry:  the inexperience and instability of a large number of the small wind businesses now in existence in the U.S.

This situation may best be summed up in DyoCore’s response to the CEC’s complaint. In their statement, DyoCore explained that their mistakes were “committed out of inexperience and naiveté,” and continued on to say that this was “the first and only experience DyoCore has had with wind generation of electricity and its only attempt at manufacturing any product and placing it into commerce.”

While DyoCore’s frankness is laudable, this underscores one of the many problems with a small, emerging market that is flooded with over 650 products. Only a small handful of the businesses have the experience, expertise, production scale or financial backing necessary to be successful.

State and federal clean energy programs are eager to see small wind succeed. After all, wind turbines offer one of the very few non-solar options for homeowners and small businesses to generate their own clean and independent energy. We all want small wind to work, and we want it now. But in the case of small wind, patience and good policy is a virtue. At present, the market is not self-governing enough for public incentive programs to take a hands-off approach. Equipment vetting, siting standards, and other criteria that promote good performance are necessary at this early stage of the technology. With small wind, as with parenting, sometimes you have to provide more guidance and oversight than you’d like.

Solutions through Collaboration

Fortunately, states do not have to go it alone. The Interstate Turbine Advisory Council (ITAC), a recently formed collaboration of state, local, and utility wind incentive providers that is being coordinated by Clean Energy States Alliance. Participating incentive programs are sharing notes and experiences on everything from incentive rates to policies. Together, these clean energy funds are helping one another build and deliver effective wind incentive programs.

Currently, the members of ITAC are building on the foundation of certification that has been laid by organizations like the Small Wind Certification Council to evaluate and identify small and mid-sized wind turbines that meet the performance, reliability, and durability expectations of incentive programs. As a group, these state clean energy programs can be a much more powerful force for influencing the evolution of the small wind market.

Hopefully, the day will soon come when the small wind industry will be able to police itself and deliver a quality, reliable product without heavy public oversight – just as the solar and large scale wind industry has over time. Until then, public clean energy programs will be working together to accelerate the maturation of the small wind industry.