disclaimer: the views expressed are those of paul gipe and are not necessarily those of the sponsor....

Disclaimer: The views expressed are those of Paul Gipe and are not necessarily those of the sponsor.

Disclosure: Paul Gipe has worked with ANZSES, APROMA, ASES, AusWEA, AWEA, BWEA, BWE, CanWEA, DGW, EECA, GEO, IREQ, KWEA, NASA, NREL, NZWEA, OSEA, USDOE, Aerovironment, the Folkecenter, the Izaak Walton League, Microsoft, PG&E, the Minnesota Project, NRG Systems, SeaWest, SEI/REIO, the Sierra Club, and Zond Systems, and written for magazines in the USA, Canada, France, Denmark, and Germany.

Ontario Sustainable Energy Association

• An Association of Member Groups

• We Encourage Local Ownership

• We Help Build Renewable Power Co-ops

• We Support Community Power

Wind Co-op Meeting, Copenhagen, Denmark

©Jen Larsen, KMoE

OOE Outline• OSEA’s ARTs Campaign

Wind OverviewCommunity WindAdvanced Renewable TariffsImpact on Farmers

• Philosophical Context• Net Metering & Net Billing• Market Mechanisms• German Market Example• Distributed Generation

OOE Outline• The Tariffs• Germany The Results• Tariff Design

GermanyFrance

• Why Premium Prices• How To Get There• Sources of Information• Wind Works

Coping with the Power CrisisBy Increasing Renewables

Overview of Worldwide Wind Development

Colorado

California

Wind Energy Has Come of Age

Paul Gipe & Assoc.

Montefalcone, Italy

Galicia, Spain

Why Wind?

• Reduces Use of Nuclear & Fossil Fuels

• Most Cost-Effective of New Renewables

• Relatively Benign

Wind Energy’s Benefits

• Clean & Green (Mostly)No SOx, NOx, or CO2

• RenewableNet Positive Energy Balance (4-6

months)

• Domestic: Not Subject to Embargo

• Does Not Consume Water

• Modular = Flexible

Wind Energy’s Impacts

• Aesthetics or Intrusiveness

• Scarring from Roads

• Shadow Flicker & Disco Effect

• Noise--They are Audible

• WildlifeHabitat Disruption

Bird Kills: Collisions, Electrocutions

Why Now?

• Wind WorksGreater Reliability

• Productivity ImprovedMore Efficient

Taller Towers

• Costs DeclinedEconomies-of-Scale

84 85 86 87 88 89 90 91 92 93 94 95 96 97

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Yield

Medium-Size & Large Wind Turbines

0

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12.5 m, 40 kW

27 m, 225 kW

40 m, 500 kW

80 m, 1.8 MW

Kincardine, Ontario

Northern Ireland

Wind is Flexible• Scale

Big or Small Projects

• LocationNear or Far

• TimeShort Lead Times

• OwnershipLocal or Absentee

Wind is Modular

• Quickly Installed

• When Needed

• As Needed

• Where Needed

• By Anyone

Tehachapi, California

Local Wind Adds Resiliency to High Voltage System*

• Near LoadBoosts HV System

• Small ProjectsCan be Sized to Load

• Less Losses

• Outages SmallEasily Corrected

*Amory & Hunter Lovins, Brittle Power, 1983.

Port Albert, Ontario

World Wind Generating Capacity

80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03

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Other Asia

Europe North America

Wind Capacity Growth by Region

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Europe

World Wind Market Comparison

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Britain

Denmark

Spain

USA

Germany

World Wind Capacity 2003~40,000 MW

U.S.A. 17%

Europe 74%

Asia 8%

Canada 1%

2003 World Wind Capacity

6,700 MW 30,000 MW

3,200 MW

Wind Growing Rapidly• Germany

2,600 MW in 2003

20,000 MW by 2006

30,000 MW by 2012

• Spain: 1,000 MW/yr

• France14,000 MW Filed

• USA: 500-2,000 MW/yr

• Growth: 20%-40%/yr

High Penetration is Possible

Percent Wind

Spain 2%

Germany 4%

Denmark 17%

Schleswig-Holstein, D 28%

Ostfriesland, D 55%

Sydthy Kommune, DK 130%

Wind Energy is a Real Business $27.5 Billion CAD in 2003

O&M5%

Electricity Sales51%

Project Development44%

Wind WorksJobs in the Wind Industry

Europe Direct Indirect Total

Germany 7,500 37,500 45,000

Denmark 8,600 4,300 13,000

Spain 7,000 15,000 22,000

Total 80,000

Wind-Generating Capacity 2003Where Ontario Stands

Germany

Spain

Denmark

California

Canada

Ontario

0 5 10 15

Megawatts (Thousands)

Era of Distributed Generation• Here Now• Resilient, Not Brittle• Short Lead Times• Near Load, Less Losses• Opportunity for Many• Fosters Energy Awareness

Alberta, Canada Ontario, Canada

Alberta, Canada

Montana, USA

Distributed Wind Energy

Distributed Wind Energy

Hohe Westerwald, Germany

Distributed Wind Energy

Thy, Denmark

Distributed Wind Energy

Ostfriesland, Germany

What is Community Power?• Local

Rooted in and Responsible to the Community

• Locally OwnedCooperative, First Nation, Farmer-Owned

• Commercial-Scale Generation

• Small Projects Making a Big Difference

Why Community Wind?

• More Power More Quickly

• More People Involved Locally

• More Money Locally

• More Jobs Locally

Increasing Acceptance #1

“Your Own Pigs Don’t Stink”

Jutland, Denmark

Why Community Wind?• Participation = Greater Acceptance

• Distributed = Greater Resiliency

• Clean & Green (Mostly)

• Human Scale

• Enables Local Ownership

• New Cash Crop For Farmers

Danish Co-ops (Vindmølleaug or Fællesmølle)

• 1/4 Capacity Nationwide

• ~ $1.7CAD Billion

• 100,000 Households Own Shares

• 5% of PopulationVelling Mærsk-Tændpibe

German Co-ops (Bürgerbeteiligung)

• 1/3 Total Capacity

• ~$7CAD Billion

• 300,000 Own Shares

• 2/3 Schleswig-Holstein

• 4/5 Nordfriesland Amt

Hooksiel, Schleswig-Holstein, Germany

Sydthy Kabelaug Denmark

• 16 km of Buried Cable

• Direct to HV Network

• 26 x V27s (225 kW)

• ~1 Million kWh/unit

• Mostly Pig Farmers

Middelgrunden Co-op København

• 20 x 2 MW Off-shore

• 1/2 Owned by Co-op

• 1/2 Owned by Utility

• 8,500 Investors

• ~$1,000CAD per Share

• Visible from Folketing

©Bonus a/s

Paderborn Co-op Germany

• 4 Wind Plants• 17 Companies• 80 x 1.5 MW• 110 MW• $240CAD Million• 780 ha (2,000 ac)• All Companies Local• All Pay Local Taxes

Enercon E66

Wieringemeer Noord Holland

• 5 x 600 kW

• Co-owned 1/2 by Two Farmers

1/4 by Manufacturer

1/4 by Utility

Toronto WindShare

• First Urban Turbine in N.A.• Co-Owned

WindShare Co-opToronto Hydro

• Prominent Location• Highly Visible• Highly Popular

So How Do We Get There?

How Does Ontario Cope with the Power Crisis

and Develop Community Wind?

How Can Ontario Farmers Help

Ontario is a New Market

• Offers Great Promise

• Potentially Large Market

• Lure to ManufacturersNot Yet Too Late

• New Markets Grow FastWhen Conditions are Right

Growth Quickens in New Markets

• “Take-Off” is Shorter

• Benefit from Experience

• Better Turbines

• Bigger Turbines

27 m, 225 kW

80 m, 1.8 MW

Growth Quickens in New Markets

Years to 2,000 MW 4,000 MW 8,000 MW

Denmark 16

Germany 7 2 2

Spain 5 1.5

Ontario ?

Renewable Tariffs Launched

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Denmark

Spain

GermanyRenewable Tariffs Launched

Elements of Success in Europe• Right Price for Fixed Period• Right of Interconnection• By-Right Permitted Rural Use

What Has Worked in Europe• What Works

Advanced Renewable Tariffs (ARTs)

• What Has Not WorkedDirect Subsidies & Tax Credits

Quota or Bidding Systems

• Proof is in the MarketARTs Markets = Many Players

Quota Markets = Few Players

Bidding or Quota Markets• Heavy Administrative Burden• Stop-Start/Boom-Bust

e.g. Quebec 100 MW, then 0

• Little DiversityNo Room for Community Projects

No Room for Farmer-Owned Projects

• Longer Lead TimesLengthy EAs

• Few or No Manufacturers

Advanced Renewable Tariffs• Creates Dynamic Markets

• Ensures Price Stability

• Encourages Manufacturing

• Offers Opportunity to Many PlayersFarmers

Communities

Coops

Wind Companies

Advanced Renewable Tariffs• What Are They?

Political Price, Not Political QuotaFixed Price/kWh for a Fixed Period

• How Do They Work?Simple & ComprehensibleLittle or No Administration

• Where?Germany, France, Spain, Austria,

Netherlands, Portugal . . . Ontario?

Advanced Renewable Tariffs for Ontario Projects <10 MW

• 20 Year Fixed-Price Contract• $0.10CAD/kWh• Years 1-10: $0.10/kWh• Years 10-20

High Productivity: $0.08CAD/kWhLow Productivity: $0.10CAD/kWh

• Streamlined Interconnection• By-Right Permitted Use

Community WindA Vision to Excite the Imagination

• 2,000 MW in 4 years?

• 4,000 MW in 6 years?

• 8,000 MW by 2012?10% of Electrical Energy

Community Wind is About People

How Wind Can Benefit Ontario Farmers

• RoyaltiesLowest Risk

Developer Bears Financial Risk

Lowest Rewards% of Gross Revenue

• OwnershipRisk Born Directly

Wind Risk, Technology Risk, Political Risk

All Profit Owned by Farmer

Royalties & Land Rents

1-10 10-20 20-30

German Average 5%

Indian Mesa, TX 4% 6% 8%

Woodward Mesa, TX 4% 6%

US BLM, CA 4%

Freiburg, Germany 3.8% 5.4%

Portugal 2.5%

Ontario 2-2.75 ?

Potential per Farm• Turbines Use Only ~5-10%!• Potential to Double Farm Income

For 1/2 of Ontario Farmers

Rural Ontario Economic Benefit

• 55,000 Farmers

• 1/2 Install One 1-MW Turbine

• 27,000 MW

• 1/3 of All Ontario Electricity

• $4 billion CAD/Year Total TurnoverMoney Stays Within Province

Money Circulates Through Rural Economy

Potentially Stimulating Rural Revival

Community Wind

Technology for Life*

*from N.F.S. Grundtvig

For Today and for Tomorrow