Week of June 23, 2008
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C O M M E N T A R Y
Multi-billion Dollar
Wind Turbine Race
Spurs Scramble for New Production Sites
For area development executives in the Upper Midwest and Great Plains states, these are exciting days. For many, this is the first time they have had an edge in competing for new manufacturing plants planned by global investors. Today many "have-not" areas are the preferred location for significant new units.

by McKINLEY CONWAY
editor bounce@conway.com
I
t's all because of the wind that sweeps across the great open spaces from Texas north to Montana. Huge wind farms are springing up. The latest wind turbine units being installed in these farms are very large. This poses a problem for wind energy system manufacturers. Their key product may be a turbine blade 150 feet (46 m.) long weighing several tons - so they can't rely on FedEx or UPS to make their deliveries. They need to be close to their market.
      Thus, we see Fuhrlander AG, a substantial German manufacturer of wind turbines, locating a new $25 million plant near Butte, Mt. Wind turbines built at the plant will sell for about $4 million each, and produce up to 2.5 MW each of electricity.
      Meanwhile, Denmark-based Vestas Wind Systems, the world's leading manufacturer of wind turbines, has opened a 400,000 square-foot (12,192 square-m) plant at Windsor, Co., on the plains north of Denver. (Last year Vestas President Ditlev Engel was named to the World Development Hall of Fame in recognition of his leadership in the field, www.sitenet.com.)
      Nordic Windpower Ltd., a company that began in Sweden, has selected Pocatello, Idaho, as the site for their new manufacturing plant that will employ 160 people.
      Acciona Energy, a firm based in Spain, and its subsidiary Acciona Windpower, is building a new $23 million plant at West Branch, Iowa. The company also has plants in Spain and China.
      Siemens Power Generation has announced plans to expand its turbine blade manufacturing operations in Fort Madison, Iowa. The $33 million project includes two buildings and a rail yard. A total of about 500 workers will be located at the site.
      Molded Fiber Glass Companies is opening a new wind turbine manufacturing plant in Aberdeen, S.D., to supply blades for G.E. turbines. The $40 million facility will employ 750.
      It's not a deal yet, but it is known that Suzlon Wind Energy, one of the world's largest developers of wind turbines, is looking at a site at Pipestone, Minn., about 200 miles (322 km) southwest of St. Paul.
      Wind turbine manufacturers looking for sites have also been attracted to existing facilities that can handle large blades and towers. For example:
      Aerisyn LLC, a new alternative energy company, has selected Chattanooga, Tenn., for its first plant site. The firm will occupy the former Combustion Engineering facility that has 1,000-foot (305-m) long bays and an 800-ton (726-t) crane. Wind turbine towers fabricated in the plant will be shipped via a barge dock on the Tennessee River adjoining the site.
      Gamesa Wind Inc., a Spanish firm, has occupied facilities at the abandoned U.S. Steel plant in Bucks County, Penn. Gamesa is one of the world's largest makers of wind turbines.

New decision factors
   These are just a few of the new location and site decisions being made by both the developers of wind farms and those who make the equipment for them. One of the important new site factors is aerodynamics. I find this to be a fascinating surprise. During the years I spent getting a couple of aeronautical engineering degrees at Georgia Tech and later while working in NACA/NASA labs as an aerodynamicist, I never dreamed that the science of aerodynamics might be a big factor in a great new global energy system.
      Further, my logbook shows 7,000 hours piloting small aircraft throughout the United States, Canada, Mexico, and Central and South America. Believe me, surface winds were of great interest - especially when they were gusting across a short dirt strip in Baja.
      Today we have a vast amount of wind information compiled to aid pilots that now gives some guidance in planning wind energy projects. We know that in the United States the strongest on-shore winds are found in the Great Plains, which stretch from Texas to Montana. Around the world, other on-shore areas with persistent good winds include eastern Siberia, northwest China, and Argentina.
      Good areas for offshore installations include the continental shelf along the East Coast of the United States and similar areas in Northern Europe and East Asia. Planners prefer locations where the water is less than 100 feet (30 m) deep. However, new designs may make it feasible to locate just about anywhere on the continental shelf.

Site factors
   One of the key factors in siting a wind farm is access to a power grid. At present these are the existing grids that may have a variety of inputs. In Europe, however, there are plans for a loop to include all major wind farms. There is talk of such a loop in the Western United States.
      When the focus is narrowed from the location region to the actual site of a wind farm, more precise wind data is needed. For big projects, engineers erect test towers on-site and measure wind velocity at various positions and elevations above the surface. Data is recorded for months to cover seasonal variations. An ideal site would show a steady non-turbulent wind of more than 10 miles (16 k) per hour with few sudden gusts or storms.
      The exact location of towers is very important. A lateral shift of a turbine by several hundred feet sometimes gives twice as much energy. Doubling the height of a turbine may give one-third more power.
      Another important site factor is environmental impact or lack of it. A few wind farms like that proposed near Nantucket have stirred fierce opposition because of scenic considerations. Others in populated places have raised objections to noise, and in rare situations, there have been alleged problems involving birds being hit by turning vanes.
      However, most wind farms located in the Great Plains have been well received. Each large turbine needs only about one-fourth of an acre (0.10 hectare). Farmers on whose land turbines are sited may receive several thousand dollars per year per unit without having to make any investment. That beats raising corn or beef.

Facility design
   Historians note that more than 2,000 years ago simple wind mills were used in Persia. They were common in the Roman Empire. In later times the Dutch began designing wind mills with vanes shaped like big sails to get more power for pumps draining lowlands. Over the years the trend has been to ever-increasing sophistication. Today, large new wind turbines may be highly complicated machines.
      Using data from NASA wind tunnel tests, turbine designers are selecting airfoil sections found to be most efficient for low-speed flight. Huge turbine blades made of composite materials are precisely shaped for thickness and camber.
      Wind turbine controls are also becoming much more sophisticated. New designs employ "ailerons" to adjust angle of attack to wind speed and maximize lift for greatest power. General Electric now offers a control system that continually adjusts the wind turbine's blade pitch angle for best rotational speed. Controls also shut turbines down when storms occur to prevent damage from over-speeding.

Leading owners
   The FPL Hollow Wind Energy Center in Texas is the world's largest. It has a total capacity of 735 MW - with an array of 291 GE 1.5-MW turbines and 130 Siemens 2.3-MW turbines.
  • The world's leading owner-developer of wind farms is FPL Energy, P.O. Box 14000, Juno Beach, Fla. 33408-0420. A subsidiary of FPL Group Inc., (Florida Power and Light), FPL Energy has 47 wind farms in 15 states.
  • The Spanish electric utility Iberdrola - 8 Cardenal Gardoqui, 48008 Bilbao, Vizcaya, Spain - is one of the world's largest investors in wind power. The company recently acquired Britain's Scottish Power for $23 billion; a 25 percent stake in Gamesa, the turbine manufacturer; and Energyworks Ltd., based in Landover, Md., for $50 million.
  • Another major is PPM Energy, headquartered at 1125 NW Couch Street, Suite 700, Portland, Ore. 97209. Key locations include Portland and Klamath Falls in Oregon; Houston, Texas; and Calgary, AB. PPM also has plant operations in various states and provinces, as well as smaller office locations.
  • Also big in wind energy is MidAmerican Energy Holdings Co., 666 Grand Avenue, P.O. Box 657, Des Moines, Iowa 50306-0657. Controlled by Berkshire Hathaway, the firm holds MidAmerican Energy Company, PacifiCorp, CE Electric UK, CalEnergy Generation and others.
  • A growing energy owner is Babcock & Brown Wind Partners, Level 39, Chifley Tower, 2 Chifley Square, Sydney, NSW 2000, Australia. Tel. +612 9229 1800. This is a globally diversified entity investing in wind energy generation in Australia, the United States and Europe.
  • Horizon Wind Energy, Houston, Texas, with regional offices in New York, Oregon, Illinois California, Colorado and Minnesota, is now owned by Energias de Portugal S.A. Previously owned by Goldman Sachs, Horizon has developed more than 2,000 MW of operating wind farms. Energias de Portugal is the largest utility in Portugal.
  • German power company E.ON has bought wind farm operations in Spain and Portugal for $1 billion from DONG Energy, a Danish company. E.ON already operates 20 onshore and offshore wind parks in Britain and plans more such projects, including the "London Array," one of the largest offshore parks worldwide.
  • The majority (73%) of DONG Energy is owned by the Danish Government. The company has recently announced plans to build and operate two UK offshore wind farms, Walney Island and Gunfleet Sands II. Walney Island will have 42 turbines and Gunfleet Sands II will have 18.
  • Other significant owners include Airtricity, an Irish firm with numerous wind farms in Europe, and BP's Alternative Energy group that has begun with 550 MW of wind energy projects.

McKinley Conway
Author McKinley Conway
Photo: Rebecca Conway
About the Author
    McKinley Conway's development history is voluminous and distinguished. Just a few of his milestones include founding Site Selection, the first-ever magazine focused on corporate real estate and economic development, and founding two industry associations that set the standard for the industry's professional development — the International Development Research Council (IDRC) and the Industrial Asset Management Council (IAMC).
      And there's much, much more. Conway created the industry's first development-focused Internet site, SiteNet, all the way back in 1983. And he founded Spruce Creek, the pioneering fly-in community near New Smyrna Beach. For even more on Conway's sizeable development-industry legacy, click here.


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