Fall 2007

 

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Wind Power for Cost Savings and Environmental Benefit

 

It seems like more and more news stories are concerned with global warming.  Al Gore’s An Inconvenient Truth makes the case that human-caused climate change is real and something needs to be done soon.  In addition, the world’s supply of oil, gas and other non-renewable resources are being depleted.  When you factor in the turmoil in many oil-producing states, alternative energy is an idea whose time has come.  While governments are wrestling with policies that will move us away from fossil fuels, people are looking for ways to reduce their carbon footprint.  Using mass transit, hybrid vehicles and biofuels are all well-known options.  Each of these has problems with cost or accessibility for rural residents.  Now there is a hassle-free alternative available.

 

Wind Power – What’s Old is New Again

During the first half of the 20th century, farmers and ranchers used windmills for their power needs.  Now, recent developments in government policy along with modern technology is making it possible for people to generate their own power. This allows producers to gain some independence from the grid as well as to hedge against future electricity rates.

 

How does this work?

Raum Energy Inc. is a Saskatoon-based manufacturer of wind turbines and accessories.  Their specialty is wind turbines that stand up to harsh prairie conditions, providing a reliable, trouble-free source of electricity.  It hooks into the power grid so customers have the reliability of the regular grid with the savings of self-generation.  When the system is set up, customers will notice a reduction in their power bills.

 

Financial Payback

When one looks at an investment in equipment, they can calculate the cash outflows and inflows and calculate a rate of return.  This rate of return is called the internal rate of return (IRR).  This can be thought of as the equivalent interest rate if the investor put the same amount of money in a savings account.  The following table shows the IRR for this type of investment.

Wind Speed / m/s	Internal Rate of Return
5	1.46%
6	4.02%
7	6.60%

While these returns do not seem that high, the marketing of green energy has just begun. Some utilities are already selling green energy at a premium and it is a good bet that this value will be available to independent producers in the future. This would increase the rate of return. Note: This table is for educational purposes only and results depend heavily on the location of the wind turbine. Individuals should contact Raum Energy Inc. to learn about the opportunities in their own regions.

 

Environmental Impact

When considering wind power, financial payback is not the only concern. When compared to coal generation, 1 kW-h of power generated by wind saves 0.8 - 1 kg (or 555 L) of CO2 released to the atmosphere. Over a year, a 1 kW generator can save over 8 tonnes of CO2. In addition, coal generation releases other pollutants like sulfur dioxide and mercury to the environment.

 

Conclusion

Whether for financial, practical or environmental reasons, harnessing wind power is a very viable option. If you would like to find out more, please contact us.