On-site generation and consumption of renewable energy can be as healthy for a business's finances as it is for the planet, says Rob van de Veerdonk.
03 June 2019 | Rob van de Veerdonk
Industrial end user electricity tariffs continue to rise to finance the overhaul of the energy grid and transmission system to make it fit for the future. So building a wind turbine for self-consumption offers businesses a way to hedge against rising costs while also avoiding energy taxes and electricity distribution costs.
Despite these benefits, industrial users are often sceptical about installing a turbine on site. The expectation of hassle in developing these projects is seen as a hurdle, regardless of the strength of the business case. Therefore, we want to address four common misapprehensions businesses have about developing and building on-site wind energy.
We don't have a suitable site
It is easy to assume that wind turbines take up lots of land and require a wide-open space to facilitate wind flow. Many businesses assume that their site conditions would not be suitable, but these days wind turbines are built to match many different wind conditions and sites.
To work out whether a turbine would make sense for your site, a wind resource assessment will look at data collected either by sensors on nearby meteorological stations or local turbines, or installed at the site itself. This data provides a picture of wind conditions at your site over several months.
By mapping this against the business's historic energy use, you'll know whether there is enough wind for a turbine to produce the energy you need.
We can't afford it
Financing is a vital consideration and saving on energy costs may be the primary reason you are considering the project. Besides putting up the capital yourself or approaching a bank for a loan, there are a number of ways to finance your wind turbine and manage costs.
- Lease the turbine from a manufacturer for a fixed fee that covers the costs of developing, building and operating the project.
- Find an equity investment partner to take on responsibility for a share of the project, bringing cash as well as expertise.
- Opt for a power purchase agreement to buy power produced by the turbine at a fixed price from a utility that takes on the responsibility for the project from beginning to end.
There are many different funding methods - whether one-off investments or structured repayments - so companies can find a solution to paying less than the price for grid electricity over the lifetime of the project.
It'll never get through planning
You would be right to expect planning applications for the construction of a single wind turbine to be scrutinised.
Turbines must comply with regulations on noise levels and shadow flicker as they affect near neighbours, and an archaeology appraisal may be required to assess the impact on local heritage sites. Building support for your project among local influencers and decision-makers will help make a reasonable timeframe achievable.
In the UK, development of a single medium-scale turbine is typically less cumbersome compared with developments of larger wind projects. In particular, applications for a single turbine with a tip height of less than 100 metres do not need an environmental impact assessment, so that saves a significant amount of time in the planning and assessment stage.
I won't be able to get the board on side
Your board wants to know that your wind turbine project is not only designed to make the business look 'green', but will also bring economic benefits. You'll be able to make the business case for the move to wind energy if you have a solid understanding of your:
- Energy use;
- Business-rate energy costs;
- Comprehensive data on the on-site wind resource; and
- A clear funding plan.
Businesses that want to develop a self-generation project should enlist an experienced consultant or manufacturer to perform a feasibility study and to support them at all phases of the project through to operation.
Rob van de Veerdonk is CMO at EWT Direct Wind