A Novel Way to Reduce Home Energy Bills

By Sara Schaefer Muoz, August 15, 2006

In the latest bid to trim energy bills, some consumers are harnessing wind power in their own backyards — as long as their neighbors don’t balk.

While wind energy is commonly associated with massive turbines churning in desolate, windy areas, a new generation of smaller systems made for areas with moderate wind is hitting the market. The latest small turbines, which resemble a ship propeller on a pole, have three blades, are up to 24 feet in diameter and are usually perched on stand-alone towers between 35 and 140 feet high. The systems have the potential to save consumers between 30% and 90% on their electric bills, manufacturers say, and promise to make no more noise than an air conditioner. But tapping so-called small wind using a high-tech windmill can be costly, and homeowners may find themselves battling zoning officials and annoyed neighbors who find the towering devices unsightly.

Interest in small wind has jumped recently: the American Wind Energy Association, an industry trade group in Washington, estimates that U.S. sales of small-wind systems totaled $17 million in 2005, up 62% from 2004. At the same time, systems designed for residential use are being supported by a growing host of state incentives to offset the cost.

Bergey Windpower’s BWC Excel turbine has 10 kilowatts of power and costs $45,000 to $60,000 (installed).

Southwest Windpower, a company based in Flagstaff, Ariz., last month unveiled the Skystream 3.7, which is more efficient in light wind and less costly and quieter than past turbines. Bergey Windpower Co., based in Norman, Okla., recently employed new airfoil technology in its BWC Excel model to make it more efficient in wind speeds as low as nine miles per hour, and the company Abundant Renewable Energy in Newberg, Ore., this year offers two new small wind turbines, the ARE110 and the more powerful ARE442, designed to be quiet and produce more energy in low-wind areas.

Wind turbines work by collecting energy from the wind and converting it into household power. In most cases, the house is still connected to the local power network and the wind power merely supplements power from the grid. Electricity produced by wind energy is deducted from the homeowner’s meter. Utilities in most states offer “net metering,” giving customers credit for producing excess power. In some cases, homeowners will actually see their meter spin backward as they generate the excess.

Prices of the latest systems depend on their peak capacity, measured in how many kilowatts they produce under optimal conditions. The Skystream, for example, has a capacity of 1.8 kw and starts at around $8,500 fully installed, whereas a 10 kw ARE442 on the highest tower offered can run up to $80,000 with installation. The higher the kilowatt capacity, the more electricity they produce.

Local zoning rules are thwarting some people who want to put up a small wind system. Many gated communities or neighborhood associations prohibit structures like wind turbines, and most municipal governments restrict building heights and may not grant variances for a wind tower.

Even if a system gains approval, neighbors can protest. When William Targosh applied with his local government to put a wind turbine and tower on his 11-acre property in Lansing, N.Y., he says the installation was delayed for almost a year because of protests from other residents, who worried the device would lower property values and threaten birds. (Manufacturers say collisions with birds are rare.) He reduced the height of his 120-foot turbine tower by 20 feet, sacrificing efficiency, he said. But once it was up, he says it cut his power bills by about 35%.

Southwest Windpower’s Skystream 3.7 system, pictured during installation, costs 1.8 kw $8,500 to $11,000 (installed).

Despite the focus on large-scale wind farms and other renewable energy sources in recent years, the market has been slower to embrace residential wind power. In the past, wind turbines were seen as unwieldy and impractical for residential use, and researchers and manufacturers instead focused on commercial devices that could be more profitable. In addition, the industry says small-wind systems have been handicapped by a lack of federal incentives. While consumers can get a 30% federal tax credit up to $2,000 for solar electric and water heating systems, no similar program exists for residential wind systems. But some lawmakers trying to change that: Bills proposed in this year in both the U.S. House and Senate would offer a 30% credit for residential wind systems.

“Small wind” is generally defined as noncommercial systems that have a capacity of 100 kilowatts, though systems installed for residential use are usually 10 kw or less. Despite the segment’s growth, small wind still makes up just a sliver of overall U.S. wind-energy capacity, which was nearly 10,000 megawatts as of June 1, or enough to serve 2.5 million households, according to the American Wind Energy Association.

The systems aren’t for city dwellers or residents of tightly packed suburbs. Those interested in small systems should have at least a half-acre of property, wind speeds of at least 10 mph and electric bills of $60 a month or more to make installing the system worthwhile, manufacturers say. It’s helpful if they live in states with programs that can help offset the costs. California, Massachusetts, New Jersey, New York, Pennsylvania, Ohio and Wisconsin are among the states offering incentives. New York started a program in 2003 that gives consumers up to 50% cash back on the costs of a residential wind system and also offers low-interest loans. In California, people who purchase small wind systems can receive rebates based on the system size; for example, a $50,000 10 kw system can be eligible for a rebate of $22,500.

Some homeowners in areas with rising power bills say they will recoup the cost of their system within a few years. Arthur Larrivee, a real-estate appraiser in Dartmouth, Mass., this summer paid around $16,000 for two Bergey wind turbines equipped with solar panels to nearly eliminate the $150 a month it costs him to power his 1,600 square-foot home. Mr. Larrivee says he will receive about $9,000 in tax credits and rebates, and with the local utility’s credit program for excess power, combined with what he will save on electric bills, he will earn back the rest of his investment in three to five years. “The wind is blowing all day long and it’s free — why shouldn’t I use it?” he says.