Wind energy isn’t a particularly popular area for venture capital, but thanks to its business model, United Wind just got a $200 million infusion.
United Wind – which sites small wind turbines (100 kilowatts or less) at rural homes, farms and commercial properties – leases the wind turbines, using the model that’s been so successful for the solar industry.
As in solar leasing, wind turbines are leased under 20-year contracts with a fixed monthly fee that’s the same or lower than utility rates. United’s Windlease Program pays the upfront cost to install the turbines (starting at $80,000 each) and is responsible for maintenance.
Small turbines power a library:
With the backing of Forum Equity Partners, United will be able to install 1000 projects in the next two years, up from 26 projects in 2013. It’s the largest investment in small wind projects to date, and is focused on the US Northeast and Midwest.
"With this new partnership, distributed wind energy begins its transition from niche concept to mainstream solution," says Jennifer Jenkins, Executive Director of the Distributed Wind Energy Association (DWEA).
DWEA estimates that, by 2030, small wind systems, including community wind, could be suitable for 23.7 million homes and buildings generating 1400 gigawatts. That’s 70% of US electricity generation in 2014!
Small wind systems produced around 1 GW of electricity in 2015, according to DWEA, with 75,000 turbines deployed across all 50 states. And prices are already coming down.
Last year, Brooklyn-based United Wind tapped New York’s Green Bank as well as US Bancorp for $13.5 million.
"The capital is coming in. We expect to see the same hockey stick (growth) curve that we’ve seen in the solar industry, United Wind CEO Russell Tencer told Reuters.
Last year, NY state released its Energy Plan which includes $5 billion over 10 years for the state’s Green Bank and other renewable energy programs.
Read our article, Successful Leasing Model Comes to Small Wind.
Read DWEA’s Distributed Wind Vision – 2015-2030:
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