Wind Power Generation Industry Overview

Excerpt from Wind Power Generation Report

Companies in this industry operate power generation facilities that convert wind into electricity using turbines. Major companies include BP, EDP Renováveis (Spain), Enel Green Power (Italy), IBERDROLA (Spain), and US-based NextEra Energy and Xcel Energy.

Competitive Landscape

Demand for wind power generation is driven by public support for alternative, nonpolluting renewable energy production methods, along with government incentives that encourage the production and use of renewable energy. Profitability of individual companies depends on strategically locating wind farms in geographies with sufficient wind conditions and access to electric transmission facilities. Large companies often have other energy holdings (such as traditional electricity generation plants and energy distribution operations), enjoy economies of scale in equipment purchasing, and can serve a broader geographic area. Small companies can compete effectively by promoting themselves as "greener" than traditional energy companies, and through serving local communities. The industry is concentrated: the top five companies account for about 50 percent of the wind power capacity, according to the American Wind Energy Association.

Products, Operations & Technology

Wind power generation firms produce electricity using large turbines that harness the kinetic energy of the wind. Turbines are typically constructed of steel and come in two basic configurations: horizontal axis and vertical axis. A horizontal axis turbine, the more common of the two styles, consists of a tower that supports a rotor (or blades), gearbox, generator, drive train, and electronic controls. In windy conditions, a turbine's blades will begin to rotate, generating electricity that is fed into utility power lines and delivered to load centers that then transfer the electricity to the grid.