Small-Wind Energy Production and Economics: kWh, Capacity Factor, and Cost
The only number that matters in small-wind economics is actual annual energy at your site: kWh per year at your average wind speed and tower height, against the installed cost and maintenance. This page walks through the estimate, the cost structure, and the conditions under which small wind is — and is not — a reasonable investment. If the site is mediocre, no turbine model fixes it.
Estimating annual energy
Annual energy = rated power × 8,760 × capacity factor at your site. The capacity factor depends on average wind speed at HUB HEIGHT, turbulence, and the machine’s power curve. Use a wind resource estimate (local data, a measurement campaign on a tall mast, or a validated wind map corrected for your local exposure) rather than the manufacturer’s marketing example. Worked example: a 3 kW turbine at a site with a realistic 12% capacity factor produces 3 × 8,760 × 0.12 ≈ 3,150 kWh/year; the same machine at 8% capacity factor produces about 2,100 kWh/year. The difference is the site, not the machine.
Power curve, cut-in, and cut-out
The power curve shows output at each wind speed. Cut-in is the speed at which generation starts; cut-out is the speed at which the turbine shuts down for protection. A machine that cuts in at 8 mph in a 7 mph-average site produces little; check the curve against YOUR wind-speed distribution, not the average alone. The average is pulled up by rare high-wind hours that the turbine cannot fully use (cube law helps high speeds, but cut-out and rated limits cap it).
Cost structure
Installed cost includes the turbine, tower (often 25–40% of the total), foundation, electrical, inverter, permits, and crane or crew time. Operating cost includes inverter and blade replacement, bearings, tower climbing or crane access, and electrical maintenance. Divide the net present cost (with financing and maintenance) by annual kWh to get the real cost per kWh; a payback claim that omits tower cost, maintenance, or a weak site is a sales number.
When small wind works — and when it does not
Small wind works best on open, elevated sites with consistent wind, tall towers, low turbulence, and load that can use the output directly (or fair export terms). It is a poor fit in suburban lots, below 30-foot obstructions, in low-average-wind regions, or where the tower and permitting costs exceed the value of the energy. Run the annual-energy and cost arithmetic before buying; if the numbers do not work at your real site, no turbine brand changes them.
Verification checklist
- Average wind speed at the actual hub height, from a source you can cite.
- Power curve and cut-in/cut-out for the exact model.
- Itemized installed cost including tower and permitting.
- Maintenance schedule and replacement parts cost.
- Utility export terms and interconnection rules.
- Your own annual kWh target and the capacity factor that implies.