by Herman K. Trabish
September 15, 2011
In the poker game being played for the
future of the wind turbine’s drivetrain, VC
NEA just told VC
Capital they would see the $15.1 million round B on permanent magnet
generator (PMG) specialist Danotek and raise with a $35 million bet
on PMG innovator Boulder Wind Power.
As just reported by Greentech Media, PMG technology’s emerging
inevitability as a replacement for the traditional gearbox in the
turbine drive-train was affirmed when CMEA Capital and three other
heavyweight Danotek backers (GE Energy Financial Services, Khosla
Ventures, and Statoil Hydro) re-upped funding to advance development
of the company’s PMG converter system.
NEA, which had already invested $11 million in first round backing
for Boulder Wind Power (BWP), joined with first-time investor and
international rare earth metals powerhouse Molycorp in a second
round of funding.
This is a unique synchronicity because a PMG’s
magnets require rare earth metals.
Danotek high-speed PMG system’s attractiveness to investors is
based on a uniquely efficient stator-rotor configuration, as well as
its existing relationships with wind industry manufacturers and
developers such as Clipper Windpower and DeWind.
BWP low-speed PMG system’s attractiveness is based on an
innovative PMG concept that gets away from expensive rare earth
metals and creates efficiencies that BWP says can make wind power
competitive with traditional sources of electricity generation
without the need for incentives.
Based on the three key factors in the
cost of wind - the capital
cost of the turbine; the production of energy; and the cost of
operations and maintenance - the BWP direct drive with its PMG can
be expected, according to rigorous modeling, to keep the cost of
wind generated electricity down in the four cents per kilowatt-hour
according to Sandy Butterfield, the company’s CEO.
At that price, said Butterfield, formerly the Wind Technology Center
Chief Engineer at the U.S. Department of Energy’s National Renewable
Energy Laboratory (NREL), wind would be would be - on an
unsubsidized basis - a more cost-effective source of electricity
The BWP direct drive system will be,
“lighter and cheaper than a
gear-driven system,” Butterfield said, “but the big bang is in
reliability. With a direct drive generator, you have basically
one big moving part to replace [instead of] a bunch of very high
precision, high quality steel moving parts in a gear box.”
Turbine gearboxes, no matter how
precisely designed and assembled, wear out long before the turbine’s
20-year life span is over, requiring a very costly replacement
process involving replacement of the complicated lubrication system,
“A direct drive system eliminates
all of those opportunities for early failure,” said Butterfield,
who, as head of the Gearbox Reliability Collaborative during his
time at NREL, is one of the foremost U.S. authorities on the
One of the most distinguishing
characteristics of the BWP PMG design is that its magnets are part
of an axial flux air core machine which operates at relatively low
temperatures and are made with a rare earth metal called
More commonly, PMG magnets are part of
iron core radial flux machines like Danotek’s, operate at relatively
high temperatures and require a rare earth metal called
In very round numbers, Butterfield said, dysprosium sells - in
today’s very constrained market dominated by China’s hoarding of its
unique rare earth metal supply - for around $1,000 to $2,000 per
kilo; neodymium sells for about $100 per kilo and is relatively more
More significantly, BWP has secured a portion of its newest funding
from first-time investor
Molycorp, the only rare earth oxide
producer in the Western hemisphere and the largest outside of China.
Molycorp will take a place on Boulder Wind Power’s board and be the
"preferred provider" of neodymium from its flagship rare earth mine
and processing facility, currently ramping up to full production, at
Mountain Pass, California.
Rare earth metal processing techniques used in China, Butterfield
“are pretty environmentally
“Molycorp has developed a closed loop
system that is both efficient and environmentally friendly.
Nothing comes out of it and their yield is much better.”
This assures BWP a secure domestic
supply of neodymium while other PMG system makers must continue to
pursue supplies of dysprosium, which, Butterfield said,
“drives the price of high
The $35 million “will get us to
commercialization,” Butterfield said.
Next, he wants “to secure commercial
partners.” He is currently in talks “and very far along” with
multiple turbine manufacturers, for whom he will design the direct
drive PMG system to their turbines’ specifications.
He expects to have operational
prototypes within 18 months.
“We would be working with the design
teams. We don’t expect the rotor to change. We don’t expect the
tower to change,” Butterfield said.
“The nacelle - everything between
the tower and the rotor - will have significant changes. But
mechanical engineering. We’re not inventing new
science. And in many ways, this is an easier machine to handle.”
Commercial deployment will come at the
end of that two-year process:
“That is when we start selling