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Wind energy in the developing world

The Western world’s longstanding dominance in the burgeoning wind industry is now under attack from Suzlon, an Indian wind turbine manufacturer that has been rapidly catching up to GE and top European European wind companies since its founding only 11 years ago.

Suzlon is the unlikely creation of a group of brothers who used to run a textile business. Frustrated with the unreliable Indian power system, and unable to make do with an imported German wind turbine, the brothers began building and maintaining turbines themselves. Today, Suzlon is the fifth largest manufacturer worldwide in terms of installed megawatt capacity.

“Technology leapfrogging” is the name given to the phenomenon in which developing countries skip the intermediate phases of technological development that industrialized nations went through, and instead leap right to the cutting edge, adapting business models and products to local needs in the process.

The most widely cited example of technology leapfrogging is the rapid spread of cell phones throughout the developing world. Many of the nations in which cell phones are now prevalent never had a functioning fixed-line telephone system in the first place, both because the infrastructure for fixed line is expensive to develop and maintain, and because monopolistic or state-run phone companies never had any real incentive to invest.

Some of the same dynamics appear to be playing out in India. Electricity boards are owned by state governments under political pressure to keep rates low. The result is an underfinanced and unreliable power system that suffers frequent outages.

Businesses have been forced to adapt by seeking alternative power supplies, and with oil prices high wind has filled some of the gap. According to the article, “roughly 70 percent of the demand for wind turbines in India comes from industrial users seeking alternatives to relying on the grid.”

Demand for turbines is surging in both India in China, which respectively saw 48% and 65% growth in the number of installations in the past year. Worldwide, turbine manufacturers have been unable to keep up with demand. Suzlon recently opened their first factory in Minnesota.

Is there any hope that China and India will leapfrog past the last century’s fossil fuel-powered industrialization directly to a more sustainable economy? Sadly, the answer is probably not. The enormous growth in demand for energy is such that coal, the dirtiest of all fossil fuels, continues to loom large in their future.

(Update: further thoughts on technology leapfrogging, looking at particular at the demand side of the energy equation.)

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