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WIND ENERGY ENDEAVOUR
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1. Introduction
As global energy needs expand, fueling development in economies like China, India,
Russia and Brazil, Dubai cannot afford to rely on the energy policy of the years past and
continue to be a growing regional commerce hub. Its energy strategy must include sustainability
to reduce reliance on traditional means and forms and better compete on the world stage of
energy. Renewable forms of energy such as wind hold promise in Dubai, where a large
percentage of the population is reliant on the central grid for meeting their energy needs.
2. Need and Desire for Initiative
Research major Business Monitor International has, in its second quarterly power report
of 2010, estimated that the PED (or the primary energy demand) in the UAE will go up by more
than 71 percent by the year 2019. The firm further predicts that the generation needs to keep
growing at an annual rate of over 5.4 percent to meet with this demand entirely. The power
consumption that stood at about 68 Terra Watt Hours (T.W.h.) in the year 2009 must go upto the
magical figure of 95 T.W.h. by the year 2019. Electricity generate in the same year was 76
T.W.h. which must increase by 5.4 percent per annum (“UAE needs energy supply growth of
71%”, 2010).
As we finish establishing the imminent power needs of the region, there is concern that
the traditional medicine of conventional power can no longer be relied on – at least not for long.
Pushing such sources will have a devastating impact on the environment, concerns over which
have increasingly intensified the world over in recent times. Sustainable power is the most
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strategic solution for needs met after 2020. Thermal power provided for over 93 percent of the
production need, which urgently needs balanced and supplanted by: nuclear, wind, solar and
hydropower. Gas (70 percent) and oil (30 percent) comprise the fuel balance in the region as of
now though.
3. Description and Objectives
My business proposal deals with crowd sourcing of energy production with installation of
standalone wind energy mills at the micro level, powering individual installations wherever
feasible. This will ensure that the initial investment does not have to come from the
government’s side, a major factor to consider when installing wind turbines. Perpetual
maintenance is relatively small in comparison, specially for the smaller turbines and can be
afforded. Research shows that operation of several wind turbines in a single constellation, or
close together, is feasible, should they be aligned properly. Therefore any insight from the side
of the government will have to come along those lines alone.
Another aspect with such an operational model is that individual wind turbines would be
able to sell unused power back to the grid, for storage to be used in peak times. This will again
help reduce the dependence on conventional fuel for power needs. With virtually no operational
costs and nearly zero carbon footprint, the marginal cost of a unit of power in the long run
decreases even more.
Within this initiative, the aim is to collaborate with wind turbine manufacturer, Gamesa
Inc. of Spain. Sourcing of a range of sizes and capacities of turbines through their China
manufacturing center and borrowing technical expertise through the initial years is planned.
3.1 Objectives
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The main objectives within the business proposal are as follows.
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1. Aim at capturing 5 percent of the domestic private energy sourcing market competing
effectively against solar equipment manufacturers.
2. Increasing turbine penetration to over one household in a hundred by 2019.
3. Asking and making available subsidies for wind turbines through governmental and
private channels for more adaptation.
4. Legal Structure of the Business
The legal structure of the business is being kept as a private limited company. This is
because of reasons associated with liability protection and the ease of doing business primarily.
A private limited company protects its shareholders from any liability arising out of risks that the
business may be exposed to. Unless the corporate veil is pierced, the private assets of the owners
and shareholders are safeguarded in the even the company must pay up for damages or claims.
There are potential tax advantages as well, arising out of the limited structure (Needham, 1996).
The benefits of liability protection can be had at par with a corporation in this case
without the need for excessive paperwork and formalities. The cost of doing business is cheap
and the savings can be passed down to the customers. For many of these, the cost of getting
invested in wind energy would be one of the major expenses and factors which would make or
break the decision for them. It is also important for the customers to place trust in the company
and the nouveau business idea of standalone wind generating turbines. A public limited structure
will also offer considerable respect to the company and much needed transparency will be
brought in.
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5. Organizational Chart
6. Marketing Plan
The marketing plan is a central determinant to the overall success of the endeavor.
Within this plan, would come the strategies concerning the product, the pricing, the promotion
and the place (Moschandreas, 2000).
6.1 Product
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We plan on differentiating the product, ready to install wind turbines, by offering them in
an output congruent to the country’s power grid output. This will ensure that converters are not
needed for using ordinary electrical equipment. Turbines will also come equipped with
warranted high efficiency power generators, with power storage batteries to account for times
when peak power is needed. Excess energy will be stored during other hours of the day.
6.2Promotion
The product will be offered with service warranties for the first three years of operation.
The parts on the turbine will be certified free of manufacturing defects through the life of the
turbines. The installation charges will be fixed at 2000 Dirham only during the first few years of
operation. The company will also work on instituting a tax credit program with the government
of the UAE, against investment in this energy sustainability program. All new customers are
automatically to be entered into service agreements with the Dubai Supreme Council of Energy,
for buying up all unused energy units at a fixed price of a quarter Dirham per unit.
6.3 Price
The company realizes the price sensitivity of the Dubai market when it comes to
extraneous utilities and has opted to institute a penetration pricing structure for the turbines
initially (Djolov, 2006). As such the long term strategic benefits of a wind turbine and the high
initial expenditure make it an expenditure of lower priority. Unless there are initiatives and
incentives from the side of the government, the public is not going to be interested in
environmental affairs that cost.
6.4 Place
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The turbines are going to be more aggressively marketed in open areas, in the
countryside and where there are private installations big enough for a turbine to find home. The
place also needs to be open to access free winds, therefore, areas like downtown must be initially
avoided without a strategy.
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