New Zealand Engineering 1999 September

Energy

The Rebith of Vortec Energy

Total reinvention
Technology advances
Three products
A viable solution

In 1995 a new concept in the wind energy industry raised much debate amongst local and international experts. Would it succeed? Would it fail? Were the developers’ claims far-fetched? How could a man with no direct energy industry experience launch a venture that required millions of dollars of funding and significant R&D before it could demonstrate its viability?

Robin Johannink, CEO of Vortec Energy, has spent the past few years marketing a venture which revolves around a novel wind turbine technology that was initially designed and patented by the US aerospace giant Northcrop Grumman Corporation (formerly Grumman Aerospace Corp). His company won a 40-year exclusive right to develop and commercialise the DAWT (Diffuser Augmented Wind Turbine) technology which was renamed Vortec, and in 1997 it constructed and installed the world’s first working model, the Vortec 7, at Waikaretu south of Auckland.

When the company started up, it obtained base funding from private shareholders, most of whom were domiciled in New Zealand. By mid-1997, the company started looking offshore for funding and sought NZ$10 million from investors to build two 50-metre wind turbines. According to press reports of the time the company was seen as "snubbing" the New Zealand Stock Exchange in attempting to float on the US Nasdaq stock exchange. Vortec Energy countered by saying that its share price would be maximised in the US due to the valuation put on technology stock in that country.

Mr Johannink admits that the company was unsuccessful in obtaining the full funding it was looking for – but it managed to obtained approximately one-third, which was sufficient to keep the R&D of the project ongoing but was insufficient to build the commercial machines.

Total reinvention

He states that 1 July 1999 has marked the "total reinvention" of Vortec Energy. "We have restructured the company and we will no longer be building and owning wind turbines. Instead, we have become a licensing and intellectual property company due to the strong interest we have had from people wanting to become licensees." In effect, this means that the funding the company is looking for is not as great as before. It has released a Private Placement Memorandum and is now seeking to raise an extra US$2 million from potential investors to facilitate commercialisation and marketing of the Vortec technology.

The first licensees will be Australian and the first power purchase agreements are currently being negotiated with power utilities in that country. Mr Johannink maintains that this will be the platform for the launch of the wind turbine and, simultaneously, the company will be looking to appoint a number of licensees around the world, all conditional upon the successful commissioning of the first Australian machine. The commissioning will take 12 to 15 months and during that time the company hopes to tie down at least another five international licensees. An extensive team is being set up and will be promoting the turbine from this month.

Why is Mr Johannink so confident that the venture will succeed this time round? He says, "Wind power is the fastest growing sector of any form of energy in the world, particularly in Europe where many governments such as those of Germany and Denmark are strongly backing the technology."

He maintains that it is unfortunate that there is a lot of "lip service" to renewable energies in New Zealand, but very little government support. Having said that, he acknowledges that the Minister for Enterprise and Commerce, Max Bradford, has taken a personal interest in his project. However, he believes that with this country’s low energy cost, the preoccupation tends to be purely with cost – and even an increase of one cent per kW militates against certain projects getting off the ground. Australia, on the other hand, has mandated that it will have four percent of its market in renewable energy by 2010 (this translates to approximately 9.070 GWh of new capacity) – a factor that is attractive to the developers of wind energy technology.

There are two distinct markets for wind energy – firstly, the environmental market such as Europe and the US which is focused on the "green" benefits of the technology, and secondly, the necessity markets that require more amounts of energy. It is interesting to note that the US government has declared that it wants to buy five percent of its energy from renewables by 2010. These facts are of immense importance to Mr Johannink and also justify his belief in the development and marketing of the Vortec wind turbine.

Technology advances

What is unique about the Vortec technology? The diffuser is an aerodynamic device that creates a low-pressure region downstream of the turbine rotor, and the suction effect doubles the ambient wind speed at the rotor. In comparison, conventional wind turbines have around 60 percent wind speed at the rotor. The diffuser also significantly increases the power density of the wind, with the potential to increase results in augmented power extraction at 5.5 times the efficiency of a traditional wind turbine.

Other Vortec advantages include land usage, cost of energy, robustness and low noise. The turbines will be rated at 3.5 MW each, which is three to five times the size of the most commonly installed wind turbines currently in use. At the same time, each machine will have a comparative blade size of a 1 MW wind turbine.

Mr Johannink points out that the advantages of land usage and economics are immense – either significantly more energy can be delivered from existing wind farm sites or, alternatively, significantly smaller land areas can be used for viable wind farms.

"Irrespective of all the environmental benefits that wind generation delivers, a key component to the success of wind power technology lies in its economics and cost of energy to consumers," says Mr Johannink. And this is where he believes that the design parameters of Vortec win hands down, bringing competitive advantages of 25 percent potential savings in the cost of energy.

The robustness of the turbine is also a unique feature. Whereas conventional turbine blades which are exposed to excessive weather conditions can experience major damage and failure, the diffuser of the Vortec turbine can protect the blades by turning away from the wind if required. The turbine is also engineered to withstand the most extreme wind conditions that could be experienced in its location and, if necessary, the whole structure can be strengthened with the simple addition of extra leg supports.

The noise factor of wind farms has often militated against their establishment – and it is in this respect that the Vortec scores as well. Noise is minimised by means of the blades being contained within the diffuser and thus deflecting and scrambling the noise generated at the blade tips.

Three products

Mr Johannink expands on the company’s total change of business plan. "We have had major technology breakthroughs in the last few months which have allowed us to refocus and be a lot more confident about our funding. We are repackaging the company into three products. Firstly, the large machines which will be a lot larger than originally anticipated. These will be 3.5 MW machines standing 90 metres tall, and one machine will generate enough energy for 3,500 homes.

"We are also developing underwater machines which will technically be constructed to the same principle as our large machines; and the third category will be the mini-watts which will be used by stand-alone farming communities right down to individual homes and boats."

The company is currently looking at setting up marketing and licensing offices in the US and Europe, and three development teams will be marketing all the Vortec products simultaneously around the world. On a positive note for New Zealand, this country will become the base for the R&D team which will develop new technologies - and Auckland University has already been involved in the development of the aerodynamics of the diffuser design, the key technology of the Vortec.

A viable solution

Mr Johannink believes that after four years of R&D, the company has created the most efficient wind turbine design in the world, which will prove to be, in his words,"the most economic renewable energy solution". Those initial years included the erection and commissioning of the Vortec 7, the subsequent value engineering of an optimum diffuser configuration, and the development of proprietary construction techniques and materials.

Mr Johannink admits that there have been twists and turns along this road. He is now looking forward to the expected commissioning of the first Vortec V3500 in June 2000 in Australia. Once this happens, he maintains that Vortec Energy will have created the most efficient wind turbine design in the world – and, as far as personal satisfaction goes, he will have proved the cynics wrong!