Title: Fleet, prey, plough: exploiting economies of experience from the large WEG sector to sustain the small wind industry

Authors: Sunderasan Srinivasan; Vamshi Krishhna Reddy Kottam

Addresses: Verdurous Solutions Private Limited, Mysore, India ' Verdurous Solutions Private Limited, Mysore, India

Abstract: The wind energy generator (WEG) manufacturing industry has split into large (above, say, 300 kW) and small (under about 100 kW in rated capacity) sectors, with their respective technology packages, research, design, assembly, logistics, clientele, marketing channels and, consequently, respective reputations. The large WEG sector is an oligopoly of about ten firms sub-categorised into 'innovators', the 'fast followers', and 'followers'. The small WEG sector, however, comprises over 300 rival firms - and an additional 300 component suppliers - mostly enthusiast-founded, funded and managed. These firms work in isolation, at very low average sales volumes, and remain acutely dependent on incentive schemes for their survival. The sector boasts no clear technology leader(s) even after 40 years of progression. The small WEG sector has remained fragile and unviable owing to the lack of scale, the dispersion in research expenditure and engineering resources, and the consequent inability to supply market-responsive products. Licensing designs and engineering from the large WEG players, co-branding and offering energy services, could help build consumer confidence and scale up sales volumes.

Keywords: oligopoly; fee-for-service; economies of experience; technology licensing; small firms; wind industry; wind energy generation; WEG; wind power; co-branding; energy services; consumer confidence.

DOI: 10.1504/IJGE.2015.075147

International Journal of Green Economics, 2015 Vol.9 No.2, pp.144 - 181

Received: 24 Nov 2015
Accepted: 31 Dec 2015
Published online: 04 Mar 2016 *

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