Small Wind Turbine Supply Chain
The Canadian SWT supply chain consists of approximately 130 retailers/distributors and six manufacturers of commercial SWTs. The distributors and retailers are concentrated in Ontario (55%), Quebec (15%), Alberta and British Columbia (8% each). Most of these companies are new entrants to the market, and the top 10 distributors/retailers account for roughly 90% of all Canadian sales by volume. Most retailers are engaged in SWT sales either as a sideline business, or as one element of a larger service and retail offering. The majority of SWTs installed in Canada originate from the United States, with 96% of reported sales in Canada attributed to three U.S. manufacturers: Bergey, Southwest Windpower and Aeromax. Most of these imported turbines are mini wind turbines in the range of 300 Watts to 1 kW.
Worldwide, the United States and China have developed a dominant presence in the manufacture of SWTs from 300 Watts to 3 kW. The U.S. manufacturers also have a presence, albeit less dominant, in the 3 to 10 kW range of SWTs. European SWT manufacturers cover a broader range, with reasonable presence in SWTs from 300 Watt to 100 kW, and a very strong presence in the 100 kW to 300 kW range. The Canadian SWT manufacturing market consists of only six firms, five of which are focused on production of medium wind machines in the range of 20 kW to 50 kW. Given that there are only 12 known manufacturers of SWTs larger than 20 kW in the world, it appears that Canada has a small, but important niche in this size range.
Exhibit ES-3 provides an illustrative overview of SWT market supply and demand characteristics (note that China is not represented as its turbines have very little, if any, presence on the Canadian market). This indicates that Canadian SWT manufacturing capacity is well-matched to the upper end of the farm & commercial market, and to the lower end of the northern communities market. It is therefore likely that stimulus of these markets would have a beneficial impact on Canadian manufacturers. U.S. manufacturers cover the lower end of the farm & commercial market, as well as the full range of on-grid residential and battery charging, while European manufacturers appear to have developed a more prominent niche in the larger turbine sizes.
Exhibit ES-3: Overview of Canadian Market Demand and International SWT Manufacturing Capacity