The U.S. market for small wind turbines – those with capacities of 100 kW and less – grew 78% in 2008, with a total of 17.3 MW of new installed capacity, says a report released by the American Wind Energy Association (AWEA).

U.S. manufacturers sold about half of all small wind turbines installed worldwide last year.

U.S. market share amounted to $77 million of the $156 million global total. (Worldwide, about 38.7 MW of new small wind capacity was installed in 2008.)

This growth is largely attributable to increased private equity investment that allowed manufacturing volumes to increase, particularly for the commercial segment of the market (systems 21-100kW). The still-largest segment of the market, residential (1-10kW), was likewise driven by investment and manufacturing economies of scale, but also by rising residential electricity prices and a heightened public awareness of the technology and its attributes.

The industry projects 30-fold growth within as little as five years, despite a global recession, for a cumulative US installed capacity of 1,700 MW by the end of 2013. Much of this estimated growth will be spurred by the new eight-year 30% federal Investment Tax Credit passed by Congress last year and augmented in February this year.

Prices for small wind turbines continue to be widely scattered due to the numerous factors affecting installation costs, but tend to gravitate between $3-6/Watt. Small wind turbine installations are far more construction intensive than solar PV. Expanding the federal ITC to small wind will likely allow economies of scale to take effect and put downward pressure on installed small-turbine costs.