An induction generator is a device that converts the mechanical energy of rotation into electricity based on electromagnetic induction. An electric voltage (electromotive force) is induced in a conducting loop (or coil) when there is a change in the number of magnetic field lines (or magnetic flux) passing through the loop. When the loop is closed by connecting the ends through an external load, the induced voltage will cause an electric current to flow through the loop and load. Thus rotational energy is converted into electrical energy.
In fact, an induction generator may operate as a motor or a generator. For instance, a standard, 3 phases, AC motor may be powered from the 50 Hz grid, with the motor speed "slipping" at less than for 50 Hz synchronism. If this motor is itself forced to rotate at more than for 50Hz synchronism by a rotating power source, (e.g. a diesel engine or wind turbine), while connected to the grid, it delivers current to the grid as a generator. The current flow is proportional to the slip, i.e. the small difference, 3%, between synchronised rpm and the actual rpm. This slip is too small to notice as a speed change of a wind turbine rotor, so induction generators are classed, somewhat erroneously, as fixed-speed generators. This type of generator is very simple, rugged, and relatively cheap. Usually it is "excited" into operation.