Originally Posted by
chucky
Using your same simplistic point of view there's no reason tossing a few magnets inside an otherwise rotating hubshell should add any drag...but it does because in order to make it reliable the generator mechanism needs it's own set of bearing surfaces, etc.
Rotating magnets produce energy loss because they repeatedly change magnetization of the stator. This comes out as heat. In addition, moving magnets give rise to eddy currents that also yield heat. In a standard demonstration of the latter a cylindrical magnet is dropped down an alu tube where it comes to a virtual stop while neither significant mechanical losses are involved nor magnetization of the tube.