|By Michael Goggin, AWEA Senior Industry Analyst|
As nearly 10,000 wind energy professionals gathered last month for the WINDPOWER 2013 Conference & Exhibition in Chicago, there were signs of optimism. Most industry participants expect a significant drop in wind farm installations this year, but a solid recovery in 2014.
That forecast follows a very late extension of the federal wind energy production tax credit (PTC). Congress allowed the incentive to expire December 31, 2012, before renewing it the next day. The result: 2012 was a record year with 13,131 MW of new installations as developers rushed to meet the deadline—wind power accounted for 42 percent of new U.S. generating capacity, topping all other energy sources for the first time. At the same time, the industry’s supply chain experienced severe whiplash as orders for 2013 shrank to zero at many companies.
With the PTC restored, the industry is reviving. Utilities are seizing the opportunity to purchase wind power, which offers both low-cost electricity at long-term fixed rates and portfolio diversification. Since WINDPOWER, utility plans for wind totaling roughly $3.5 billion in investment have been announced:
- MidAmerican Energy Co., owned by billionaire investor Warren Buffett, said it will add up to 1,050 megawatts (MW) of wind generation in Iowa by the end of 2015. The new development, it said, will be built at no net cost to its customers and will help stabilize electric rates.
- Xcel Energy plans to add approximately 550 MW of new wind generation in Colorado between now and 2016. A company spokesman said, “These projects meet our customers’ interest in a clean, reliable and diverse energy supply … at prices that would make sense for our customers regardless of any environmental regulations.”
- Portland General Electric said it will buy a 267 MW wind farm in Washington state that is under construction and operate it after it’s completed in 2015.
Some highlights from WINDPOWER 2013:
Incoming AWEA Board Chair Gabriel Alonso, of EDP Renewables, outlined his vision of a strategy for the industry to achieve the stability and sustainability it needs. That strategy, he said, includes strengthening AWEA and the industry’s brand and mobilizing companies and their employees to carry the industry’s message to policy makers.
Incoming AWEA CEO Tom Kiernan was officially introduced to his new industry. Kiernan said his passion for wind energy is personal: “Wind power is clean, affordable, and homegrown. The country needs us to succeed. The natural world needs us to succeed. And frankly, my children and your children need us to succeed.” At another session, representatives of AWEA, the National Wildlife Federation, American Wind Wildlife Institute, and National Audubon Society joined Jose Zayas, director of the Wind and Water Power Technologies Office at the U.S. Department of Energy (DOE), to launch discussion of a new vision for the wind industry’s future to succeed the “20 Percent by 2030” technical report produced by DOE in 2008.
According to Lawrence Berkeley National Laboratory, wind energy costs have fallen by one-third over the last several years, due primarily to technological advances yielding larger and taller wind turbines with greater energy production. Utilities are taking advantage of these reduced costs, with a total of 74 buying or owning wind power in 2012, up from 42 in 2011.
Utilities and grid operators are also successfully integrating increasing quantities of wind energy. In 2011, wind energy provided around 20 percent of the electricity in Iowa and South Dakota, and recently broke a new record on the main power system in Texas, providing more than 35 percent of the electricity at one point in early 2013.
Across Texas, the Midwest and parts of the West, new transmission lines that will enable dozens of gigawatts of new wind energy development have been approved and are expected to be placed in service over the next five years.
These are exciting times for the wind industry, and times of great challenge as well. Our country’s energy sector must shape a new paradigm for meeting America’s energy needs and addressing the threat of climate change. The best days for American wind power are still ahead.
Michael Goggin joined AWEA in February 2008. As Senior Electric Industry Analyst, Michael works to promote transmission investment and advance changes in transmission rules and operations to better accommodate wind energy on the power system while maintaining system reliability. Prior to joining AWEA, he worked for two environmental advocacy groups and a consulting firm supporting the U.S. Department of Energy’s renewable energy programs. Michael holds an undergraduate degree with honors from Harvard University.
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