Analysis: U.S. wind power boom to continue 

A record 2,750 megawatts of wind energy capacity was installed in the United States last year and expectations for 2007 are even higher.

“This was one of the best years we ever had in the wind industry,” said Robert Gleitz, wind product line leader for GE Energy.

The U.S. wind industry now has the capacity to generate more than 10,492 megawatts, according to the most recent estimates by the American Wind Energy Association – enough energy to meet the demand of about 2.5 million homes.

The Energy Information Administration, the data arm of the U.S. Energy Department, said wind power made up between 18 and 20 percent of all newly installed capacity in 2006; only natural gas plants provided more.

In the early release of the EIA’s 2007 Energy Outlook, the predicted generation for this year is 46.21 billion kilowatt hours, an increase from last year’s prediction.

Chris Namovicz, operations research analyst for the EIA, said they underestimated in 2006. The longer term outlook predicts approximately 51.85 billion kilowatt hours by 2030.

The EIA expects about 4,000 megawatts of wind power capacity to be added in 2007. That’s more than the AWEA projection of 3,000 to 3,500 megawatts.

“Current regulations keep wind from more significantly contributing to renewable goals,” Namovicz said. “Not that it wouldn’t happen, but there isn’t policy in place right now.”

The analysis, Namovicz said, reflects that wind energy generation is up but it also responds to policy drivers. Originally, the federal production tax credit was scheduled to expire in December 2007 but as one of their last actions, the 109th Congress passed an extension until December 2008, which wind energy producers can benefit from.

The current PTC rate is two cents per kilowatt hour and some industry officials say the market would stabilize if the credit was available for more than a year at a time. The current EIA projections are based on the 2007 deadline and Namovicz said that if the 2008 deadline for PTC’s was extended further, additional generation beyond what’s been predicted would be possible.

“It’s clear that if we had a long term predictable PTC it would benefit the whole wind industry and everybody would be much happier and we would too,” Gleitz said. “Nevertheless today we have 24 months in front of us with full PTC and that’s already a good business climate.”

Spain and Germany currently lead the world in the wind market. Spanish wind farms are expected to supply more than 15 percent of Spain’s electricity by 2010. If the U.S. wind industry meets the 3,500 megawatt capacity expectation for 2007, then it would become the largest market, officials said. Europe has become crowded and is running out of room to put new wind farms while the United States still has untapped land resources.

The largest land-based wind project to date was completed last year in Texas. The Horse Hollow Wind Energy Center in Abilene has a generation capacity of 735 megawatts per hour. The largest offshore project was approved to be built in Britain towards the end of 2006. When it’s completed it is predicted to generate 1 gigawatt of zero emission, renewable energy.

The high price of fossil fuels and growing concern over the pollution they produce, especially those that may cause global warming, have been a major driver behind renewable energy sources like wind.

Lack of a long term tax credit program, along with opposition from environmentalists over land use and effects on wildlife, continue to pose a challenge to the industry.

Residents’ objections over poor aesthetics and noise also create obstacles; most recently, plans for a wind farm in Britain were rejected Monday due to resident complaints.

Integration into public utility’s electric grids is also sometimes a challenge for wind power producers. And regulations vary state to state.

“The challenge on our side, is more getting the components for all the machines we need to deliver to our customers,” Gleitz said, noting the increasing demand for wind, as well as the rising cost of needed materials like steel, is tightening the supply.

GE was one of the largest contributors to the wind industry, expanding its manufacturing with plants in China and Canada, and selling more than 5,000 of its 1.5 megawatt turbine. GE also advanced technologically with the introduction of a 2.5 megawatt turbine as well as grid integration products.

“The twelve months in 2007 will be full steam ahead to produce the maximum number of turbines and we’ll again increase the number of turbines we deliver into the market, and launch some new features and products, it should be a tremendous year,” he said.

By Kristyn Ecohard
UPI Energy Correspondent

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