Turbines Have Winds at Their Backs

By Published On: October 24, 2008

This year is a banner year for wind energy, with the amount of new projects across the country soaring 45 percent, compared to last year. The American Wind Energy Association expects 7,500 MW of newly installed wind turbines in the U.S. by the end of 2008, with 3,000 MW coming on line the last three months of this year. There were 65 MW of new wind projects installed in California so far this year. That includes the 20 MW Edom Hills Repower and 65 MW Iberdrola project, both of which have contracts with Southern California Edison. The 7,500 MW nationally represents 35 percent of the new installed generating capacity in the country, Randy Swisher, AWEA executive director said October 23. Last year, 5,249 MW of new wind projects were built. “[I]f we are to keep this momentum going, the new president and Congress will need to put in place what the majority of the American people support but the country still lacks: a long-term renewable energy policy,” Swisher said. Part of the boom is associated with the one-year extension of the federal production tax credit (Circuit, Oct. 2, 2008). The credit, which was extended last minute, gives wind producers about 2 cents a kWh. However, a slow down in wind energy installations next year is predicted given the market shakeup, higher costs of capital, and access to capital and transmission constraints. Current market and lending woes are expected to keep new wind developers out of the market. One problem area is the downfall of equity investors like Lehman Brothers, AIG, and Wachovia. Swisher highlighted the advantages of wind power over fossil-fuel plants, including that they do not face fuel, carbon emission, or construction risks. Wind turbines are built in about six months, whereas coal plants take about five years and new nuclear plants, about a decade to construct. Overall, wind “continues to be well positioned” said Swisher. Big drivers are state and national policies. Energy is now front and center stage on the national political level. And, state renewable supply mandates in California, Texas, and other states promote new wind projects. Texas, however, has seen the most wind power installed–693 MW between July and September of this year–because of its commitment to wind and other alternative renewable resources, including agreeing to spend $4.9 billion on new transmission. That cost is expected to save Texans $2.4 billion a year in reduced fuel costs, said Swisher. Four wind projects representing 275 MW of new wind power are under construction to serve the Golden State. Those include Los Angeles Department of Water & Power’s 120 MW Big Pine project, Pacific Gas & Electric’s 150 MW Shiloh 11 project in Oregon, and the 5 MW San Gorgonio Repower. To keep wind energy booming, AWEA plans to push for a five-year extension of the federal production tax credit next year.

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