THE WHIRLING WIND

Success of tax credit and new more affordable U.S.-built technology helping drive strongest year yet for U.S. wind energy

October 18, 2012 (American Wind Energy Association)

“The success of the federal Production Tax Credit and wind energy’s increased affordability are helping drive turbine installations to record levels in America…[according to the American Wind Energy Association (AWEA) Q3 report]...The U.S. wind industry in August for the first time surpassed 50,000 megawatts (MW) of total installed electrical generation capacity…[and] has added 4,728 MW of wind power so far this year…with another 8,430 MW currently under construction.

“Factors for the strong year…[include, 1] Greatly expanded U.S. manufacturing, which now makes up to nearly 70 percent of the value of U.S.-installed equipment, cutting transportation costs…[2] Technological advances, such as higher towers and longer blades, which make turbines more efficient and further drive down costs…[3] The fact that more electric utilities are locking in 20- to 25-year contracts for lower-priced wind power, to the benefit of their consumers…[and, 4] The federal Production Tax Credit for renewable energy, which has been kept continuously in place since 2005 and currently extends to the end of the year…”

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“The PTC incentivizes over $15 billion a year in private [wind] investment…[but expires] Dec. 31. A proposal to extend the tax credit for projects that start construction next year won bipartisan support from the Senate Finance Committee on Aug. 2, as part of an overall ‘tax extenders’ package. It now awaits action by the full Congress, expected in its lame duck session after the election…Navigant Consulting has forecast [37,000 jobs lost] if the PTC is not extended. Thousands of layoffs have already begun in wind energy measurement, development, and U.S. manufacturing, even as the construction sector remains busy…

“The third quarter saw 1,833 MW of new installations, putting total U.S. wind capacity at 51,628 MW on Oct. 1. Over 40,000 wind turbines across the U.S. [now produce electricity]…The year-to-date total stood at 4,728 MW at the end of the quarter, up 40 percent from the same point in 2011. The average turbine size installed throughout the year continues to hover around 2.0 MW…Over 80 percent of the new capacity coming online or under construction is covered by a long-term power offtake agreement [involving 68 utilities], either through a power purchase agreement between a utility and a wind developer, or through direct utility ownership…”

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