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U.S. Wind Market Boomed in 2012

Wind power remains the king of renewable energy generation in the United States. Project developers installed 13.1 GW of wind turbines in 2012, a 28 percent growth from the year before, according to the American Wind Energy Association.

The fourth quarter of last year was particularly busy as 8,380 MW of wind energy generation materialized. That doubled the 4,113 MW added in the last quarter of 2009, the association said in a report released Wednesday.

Overall, the U.S. has about 60 GW of wind energy generation capacity, though that doesn't speak of the amount of electricity that flows from the wind turbines. The turbines will start to turn and generate electricity only when there is a strong enough wind. The intermittent trait of wind energy generation, along with solar energy production, remains a challenge for utilities to manage and integrate them into the electric grid. The grid runs smoothly when it achieves a balance of supply and demand.

Wind energy does out-produce other forms of renewable electricity. Wind farms generated 120.2 terawatt-hours of energy in 2011, compared to 1.8 terawatt-hours of solar, according to the U.S. Energy Information Administration. For the first 11 months of 2012, wind turbines across the country produced 125.9 terawatt-hours of electricity, compared with 4.1 terawatt-hours of solar during the same period.

A fear of losing a federal production tax credit (PTC) drove much of the frenzy to complete projects before the end of 2012. For a while, it seemed destined to disappear at the turn of the new year. The tax credit, worth 2.2 cents per kilowatt-hour, was then saved by the bill to prevent the so-called "fiscal cliff" earlier this month. The one-year extension also changed the rules: wind farms that begin construction 2013 but won't finish until 2014 or later will still be eligible to claim the credit. Previously, only wind farms that were completed before the end of 2012 could claim the credit.

The federal government first offered the PTC in 1992 to help the fledging wind energy industry. Congress has extended over half a dozen times and seems to be the subject of the perennial debate over how much the government should subsidize renewable energy generation. Renewable energy advocates argue that the government should continue its financial support of renewable energy production because renewable energy leaves a smaller carbon footprint. Beyond that, they point out that the fossil fuel industry gets a greater amount of government incentives.

It will be a long while yet before renewable electricity will get anywhere near the production levels of power from fossil fuels or nuclear. Renewable electricity accounted for 13 percent of the total electricity generation in the U.S. in 2010, and that slice should grow to 16 percent by 2040, said the Energy Information Administration. Coal-based power generation is set to decline while natural gas power plants will increase their dominance to 30 percent of the country's total electricity generation by 2040. Back in 2010, natural gas fueled 25 percent of the power generation.

The wind energy association noted a growing interest by large businesses to install their wind turbines or contract to buy wind energy. More schools and universities also have signed power purchase agreements. The association counted 18 companies that have bought wind energy, as well as at least 11 schools and colleges.

Texas retains the top spot for wind energy generation, followed by California, Iowa, Illinois and Oregon.  Texas added 1,289 MW of wind in the fourth quarter of 2012 while California installed 994 megawatts.  The No. 3 most active wind construction state at the end of 2012 was in fact Kansas, followed by Oklahoma.

The association declined to issue an installation forecast for 2013. 

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