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As Expected, U.S. Wind Installations Down 50% in 2010

By RenewableEnergyWorld.com Editors
January 24, 2011 | 16 Comments

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Washington, D.C. -- Hurt by falling natural gas prices, low demand for power and lack of a long-term renewable energy target, the American wind industry saw installations fall almost 50% last year, according to figures released by the American Wind Energy Association (AWEA).

Wind developers constructed 5,115 MW of wind capacity in 2010, down from 10,000 MW in 2009. Activity has already increased, however; AWEA reports that 5,600 MW of projects are already in the construction phase in 2011.

The new activity was spurred by an extension of the Treasury Grant Program, which allowed developers to take a cash payment for 30% of equipment costs in lieu of the production tax credit. AWEA projects installed wind capacity to grow in 2011 compared to 2010.

The tough year for wind in America caused the country to slip in the global standings; The U.S. now has 40,180 MW of wind capacity – 620 MW short of China's overall capacity.

Although it's been harder for companies to sign power purchase agreements with utilities, wind is an increasingly important piece of the generation picture in many states with Renewable Portfolio Standards. Here's AWEA's breakdown of top states developing wind power:

Texas – 10,085 MW

Iowa – 3,675 MW

California – 3,177 MW

Minnesota – 2,192 MW

Washington – 2,105 MW

Texas, the leading wind power state in America for several years running, achieved a major milestone by surging past the 10,000-megawatt mark for total installations, a quarter of all wind capacity in the U.S., with the addition of 680 MW in 2010. Known as the hub of the oil-and-gas industry, Texas achieved the mark thanks to aggressive pursuit of renewable energy and a renewable electricity standard passed in 1999 and strengthened in 2005. On average, wind now generates 7.8% of the electricity in the Electric Reliability Council of Texas (ERCOT) which covers most of the state, peaking as high as 25%.

Other states active in pursuing targets for renewable energy last year were Illinois (498 MW added), California (455 MW), South Dakota (396), and Minnesota (396 MW). Five more states, which generally began tapping their inexhaustible wind resources more recently than the leaders, showed growth rates above 100%.

With the addition of Delaware and Maryland, 38 states now have utility-scale wind projects, and 14 of those have now installed more than 1,000 MW of wind power.

Wind Power

16 Reader Comments

Comment
1 of 16

Andrew_W

January 25, 2011

Wind and Solar energy are just very expensive supplements, not real "alternatives." People are finally understanding that.

We need to continue to seek a viable solution.

Comment
2 of 16

tom-gray-36391

January 25, 2011

No, that is not correct. See, for example, this recent analysis by investment bank Lazard of comparative energy costs (PDF, see p.3 of report): http://efile.mpsc.state.mi.us/efile/docs/15996/0145.pdf . Wind is clearly competitive with other new types of power plant. As for the resource, it's estimated at roughly 12 times total U.S. electricity demand.--Tom Gray, consultant to American Wind Energy Association

Comment
3 of 16

Andrew_W

January 25, 2011

Sorry Tom. That report doesn't take into account that Wind isn't dispatchable. Wind needs to solve storage to become reliable and feasible.

Instead of continuing to waste billions on Wind schemes we should be looking for a b r e a k t h r o u g h .

We need clean, affordable electricity and wind is not - it's an expensive supplement.

Comment
4 of 16

tom-gray-36391

January 25, 2011

Readers may consult our fact sheet on integration of large amounts of wind into a reliable electric utility system: http://www.awea.org/documents/factsheets/Reliability_Factsheet.pdf

Another good resource on integration is this article on debunking wind myths from Power Engineering, the magazine of the Power Engineering Society of the Institute of Electrical and Electronics Engineers (IEEE): http://www.ieee-pes.org/images/pdf/open-access-milligan.pdf

My personal opinion is that we would do better to make use of the vast and obvious potential of wind rather than chasing after mystical breakthroughs.

- Tom Gray, consultant to American Wind Energy Association

Comment
5 of 16

Andrew_W

January 25, 2011

@ Tom Gray: "Mystical breakthroughs?" Are you serious? Government and private industry have invested more than $400 billion on wind and solar schemes in the last 20 years it it still isn't RELIABLE or AFFORDABLE.

We would do much better seeking real, sustainable SOLUTIONS that pretending that wind and solar can solve our energy needs.

Wind and solar schemes are very expensive, highly subsidized "supplements." Maybe they make some people feel good, but they are not solutions.

Have a look at the collapse of solar schemes in Spain:

http://www.renewableenergyworld.com/rea/news/article/2011/01/spains-solar-sector-sues-government-over-retroactive-tariff-cuts?cmpid=rss

If you remove the tremendous subsidies for wind and solar schemes they would cease to exist because they don't make economic sense.

The only people making any money in wind and solar are the promoters and developers.

We MUST look for real breakthrough technologies that can reliably produce clean, affordable electricity. Wind and Solar do not.

Comment
6 of 16

StephenLacey

January 25, 2011

Andrew -- one need only look to history to see how long it takes for energy technologies to reach mass penetration and drop significantly in cost. From Vaclav Smil, one of my favorite energy-history writers (and while a supporter of renewables, certainly not a vociferous defender):

"The pace of the global transition from coal to oil can be judged from the following spans: it took oil about 50 years since the beginning of its commercial production during the 1860s to capture 10 percent of the global primary energy market, and then almost exactly 30 years to go from 10 percent to about 25 percent of the total. Analogical spans for natural gas are almost identical: approximately 50 years and 40 years. Regarding electricity, hydrogeneration began in 1882, the same year as Edison's coal-fired generation, and just before World War I water power produced about 50 percent of the world's electricity; subsequent expansion of absolute production could not prevent a large decline in water's relative contribution to about 17 percent in 2008. Nuclear fission reached 10 percent of global electricity generation 27 years after the commissioning of the first nuclear power plant in 1956, and its share is now roughly the same as that of hydropower."

Yes, searching for new technologies is important. But who's to say it won't take another 30 years and 400 billion dollars to scale that technology up?

I'm not convinced your logic is backed up by historical experience.

Comment
7 of 16

Andrew_W

January 25, 2011

@Stephen: In case you haven't noticed, it is 2011 and things happen a lot quicker. Using history to suggest that we need decades to find a breakthrough only discourages the innovators that may have useful ideas.

I completely understand that Solar and Wind has some benefit, but they are certainly not going to solve our energy needs. They are very expensive and highly subsidized supplements.

We NEED a breakthrough. Promoters and cheerleaders suggesting that wind and solar are actual breakthroughs are simply counterproductive.

Keep looking.

Comment
8 of 16

Tam_Hunt

January 25, 2011

Andrew, if you insist on repeated posts criticizing the perceived failures of wind and solar, please do us all a favor and read the reports I've sent you in other threads demonstrating the viability of wind (as an "as available" energy resource) and of solar (as a fairly reliable peak power resource).

Why on earth do you think companies are investing billions of dollars in wind in the US and around the world? China added 16 GW in 2010, the US 5 GW (after 10 in 2009). These companies aren't stupid. They're sophisticated companies that expect a good return on a low-risk investment and this is exactly what they get. Wind subsidies include a 30% tax credit or cash grant and accelerated depreciation. These subsidies amount to just a few billion dollars a year for the US as a whole and will likely be phased out eventually (and should be in my view, so that we can stop facing criticisms about subsidies). There are numerous reports now demonstrating that wind power is competitive with traditional power plants in many scenarios. Solar power, when considered as a reliable peak power resource, is also a viable technology and a good deal for ratepayers.

In the last analysis, the future is clear: a continued boom in renewables despite detractors. Check back in five years and let's see what transpires.

Comment
9 of 16

glenn-doty-175949

January 25, 2011

Tam, don't wish for the end of wind subsidies... they are small enough that they are justifiable.

What we need is not an end to subsidies, but a constancy in subsidies. We need to determine exactly what we're subsidizing, and PRICE it. Right now, wind subsidies balance out to ~$20/MWh, while nuclear subsidies exceed that by 3fold and solar subsidies exceed that by 10-20fold. What is the benefit we are subsidizing? If we're subsidizing carbon-emissions reduction, why aren't all three options receiving the same subsidy? If someone built a power plant which incinerated beef fat, would THAT get a carbon emissions reduction subsidy (no), why wouldn't they... or for that matter, why wouldn't an ultra-supercritical pulverized coal plant that achieves 50% efficiency earn some subsidies - its much lower emissions than the simple pulverized coal designs of 30 years ago...

If we simply priced the externalities and offered a subsidy in direct response to that price, then no-one would complain. People complain when they feel the board is being manipulated for no reason other than corruption. We should offer a subsidy equal to $8 for every man-hour of labor that goes into a new energy project that will replace an existing energy producer of greater carbon intensity (recognizing that this is just shifting welfare/unemployment money and is no net cost to the government)... and we should offer a $20-$50 (we can fight out the value, but it must be constant across all energy projects)/t-CO2 projected emissions reduction that results from the project. And if you're worried about peak oil, we should offer $1/gallon of gasoline that would be directly abated by the purchase or installment of the technology - vs the fleet average (this would also result in taxing projects and purchases that are more carbon intensive than average).

That would be FAIR subsidies, which people wouldn't complain about... But then again, they probably would at that.

Comment
10 of 16

Andrew_W

January 25, 2011

@Tam: Nothing you posted as a reference confirmed wind and solar projects as "profitable." You can cheerlead all you want. We get it. It's your business. But stop suggesting that wind and solar are "clean, affordable electricity" when they are not. Wind and solar capital costs may have decreased a little, but only the subsidies make these deals even close to be profitable.

We are beginning to learn that most of these wind and solar schemes will only benefit the developers because of their upfront fees and lack of any real investment. These deals are being discovered for what they really are: bad investments.

Comment
11 of 16

rolf-westgard-67277

January 26, 2011

Those reports are a joke, as is wind power which is an expensive joke. I just took my class to tour one of Excel Energy's power plants. The mention of wind sends the operators into a combination of panic and laughter as they describe the problem of integrating erratic wind. It has no capacity value and a 26% capacity factor in the US in 2010.
Take away the subsidies and the wind business goes as quiet as those turbine blades on a sultry summer day when there isn't a "breath of air". And electric demand is at a peak.

Comment
12 of 16

Tam_Hunt

January 26, 2011

Andrew, the CEC report I've referred you to more than once shows that wind power, unsubsididized, is still competitive with many forms of traditional generation. Read it. And the cost curves are only getting more favorable with time as technologies improve.

Comment
13 of 16

Tam_Hunt

January 26, 2011

Glenn, solar has historically received very large subsidies, particularly for net-metered facilities. However, subsidies are dropping dramatically in most jurisdictions as solar capital costs come down. In CA, subsidies for net-metered systems have literally run out for SDG&E and PG&E six years ahead of schedule (under the CA Solar Initiative) b/c of such strong interest. But the market continues to grow b/c even without the state rebate these systems can still make economic sense.

More importantly, you're comparing apples and oranges when you compare wind and solar as you do b/c wind is almost never net-metered (unfortunately). Rather, the apples to apples comparison is direct sale solar to direct sale wind (and all other direct sale technologies, of course. And currently, the subsidies for direct sale solar are almost exactly the same as for direct sale wind: a federal 30% cash grant or tax credit and accelerated depreciation. Some states like CA cut solar a property tax break that doesn't apply to wind, but for the most part subsidies for these two technologies are now almost identical. And they're both growing gangbusters despite a less stellar year for wind in the US in 2010 (wind installations around the world will show a healthy increase over 2009).

Comment
14 of 16

Anonymous

January 26, 2011

Rolf writes in comment #11:
"It (wind power) has no capacity value and a 26% capacity factor in the US in 2010."

Few would say that wind has no capacity value. Spain manages to generate ~15% of its electricity from wind and, unlike Denmark, is not strongly connected to other grids that readily soak up extra capacity. Some might remark that some of the European countries have a penchant for subsidizing boondoggles. However, China and India must be more careful with their limited funds and each has made a major push into wind power, as have many other nations. In many markets wind power is still somewhat more expensive than fossil fuels, but the differential is small and decreasing--wind power is a viable part of the generation mix.

I also wonder how Rolf calculated this "26%" capacity factor for 2010; I think his value is too low. As far as I know, wind energy generation values are only available through Oct. of 2010 so far--at least if one uses EIA numbers. Consider this estimate:

For the rolling 12 months ending in Oct. 2010 the latest (1/14/11 release) of power monthly specifies wind generated 89,721,000 MWh of energy. AWEA claims 36985 MW of capacity installed by the third quarter of 2010, some of this capacity was not available during part of the previous year, so if we use this capacity value we obtain a LOWER BOUND on the capacity factor of:
( 89,721,000)/(365*24*36985) = 0.277, already significantly higher than Rolf's claim even though it is a lower bound for the 12 months ending Oct. 2010. The actual value will be a bit higher. Furthermore, the capacity factors of new installs are probably in the ballpark of 35% as the newer and larger turbines have much better capacities.

Rolf seems to be engaging in hyperbole....
Steven

Comment
15 of 16

glenn-doty-175949

January 27, 2011

Tam,
What matters is the subsidy in $/unit energy, not $/installed watt. That's the point.

The POINT of subsidizing renewables should be to offset carbon and sulfur, nitrates, and heavy metal emissions... not "doing it just to do it".

Ergo, it's ENERGY produced, not POWER produced, that is important.

Consider the following cases:
100-MW wind farm in MN: $1.7/W, 38% capacity factor, 40-year longevity:
Total system cost: $170M. Total federal subsidy: $56.6M. Total energy produced: 13,300,000 MWhs.

Federal subsidy/MWh: $4.26/MWh. Federal subsidy/t-CO2 abated: $4.92/MWh.

Now consider a rooftop PV system in California: 3kW, installed cost of $7/W, capacity factor 18%, longevity 25 years with 1%/year degradation.
Total system cost: $21k. Total federal subsidy: $7k. Total energy produced: 105.1 MWh.

Total federal subsidy/MWh :$66.60/MWh. Total federal subsidy/ton-CO2 abated: $77.00.

So in this case you have a difference in federal subsidies of 15.6-fold... That's before you look at added incentives for installers and manufacturers - which are FAR greater on a /W basis than they are for wind.

Of course, if you look at EV's, the prius, which would shave ~60 t-CO2 lifetime emissions from the average fleet case, has 0 (goose-egg) subsidies, for a total subsidy of $0/t-CO2 abated... while the Leaf, which would save an average of ~66.7 t-CO2 from the average case, gets an absurd $7500, for an average of $112/t-CO2... or if you wish to use the Prius as a baseline to justify it's lack of subsidies we're paying $1119/t-CO2 through those dumbass subsidies.

If subsidies were blanket, equal across-the-board, and based on clearly defined goals... people wouldn't be so pissed off about them.

Comment
16 of 16

migueliprado

January 27, 2011

I am in the renewable energy business and I think we need more atomic energy, coal, oil, gas and hydro power sources until renewables can start to meaningfully replace them which, of course, they will.

I am all for wind power, but boy those wind farms are ugly and scar the land too.

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