Project Development, Wind Power

Wind Outlook

RE Outlook 2003 – As 2002 draws to a close, wind’s crystal ball for 2003 is a bit cloudier than usual, owing to the financial turmoil in the electric power industry generally.

RE Outlook 2003 – January 14, 2003 – As 2002 draws to a close, wind’s crystal ball for 2003 is a bit cloudier than usual, owing to the financial turmoil in the electric power industry generally. The American Wind Energy Association (AWEA) still expects to see a strong year of growth across the U.S., spurred by growing interest in the technology, wind’s increasingly attractive economics, and the impending expiration of the federal wind energy production tax credit (PTC) on Dec. 31, 2003. With so much uncertainty in the electric industry, though, we have scaled back expectations from a record year of more than 2,000 megawatts (MW) to a range somewhat below that (a megawatt of wind produces enough electricity for 250 to 300 average homes). Some other things to look for in the year ahead: * Another extension of the PTC: Congress has extended the PTC twice – in late 1999 and early in 2002 – after allowing it to expire. Although there is strong bipartisan support for another extension (this time through 2006), with Congress still close to evenly divided, energy tax legislation could again become a political football. * More state leadership in developing wind and other renewables: New Mexico, where former Secretary of Energy Bill Richardson (D) was just elected governor, saw a Renewables Portfolio Standard (RPS) of 10 percent by 2011 enacted by its state commission last month, and Colorado, where an RPS narrowly missed passage last year, expects to see new renewables legislation introduced by its Speaker of the House with broad bipartisan support. There are now 13 states that have enacted an RPS or state minimum Renewable Energy requirement. * Continued growth in the mainstream power industry’s interest in wind: one simple indicator of this growth: the expansion of WINDPOWER, AWEA’s annual conference and exhibition. WINDPOWER nearly doubled in size from 2001 to 2002, and the 2003 edition, scheduled for May 18-21 in Austin, Texas, looks likely to be larger still, with an expected 3,000 participants. * Continued debate over vitally-needed access to transmission lines: As federal regulators continue the process of developing standard rules to oversee the national wholesale electric industry and its transmission system, the wind industry will be an active participant in the discussion – making use of the huge wind resources of the Great Plains requires transmission to reach the customers in major cities. * More talk about offshore wind plants: in regions of the U.S. that lack immense open space, such as the Northeast, offshore wind development can be a feasible alternative. In the Northeast, two potential offshore developments stand out – the Cape Wind project near Cape Cod has received a huge amount of press attention and the Long Island Power Authority is actively evaluating offshore options. Since the PTC first expired in 1999, every year has posed new challenges, and the wind industry has overcome them all. Given rapidly growing utility interest in wind technology’s attractive economics and environmental benefits, 2003 should be no exception. About the Author: Randall Swisher has served as Executive Director of the American Wind Energy Association since 1989. Prior to that, he worked as Legislative Representative for the American Public Power Association and as Energy Program Director for the National Association of Counties. Swisher has a Ph.D. in American Civilization from George Washington University and a B.A. in Political Science from the University of Iowa. He can be reached at: [email protected]