Amid uncertainty, U.S. wind industry installs 1,400 MW in 1st quarter

May 07, 2008 — With the fate of a key federal incentive in the balance, the U.S. wind energy industry continued new installations at a breakneck pace in the first quarter of 2008, putting 1,400 megawatts (MW) or approximately $3 billion worth of new generating capacity in place, the American Wind Energy Association (AWEA) said today in its quarterly market report.

“These new wind power plants — enough to serve the equivalent of 400,000 homes — coupled with investment in 17 new manufacturing facilities over the past year and a quarter show that, with consistent policy support, America’s wind industry can deliver the goods in terms of clean energy and new clean technology jobs,” said AWEA executive director Randall Swisher.

“But if Congress does not act quickly, this momentum could be derailed at the worst possible time for the economy, placing 76,000 jobs and over $11.5 billion in investment at risk,” Swisher added. “While 2008 is shaping up to be another great year, we could see a very different story in 2009 as uncertainty looms over investment in wind power projects and manufacturing due to continuing delay in extending the production tax credit.”

The production tax credit (PTC) is the primary federal incentive for wind power, and expires at the end of the year along with incentives for other renewable electricity sources.

At previous times when the credit has lapsed (1999, 2001 and 2003), installations have dropped by as much as 93 percent in the following year, as shown in Figure 1 above.

The new wind power facilities installed this quarter span 10 states and bring total U.S. wind power capacity to over 18,000 MW, or enough to serve the equivalent of 5 million homes. Texas added over half this new capacity and now has well over 5,000 MW installed. Over 4,000 MW of projects are now also under construction nationwide.

Additionally, AWEA reports an increase in the share of U.S.-made wind turbine components-from less than 30 percent to approximately 50 percent in three years. Prior to 2005, AWEA estimates that less than a third of components were manufactured domestically. But the relatively stable availability of the PTC since August 2005 has allowed U.S.-based supply chain providers to begin establishing a much stronger foundation of domestic manufacturing for turbine components, which range from towers and blades to gearboxes, bearings, and electrical and electronic components. AWEA estimates that, by the end of 2008, approximately half of turbine components for turbines installed in the U.S. will be produced domestically.

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