second quarter wind industry market report from AWEA

Wind projects totaling more than 2,000 MW are awaiting the expected renewal of a major federal tax incentive, the American Wind Energy Association (AWEA) said in its quarterly U.S. market outlook.

New projects in the pipeline amount to more than $2 billion in business, said AWEA executive director Randall Swisher, and they are ready to provide millions of dollars of badly-needed tax revenues and hundreds of skilled jobs to rural counties around the nation, once Congress renews the wind energy production tax credit (PTC).

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Swisher pointed to the Colorado Green Wind Project, a large wind farm installed last year in eastern Colorado, as an example of the benefits that wind energy development can bring to rural areas. In rural Prowers County, population and jobs had been falling for years. Since the Colorado Green Wind Project was built, a chain reaction of economic development has added jobs royalty payments for the property owners and sharply-increased local and county tax revenues. The project is providing clean power for approximately 52,000 average American households.

Owners of the property where the turbines are located will receive between $3,000 and $6,000 annually for each of the project’s 108 turbines. The project has created 15-20 ongoing, full-time well-paying local jobs.

County sales tax revenues jumped 62 percent in one year, from $95,000 to $154,450. The tax base increased by 29 percent, resulting in annual increases of:

“- $917,000 for the school district general fund;
“- $203,000 for the school district bond fund;
“- $189,000 to the Prowers medical center; and
“- $764,000 to the county general fund.

The wind industry installed 1,687 MW in 2003, but most new wind energy projects are on hold this year because of the uncertainty created by Congress’s delay in renewing the tax incentive, AWEA said. The industry has installed less than 30 MW of new capacity so far this year, and the trade group said it doesn’t expect more than 350 MW total in new projects by the end of the year.

Sixty MW at the Oasis Wind Farm in Tehachapi, Calif., 310 MW at the MidAmerican Wind Farms in Ohio and 300 MW at the Flat Rock Wind Farm in New York are among those projects AWEA lists as being “stalled” by the lack of tax incentive.

If the wind industry were to consistently grow at a rate of 18 percent per year, AWEA said, 6 percent of the nation’s electricity could be generated by wind power by the year 2020, resulting in over $100 billion of investment. Over the last five years, U.S. wind capacity has expanded at an annual average rate of 28 percent, showing that the supply chain can ramp up quickly to meet the nation’s power needs. Without a PTC extension, however, the U.S. will likely see very few new installations this year, the group stated.

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