The first quarter of 2013 was the wind industry’s worst first quarter since 2006. The industry installed only 384 MW compared with 1,912 MW a year ago, according to SNL data.
The weak quarter comes in the wake of huge surge installations in 2012, which saw 13,329 MW installed ahead of the scheduled expiration of the production tax credit (PTC). The fourth quarter of 2012 saw 8,054 MW of capacity brought online, more than twice the amount in prior quarters. The fourth quarter of each year since 2000 has been the industry’s strongest, particularly during years when the PTC was scheduled to expire.
That trend might continue, but fourth-quarter booms likely will be reduced by the latest version of the PTC passed by Congress early this year. That revised policy extends the PTC through 2013 but requires projects begin construction or meet a safe harbor clause by the deadline instead of beginning commercial operations, putting less pressure on projects to come online at the same time.
Given that safe harbor provision and the time required to build a wind project, turbine manufacturers expect only limited installations this year followed by an increase in new capacity in 2014 as projects can begin operations.
The solar industry had its best first quarter ever for utility-scale solar generation. The 297 MW completed during the quarter more than doubled the 123 MW completed in the first quarter of 2012. Along with wind, solar capacity peaked in the fourth quarter of 2012, with 841 MW installed — more than twice the amount in any prior quarter. Solar projects are subject to different federal incentives, including the investment tax credit, which steps down from 30 percent to 10 percent at the end of 2016.