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Politics : Rat's Nest - Chronicles of Collapse -- Ignore unavailable to you. Want to Upgrade?

To: Asymmetric who wrote (6953)	1/20/2008 4:14:49 PM
From: Wharf Rat	Read Replies (1) \| Respond to of 24225

2007: record year for US wind industry Posted by Jerome a Paris on January 20, 2008 - 12:55pm in The Oil Drum: Europe This is impressive news: Shattering all its previous records, the U.S. wind energy industry installed 5,244 megawatts (MW) in 2007, expanding the nation's total wind power generating capacity by 45% in a single calendar year and injecting an investment of over $9 billion into the economy, the American Wind Energy Association (AWEA) announced [Thursday]. Disclaimer: I am working for the wind industry - I finance wind projects in Europe. This was widely expected to be an excellent year, after an already good year in 2006, when more than 2,500MW were installed in the US. hopes were that 3,000, or even 3,500MW would be installed in 2007. With more than 5,000 MW built and connected to the grid, the record for any country is shattered (the previous one was Germany with 3244 MW in 2002). And 2008 is looking good too. As the AWEA notes, wind power has several advantages: Helps protect consumers from increases in electricity costs due to volatile fuel prices and supply disruptions: by reducing the use of natural gas and other fuels used for electricity generation, and lowering the pressure on their price, wind can save consumers money, even in regions with low or no wind resources. Wind power prices are quite simple: there is no fuel cost, just a little bit of maintenance, so each additional kWh of power provided when wind blows is almost free once the turbines are installed. Which means that the only cost is the amortization (or financing) of the initial construction. And the good news is that this cost is set in stone from the start, and will not change for the next 20 years: you know how much interest and principal you need to pay, and that's it. Compared to gas-fired plants or even coal-fired plants, whose main cost is that of the fuel, it's becoming a huge advantage, and an incredibly safe bet. Even better, as the AWEA notes, each time wind blows, power with zero marginal cost is sent into the network; with electricity market prices set at the highest marginal cost needed to satisfy demand at any given moment, the more ultra cheap power you have, the lower that market price will be, as there is less need to tap the more expensive producers (like diesel plants or gas peaking plants). That reduces the price of electricity for everybody. The Economist noted that studies in Denmark have shown that the savings to electricity consumers thanks to that effect are now larger in that country than the cost of subsidizing wind power production - which means that this is exactly the kind of things that governments should do, ie bear an expense that creates a larger gain for the overall population. Today, wind power, while still more expensive than existing coal and nuclear plants, is cheaper than gas-fired power and, thus, most of the time, cheaper than market prices which are driven by gas prices. The trouble is that investors are not yet convinced that this will be true for the full next 15 years, and are still reluctant to some extent to support wind construction without some form of support. In the US, that support takes the form of the PTC, or production tax credit, which allows investors to deduct, for ten years, an amount equal to 2cents/kWh from their tax bills, which can thus be added to their income coming from the wind project. more europe.theoildrum.com