USA - 4,000 MW of Wind Power Installed in First Half of Year

The U.S. wind energy industry installed 1,210 MW of new power generating capacity in the second quarter, bringing the total added this year to just over 4,000 MW—an amount that was actually larger than the 2,900 MW added in the first six months of 2008, AWEA said in its second quarter market report.

While the number of completed wind farm installations was solid for the second quarter, AWEA said it is seeing a reduced number of orders and lower level of activity in manufacturing of wind turbines and their components, a development it termed troubling in view of the fact that the U.S. industry was previously on track for much larger growth and the global wind power industry is continuing to expand.

“The numbers are in, and while they show the industry has been swimming upstream, adding some 4,000 MW over the past six months, the fact is that we could be delivering so much more,” said AWEA CEO Denise Bode. “Our challenge now is to seize the historic opportunity before us to unleash this entrepreneurial force and build up an entire new industry here in the U.S. that will create jobs, avoid carbon, and strengthen our energy security. To achieve that, Congress and the Administration must pass a national renewable electricity standard (RES) with strong early targets.”

During the second quarter, the U.S. wind energy industry completed a total of 1,210 MW in 10 states, enough to power the equivalent of about 350,000 homes. These new installations nudge total U.S. wind power generating capacity to 29,440 MW, according to the report. The U.S. wind power generating fleet now offsets an average of 54 million tons of carbon annually, reducing carbon emissions from the electricity sector by 2% or the equivalent of taking 9 million cars off the road.

On a Webcast held in conjunction with the release of the report, AWEA Manager of Industry Information Kathy Belyeu shed light on a somewhat complex picture of an industry that continues to post impressive deployment numbers but also is experiencing trends of some concern, such as a slackening manufacturing supply chain.

The latter is largely the result of the economic downturn and related credit crisis, said Belyeu. Still, the news has been partially positive, indicating wind power’s potential to create jobs. At least 20 manufacturing facilities were opened, expanded, and announced in the first six months of the year. At the same time, many existing supply-chain companies have stopped hiring or have furloughed employees due to the slowdown in contracts for wind turbines. Wind turbine component manufacturing investment was one of the bright spots in the economy in 2008, with 55 facilities added, expanded or announced that year.

“Manufacturing investment is the canary in the mine, and shows that the future of wind power in this country is very bright but still far from certain,” said Bode. “The reality is that if the nation doesn’t have a firm, long-term renewable energy policy in place, large global companies and small businesses alike will hold back on their manufacturing investment decisions or invest overseas, in countries like China that are soaring ahead. The instances where manufacturing investment is moving forward in the U.S. are in states like Kansas that have demonstrated a commitment to renewable energy and passed a renewable electricity standard. This type of commitment now needs to be made at the national level.”

Discussing the impressive six-month deployment numbers, Belyeu explained that for the majority of projects commissioned in the first half of the year, developers already had secured financing and started construction in 2008, prior to the economic downturn.

Meanwhile, other factors have recently begun to work in the wind industry’s favor. On July 9 the U.S. Treasury Department and U.S. Department of Energy released the long-awaited guidance for how wind farm developers can access cash grants in lieu of the investment tax credit. The grants, which were part of the American Reinvestment and Recovery Act (ARRA, also known as the stimulus bill), are expected to help get wind projects built while capital markets remain difficult. Since the July 9 announcement, 100 MW of projects have been completed, construction has started on 550 MW, and more than 500 MW of projects have been announced. “We’re definitely seeing the stimulus bill start to have an effect,” on the industry, said Belyeu.

As for other findings from the report, the state posting the fastest growth in the second quarter was Missouri, where wind power installations expanded by 90%. “Missourians know that in order for us to grow our state’s economy and create the jobs of the twenty-first century, we must embrace new technology and advances like the ones presented to us through renewable wind energy,” said Missouri Governor Jay Nixon (D). “So I’m proud that the American Wind Energy Association’s quarterly report shows no state has capitalized on these growth opportunities more aggressively over the last three months than Missouri has. But that isn’t enough. Missouri will continue to look for ways to enhance our energy supply and independence by using common-sense and cost effective expansions of clean, renewable wind power.”

Pennsylvania and South Dakota ranked second and third in terms of growth rate in the second quarter, expanding by 28% and 21% respectively. Iowa, meanwhile, passed the 3,000-MW mark with a cumulative total of 3,043 MW installed and consolidated its position as #2, behind Texas (8,361 MW) and ahead of California (2,787 MW). A total of nine states have now surpassed the 1,000-MW milestone.

The full report is available on the AWEA Web site at http://www.awea.org/publications/reports/2Q09.pdf .