The “Unlimited” Potential of American Wind Power: AWEA
The American Wind Energy Association held a press conference today (4/21/08) to discuss the present and future of their industry in the United States. Representatives from Siemens, Vestas, GE and Gamesa were there to share their perspectives and answer questions. What they revealed was an industry both optimistic and tenuous; their products are in high demand, but they are reliant on tax credits for large-scale expansion. Given the increasing popularity and regulatory necessity of sustainable power generation, both American and international turbine producers are eying the practically limitless growth potential in the United States. All they need is stability in policy to dramatically expand their manufacturing and R&D capabilities, simultaneously creating thousands of jobs and a competitive American industry.
The United States has a natural edge when it comes to wind energy. Unlike Europe, we have a lot of land with which to harness wind, including across sparsely populated areas. If NIMBY isn’t a problem, the potential for sustainable energy generation is even greater.
According to Roby Roberts, V.P. of Government Relations for Vestas, you need about 8,000 components to make a wind turbine, some of which are really big. Apparently the trick with so many bits and pieces is bringing them together; it doesn’t make sense to transport them over vast distances. Consider the iconic wind turbine propeller blades. Some of the largest blades are 80 meters long – over 260 feet! – which no doubt require special handling, licensing, and lots of money to transport. Instead of building or assembling many of these parts overseas, it makes much more economic sense to manufacture and assemble them locally. That means jobs, lots of them, for communities and regions where wind turbines can be built.
All of the industry leaders agreed that each of their companies was eager to build and expand their manufacturing and Research & Development capabilities across the United States, which would produce thousands of stable jobs. Julius Steiner, CEO of Gamesa USA, commented that if the supply chain could be built in the USA, it would be internationally competitive. That’s part of why, despite policy difficulties, international companies like Gamesa (founded in Spain) have jumped into the US market without any guarantee of a production tax credit (PTC) extensions.
“The PTC provides an incentive of two cents per kilowatt-hour generated to facilities that produce electricity from renewable energy resources…The credit can be claimed for 10 years, beginning on the date the qualified facility is placed in service. The facility must begin operation before the credit expires.” – AWEA newsroom
It’s not that the wind industry needs tax credits to exist, but they do need the PTC to expand and build a supply chain. Without these tax credits, building the manufacturing infrastructure for large-scale wind turbine projects would be nearly impossible. The key to investment in manufacturing is a long-term outlook.
Randall Swisher, Executive Director of the AWEA, said the industry needed five years minimum of policy stability to expand the existing infrastructure foundation. Roby Roberts of Vesta claimed that once the supply chain is in place, prices should drop, making the industry even more competitive. If Congress extends the PTC for even a year, these companies will continue to expand their manufacturing capabilities. Fortunately all of these companies have already built the first links of a solid supply chain, all of them are optimistic that the tax credits will come, and all are commited to the US market.
The importance of the PTC can be gleaned if you take a step back. Internationally, the markets with the most lucrative potential for the wind industry are the USA, Europe, China and India. Europe has a lucrative policy system in place, and China recently announced their own policy to spur the development of wind power. That leaves the United States as a kind of uncertain frontier where, like the Wild West, fortunes could be made or lost. The fortune at stake is not just local jobs, but leadership in a lucrative technology which these industry leaders agree is “limitless”.
Wind power is already booming, but because energy demand is always rising and wind is renewable, this industry could grow for decades without slowing down. All they need is enough time to build, which relies upon the PTC. Julius Steiner characterized this moment as, “the middle of the beginning for the renewable energy industry.” He compared potential renewable energy policy to the laws that made the Interstate Highway system possible, hoping for a similar national push towards a nationally beneficial energy infrastructure. They were all unanimous in a sense of urgency: the time to expand the PTC was now. If the tax credits are allowed to expire, opportunities could be lost and manufacturing jobs will be the first to suffer.
I left with a firm impression that these industry leaders are optimistic about the future. Having survived previous boom-and-bust cycles, they felt that they had passed a critical phase in their industry development, and that a foundation had been built on their end. But, I agree with Julius Steiner when he said that we needed to get the “fundamentals right in our country” by setting a policy foundation for renewable energy to launch from.
Several states have already begun to move in that direction, but the wind and sun know no political boundaries. Even a minimum national policy would help us diversify the power grid, move towards energy independence, and build manufacturing jobs at home instead of exporting them overseas. On top of it all, we would have cleaner air and contribute less to climate change. Wind power is already a leader among renewable energy technologies, and its future is bright – that is not in question. The question instead is whether or not we, as a nation, will support it now and reap the economic and ecological benefits later, or delay it another year while our competition forges ahead.
See a video of highlights from the press conference here.
(AP Photo/The Rosen Group, Kevin Wolf via AWEA’s Flickr)
(Many thanks to Kate Marshall for a copy of the graph.)
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April 22nd, 2008 at 4:41 pm
The solar industry is also in a very similar predicament. There were purchase agreements signed for 3.2 gigawatts of concentrated solar power during 2007, but this won’t happen without the federal tax credit.
Unfortunately, wind farms and solar plants can’t be constructed over night. When incentives come and go, it doesn’t provide the stable energy policy needed for renewable energy to thrive.
April 22nd, 2008 at 8:54 pm
Woo hoo! Maybe this will allow wind turbines to produce 5% of power for Texas (on a good day). Of course, there’s always the need for a dependable spinning reserve when harnessing the intermittent nature of wind, so this is a nice thought but will ultimately do very little to reduce coal/fossil fuel dependency. I believe Texas is in the process of building many more conventional (i.e. dirty) coal plants right now to save itself from the occasional wind power brown-out. Wind power is an intriguing concept but does not provide a suitably stable source for grid power. I can’t help but think that investors will be setting themselves up for failure and/or a government bail-out.
April 22nd, 2008 at 9:49 pm
Kevin:
Actually I believe Texas has canceled at least one coal plant and there is strong opposition against others that are stuck in the planning stage. It’s true that wind is intermittent, but technology is stepping up to solve that problem. Just this week an announcement was made about a new technology that could store excess wind energy and feed it into the grid as needed.
No one is speaking about 100% wind energy, but it pairs well with other existing technologies. In Denmark, for example, they can generate an excess of electricity from their wind farms and they sell it to their neighbors. The secret to wind success is location, and trust me – the industry experts know exactly where the wind blows and in what quantities. They plan their farms, and what they promise to the power companies, accordingly.
April 30th, 2008 at 3:30 pm
Michelle,
What was the announcement about new excess wind energy storage? Do you have a link?
Thanks, Bill
April 30th, 2008 at 4:13 pm
Bill,
The article referening the battery technology mentioned above:
http://www.thecuttingedgenews.com/index.php?article=428
May 6th, 2008 at 2:38 am
[...] Related Posts: What’s Holding Wind Power Back? [...]
May 8th, 2008 at 3:02 pm
For Bill, the wind storage announcement you ask about may be The Iowa Stored Energy Park, a joint project of Iowa, Minnesota and the Dakotas which is one such effort. Check out this post for more: http://tinyurl.com/4maunf
May 8th, 2008 at 5:13 pm
Thanks, Timlynn.
I love the idea of using compressed air to store energy. Can’t wait until they start test and demonstration projects.
May 26th, 2008 at 1:07 pm
Who should I contact about offering land for wind generating turbine towers?
May 27th, 2008 at 7:02 am
@ Marie:
That’s a great question! I’ll be honest and say that I’m not entirely sure for the following reasons:
1) It depends on where you are, if there are any local investors who would want to finance a project on your land, if you have good wind resources, and who the local wind gurus are in your area.
2) I admit that I haven’t researched that part of the process!
So here are some ideas to get you started. First, figure out who builds turbines in your area. You can do that by checking out the phone book or Googling Wind turbines and (the name of your town). Contact their sales representative and ask them; they should have some good contacts. If not, check with any wind/energy/conservation non-profits in your community. There are probably investors or maybe even a regional city who would love to build turbines and attach them to the grid. Your property could help make that happen.
Just keep in mind that this will be a big project, and there might be some legal hurdles along the way. You should do research on any laws concerning the erection of tall structures in your area (would it block a view?). Also, big turbines are in high demand right now and in some areas you might have to wait a year or more before they fulfill their back-orders.
Don’t let that discourage you! Even if you can’t get wind turbines *right now*, it’s a worthy effort and it could turn out to be lucrative for you in the end. If the BIG turbines turn out to be too difficult or infeasible, look into smaller turbines. They’re more affordable, less legally challenging, and they generate plenty of energy. Start with one or two and build up from there. You can hook them up to your house and get a two-way meter to feed them into the grid. They you’ll become an energy producer.
There is an article about smaller wind turbines on Cleantechnica:
http://cleantechnica.com/2008/03/21/the-five-best-micro-wind-turbines/
May 28th, 2008 at 12:51 pm
@ Marie:
Good news! An article just came out to answer your question. Enjoy:
http://news.cnet.com/8301-11128_3-9952638-54.html?part=rss&tag=feed&subj=GreenTech
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July 16th, 2008 at 4:30 am
Have you ever seen 20 Turbines on a Mountain Top? What an overkill. Ruins skyscapes, and property values. How about something else?
July 21st, 2008 at 5:07 pm
One of the best reasons for the alternate energy is the jobs that it will create in this country……as long as the work on the project is done IN THIS COUNTRY…..
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October 22nd, 2008 at 2:10 pm
I need information on the cost of wind power over the years, and the growth of wind capacity intalled world wide. Can you help me?