Energy generation from wind is on target to beat natural gas in 2012, thanks to a mad dash by wind producers to finish projects, as the wind tax credit is set to expire on January 1st.
As of November 30th, preliminary numbers have 6,579 megawatts (MW) of new wind capacity created in the US, just nudging ahead of natural gas, which is at 6,335. It’s also about twice the amount of new coal power being produced, according to a recent Bloomberg article.
“Wind will very likely beat gas, but it may be close,” said Amy Grace, who heads wind energy analysis for New York–based Bloomberg New Energy Finance.
“It’s very likely that we get over 8 gigawatts for 2012,” she said. Finalized data will come from Ventyx Inc. in January, 2013.
But with the end-of-year surge, it’s quite possible that we will get a lot more wind power by the end of the year.
New wind energy capacity could possibly reach as high as 12 gigawatts (GW), beating new gas turbines and possibly adding more new wind capacity in November and December as in all the rest of the year.
The impact of wind energy in the energy mix is starting to make a real impact, a big difference from just a few years ago, as noted by an industry expert:
“It shows that wind has firmly planted its foothold as a valuable energy source,” Jacob Susman, chief executive officer of New York wind developer OwnEnergy Inc., said in an interview. “Five years ago we had to drag utilities in kicking and screaming. Now they’ve got teams of experts who understand its value.”
However, the ongoing threat of the wind power production tax credit expiring looms large. If the credit were to expire, data from Bloomberg New Energy Finance points to US wind energy installations plummeting as much as 88% next year (to about 1.5 GW).
Recently, to address these concerns, the American Wind Energy Association (AWEA) has put forward a plan to phase the credit by 2019, to prevent the potential loss of 37,000 wind energy jobs.
Critics, including senior vice president of Exelon Corp. Joseph Dominguez, who heads one of the largest US nuclear power plants, suggests the wind industry is strong enough to live without the tax credit, because of the strong installations recently:
“The wind energy industry has matured and is thriving today; the PTC is no longer needed,” Dominguez said in a Dec. 13 statement, opposing the AWEA plan.
The increase in wind installations, with the pending end of the tax credit, has benefited General Electric (GE), said Jeffrey Immelt, GE’s CEO, in a recent teleconference call on December 17th.
“We’ll probably make more money this year than the rest of the industry combined in renewables,” Immelt said.
“We can’t control how the PTC works or doesn’t work, but we have a very strong competitive wind business that basically has done the job,” he said.
Can wind energy installations keep up this frantic pace? The next few months will be very interesting. We’ll see where the road takes the wind industry.