A new gust of wind projects across the US
High natural-gas prices and global-warming concerns may help wind energy gain critical mass.
(Page 2 of 2)
With three full years of growth behind it and stable growth ahead until at least 2007, when the tax credits expire again, wind developers and turbine manufacturers are "seeing a more stable environment and growing confidence," Chua says.Skip to next paragraph
Subscribe Today to the Monitor
"There's not a utility company in the country that isn't thinking at least a little bit about wind energy and renewable power," says Michael Skelly, chief development officer of Horizon Wind Energy. A major factor, he says, is uncertainty over global warming.
"When you're an energy company deciding where to get your electricity, you're making decisions 20 years ahead," he says. "For most of these industry people, looking that far out, they see a carbon question mark."
Undergirding that shift is the fact that with natural-gas prices soaring, zero-fuel-cost wind looks cheap. Advances in wind-turbine technology cut the average cost of wind power to about 4 to 5 cents per kilowatt hour in 2004, from more than 80 cents per kilowatt hour in 1980. Add to that the tax credit, which chops the cost a further 1.9 cents per kilowatt hour, making it competitive with natural gas and even with coal.
"Word is getting around about wind," says Randall Swisher, executive director of the American Wind Energy Association in Washington. "Up and down the Great Plains are states like Oklahoma, Kansas, Nebraska, and the Dakotas, where there's no special incentives or mandates. But hundreds of megawatts of wind are being developed there because it pays."
That message is getting out. Whole Foods Market Inc., the grocery chain, this month announced it would buy wind power to supply all its energy needs. In Colorado, where typically a mere trickle of consumers sign up for wind power, the falling price of wind power saw Xcel Energy's Windsource program get nearly 3,000 applications in November - more than 15 times the usual volume of consumers. That created a waiting list of more than 1,100.
The gale of wind-power projects has produced a surge of orders for wind turbines that is currently the major constraint on industry development, analysts say. General Electric, the largest US producer of wind turbines with 60 percent of the market by some estimates, is producing all it can make and has an order backlog.
All that interest has new US wind- turbine companies like Gamesa, Suzion, and Clipper Wind Power coming on strong. Last year, Clipper's factory in Cedar Rapids, Iowa, produced just five turbines. This year, it plans to make 150.
"It's great to see the institutional interest among utilities and the finance community," says Jim Dehlsen, Clipper's chairman and CEO. "It's been a long time coming."
Back in Texas, King Mountain near McCamey was one of the biggest wind farms in the country with 215 turbines just completed in 2004, creating scores of new jobs and millions in tax revenue for the town. Now, hundreds of megawatts of new wind power are in development in other dry, wind-swept Texas vistas like Taylor County. A new offshore development near Galveston has also been approved.
This year, Texas could become the nation's leading wind-power state.
"We're about to pass California," says Jim Suydam, spokesman for the Texas General Land Office, which oversees state-owned lands. "We're having a little bit of a race."