U.S. Windpower: The Good News and the Great News

In 32 data-packed pages, a U.S. Department of Energy Berkeley Lab study released last May details America’s exploding wind power marketplace, with a focus on capacity growth, prices and costs to producers in 2007.

The conclusion? The industry has seen unprecedented growth that has beaten the most optimistic projections.

But, the authors also conclude that the federal renewable energy production tax credit (PTC) has been vital to wind’s immense success, and predicted more boom-and-bust if it’s left to expire in December ‘08. They bottom-line it this way:

If the PTC is not extended, 2009 is likely to be a difficult year of industry retrenchment.

This week, a bill introduced by Senator Max Baucus (Montana-D) containing an extension of the expiring tax incentive failed to move past a cloture vote in the Senate, again. That’s a big blow to the industry and an end to the Baucus bill chapter.

But it’s not the end of the story.

The good news and the great news, on the state of U.S. wind power, after the jump.

In 2007, the US invested $9 billion to add about 5 gigawatts (GW) of nameplate power production, increasing American wind power by 46%. That represents more than the U.S. added in the previous two years combined. Furthermore, no country has ever added 5 GW in a single year. America's total capacity is now about 17 GW. For perspective, a typical nuclear plant puts out about 1 GW.

Even better, 20 GW was added worldwide, bringing the total to 94 GW. The US led the world in new wind power last year by a long shot. Following in order were China, Spain, Germany and India. At the end of the year, Germany led the world with 22 GW of installed capacity. The US was number two at 17 GW, while Spain was third with 15 GW.

Last week the U.S. passed Germany in energy actually generated but still trails in capacity. How can we trail in capacity and lead in actual megawatts (MW) generated? Simple: the U.S. is getting more out of its turbines.

Like any electric generator, the nameplate capacity -- or the number on the manufacturer's nameplate -- is the maximum power that a turbine can produce. Since nothing is able to run at its full speed all year long, the actual energy produced is always lower.

The wind, for example, isn't always blowing hard enough, the sun doesn't always shine and even fossil fuel and nuclear plants shut down for maintenance. The ratio of the actual power produced to the power that theoretically could have been generated while running at the maximum rate is called the capacity factor.

That's a key figure when comparing different power technologies because it tells you how much actual electricity will be generated. Nameplate capacity is usually the number that is reported, talked, written and blogged about, but you need to multiply that by the capacity factor to see just how much actual electricity will be generated. Typical capacity factors for nuclear plants are about 90%, for coal 70%, and for wind 20% to 40%.

Now, getting back to the question, the US passed Germany in actual megawatts produced because its turbines ran longer at higher speeds, raising the output and the capacity factor.

The average turbine size, wind-farm size and capacity factor all increased. The average turbine had a nameplate capacity of 1.65 megawatts. The one to 1.5 MW turbines have become the most popular, accounting for almost half of the new installations. About 24% of turbines are in the 1.5 to 2.0 MW range. The average wind farm was 120 MW in total.

Capacity factors are improving due to higher hub height, better siting and better turbine design. The hub is the horizontal axis of the turbine at the top of the tower, where the blades attach to the turbine. Higher hub heights get the turbine up where the faster wind lives. Capacity factors above 40% are becoming more common. Only 4% of turbines installed more than 3 years ago have capacity factors above 40%, but this number goes up to 25% for those built in the last 3 years. This is a big deal because producing more power means wind power competes better with fossil fuels and can economically replace more dirty coal. For example, increasing the capacity factor from, say, 30% to 45%, means generating 50% more power, and that makes a giant difference.

Six new factories opened up in the US last year, and plans for nine more were announced. Several of these were by foreign manufacturers trying to reduce the transportation costs of moving components nearly half the size of a football field from Europe, and it also gives them some protection from exchange rates movements. With those new factories came 4,700 new jobs.

GE still leads in turbines sales with 44% of the market, as measured by megawatts. Vestas from Denmark, Siemens from Germany and Gamesa from Spain, are the other big players.

Four more states passed Renewable Portfolio Standards (RPS) into law, which require utilities to use renewable energy for some portion of their power. Illinois, New Hampshire, Oregon and North Carolina were added to the honor roll. And Ohio became the 26th RPS state early in 2008. The more RPS states, the more demand for wind and other renewable power.

The major issue against using wind power is that it is intermittent. Makes sense. After all, the wind changes from day to day, and at times minute to minute. That makes providing the power grid with a nice steady current a potential problem. The Berkeley Lab authors reviewed several studies and concluded that integration into the grid is manageable, but it will not be cost-free. The cost is usually below $5 per megawatt hour or less than half a cent per kilowatt hour, the unit used on your electric bill.

The common, published limit on intermittent power is 20% of a grid's total capacity, but other studies are testing limits as high as 30%. That could be very good news if it works because if grids can use more intermittent power then wind and solar could displace even more conventional coal plants. Larger grid operators are likely to handle these problems better -- and soon -- and wind power forecasts will significantly reduce costs and obstacles.

Part of the process of building a new power plant is to inform and coordinate with the area grid operator, which makes applications to the grid interconnection queue a good indication of future development.

Of course, not all projects will actually be built or necessarily be completed at the projected size, but it's still a good estimate. The Berkeley Lab authors looked at the queues of the 60% of the US grid operators that are the most wind-relevant. How much wind power is in the pipeline? Some 225 gigawatts! That's more than 13 times the 17 GW we have now -- a stunning leap of 1,300 percent!

If you use a capacity factor of 35%, that's enough to replace about 37% of our coal plants.

The other 40% of grid operators could have some wind power projects in the pipeline, too, but these aren't the big players in US wind power, so expect their contribution to the overall total to be marginal.

Next Post

You can't expect everything to be perfect when it's growing so fast, not even clean windpower, so my next post will detail the bad news.

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