Costs of Wind Power

Wind technology is competitive today in bulk power markets with support from the production tax credit, and in high-value niche applications or markets that recognize non-cost attributes. Current performance is characterized by levelized costs of 4 to 5.5¢/kWh (depending on resource intensity and financing structure), capacity factors of 30 to 40 percent, availability of 95 to 98%, total installed project costs ("overnight" — not including construction financing) of $800 to $1,100/kW, and efficiencies of 65% to 75% of the theoretical (Betz limit) maximum.

The worldwide annual market growth rate for wind technology is about 30% with new markets opening in countries throughout the world. Domestic public interest in environmentally responsible electric generation technology is reflected by new state energy policies and in the success of "green marketing" of wind power across the country.

This trend graph compares the capital cost in dollars per kilowatt for wind power in areas with Class 4, or  "good"  wind resources and Class 6, or "outstanding" wind resources, starting in 2000 with projections to 2020. Wind plants located in Class 4 and Class 6 wind resources both cost 1,000 dollars per kilowatt in 2000 and 900 dollars per kilowatt in 2005. After that they diverge slightly, and by 2020 plants in Class 4 areas cost 850 dollars per kilowatt, while plants in Class 6 areas cost 770 dollars per kilowatt. This trend graph compares the cost of wind power in areas with Class 4, or "good", wind resources and Class 6, or "outstanding" wind resources, starting in 1992 with projections to 2020. Wind plants located in Class 6 wind resources produce the cheapest power, starting at 8 cents per kilowatt-hour in 1992, decreasing to 3 cents per kilowatt-hour in 2005 and to 2.2 cents per kilowatt-hour in 2020. Wind plants located in Class 4 wind resources produced more expensive power in 1992, at 12 cents per kilowatt-hour, but the margin has narrowed and will continue to narrow, reaching 5 cents per kilowatt-hour in 2005 and dropping to 2.8 cents per kilowatt-hour in 2020.