U.S. Wind Power Industry Tempers its 2006 Forecast Slightly

November 1, 2006

Photo of cranes assembling wind turbines. A crane in the foreground is setting a tower in place, while behind that stands a tower with just the nacelle. A completed turbine stands in the background.

Wind power construction projects are continuing apace throughout the country.
Credit: Scott Kirk/Puget Sound Energy

The American Wind Energy Association (AWEA) announced on October 24th that the U.S. wind energy industry remains on track to set a record for wind power installations this year, with U.S. wind generating capacity increasing by 2,750 megawatts (MW). That forecast is actually down somewhat from the 3,000-MW growth predicted by AWEA earlier this year, because some of the projects that companies meant to complete this year will be delayed until 2007. However, the lags in this year's projects, combined with an expected rush on projects next year to beat the expiration of the production tax credit, should cause 2007 to shatter all records. AWEA currently anticipates the installation of up to 3,500 MW of new U.S. wind power capacity in 2007. See the AWEA press release.

A critical factor for the growth of new wind power is the availability of transmission lines to deliver the wind power to consumers, an issue that several western states are currently addressing. In Texas, Governor Rick Perry has secured $10 billion in funding commitments from private companies to build the transmission facilities needed to support the state's burgeoning wind power industry. The state's Public Utility Commission will direct the construction of the new transmission lines. In Montana, Governor Brian Schweitzer announced on October 23rd that TransCanada is moving forward with its $2-billion NorthernLights Transmission project, a high-voltage direct-current line that will deliver Montana's wind power to the Southwest. And in California, the Independent System Operator (ISO), which operates the power grid, plans to petition the Federal Energy Regulatory Commission to allow investors to build transmission lines into renewable resource areas and to gradually recover their costs from renewable energy generators. Currently, the first renewable project in an area needs to shoulder the cost of the transmission line, creating a financial barrier for small renewable energy companies. See press releases from Governor Perry, Governor Schweitzer, and the California ISO (PDF 117 KB). Download Adobe Reader.

National Grid, which operates transmission systems in the Northeast, issued a white paper in late September that urges changes in transmission policies to remove such obstacles for renewable energy generators. The report calls for comprehensive regional planning; a fair cost allocation for transmission system improvements; federal and state cooperation on siting and cost recovery; and policies that address the unique characteristics of renewable power generation. See the National Grid press release and report (PDF 1.2 MB). Download Adobe Reader.