Wind Power Generation Beating Natural Gas in U.S. in 2012
Wind-turbine installations are poised to exceed natural gas-fueled power plants in the U.S. for the first time this year as developers race to complete projects before a renewable energy tax credit expires. New wind capacity reached 6,519 megawatts by Nov. 30, beating the 6,335 megawatts of gas additions and more than double those of coal, according to data from Ventyx Inc.
“Wind will very likely beat gas, but it may be close,” said Amy Grace, who leads North American wind industry analysis for Bloomberg New Energy Finance in New York. “It’s very likely that we get over 8 gigawatts for 2012.”
A surge of wind-farm connections in November and December may double the amount of wind capacity added this year to as much as 12 gigawatts, outpacing the additional gas turbines, according to New Energy Finance.
“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.”
A bill to extend the wind production tax credit was approved by the Senate Finance Committee in August and promoted by Senator Chuck Grassley, an Iowa Republican who sponsored the first wind energy tax credit in 1992.
“The reason we’re having an historic year is because the incentives are in place,” said Elizabeth Salerno, chief economist at AWEA. “There’s more at stake now than there ever has been.”
Some utilities oppose the plan, noting that the strength of installations shows wind can survive without subsidy, according to Joseph Dominguez, a senior vice president of Exelon Corp. (EXC), the largest owner of U.S. nuclear power plants.
“The wind energy industry has matured and is thriving today; the PTC is no longer needed,” Dominguez said in a Dec. 13 statement criticizing the group’s proposal. “Rather than a reasonable phase-out, AWEA is essentially asking for a six-year extension of the now 20-year-old” tax credit.
An increase in gas prices may make wind more competitive. Gas futures have risen almost 15 percent this year, which would be their first annual increase since 2007.
Utilities in 29 states are required to get an increasing amount of their supplies from renewable resources such as wind and solar, whether or not Congress renews the tax credits.