Strong Ending for 2011
Orders lag for next year
The boom continues in the wind industry as fourth-quarter figures were just released. But the “boom” in the boom-bust cycle will end sometime this year as a key federal subsidy appears ready to lapse.
The U.S. wind industry installed just over 6,810 megawatts (MW) in 2011, 31 percent higher than 2010, and has more than 8,300 MW under construction, setting the stage for a strong 2012, according to the American Wind Energy Association.
The wind energy PTC will expire in 2012 unless Congress takes action. Industry leaders are looking to the budget negotiations that re due to start again in February. The PTC, at 2.2 cents per kilowatt-hour, is a tax incentive that has sustained the industry for close to two decades.
Private investment generated over the last four years of relative PTC stability averages $17 billion a year, AWEA says.
Meanwhile, this year appears strong as developers race to beat the December placed-in-service deadline.
“Under construction we have over 8,300 MW entering 2012,” said AWEA Chief Economist Elizabeth Salerno.
Total installed capacity is now 46,919 MW, with yearly total at 6,800 MW. That represents 100 projects in 30 states, with 3,444 MW in the fourth quarter, typically the industry’s best.
But 2013 is shaping up to be a different story. Vestas has already threatened to cut 1,600 manufacturing jobs next year and Iberdrola Renewables has cut staff and said it will suspend planning for next year’s installations.
Further downstream, suppliers on an AWEA conference call reported strong orders in the current quarter but couldn’t promise how their factories would be operating later this year or early next.
“We like to plan out eight to 10 months out, given our supply chain,” said gearbox maker Winergy CEO Terry Royer. “Now, we’d like to be seeing forecasts in this quarter from our customers for planning 2013.”
With the bottom ready to drop out due to Congressional inaction, that planning process is impossible.
Denise Bode, AWEA CEO, said of the “Traditional tax incentives are working. This tremendous activity is being driven by the federal Production Tax Credit (PTC) – which leveraged an average of more than $16 billion a year in private investment over the last several years and supported tens of thousands of manufacturing jobs.”
While California topped the list for megawatts installed in 2011 with 921, Illinois came in with the second most megawatts installed for the year and rising to fourth overall list.
How much longer can there be continued growth?
AWEA has seen this lapse before, with the industry collapsing when credits expired, only to be reinstated retroactively. The wind industry is facing the recurrence of the boom-bust cycle it saw in previous years when the PTC was allowed to expire. In the years following expiration, installations dropped by between 73 and 93 percent, resulting in major job losses.
The editorial staff at RenewablesBiz.com is passionate about exchanging ideas and dedicated to promoting ongoing conversation about renewable and sustainable energy issues. We invite you to join and contribute to our online community. If you have an idea for an article or editorial contribution, please contact me via email, bopalka@energycentral.com, or phone, 860.633.0090.
Comments
Can PowerwoRx e3 be used with Solar Panel/Wind Turbine installat
PowerwoRx e3 is an excellent addition to any solar panel/wind turbine installation regardless of the configuration including the use of Reverse Metering (where electricity is fed onto the grid by the user). Some common configurations are:
‐ Solar or wind is used to supplement the systems energy needs
‐ Solar or wind is connected to the grid via a bi-directional electric meter (Reverse Metering)
‐ The system is off grid and relies on 100% solar energy for all the energy needs
All three of the PowerwoRx technologies benefit a system which incorporates solar and wind energy generation:
‐ Surges & spikes are more frequently internally generated than external. Solar Power Center protection is accomplished by a device called an MOV (Metal Oxide Varistor). When the voltage rises the PowerwoRx prevents the spike from potentially damaging the expensive electronics including the Inverter.
‐ Harmonics are more prevalent in a solar generated power system due to the nature of how the AC waveform is created by the Inverter. These Harmonics waste electricity, are damaging to appliances and electronics.PowerwoRx significantly reduces Harmonics and Noise in the system ‐ Improved Power Factor translates into reduced I2R losses, increasing system capacity and reducing energy use.