The Wind Industry

2008 Wind Technologies Market Report

2008 Wind Technologies Market Report

Berkeley, California - The U.S. Department of Energy released its “2008 Wind Technologies Market Report.” This report, authored primarily by Ryan Wiser and Mark Bolinger of Lawrence Berkeley National Laboratory, provides a comprehensive overview of trends in the U.S. wind power market, with a particular focus on 2008. For the fourth consecutive year, the U.S. was home to the fastest-growing wind power market in the world in 2008. Specifically, U.S. wind power capacity additions increased by 60 percent in 2008, representing a $16 billion investment in new wind projects. "At this pace, wind is on a path to becoming a significant contributor to the U.S. power mix," notes report author Ryan Wiser, of Berkeley Lab. Wind projects accounted for 42% of all new electric generating capacity added in the U.S. in 2008, and wind now delivers nearly 2% of the nation's electricity supply.

Wind projects
accounted for 42% of all new electric generating capacity added in the U.S. in 2008, and wind now delivers nearly 2% of the nation's electricity supply.

The “2008 Wind Technologies Market Report” provides a comprehensive overview of developments in the rapidly evolving U.S. wind power market. The need for such a report has become apparent in the past few years, as the wind power industry has entered an era of unprecedented growth, both globally and in the United States. At the same time, the last year has been one of upheaval, with the global financial crisis impacting near-term growth prospects for the wind industry, and with federal policy changes enacted to push the industry towards continued aggressive expansion. "With the market evolving at such a rapid pace, keeping up with trends in the marketplace has become increasingly difficult," notes report co-author Mark Bolinger. "Yet, the need for timely, objective information on the industry and its progress has never been greater...this report seeks to fill that need." 

Some of the key findings of the report include:

  • The United States continues to lead the world in annual capacity growth. For the fourth straight year, the United States led the world in wind capacity additions, capturing roughly 30% of the worldwide market.
  • The cumulative wind capacity installed in the United States at the end of 2008 would, in an average year, be able to supply roughly 1.9% of the nation's electricity consumption.
  • Soaring demand for wind has spurred expansion of wind turbine manufacturing in the United States. The share of domestically manufactured wind turbine components has grown from less than 30% in 2005 to roughly 50% in 2008, and that roughly 8,400 new domestic manufacturing jobs were added in the wind sector in 2008 alone.
  • Texas led all states with 7,118 MW of total wind capacity installed, followed by Iowa (2791 MW) and California (2517 MW). Seven states now have more than 1,000 MW installed, and 13 have more than 500 MW.
  • Iowa and Minnesota have the highest levels of wind penetration.
  • Wind power remained competitive in wholesale power markets in 2008, with average wind power prices at or below the low end of the wholesale power market price range.

The report can be downloaded at:

A PowerPoint presentation based on the report can be found at:

Wind Energy Growth in 2008

In 2008 U.S. wind energy grew by over 8,500 megawatts (MW) of new wind power capacity, increasing the nation’s cumulative total by 50% to over 25,300 MW, pushing the U.S. above Germany as the country with the largest amount of wind power capacity installed, according to a new report from the American Wind Energy Assocation (AWEA). Iowa surged past California into second place in the U.S. adding nearly 1600 MW to more than double its wind power generating capacity, with Texas still the leader in wind project capacity.

The top five states in terms of capacity installed are:

  • Texas, with 7,118 MW
  • Iowa, with 2,791 MW
  • California, with 2,517 MW
  • Minnesota , with 1,754 MW
  • Washington, with 1,447 MW

Both Iowa and Minnesota now get over 7% of their electricity needs from wind, with Minnesota ranking first with 7.48% followed closely by Iowa with 7.1%. Oregon moved into the club of states with more than 1,000 MW installed, which now numbers seven: Texas, Iowa, California, Minnesota, Washington, Colorado, and Oregon.

"The wind energy industry today generates not only clean energy for our economy, but also hope and opportunity for American workers and businesses,” said AWEA CEO Denise Bode.  “Whether it is building or maintaining a wind project, or producing wind turbine components, you’ll find people employed in wind power in nearly all 50 states today."

Wind projects boost local tax bases, helping to pay for schools, roads and hospitals, according to the report. Wind projects also revitalize the economy of rural communities by providing steady income to farmers and other landowners. Each wind turbine contributes $3,000 to $5,000 or more per year in rental income, while farmers continue to grow crops or graze cattle up to the foot of the turbines.

The American Wind Energy Association Annual Wind Industry Report for 2008 is available at the AWEA web site.

Iowa Wind Farm Photography by Edith OSB, Some rights reserved.

How Will Stimulus Bill Help Community Wind?

American Recovery and Reinvestment Act

Obama signs stimulus bill
President Obama signs American
Recovery and Reinvestment Act

Now that Congress has passed and President Obama has signed the American Recovery and Reinvestment Act of 2009, how will this help to stimulate Community Wind projects? According to Denise Bode, American Wind Energy Association CEO, "the stimulus bill contains a number of provisions aimed at helping our industry continue the very strong growth in new installations and new jobs we have seen over the past few years." Some of the provisions include:

  • 3-year extension of the federal wind energy production tax credit (PTC)
  • Option for a 30% investment tax credit (ITC) instead of the PTC
  • Option to convert the ITC into a grant for projects placed in service before 2013
  • Additional loan guarantees, bonds, and tax incentives

President Obama's goal with the stimulus package is to create a wide variety of initiatives to jumpstart the American economy. This opens up new sources of funding for renewable energy at a time when the Wind Energy industry is set for even more growth despite  being stalled by the economic downturn. These programs will allow Community Wind projects to take advantage of more funding opportunities.

“Over the next two years, this plan will save or create 3.5 million jobs. More than 90 percent of these jobs will be in the private sector, jobs rebuilding our roads and bridges, constructing wind turbines...”

President Barack Obama
Presidential Address to Congress
February 24, 2009

Wind facilities that qualify for the PTC can now make an irrevocable decision to take a 30% ITC in lieu of the PTC. In order to do so the project must be placed into service by December 31, 2012, and the PTC will no longer be available for the project. This has the potential to attract more investors who may not have enough passive activity income to realize the PTC. Which credit a taxpayer uses will depend upon an analysis of the project revenue and cost projections as well as analysis of the investor tax appetite. 

Further, if the project qualifies for the PTC or the ITC and is placed into service between 2009-2010 (or it begins construction at that time and is placed into service before 2013) the project can choose to apply to the Treasury Department for a cash grant that is equal to 30% of the qualified costs of the project. This cash grant is in lieu of both the PTC and ITC. This means the value of the ITC can be realized, even if the taxpayer cannot take advantage of the credit. The rules and application guidelines for this program have not been finalized yet.  

There are other provisions that address renewable energy financing on other levels. The Act removes the $4,000 cap on the small wind credit so taxpayers can now take the full 30% credit for a qualified small wind system.

The Act also provides for an additional $1.6 billion for Clean Renewable Energy Bonds (CREBs) that are used to finance renewable energy. There have been no announcements yet that applications are being accepted for these new allocations, and no guidance has been given on how the program will operate. Previously, these bonds have been given at 0% interest rate, and the bondholder receives a tax credit in lieu of bond interest. 

The Department of Energy received an extension of their authority to provide loan guarantees for qualified technologies under Title XVII of the federal Energy Policy Act of 2005 and an additional $6 billion for this program. Eligible technologies include electricity-generating renewable energy projects.   

Read more on the American Recovery and Reinvestment Act of 2009 Wind Energy Provisions at the Fredrikson & Byron P.A. web site and read how The Geniuses at DSIRE Translate the Energy Parts of the Stimulus Package via the Interstate Renewable Energy Council web site.

Along with this important step forward to make wind power and other renewables a catalyst for America’s economic recovery, the American Wind Energy Association has launched an effort to enact a national renewable electricity standard (RES) and to make progress toward construction of the Green Power Superhighway, a new transmission system needed to fully develop America’s immense wind resources. Read more about the AWEA New Wind Agenda.


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