U.S. wind industry hits 70 GW capacity mark, celebrates tax credit extension
- The U.S. wind energy industry passed the 70 GW cumulative installed capacity milestone in November and is this month celebrating the long term and retroactive extension of its vital $0.023/kWh production tax credit (PTC) by Congress. President Obama signed the tax extenders, part of a larger omnibus spending bill, on Friday.
- The five-year extension of the PTC will run through 2019 and is expected to support development of another 19 GW of installed capacity, according to Bloomberg New Energy Finance (BNEF). The growth is expected to also drive technology innovation that will make wind production widely cost-competitive with other energy resources.
- Existing wind capacity set new electricity production records this year in wind-rich sections of the U.S. with grids operated by the Electric Reliability Council of Texas (ERCOT), the Midcontinent Independent System Operator (MISO), and the Southwest Power Pool (SPP) recording new highs.
The new retroactive PTC extension allows developers to earn the full tax credit for projects that meet “commence construction” criteria in 2015 and 2016 and are completed within two years. The credit drops 20% in 2017, 20% further in 2018, and a final 20% more in 2019 before terminating on January 1, 2020.
The five-year extension is expected to drive an addtional 19 GW of wind growth over what would be deployed without the tax credits, according to new analysis from BNEF.
"By the time the new tax credit expires, solar and wind will be the cheapest forms of new electricity in many states across the U.S.," Bloomberg reported on the findings from its research arm.
But while natural gas is still cheaper than wind across much of the country, wind is having its biggest year ever for generation in 2015 as it works in concert with gas resources to meet demand.
The MISO system, which spans 12 states from Manitoba to Louisiana, reached a peak of 12,614 MW at one point this year. The SPP system, which extends from the Dakotas to the Texas panhandle, hit a peak wind production of 9,564 MW in November.
The main Colorado grid, operated by Xcel Energy, got a record-setting 66.4% of its electricity from wind during a period in November.
According to the Department of Energy, wind could provide up to 35% of the nation's power by midcentury.
- Windpower Engineering & Development American wind power breezes past 70-GW milestone