Berkeley Lab: Annual Wind Power Report Shows U.S. Market Continues to Grow

June 11, 2008 // Published as a news service by IHS

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For the third consecutive year the U.S. was home to the fastest-growing wind power market in the world, according to a report by the U.S. Department of Energy (DOE) and Lawrence Berkeley National Laboratory (Berkeley Lab).

U.S. wind power capacity increased by 46% in 2007, representing a $9B investment in wind projects.

Wind projects accounted for 35% of all electricity-generating capacity added in the U.S. in 2007 and more than 200 gigawatts (GW) of wind power are in various stages of development throughout the country, said Berkeley Lab.

The 2007 edition of the Annual Report on U.S. Wind Power Installation, Cost, and Performance Trends 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 U.S., said the lab.

Drawing from a variety of sources, this report - the second in an ongoing annual series - analyzes trends in wind power capacity growth, turbine size, turbine prices, installed project costs, project performance, wind power prices and how wind prices compare to the price of conventional generation.

It also describes developer consolidation trends, current ownership and financing structures and trends among major wind power purchasers. The report examines other factors impacting the domestic wind power market, including grid integration costs, transmission issues and policy drivers.

"By consolidating this information into a single, publicly available document, DOE and Berkeley Lab hope to provide a valuable resource to industry participants, energy regulators, and state and local policymakers," said coauthor Mark Bolinger of the Berkeley Lab Environmental Energy Technologies Division (EETD).

According to Berkeley Lab, the inaugural 2006 edition quickly became a key benchmark by which the wind industry judges its progress and by which regulators and policymakers evaluate the merits of wind power.

Some of the key findings from the 2007 edition include:

• The U.S. is the fastest-growing wind market worldwide. The U.S. has led the world in new wind capacity for three straight years and 1.2% of the nation's electricity supply could be met with the wind capacity on line at the end of 2007.
• Growth is distributed across much of the U.S. States as diverse as Texas, Colorado, Illinois and Oregon led the U.S. in annual wind capacity growth in 2007. Sixteen states had more than 100 megawatts (MW) of wind capacity installed by the end of 2007 with six states topping 1,000 MW.
• Market growth is spurring manufacturing investments in the U.S. Several major foreign wind turbine manufacturers either opened or announced U.S. wind turbine manufacturing plants in 2007. New and existing U.S.-based manufacturers either initiated or scaled up production. The turbine and component manufacturing facilities opened or announced in 2007 alone could create more than 4,700 new jobs in the U.S.
• Wind turbine prices and installed project costs have risen since 2002. Turbine price increases have been driven by weakness in the dollar, higher prices for materials and energy inputs and shortages in certain turbine components Ñ all factors that are impacting many different types of generating technologies.
• Wind project performance has improved in recent years. The improvement in project performance has been driven in part by taller towers and larger rotors, enhanced project siting and technological advancements.
• Wind power is competitive and has provided good value in wholesale power markets. Despite rising project costs, in recent years wind power has consistently been priced at or below the average price of conventional electricity, as reflected in wholesale power prices.

Source: U.S. Department of Energy (DOE) Lawrence Berkeley National Laboratory.