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Top slides on U.S. wind power - AWEA August 2017
- 1. Peter Kelley VP, Public Affairs, American Wind Energy Association August 2017 pkelley@awea.org
- 2. Wind energy is on sale in America: 66% off Source: Lazard, Version 10.0, 2016
- 3. Source: LBNL Cost of wind power falling with economies of scale
- 4. Sources: EIA, Lawrence Berkeley National Laboratories, 2016 Wind Technologies Market Report, August 2017 Wind contracts beat natural gas cost projections
- 5. Deal to phase down Production Tax Credit ended boom-bust era Source: AWEA U.S. Wind Industry Annual Market Report Year Ending 2016
- 6. Trend: New turbines reaching higher winds and more areas Wind resource at 110 metersWind resource at 80-meter turbine height
- 7. Wind variability Wind uncertainty More turbines over larger areas = more predictable output
- 8. Wind power is increasing on the grid, reliably integrated • The SPP power grid in 14 states now peaks at over 50% wind • Wind now generates nearly 40% of Iowa’s electricity year-round • 14 states produce over 10% of in-state electricity from wind Source: U.S. Wind Energy Share of Electricity Generation, by State AWEA U.S. Wind Industry Annual Market Report Year Ending 2016
- 9. Grid operators and utilities report breakthroughs in reliability
- 10. Wind farms and factories benefit all 50 states Source: AWEA U.S. Wind Industry Annual Market Report Year Ending 2016
- 11. State renewable standards keep generating demand Source: AWEA State RPS Market Assessment 2016
- 12. Trend: Major brands cutting costs & pollution with wind Source: Non-utility purchases by year of announcement, inc. physical and virtual PPAs, direct ownership, and large-scale REC purchases from a single wind farm, AWEA U.S. Wind Industry Annual Market Report Year Ending 2016
- 13. Trend: Cities buying more wind energy • Over 200 city purchases to date • Nearly 7 percent of U.S. wind power capacity • Renewable commitments from Chicago, Pittsburgh, Atlanta, San Diego, Washington, D.C., many others 0 200 400 600 800 1000 1200 1400 '94 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 16 Municipal Wind Power Purchases, by Year (in MW) Municipal Utility Government Agency
- 14. More transmission getting more low-cost wind to market Eastern Interconnect Planning CollaborativeRegional grids: Benefits exceed costs many times over Sources: DOE; AWEA U.S. Wind Industry Annual Market Report Year Ending 2015. Wind project capacity includes projects under construction DOE WindVision 2050 caseHigh-voltage DC lines coming
- 15. New technologies helping wind and wildlife to coexist Five minutes after acoustic deterrent turned on Bats feeding on pond Renewable NRG Systems, Vermont
- 16. Wind will generate $85 billion in economic activity through 2020 – mostly in rural areas
- 17. Each new turbine = 44 years of full-time employment Data: Navigant, February 2017
- 20. 88% of new wind capacity is in states that voted for Trump Source: AWEA U.S. Wind Industry Annual Market Report Year Ending 2016
- 22. Consumer savings include health costs of pollution Source: Nature Energy: The climate and energy benefits of wind and solar power in the United States, by Millstein, Wiser et al, August 2017
- 23. U.S. offshore: the next frontier
Editor's Notes
- The cost of wind energy has fallen by 66% in seven years
- Wind energy costs decline is leading the clean energy sector by a wide margin because of advanced technology The cost of wind-generated electricity fell by two-thirds in the past seven years Reasons for falling wind costs include: Economies of scale – taller towers, longer blades, consolidation of the supply chain By accessing higher winds, this technology opens up more places for development Optimized siting adjusts for how turbines affect each other Predictive O&M uses big data and self-learning to finetune the wind farm; so the turbines maximize generation, and we can maintain before repairing, and repair before replacing U.S. manufacturing is saving on shipping of these big, heavy parts Upgraded transmission lines are connecting the best wind resources to the customers President-Elect Trump has said in his victory speech, ‘We’re going to rebuild our infrastructure [so it’s] second to none. And we will put millions of our people to work as we rebuild it.’ The 2016 Republican platform backed transmission, as did the Democrats’ platform. So we think there’s a real opportunity to make progress on a more reliable grid. And of course our key policy, the Production Tax Credit, is now more predictable, on a five-year phase-down so we can plan ahead. President-elect Trump and the new Congress have tax reform on their list. But our policy was settled last year. The wind and solar tax credits are now on a 5-year phasedown, although Congress did not touch oil and gas tax incentives. Businesses are investing billions on that basis. And there is sufficient bipartisan support to keep it that way.
- Wind energy costs decline is leading the clean energy sector by a wide margin because of advanced technology The cost of wind-generated electricity fell by two-thirds in the past seven years Reasons for falling wind costs include: Economies of scale – taller towers, longer blades, consolidation of the supply chain By accessing higher winds, this technology opens up more places for development Optimized siting adjusts for how turbines affect each other Predictive O&M uses big data and self-learning to finetune the wind farm; so the turbines maximize generation, and we can maintain before repairing, and repair before replacing U.S. manufacturing is saving on shipping of these big, heavy parts Upgraded transmission lines are connecting the best wind resources to the customers President-Elect Trump has said in his victory speech, ‘We’re going to rebuild our infrastructure [so it’s] second to none. And we will put millions of our people to work as we rebuild it.’ The 2016 Republican platform backed transmission, as did the Democrats’ platform. So we think there’s a real opportunity to make progress on a more reliable grid. And of course our key policy, the Production Tax Credit, is now more predictable, on a five-year phase-down so we can plan ahead. President-elect Trump and the new Congress have tax reform on their list. But our policy was settled last year. The wind and solar tax credits are now on a 5-year phasedown, although Congress did not touch oil and gas tax incentives. Businesses are investing billions on that basis. And there is sufficient bipartisan support to keep it that way.
- Stable policy has helped make wind cost-competitive and drive new orders for U.S. factories. We’ve finally been able to say goodbye to boom-bust cycles like this one with the long-term extension of the Production Tax Credit. It will continue at 100 percent value for projects that start construction by the end of this year, then phase down to 80% of full value for 2017 projects, 60% for 2018 projects, and 40% for 2019 projects. By that time early action to meet RPS standards and other sources of demand such as corporate purchasers will accelerate wind purchases.
- Longer blades can reach higher and steadier winds, capturing more energy That plus our lower costs make it possible for new regions of the country to develop land-based wind farms We’re working to overcome limits set by transportation and the cost of higher towers, as well as transmission and siting issues
- Another myth is that wind energy is somehow not reliable. Actually a typical turbine generates useful amounts of electricity over 90 percent of the time. Outages at conventional plants occur instantaneously and without warning They must be backed up by “hot, spinning reserves” that are available at a moment’s notice Changes in total wind output occur gradually, on the other hand and can be forecast from 4 to 48 hours in advance, based on 35 years of experience They can be backed up by cold reserves, at 2% of the cost because no fuel is being expended when those backup plants shut down
- Wind provided more than 35% of Iowa’s in-state electricity generation in 2016, the first state to generate more than 1/3 of its in-state electricity from wind. At times, wind has supplied more than 65% of the electricity on the main utility system in Colorado, and the main grid operator in Texas has surpassed 50%.
- Grid operators are surprised how fast wind has come on as a major contributor to grid reliability. Turbines are now spread out over 41 states. Their power can be instantaneously fine-tuned electronically, helping regulate grid voltage drops and frequency variations that can otherwise cause blackouts. And the wind is always blowing somewhere.
- If the federal PTC creates the market, state Renewable Portfolio Standards determine where wind projects are most likely to get built. 29 states have RPS, and many are expanding theirs after seeing the success creating a more diverse energy mix, attracting private investment into local and state economies, and reducing pollution States with the strongest standards tend to get the most wind business. Recent RPS updates: Oregon: RPS was raised early this year to 50% by 2040 for large IOUs and 25% by 2025 for large coops New York: The New York PSC issued a Clean Energy Standard order implementing Gov. Cuomo’s call for 50% clean energy by 2030. Massachusetts: Passed an energy bill requiring the procurement of 9.45 million MWh of clean energy generation and 1,600 MW of offshore wind. The RPS itself was not changed. DC: increased its RPS to 50% by 2032 in July 2016. Rhode Island: Governor signed bill extending the renewable energy standard from 2019 through 2035, with the obligation continuing to ramp up at the rate of 1.5 percent per year. Michigan: Governor signed energy bill that raises RPS to 15% by 2021
- We’re seeing a rapidly growing trend of non-utility players buying wind directly: major consumer brands, city governments, universities, and other institutions are now signing PPAs. Last year, 39% of wind capacity contracted through power purchase agreements (PPAs) were by non-utility buyers. The Fortune 500 like the fixed low prices, as much or more than the carbon savings. Short of simple energy efficiency, wind is the biggest, fastest, cheapest way for these companies and institutions to fulfill the commitments they’ve made to cut their carbon footprints. EXAMPLE: Google You may have seen Google announced last week they will hit 100% renewable power next year. Guess how much of that is coming from wind? The answer is 95%. As of next year, Google will be 95% wind-powered worldwide.
- We hear a lot about an infrastructure bill in the new Congress. Wind farms are some of the best infrastructure we’ve ever built in this country. But we still need the transmission infrastructure to get all this clean energy to market. Major transmission investments over the last decade have made wind energy’s growth possible. Much of this investment increases access to wind resources located in low-cost areas, enabling us to bring it to cities and low-wind areas where wind energy isn’t economical. In many cases, 2 cent/kWh carbon-free energy, delivered for a cost of 2 cents/kWh leads to delivered carbon-free energy for 4 cents/kWh which is competitive in any region. There are opportunities within states and regions, as well as inter-regionally and nationally. Achieving the Wind Vision goal of 20% by 2030 will require 890 more miles per year in the coming decade to connect the best wind resources to load Need to remove remaining barriers of transmission and get the long-distance lines we need built to let new areas capitalize on their rich wind resources. The benefits far exceed costs. Particularly problematic right now is getting transmission built from one region to another – interregional projects sometimes provide different benefits to different regions, or RTO’s consider different benefits when evaluating projects, making it difficult to find a project that appeals to all parties FERC: The lack of interregional planning across transmission regions could be needlessly increasing costs for customers The wind industry is working to improve this and could use your help.
- NRG has a new acoustic deterrent system to keep bats away from turbines while they’re operating.
- According to Navigant, the wind industry in this four-year period will generate $85 billion in economic activity. And most of that is going into rural and Rust Belt America. So we believe that wind energy can help Mr. Trump keep his promises. And that it’s in everyone’s interest to see this American success story continue. The economic benefits flow to the community in more income, and more local taxes paid by the wind farm developers. EXAMPLE: Van Wert County, Ohio In Van Wert County, Ohio, the school system used the additional tax base to buy enough laptops for every student. They fully funded the repair and replacement fund, for when the laptops break. They started two new job training programs in the high school. And they built an athletic center, which is now open to everyone who lives there. All with wind money.
- Wind turbine technician will be the fastest-growing job in America through 2024, according to the Bureau of Labor Statistics. And wind accounts for over 25,000 U.S. factory jobs in America today. Navigant projects that wind will create another 8,000 U.S. factory jobs in the next four years. And that by the end of 2020, including jobs in the communities around wind farms and factories, wind will support a total of 248,000 jobs.
- The politics of wind are in our favor. Nearly 88% of the 8,203 MW installed during 2016 were built in states that voted for President Trump. These 13 states accounted for 7,126 MW of the wind power capacity built during the year, continuing the concentration of wind power in Republican-leaning states. Just before the election, Pew took a poll on clean energy. They found 77 percent of Trump voters “favored expanding wind turbine farms.” And turnout for Mr. Trump was heavy among rural voters, whose No. 1 concern was the economy.
- The politics of wind are in our favor. Nearly 88% of the 8,203 MW installed during 2016 were built in states that voted for President Trump. These 13 states accounted for 7,126 MW of the wind power capacity built during the year, continuing the concentration of wind power in Republican-leaning states. Just before the election, Pew took a poll on clean energy. They found 77 percent of Trump voters “favored expanding wind turbine farms.” And turnout for Mr. Trump was heavy among rural voters, whose No. 1 concern was the economy.
- We finally have offshore wind operating in America. In 2016 Deepwater Wind installed the first 5 turbines in the US, a 30-MW project off the coast of Rhode Island. GE Renewable Energy – which completed its acquisition of Alstom’s offshore wind unit last year – supplied five 6-MW wind turbines for the Block Island Wind Farm. To date, the government has issued 11 commercial wind energy leases off the Atlantic coast, including leases off the coasts of New York, New Jersey, Rhode Island, Massachusetts, Delaware, Maryland, Virginia. Global leaders in offshore energy are setting up shop here in the U.S. With stable policy in place, the Department of Energy found the U.S. could install a total of 86,000 MW of offshore projects by 2050. As we continue to invest in and develop this homegrown resource, costs will continue to drop and value to consumers will grow. Offshore wind costs will likely come down as the U.S. industry reaches economies of scale; the cost of land-based wind has fallen by two-thirds since 2009.
- Recently Bloomberg called wind “the new corn.” That’s because for the farmers and ranchers who rent land to them, wind turbines have become a new cash crop. U.S. wind farms now pay $245 million dollars a year to farming families and other rural landowners, with 70 percent of that going to landowners in counties with below average incomes. And once the turbines are installed typically 98% of the land is available for other uses so they can keep farming. We are literally helping keep farms in the family. And this cash crop is drought-proof. The Wilson family near Colorado Springs was about to subdivide their ranch and sell it off for home lots, But now thanks to the lease payments they get from wind turbines, it will continue into a fourth generation. Wind really does work for America.