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US nudges ahead in wind capacity adding 13,000 megawatts in 2012

US nudges ahead in wind capacity adding 13,000 megawatts in 2012

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Market Briefing
Published: October 2013
Pages: For full details, please email keithw@cmsinfo.com
Tables: For full details, please email keithw@cmsinfo.com
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Research from: energy-market-research.info
Sector: Blog

One of the major problems with wind energy is storing the energy created. When the wind blows, there is ample power; when the wind drops there has to be something ready to take over. In conventional market models this would be a fleet of coal fired power stations providing the base load.

But its from the US - the market that is normally associated with fossil fuel production and consumption - that some of the more advanced thinking on the subject has come from.

Should there a move towards electric cars for short-haul commuting, which could be plugged in at either or both terminal points for a large part of the day, then at a stoke a storage facility would have been created to take the electricity generated by wind farms.

This would make a lot of sense in markets which have taken on board the renewables concept, but would seem to be counter-intuitive in a market such as the US

That is, until I read a note posted recently by Frank Wright of energy analyst firm Douglas-Westwood. Wright noted that US wind energy experienced a record year in 2012 with more than 13,000 megawatts of new capacity installed.

Putting this in perspective, the European Union (EU), often cited as the undisputed global champion in all matters low carbon, has installed just under 12,000 megawatts in the same period. High activity levels were seen in California, Oklahoma, and Kansas but it was oil & gas-rich Texas that led the way, now accounting for 20% of all US cumulative capacity.

Examining the historic trend reveals regular swings in activity driven by the unique workings of the Production Tax Credit (PTC) system. The PTC has come close to lapsing on a semi-annual basis causing developers to rush to get projects moving.

Despite this uncertainty, Douglas-Westwood believes that the general outlook is positive due to a combination of factors. For one thing, wind energy is a rare issue enjoying support from both sides of the political divide: increased renewable generation fits well with the Democratic Party's policy platform, and politicians of all stripes can get behind construction and manufacturing jobs in their home states. Another positive factor is the sheer scale of the US power generation market, which means there is plenty of growth potential with wind energy still only accounting for a small sliver of supply.

Last month Douglas-Westwood (DW) updated its World Offshore Wind Market Forecast market study, which provides a ten year view of the sector through to 2022. In the last five years global capital expenditure rose significantly, however DW predict that over the next decade this spending will level off at approximately EUR 15 billion per annum. New global installations are expected to average just over 3,000MW per year during this period.

The increase in turbine capacity is thought to be one of the key factors for reducing the cost of energy, and European offshore wind developers will be specifying larger wind turbines with capacities of 5MW or greater.

As the industry seeks to reduce costs, a new generation of wind turbine designed around the unique requirements of the offshore environment are being rolled out with European project developers increasingly choosing to specify larger models with power outputs of 5 MW or more. The size of the components for these future wind turbines creates a unique set of challenges for installers, foundation designers and service providers. In that respect, there is already appropriate expertise available, ironically from the oil & gas sector which has many years of direct experience handling large structures in off-shore waters.

So maybe electric cars will have a place in Europe as well... Check out The Grid Scale Battery Storage Market 2013-2023 for more on this theme.

Keith Wallace
Energy-Market-Research.info

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Further reading:

World Offshore Wind Market Forecast 2013-2022
Published by Douglas-Westwood in September 2013
Now in its fifth edition, the new Douglas-Westwood (DW) World Offshore Wind Market Forecast provides a ten year view of the sector through to 2022. The last five years saw global capital expenditure increase significantly, however DW predict that over the next decade t...(more)

North and South America Renewable Energy Policy Handbook 2013
Published by GlobalData in September 2013
North and South America Renewable Energy Policy Handbook 2013Summary?North and South America Renewable Energy Policy Handbook 2013? is the latest policy report from GlobalData, the industry analysis specialists that offer comprehensive information on major policies gove...(more)

US nudges ahead in wind capacity; adds 13,000 megawatts in 2012
Published by energy-market-research.info in October 2013
One of the major problems with wind energy is storing the energy created. When the wind blows, there is ample power; when the wind drops there has to be something ready to take over. In conventional market models this would be a fleet of coal fired power stations provid...(more)

Power Quarterly Deals Analysis: M&A and Investment Trends ? Q4 2012
Published by GlobalData in January 2013
Power Quarterly Deals Analysis: M&A and Investment Trends ? Q4 2012SummaryGlobalData?s ?Power Quarterly Deals Analysis: M&A and Investment Trends ? Q4 2012? report is an essential source of data and trend analysis on the mergers and acquisitions (M&As) and f...(more)

Offshore Wind Power - Global Market Size, Average Installation Price, Regulations, Market Share and Key Country Analysis to 2020
Published by GlobalData in January 2013
Offshore Wind Power - Global Market Size, Average Installation Price, Regulations, Market Share and Key Country Analysis to 2020Summary?Offshore Wind Power - Global Market Size, Average Installation Price, Regulations, Market Share and Key Country Analysis to 2020? is a...(more)

The Grid Scale Battery Storage Market 2013-2023
Published by Visiongain in March 2013
The rising demand for electricity has led to an increasing demand for more flexible and efficient grid systems that can handle intermittent power generated by renewable sources such as solar and wind. This has given rise to governments and private companies investing in...(more)

 

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