Wind energy enjoys broad public support and can be a fundamental part of state economic development strategies. With the right policy support, wind power can grow to provide 20% of the United States' electricity, and in doing so, support 500,000 American jobs. The U.S. Department of Energy's 20% wind energy by 2030 scenario shows that rural land owners would earn more than $600 million a year through land lease payments that range from $2,000 to $4,000 per megawatt annually, and rural communities would see increases of as much as $1.5 billion annually in property tax revenues that can be allocated to fund schools, infrastructure, medical centers, and other public services.
Energy is a policy-driven industry. A number of state legislative and regulatory activities influence the wind industry's ability to compete in the electric market. A few of the key state-level policies AWEA pursues include:
Strong state-wide renewable electricity standards (RES)
A renewable electricity standard (RES), also known as a renewable portfolio standard (RPS), is a policy that sets hard targets for renewable energy in the near- and long-term to diversify our electricity supply, spur local economic development, reduce pollution, cut water consumption and save consumers money. Today, 29 states have renewable electricity standards, and seven states have renewable energy goals. Please refer to the Database of State Incentives for Renewables and Efficiency for the current map of state-specific RES policies.
Predictable tax policies
The federal production tax credit (PTC) has moved wind toward a level playing field alongside the federally supported incentives for conventional energy. Some states also have tax policies that can either attract or discourage wind development. Special property tax treatment to encourage economic development has been beneficial to wind development in some states. Tax rules applicable to property, generation or sales of equipment can make the difference to a wind developer considering one state over another. Please refer to the Database of State Incentives for Renewables and Efficiency for the current map of tax credits for renewables. AWEA members can also access the State Property Tax Database through the AWEA Member Center for a state by state analysis of property tax profiles for commercial wind power projects.
Favorable transmission policies
Expansion of the transmission grid is essential to wind energy development. To promote the expansion of renewable energy, the transmission grid should be built to link areas with vast wind resources to the areas that have significant demand for electric power. A modern and robust electricity grid also can save consumers money. State regulators play key roles in planning, permitting, and paying for the expansion of the transmission grid. Please see the transmission and grid integration page for more resources on this topic.
Prudent siting policies
Resolving wind power project siting issues is an important part of expanding wind energy development. The principles applied to wind energy siting issues must promote efficient, fair and open permitting processes at the federal, state and local levels. Project siting guidelines must address wildlife and habitat issues, military and non-military infrastructure, and community concerns. Given all the potential benefits of wind energy development, the wind industry’s impacts should be considered in context with other forms of energy production and treated accordingly during the policy-making process. Please see the siting policy page for more resources on this topic.
Case study in exemplary state policy
Texas leads the U.S. states in installed wind capacity thanks to good market policies, high electricity demand, and a great wind resource. Wind development got underway when the Texas state legislature passed a modest renewable energy standard (RES) in 1999, requiring utilities to begin to diversify their electricity sources. Then, in 2005, the legislature both strengthened the RES and added the landmark transmission policy calling for the creation of Competitive Renewable Energy Zones (CREZ), which allowed for movement of electricity from wind-rich west Texas to the heavy load centers further east and south.
As a result of such strong policies, in 2009 Texas surpassed its renewable energy targets. In 2010, the Electric Reliability Council of Texas (ERCOT) generated about 8% of its electricity from wind; on some days, ERCOT now secures as much as 25% of its electricity from wind.
According to the Texas Public Utilities Commission (PUC), wind in Texas has saved consumers money. The PUC Scope of Competition 2009 Report to the Texas Legislature said, “For each additional 1,000 MW of wind that was produced, the analysis showed that the clearing price in the balancing energy market fell by $2.38.”
A full 38 states now have utility-scale wind projects, and 14 of those have now installed more than 1,000 MW of wind power. For a state snapshot of the wind power industry’s projects, jobs, supply chain and generation of economic development in each state, please see AWEA’s state fact sheets.
Partners in state policy
AWEA partners with a network of regional organizations to promote the growth of the wind industry at the local, state, and regional level around the country. AWEA encourages you to learn more about these organizations and their current activities on our Regional Partners page.