July 13, 2012
Small business bill stalls, so PTC extension not considered
While possibilities continue to be created thanks to the policy’s effectiveness and popularity, the search for a legislative vehicle for a Production Tax Credit extension nevertheless continues.
In a week that saw a vehicle arise and then recede within a couple of days, a bipartisan effort by three U.S. Senators to have an extension of the federal wind energy Production Tax Credit (PTC) considered by the full Senate was thwarted Thursday, when the Small Business Jobs and Tax Relief Act (S. 2237) failed to receive enough votes to move forward.
Earlier in the week Sens. Michael Bennet (D-Colo.), Jerry Moran (R-Kans.) and Mark Udall (D-Colo.) had filed a proposed amendment to the bill that would have extended the PTC, for which a scheduled Dec. 31 expiration date is looming, for two years. But since the broader bill will not be debated, the amendment will not be considered.
In a letter late Thursday, AWEA’s Chris Chwastyk, vice president for federal legislative affairs, told PTC supporters, “We very much appreciate your efforts to reach out to your Senators about an amendment that had great potential to give the wind industry the certainty it needs to continue to grow its American manufacturing base and invest in clean, affordable, homegrown wind power. It is crucial that Members of Congress continue to hear from their constituents that the PTC extension is a pressing concern.”
The amendment would also have extended the wind energy Investment Tax Credit (ITC)—an important policy for offshore wind development—for two years.
The PTC, wind power’s primary policy incentive, provides an income tax credit of 2.2 cents per kilowatt-hour for the first 10 years of electricity production from utility-scale turbines. It is set to expire at the end of the year unless Congress extends it first. A recent study by Navigant Consulting found that extending the Production Tax Credit will allow the industry to grow to 100,000 jobs in just four years, while an expiration would kill 37,000 jobs within a year. Many such “tax extenders,” as they are known, are often addressed toward the end of the year (in this year’s case, the lame-duck session after the November election), but the industry supply chain is already being affected by the uncertainty, with orders for wind turbines’ 8,000 components slowing down and layoffs already being reported.
The amendment represented the most recent bipartisan effort by the Senators to secure an extension of the credit to provide certainty to wind energy businesses across the country. In February, they filed an amendment to the transportation bill to extend the credit; however, it was never brought to a vote. The Senators also joined several of their colleagues in sending a letter to Senate leadership urging them to consider legislation that will extend the PTC.
A House bill seeking to extend the PTC has 105 cosponsors, including 24 Republicans, while a similar Senate bill is cosponsored by seven Senators, including three Republicans. PTC extension efforts have received the endorsement of a broad coalition of more than 370 members, including the National Association of Manufacturers, the American Farm Bureau Federation, the Edison Electric Institute, and the Western Governors’ Association. A PTC extension also has the support of the U.S. Chamber of Commerce, the National Governors Association, and the bipartisan Governors’ Wind Energy Coalition, which includes 23 Republican and Democratic Governors from across the U.S. A PTC extension has been endorsed by a number of newspapers across the country, including the Houston Chronicle,The New York Times, the Denver Post, the Daily Oklahoman, and the Toledo Blade.
25% by 2025: Michigan renewables target headed for November ballot
Renewable energy advocates submitted 530,000 signatures—well over the requisite 323,000—to Michigan’s Secretary of State petitioning to have a proposed 25 percent-by-2025 renewable portfolio standard included on November ballots, paving the way for the pro-renewables policy to be placed directly in the hands of voters.
At events in Lansing, Grand Rapids and Detroit, clean energy businesses from across the state rolled out the news by highlighting the job-creating and business-investment potential the policy fosters. A full 140 businesses have joined a bipartisan coalition of organizations and individuals to endorse the ballot initiative.
All that remains for the renewable portfolio standard (RPS) to get on the ballot is for the state to verify the signatures.
Under the proposed RPS, the 25 percent threshold would be met in increments, with wind, solar, hydro and biomass qualifying as resources. The proposal includes a 1 percent cap on electricity rate increases, a provision that would answer any possible claims by opponents that the RPS would negatively impact consumers’ wallets. Given the current cost of electricity in the state, the RPS would not be expected to trigger such a rate cap, even without the federal Production Tax Credit, which is awaiting extension (see lead story). (Current power-price revenues for the two largest utilities in the state are at around $100 per megawatt-hour, and wind power purchase agreements in the state range between $65 and $95/MWh.) Currently Michigan has an RPS of 10 percent by 2015.
By all measurements, a 25 percent RPS would generate a significant amount of wind power activity in the state, creating jobs along the way. In total the 25 percent target would create the equivalent of 5,300-6,000 MW of incremental demand for renewable energy by 2025, or 530 to 600 MW per year between 2015 and 2025.
“Thanks to more than 530,000 Michigan voters, we are taking the first step toward becoming an energy leader that can compete with anyone in the world,” said Mark Fisk, spokesman for Michigan Energy Michigan Jobs. “Clean energy businesses here in Michigan are using our manufacturing skills to diversify the economy and put people back to work. By increasing our renewable energy standard, we can strengthen this sector even further and move our economy forward.”
“Advanced energy manufacturing already supports more than 20,500 jobs in Michigan and $5 billion in economic activity,” said Steve Linder, organizer for the Michigan Energy Michigan Jobs Business Leadership Group. “The ballot initiative will lead to further investment and innovation right here in Michigan.”
Environmental docs released for big Power Co. of Wyoming project, offshore zone
The Obama Administration continued to push its renewable energy agenda forward this week with two simultaneous wind power announcements from Interior Secretary Ken Salazar—the release of the final environmental impact statement for Power Company of Wyoming’s proposed record-breaking wind farm and publication of an environmental assessment for commercial wind leases and site assessment activities on the Outer Continental Shelf (OCS) off the coasts of Rhode Island and Massachusetts.
Power Company of Wyoming’s (PCW) Chokecherry and Sierra Madre Wind Energy Project in Carbon County, Wyo., would have a capacity of between 2,000 and 3,000 MW, which would make it by far the largest wind farm in the U.S. by today’s capacity numbers. The company submitted an application to the U.S. Bureau of Land Management (BLM) in January 2008 for wind energy development on the federal lands that comprise approximately 50 percent of the Chokecherry and Sierra Madre project area. The remainder of the project is located on private lands owned by the Overland Trail Cattle Company LLC.
The final environmental impact statement (EIS) reflects more than four years of environmental data-gathering, analysis, public input and collaboration among federal, state and local agencies. During the process, PCW took input from stakeholders and in response proactively made project adjustments, in 2010 submitting a modified wind development plan to BLM. That plan included avoidance of Wyoming’s designated sage-grouse core areas, greater-than-required turbine setbacks from the North Platte River, and other revisions made in response to stakeholder concerns and that reduce potential impacts. Such revisions even consisted of excluding project development in some of the nation’s strongest Class 6 and 7 wind resource areas, according to the company.
“We believe [the preferred alternative approach in the EIS] reflects a balanced approach that will provide the best opportunity to develop an environmentally responsible, economically viable wind project and to provide the country with millions of megawatt-hours of cost-effective clean energy,” said Bill Miller, PCW president and CEO. “We’re committed to continuing to move forward through the remaining federal, state and local permitting processes, and we appreciate the widespread support we have received for the project and its economic and environmental benefits.”
Environmental assessment marks offshore progress
Meanwhile, in the offshore arena, Salazar announced the publication of an environmental assessment for commercial wind leases and site assessment activities on the Outer Continental Shelf (OCS) offs the coasts of Rhode Island and Massachusetts.
The environmental assessment will be used by the Bureau of Ocean Energy Management (BOEM) to inform future leasing decisions as part of the administration’s “Smart from the Start” offshore wind energy initiative. The Wind Energy Area (WEA) comprises approximately 164,750 acres within the area of mutual interest identified by the two states. BOEM leadership will host public information sessions on July 16 and 17 to further engage stakeholders and consider public comments on the environmental assessment in determining whether to issue a Finding of No Significant Impact, or conduct additional analysis in advance of holding a lease sale for commercial offshore wind development.
“When it comes to wind energy, we’re making significant progress both onshore and offshore to diversify our nation’s domestic energy portfolio and stand up a clean energy economy,” Salazar said. “Today, as we take the next steps toward realizing what could be the largest wind energy project in the world and holding a competitive offshore wind lease sale, we are really at the forefront of a renewable energy revolution.”
Juwi Wind starts construction on Community Wind South project in Minnesota
Construction has started on juwi Wind’s 30-MW Community Wind South wind farm in Nobles County, Minn., the company announced.
The project, located northwest of Worthington, will provide power for investor-owned utility Xcel Energy under the terms of a long-term power purchase agreement. The 100-meter towers will be the tallest in the state, according to the company. As the name of the facility indicates, the wind farm is considered a community-wind project, with members of the community owning a portion of it. Juwi will construct and operate the facility.
“Juwi is proud to start construction on Community Wind South and transform the local community’s vision into a reality of economic benefits and jobs for Nobles County,” said juwi Wind North America CEO Michael Rucker. “The project, which has been years in the making, will deliver a reliable source of renewable power for Xcel Energy, America’s No. 1 wind utility.”
The first foundation has been poured for the 15 REpower MM92, 2-MW turbines that will be delivered during the summer and early fall. Signal Energy Constructors will build the project, which is scheduled to be completed in October.
“Juwi has enjoyed tremendous support from the community, landowners, state regulators and Xcel Energy,” said Aaron Peterson, juwi’s community relations and regulatory affairs manager. “Minnesota is a great place that knows how to do wind. Our local partners trusted us to deliver for them, and we did.”
O&M segment of industry to experience high growth, says report
Annual expenditures for operations and maintenance services in the U.S. wind industry are expected to double from just under $3 billion in 2012 to nearly $6 billion in 2025, according to a recent study.
Operation & maintenance’s (O&M) share of annual U.S. wind expenditures is expected to increase from 12 percent to 29 percent over the same period.
“Despite declines in unit-level costs due to anticipated efficiencies, operations and maintenance spending is only set to increase as the U.S. wind fleet grows and ages,” said Matt Kaplan, associate director of the North American Wind Energy Advisory program at IHS Emerging Energy Research (IHS EER), which published the study. “O&M strategies are increasingly vital to improving the operational performance and bottom line of a wind owner’s collective investment.”
IHS EER expects overall annual spending on O&M to increase at a 5.5 percent compound annual growth rate, based on a presumption that installed land-based wind capacity in the U.S. grows from 47 gigawatts (GW) in 2011 to more than 127 GW by the end of 2025. The pace of annual O&M expenditure will vary as a result of variations in annual build and fluctuations in annual maintenance costs, the report noted.
Southwest Windpower turbines power remote Alaska village's water treatment plant
Wind power now provides residents of an isolated Alaska village with renewable energy to run a water treatment facility, reducing the village’s dependence on imported diesel fuel while maintaining crucial infrastructure.
Southwest Windpower, in conjunction with the Alaska Native Tribal Health Consortium (ANTHC) and Anchorage-based Susitna Energy Systems, installed three of the distributed wind turbine maker’s Skystream 3.7 machines, which will power ANTHC’s two-year-old, state-of-the-art water plant. The wind turbines are projected to supply approximately 75 percent of the roughly 18,000 kWh consumed annually by the facility. In high wind conditions, excess energy produced by the wind turbines will be distributed to the village, called Goodnews Bay, through a micro-grid.
Home to about 250 residents, the coastal village located about 500 miles west of Anchorage is one of Alaska’s poorest communities. Until the wind turbines became operational last month, the village was completely reliant on diesel generators to supply its electricity. Because of the remote location, diesel must be imported by boat or aircraft, further adding to the cost of the energy source. Diesel is also one of the dirtier means of producing electricity but is heavily relied upon in Alaska because of its remote areas. Distributed wind power, such as the deployment of the Skystream 3.7 in this case, is seen as a solution to meeting the power needs of many such communities in the state. Skystream 3.7s have been used for other village electrification projects in coastal regions of Alaska, such as in the 2008 installation of a 10-turbine micro-grid for the village Perryville.
Wind speeds at the village are classified as Class 5, or, “excellent” by the U.S. Department of Energy’s National Renewable Energy Laboratory.
“The wind turbines take advantage of an available natural resource and will be used to offset electrical power demands for the water system and ultimately make sanitation and improved health more sustainable for the community,” said John Warren, P.E., engineering services director for ANTHC’s Division of Environmental Health and Engineering.
“The Goodnews Bay project is a great example of small-scale wind energy systems helping people while also saving money and fostering a sense of self-sufficiency,” said Greg Erdmann, vice president of sales and marketing at Southwest Windpower. “Our new corporate tag-line is ‘Energy where it matters,’ and this is a perfect example of our products providing on-site energy for village electrification projects in developing and remote areas of the world.”
Supply Chain Connections
Juhl Wind signs on for Natural Power’s remote asset management/operations tools
Community Wind Power company Juhl Wind, Inc. selected international renewable energy consultancy Natural Power to provide a set of asset management tools and services for the owner-developer’s wind assets.
Juhl Wind will deploy Natural Power’s asset management tools including remote monitoring and operations through WindCentre and WindManager. Natural Power’s WindCentre is an independent control center operated around the clock 365 days a year. WindManager is a Web-based portfolio information management system that supports all aspects of wind farm operations, from weather forecasts to plant technical status and planning, to nomination and delivery of power into the grid.
GL Garrad Hassan, China Electric Power Research Institute collaborate
The Renewable Energy Department of the China Electric Power Research Institute (CEPRI RED) and GL Garrad Hassan signed a memorandum of understanding (MOU) concerning cooperation between the two entities in the area of wind turbine prototype measurements, wind turbine inspections and technical guideline development. CEPRI, a subsidiary of the State Grid Corporation of China, is a multi-disciplinary research institute focused on China’s electric sector, and GL Garrad Hassan is part of the GL Group’s renewables business segment.
CEPRI RED and GL Garrad Hassan will cooperate in offering prototype tests for wind turbines. That will involve a number of evaluations, including power performance tests, load measurement, acoustic noise measurement, power quality measurement, and LVRT (low voltage ride through) testing.
Under a strategic cooperation mechanism, both parties will also cooperate on such activities as the development of industry and national standards, information exchange, and safety-related training. The MOU was signed during a seminar on wind power safety held in Beijing in June.
AWEA Regional Wind Energy Summit - New England
With a focus on New England, this seminar is packed with experts who specialize in issues pertinent to wind development in this region of the United States. The Regional Wind Energy Summits have been a popular new addition to the AWEA lineup, and the latest installment comes to New England for the first time Sept. 5-6 in Portland, Maine. Learn more.
US Offshore WINDPOWER: Drive demand
If you are serious about offshore wind development and need to get the most up-to-date information, and network with all the right people active in this market... you must attend Offshore WINDPOWER 2012. Learn more.
Volume 29, Issue 1491
|Wind Energy Weekly is a publication of the American Wind Energy Association and a service to its Members.
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AWEA Wind Resource & Project Energy Assessment Seminar
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AWEA Wind Energy Fall Symposium
November 13-15, 2012
AWEA Regional Wind Energy Summit - Southwest
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