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PG&E CORP. DEDICATES LARGEST
WIND POWER PLANT IN EASTERN U.S.
PG&E Corporation's National Energy Group, of Bethesda, Md., will host a
ribbon-cutting ceremony today to mark the beginning of commercial operation of
the largest wind power plant in the eastern United States, an 11.5-megawatt
(MW) facility in Madison County, N.Y., near the town of Hamilton.
The project is located on farm land and consists of seven Vestas 1.65-MW
wind turbines, the largest operating anywhere in the nation (eight units of the
same model were installed last year at Big Spring, Tex.).
The Madison plant is New York's first commercial wind farm, and
highlights the growing attractiveness of wind energy as a source of electricity
in the northeastern U.S. A 6.6-MW wind project is also nearing completion in
Wethersfield, Wyoming County, New York. Vermont is home to the region's first
wind plant, a 6.05-MW project installed in 1996, and a 10.4-MW wind facility
began operating earlier this year in Somerset County, Pa. In addition, construction is scheduled to begin soon on a second and slightly larger (12-MW)
wind project in Madison County, in the town of Fenner.
The following is relevant information about wind energy in New York, the U.S.,
and the world. (See also:
Wind Power New York)
Growth of the Wind Energy Industry
- Total worldwide wind capacity today is approximately 15,000 MW, enough to
generate about 30 billion kilowatt-hours of electricity each year. This is
about the same amount of electricity as 4 million average New York households
(containing 11 million people) use.
- Wind energy was the world's fastest-growing energy source during most of the
1990s, expanding at annual rates ranging from 25% to 30%. Last year, about
4,000 MW of new wind capacity ($4 billion investment) was installed around the
world, and 732 MW ($700 million investment), or 18%, of that total was installed in the U.S.
- Leading states in terms of installed wind capacity today are California (1,646 MW), Minnesota (272 MW), Iowa (242 MW), and Texas (188 MW). Once the
Madison project is done, New York will move into 9th place nationwide, behind
those four states and Wyoming (72 MW), Oregon (25 MW), Wisconsin (23 MW), and
Colorado (22 MW).
- U.S. wind potential is vast--many times the amount installed. New York, for
example, could accommodate approximately 23,000 MW of wind capacity.
Market Drivers Behind Wind Energy's Growth
(1) Federal government policy: The federal government provides a tax credit of
1.5 cents per kWh (adjusted for inflation) for electricity generated by a wind
plant during its first 10 years of operation. This credit is intended to "level the playing field" for wind, which must compete with other energy
industries that receive billions of dollars in federal subsidies each year.
(2) State government policy: Several states, as part of electric utility
restructuring legislation, have enacted policies to encourage clean energy
sources like wind. The state of Texas, for example, has passed a law requiring
the construction of 2,000 MW of renewable energy generation by the year 2009,
of which wind is expected to capture a major share. New wind projects of 160
MW, 208 MW, and 82.5 MW have been announced in Texas within the past few weeks.
(3) Declining costs: The cost of producing electricity from wind energy has
declined by more than 80%, from about 38 cents per kilowatt-hour in the early
1980s to a current range of 3 to 6 cents/kWh (levelized over a plant's lifetime). In the not-too-distant future, analysts believe, wind energy costs
could fall even lower than most conventional energy sources, reaching a cost of
2.5 cents/kWh.
(4) The green power market: As the electricity market becomes more
competitive,
utilities and other power suppliers are looking for ways to differentiate their
products. One of the best ways to do that is to offer "green power"--electricity from clean energy sources like wind--at a premium price.
Today, more than 175 utilities nationwide are selling wind-generated electricity as part of green power programs, and consumer demand for green
power (even though still very small) is beginning to result in the building of
new wind power projects like the ones in New York and Pennsylvania.
Clean Energy Policy Options in New York
Public Benefit Fund: Cost sharing and performance incentives available
from the
New York State Energy Research and Development Authority (NYSERDA) in recent
years have succeeded in attracting at least 30 MW of wind energy generation (of
which the Madison project is the first) to western New York. This support came
from a New York Public Service Commission (PSC) order establishing a system
benefit charge (SBC) on electricity sales to support energy conservation and
renewable energy. The authorization for this runs out early next year. The
PSC or Legislature should: (1) extend the SBC for an additional five years;
and (2) increase the amount of funds available for renewable energy development. AWEA recommends that the SBC be raised to 2 mills/kWh and that
the percentage devoted to renewable energy be increased to 30%.
Small Wind Net Metering & Tax Credit: AWEA supports legislation to create net
metering and a tax credit for small wind turbine owners. Net metering optimizes the value of wind for both the landowner and the electric system by
providing landowners and farmers a reduction in their electric bills for wind
energy supplied to the local power grid. The tax credit would help get a small
wind industry started in New York by reducing the upfront capital costs during
the early period of small turbine market development.
Renewables Portfolio Standard (RPS): Eight states, including Texas,
Massachusetts, New Jersey, and Connecticut, have established RPS policies that
gradually increase the amount of renewable energy in the electric power mix.
Electricity retailers would satisfy this requirement by purchasing electric
power generated by wind, solar, and biomass renewable energy generators. The
RPS encourages renewable energy investment by reducing the uncertainty regarding growth in retail electric demand for renewables.
Benefits of Wind Energy Development in New York
- Wind energy provides both environmental and economic benefits.
- Windy counties in central and western New York can be expected to profit from
wind development through:
(1) Tax payments: Alameda (Calif.) County collected $725,000 in property taxes
during 1998 from wind turbine installations valued at $66 million.
(2) Jobs: The 240 MW of wind capacity installed in Iowa in 1998 and 1999
produced 200 six-month long construction jobs and 40 permanent maintenance and
operations jobs.
(3) Payments to landowners: Iowa's wind turbines also generate $640,000 per
year in direct lease payments to farmers and other landowners.
(4) Stable electricity prices: A recent study (January, 2000) found Iowa's
electric utility customers could save over $300 million over a 25-year period
if a proposal to meet 10% of the state's electric demand through wind energy is
adopted. The savings result because the cost of fossil fuels is expected to
rise over time, while wind's costs decline.
- A single 1.65-MW wind turbine will displace emissions of 2,700 tons of carbon
dioxide (the leading greenhouse gas), 14 tons of sulfur dioxide (the leading
component of acid rain), and 9 tons of nitrogen oxides (the leading component
of smog) every year, based on the U.S. average utility fuel mix. A forest
measuring 1.5 square miles would be needed to absorb the same amount of CO2.
Quotation
"We are delighted to welcome New York into the ranks of states with modern utility-scale wind plants. The Madison County wind project will be a
highly visible symbol of the rapid progress of this new, pollution-free energy
technology and its potential to contribute to the Empire State's economy."--Randall Swisher, AWEA Executive Director
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AWEA, formed in 1974, is the national trade association of the U.S. wind energy
industry. The association's membership of more than 700 includes turbine
manufacturers, wind project developers, utilities, academicians, and interested
individuals from 49 states. More information on wind energy is available
from the home page
of the AWEA web site: www.awea.org
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