US stimulus money boosts wind power

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The US renewable energy grant programme has led to a surge in wind project development in recent months, according to the American Wind Energy Association (AWEA)

But it warned that development in the fourth quarter of 2009 is unlikely to be as strong, because wind turbine manufacturing still lags below 2008 levels.

The US wind energy industry installed 1,649MW of new generating capacity in the third quarter, up from 1,210MW in the second quarter and 1,389MW in third quarter 2008. More than 5,800MW of wind capacity has been added so far in 2009, bringing total US capacity to more than 31,100MW, according to the Washington, DC-based AWEA.

A change in the tax code by Congress allows wind, biomass and other renewable energy projects to temporarily elect to receive an investment tax credit (ITC) normally reserved for solar projects, instead of receiving tax credits against power production. In the economic stimulus package in February, the US also allowed project developers to receive cash payments in lieu of the tax credits.

Since the early July announcement of the grant programme rules, the wind sector has seen more than 1,600MW of completed projects and more than 1,700MW of construction started. These projects equate to about $6.5 billion in new investment, according to AWEA.

“We have seen an almost instantaneous response from the project development side in wind in terms of new activity,” said Elizabeth Salerno, director of industry data and analysis for AWEA.

However, she added that: “We can’t ignore the fact that we aren’t out of the trenches yet. The grant programme is working, but we still don’t have a long-term, stable policy in place.”

More than 5,000MW of wind capacity is now under construction for completion this year or next, but that is nearly 38% lower than the 8,000MW-plus under construction at this time in 2008.

The wind industry installed a record 8,358MW of new capacity in 2008, a number AWEA does not expect to exceed this year, Salerno said.

“I don’t think that should be a surprise to anyone given the hit of the financial crisis but, nevertheless, [this is] still a very strong year,” she said.

Texas added the most new wind capacity in the third quarter at 436MW, followed by Oregon at 251MW and Illinois at 201MW. Texas also has the highest total wind capacity at 8,797MW, with Iowa second at 3,053MW and California at 2,787MW.

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