Wind Energy Update Larry Flowers National Wind Technology Center, NREL Appalachian Regional Commission - September, 2009
Installed Wind Capacities ( 99 09) *Preliminary data
Four Years of Strong Growth: 2008: 8,558 MW Added; $16 billion Investment 9,000 8,000 7,000 27,000 24,000 21,000 6,000 18,000 5,000 15,000 4,000 12,000 3,000 9,000 2,000 6,000 1,000 3,000 0 0 Annual Capacity (MW) 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Cumulative Capacity (MW) Annual US Capacity (left scale) Cumulative US Capacity (right scale) 2008 Wind Market Report; LBL
Geographic Spread of Wind Projects in the United States Is Reasonably Broad
Texas Easily Led Other States in Both Annual and Cumulative Capacity Annual Capacity (2008, MW) Cumulative Capacity (end of 2008, MW) Estimated Percentage of In-State Generation Texas 2,671 Texas 7,118 Iowa 13.3% Iowa 1,600 Iowa 2,791 Minnesota 10.4% Minnesota 456 California 2,517 South Dakota 8.8% Kansas 450 Minnesota 1,753 North Dakota 7.1% New York 407 Washington 1,447 Kansas 6.7% Wyoming 388 Colorado 1,068 Colorado 6.6% North Dakota 370 Oregon 1,067 Oregon 5.4% Wisconsin 342 Illinois 915 Texas 5.3% Washington 284 New York 832 New Mexico 4.5% West Virginia 264 Oklahoma 831 Wyoming 4.1% Illinois 216 Kansas 815 Washington 3.9% Oregon 185 North Dakota 714 Oklahoma 3.7% Oklahoma 142 Wyoming 676 Montana 3.4% Indiana 131 New Mexico 497 California 3.1% Michigan 127 Wisconsin 395 Hawaii 2.2% Montana 125 Pennsylvania 361 Idaho 1.6% Missouri 106 West Virginia 330 New York 1.4% South Dakota 89 Montana 272 Illinois 1.4% California 89 South Dakota 187 Wisconsin 1.3% Pennsylvania 67 Missouri 163 West Virginia 0.9% Rest of U.S. 52 Rest of U.S. 622 Rest of U.S. 0.2% TOTAL 8,558 TOTAL 25,369 TOTAL 1.8% Source: AWEA project database, EIA, Berkeley Lab estimates 13 states had >500 MW of wind capacity at the end of 2008 (7 had >1000 MW, 3 had >2500 MW) 2 states (IA and MN) have in-state wind generation that exceeds 10% of total in-state generation (6 other states exceed 5%)
U.S Lagging Other Countries in Wind As a Percentage of Electricity Consumption Projected Wind Generation as a Proportion of Electricity Consumption 22% 20% 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% Denmark Spain Portugal Ireland Germany Greece Netherlands India Austria Approximate Wind Penetration, end of 2008 Approximate Wind Penetration, end of 2007 Approximate Wind Penetration, end of 2006 UK Italy U.S. France Australia Sweden Brazil Turkey Canada China Japan TOTAL Note: Figure only includes the 20 countries with the most installed wind capacity at the end of 2008
Wind Is a Major Source of New Generation Capacity Additions: Wind Contributed 42% of New Additions in the US in 2008 70 1% wind Other non-renewable 60 3% wind Coal Annual Capacity Additions (GW) 50 40 30 20 0% wind 4% wind 2% wind 12% wind 18% wind Gas (non-ccgt) Gas (CCGT) Other renewable Wind 42% wind 35% wind 10 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 Wind was the 2 nd -largest resource added for the 4 th -straight year
Nearly 300 GW of Wind in Transmission Interconnection Queues 300 Entered Queue in 2008 Total in Queue at end of 2008 250 Nameplate Capacity (GW) 200 150 100 Twice as much wind as next-largest resource (natural gas) in queues 50 0 Wind Natural Gas Coal Nuclear Solar Other MISO (64 GW), ERCOT (52 GW), SPP (48), and PJM (43 GW) account for >70% of total wind in queues Not all of this capacity will be built.
Drivers for Wind Power Declining Wind Costs Fuel Price Uncertainty Federal and State Policies Economic Development Environment/Water Public Support Green Power Energy Security Carbon Risk
As a Result of Foregoing Trends, Wind Prices Have Been Rising Since 2002-03 Wind power prices bottomed out with projects built in 2002-03 Projects built in 2008 are ~$15-20/MWh higher on average 2008 Wind Market Report; LBL
Wind Has Been Competitive with Wholesale Power Prices in Recent Years 90 80 70 Wind project sample includes projects built from 1998-2008 2008 $/MWh 60 50 40 30 20 10 0 Nationwide Wholesale Power Price Range (for a flat block of power) Cumulative Capacity-Weighted Average Wind Power Price (with 25% and 75% quartiles) 2003 2004 2005 2006 2007 2008 49 projects 62 projects 80 projects 98 projects 117 projects 145 projects 2,268 MW 3,069 MW 4,083 MW 5,165 MW 7,654 MW 9,873 MW Wholesale price range reflects flat block of power across 23 pricing nodes Wind power prices include sample of projects built from 1998-2008
Even Among More-Recent Projects, Wind Was Competitive in Most Regions in 2008 90 80 Wind project sample includes projects built from 2006-2008 70 2008 $/MWh 60 50 40 30 20 10 0 Average 2008 Wholesale Power Price Range (by region) 2008 Capacity-Weighted Average Wind Power Price (by region) Individual Project 2008 Wind Power Price (by region) Texas Heartland Mountain Northwest Great Lakes California East New England Total US 2 projects 28 projects 10 projects 5 projects 6 projects 3 projects 4 projects 2 projects 60 projects 241 MW 2,133 MW 1,115 MW 831 MW 713 MW 233 MW 170 MW 29 MW 5,465 MW Note: Within a region there are a range of wholesale power prices because multiple wholesale price hubs exist in each area (see earlier map)
Comparative Generation Costs Source: LBL
Soaring Demand Spurs Expansion of U.S. Wind Turbine Manufacturing
CO 2 prices significantly increase the cost of coal Levelized Cost of Electricity (2010) vs. CO2 Price 140 130 2006$/MWh 120 110 100 90 80 70 Coal PC Coal IGCC Coal IGCC w/ccs Gas CC Nuclear Wind Class 6 Wind Class 4 Wind Offshore Class 6 60 50 0 10 20 30 40 50 Carbon Price ($/ton CO2)
Economic Development Opportunities Land Lease Payments: 3-5% of gross revenue $3000-4000/MW/year Local property tax revenue: 100 MW often brings in on the order of $500K-$1 million/yr 80-100 jobs/ 100 MW during construction 6-8 permanent O&M jobs per 100 MW Local construction and service industry: Foundations, roads-- often done locally Investment as Equity Owners: production tax credit, accelerated depreciation, project revenues Manufacturing and Assembly plants expanding in U.S.-- single most significant economic development opportunity
Maple Ridge I Wind Farm 231 MW (1.65-MW turbines) Landowner payments: $1.65 million/year, $49.5 million over 30-year period 300 workers during peak construction (60% local) 20 O&M positions Total annual tax payments: $8 million/year; $240 million over 30 years Located in Lewis County, NY Jointly owned by Iberdrola & Horizon Wind Energy On-line in 2006
Mount Storm Wind Farm Phase 1 164 MW (2-MW turbines) Landowner payments: $700,000 annually; $17.5 million over 25 years ~ 300 workers during peak construction Total annual tax payments: $584,000/year; $14,600,000 over 25 years Schools will receive a separate payment of $68,000/year; $1.7 million over 25 years Located in Grant County, WV Jointly-owned by Dominion Energy and Shell Wind Energy On-line in 2008
Locust Ridge Wind Farm Phase I 26 MW (2-MW turbines) Landowner payments: $9,000 - $12,000/year/turbine 85 90 workers during peak construction 3 O&M positions Total annual payments: $18,000/year including taxes; $540,000 over 30 years Located in Schuylkill County, PA Owned by Iberdrola On-line in 2006
On site & Project Development Labor Truck drivers, crane operators Earth moving, cement pouring 21 Management and support Construction
Off site and supply chain jobs, services, materials Utilities Blade and tower manufacturers Property taxes Steel mill jobs, parts, services Photos: E.C.Levy, Inc, Detroit, MI Financing, banking, accounting Equipment manufacturing and sales 22
Induced jobs, services, materials Money spent on local area goods and services from increased revenue: sandwich shops, child care, grocery stores, clothing, other retail, public transit, new cars, restaurants, medical services 23
Jobs and Economic Impacts from the JEDI Model 1,000 MW of New Wind Power in Virginia JEDI Model Version W1.09.03e Project Development & Onsite Labor Impacts Landowner Revenue: $3 million/year Local Property Taxes: $9.9 million/year Construction Phase: 500 new jobs $39.8 million to local economies Operational Phase: 51 new jobs $3.5 M/year to local economies Local Revenue, Turbine, & Supply Chain Impacts Induced Impacts Construction Phase: Construction Phase: 3,118 new jobs 1,081 new jobs $405.8 million to local $125.4 million to local economies economies Operational Phase: 71 new jobs $20.2 million/year to local economies Operational Phase: 84 new jobs $9.8 million/year to local economies Construction Phase = 1-2 years Operational Phase = 20+ years Total economic benefit: $1.24 billion New local jobs during construction: 4,699 New local long-term jobs: 206 24
Jobs and Economic Impacts from the JEDI Model 1,000 MW in each of 11 Appalachian States JEDI Model Version W1.09.03e Project Development & Onsite Labor Impacts Landowner Revenue: $33 million/year Local Property Taxes: $86 million/year Construction Phase: 5,573 new jobs $415.6 million to local economies Operational Phase: 561 new jobs $35.7 M/year to local economies Local Revenue, Turbine, & Supply Chain Impacts Induced Impacts Construction Phase: Construction Phase: 36,446 new jobs 13,561 new jobs $4,441.5 million to local $1,475.6 million to local economies economies Operational Phase: 835 new jobs $198 million/year to local economies Operational Phase: 899 new jobs $97.7million/year to local economies Total economic benefit: $15.3 billion New local jobs during construction: 55,580
Renewable Portfolio Standards www.dsireusa.org / September 2009 by 2020* 5% by 2025* 2010 MT: 15% by 2015 by 2025 (large utilities)* by 2025 (smaller utilities) UT: 20% by 2025* AZ: 15% by 2025 ND: 10% by 2015 SD: 10% by 2015 CO: 20% by 2020 (IOUs) 10% by 2020 (co-ops & large munis)* KS: 20% by 2020 NM: 20% by 2020 (IOUs) 10% by 2020 (co-ops) MN: 25% by 2025 (Xcel: 30% by 2020) WI: Varies by utility; 10% by 2015 goal IA: 105 MW IL: 25% by 2025 MO: 15% by 2021 VT: (1) RE meets any increase in retail sales by 2012; (2) 20% RE & CHP by 2017 MI: 10% + 1,100 MW by 2015* NY: 24% by 2013 OH: 25% by 2025 VA: 15% by 2025* NC: 12.5% by 2021 (IOUs) 10% by 2018 (co-ops & munis) ME: 30% by 2000 New RE: 10% by 2017 NH: 23.8% by 2025 MA: 15% by 2020 + 1% annual increase (Class I Renewables) RI: 16% by 2020 CT: 23% by 2020 PA: 18% by 2020 NJ: 22.5% by 2021 MD: 20% by 2022 DE: 20% by 2019* DC: 20% by 2020 HI: 40% by 2030 TX: 5,880 MW by 2015 29 states & DC have an RPS renewable portfolio standard renewable portfolio goal Minimum solar or customer-sited requirement Extra credit for solar or customer-sited renewables 5 states have goals
Environmental Benefits No SOx or NOx No particulates No mercury No CO2 No water
Key Issues for Wind Power Financial markets Policy Uncertainty Supply chain/workforce Siting and Permitting: avian, noise, visual, federal land Operational impacts: variability, ancillary services, forecasting, cost allocation Accounting for non-monetary value: green power, no fuel
Wind Resource at Elevation 1566MW 33,000MW
The future ain t what it used to be. - Yogi Berra
140 120 100 Onshore Class 7 Class 6 Class 5 Class 4 Class 3 Offshore Class 7 Class 6 Class 5 Class 4 Class 3 10% Available Transmission 80 60 40 20 0-200 400 600 800 1,000 Quantity Available, GW
46 States Would Have Substantial Wind Development by 2030 Wind Capacity tal Installed (2030) (GW) 0.0-0.1 0.1-1 1-5 Includes offshore wind. The black open square in the center of a state represents
20% Wind Scenario Impact on Generation Mix in 2030 duces electric utility tural gas consumption by % duces total natural gas nsumption by 11% tural gas consumer nefits: $86-214 billion * duces electric utility coal nsumption by 18% oids construction of 80 GW new coal power plants 100% 80% 60% 40% 20% 0% U.S. electrical energy mix No New Wind 20% Wind Natural Gas Hydro
National (U.S.) Economic Impacts Cumulative Impacts from 2007-2030 From the 20% Scenario 300 GW new Onshore and Offshore Development JEDI Model Version W1.09.03e Project Development & Onsite Labor Impacts Landowner Revenue: $783 million Local Property Taxes: $1,877 million Construction Phase: 834,072 FTE jobs $65 billion to the US economy Operational Phase: 366,441 FTE jobs $17 B to the US economy Local Revenue, Turbine, & Supply Chain Impacts Induced Impacts Construction Phase: Construction Phase: 2.63 M FTE jobs 2.75 M FTE jobs $526 billion to the US $353 billion to the US economy economy Operational Phase: 1.3 M FTE jobs $207 billion to the US economy Operational Phase: 1.64 M FTE jobs $192 billion to the US economy Total economic benefit: $1.36 trillion New local jobs during construction: 6.2 M FTE
Jobs and Economic Impacts from the JEDI Model 20% Wind Power in Appalachian States (47.37 GW) Direct Impacts Landowner Revenue: $43.8 million/year Local Property Taxes: $106.2 million/year Construction Phase: 100,814 new jobs $12.4 Billion to local economies Operational Phase: 21,502 new jobs $2.1 B/year to local economies Indirect & Induced Impacts Construction Phase: 87,287 new jobs $8.7 Billion to local economies Operational Phase: 13,728 new jobs $1.4 Billion/year to local economies Totals (construction + 20 yrs) Total economic benefit: = $91.5 Billion New local jobs during construction: = 188,001 New local long-term jobs: = 35,030
Cumulative Water Savings from 20% Scenario Reduces water consumption of 4 trillion gallons through 2030
Results: Costs & Benefits remental direct cost to society ductions in emissions of greenhouse ses and other atmospheric pollutants ductions in water consumption s created and other economic efits ductions in natural gas use and price ssure $43 billion 825 M tons (2030) $98 billion 8% total electric 17% in 2030 140,000 direct $450 billion total 11% $150 billion Net Benefits: $205B + Water savings
ut ramping up to ~16 GW/year and maintaining that pace r a decade is an enormous challenge, requiring proactive olicy, substantial transmission expansion, mitigation of U.S. Remains on Early Track To Meet 20% of Nation s s Electricity with Wind by 2030 18 315 16 14 12 10 8 6 4 2 annual projections (EER) Deployment Path in 20% Wind Report (annual) Actual Wind Installations (annual) Deployment Path in 20% Wind Report (cumulative) 280 245 210 175 140 105 70 35 Cumulative Capacity (GW) 0 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
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