In August, the U.S. Department of Energy released its 2014 Wind Technologies Market Report. The report, released annually for the past three years, tracks American progress in wind related areas including installed capacity, prices, jobs, and technological trends, among several others. This edition contains several positive developments for U.S. wind, as last year 4,854 MW of new capacity was added, representing $8.3 billion in new investments. For a summary of the report’s major highlights, read more below:
- Record Capacity Levels: After a down year in 2013, the U.S. wind industry rebounded last year to grow nationwide capacity by 8%, totaling almost 66 GW. These additions put the U.S. second in the world in cumulative wind capacity. This wind expansion is making its mark on the whole power sector – wind power represented 24% of last year’s electric generating capacity additions.
- Innovation is Capturing More Wind: The wind industry’s technological breakthroughs are occurring rapidly. In recent years, turbines designed for lower speed sites have captured the market with their greater swept rotor areas. These growing rotor diameters, in combination with an increase in nameplate capacities and hub heights, are deploying turbines that are capturing records energy amounts.
- As Technology Scales, Prices Drop: Wind infrastructure advances are not only improving energy production –they are also making wind more affordable. With a national average of 2.35 cents/KWh, Power Purchase Agreement (PPA) prices are at all-time lows. Costs for turbines themselves are dropping, with recent transaction prices in the $850-$1,250/kW range. These cost reductions helped bolster the economic competitiveness of wind, as average PPAs signed last year were in the bottom portion of all national wholesale power prices. Wind prices projected into the 2040s compare favorably against other fuels, particularly gas.
- Increases in Investment and Employment: After the Production Tax Credit extension renewed investor enthusiasm, capital for wind projects flowed. Last year, the wind industry raised $5.8 billion of new tax equity, a record for a single year. Strong investment is spurring projects and creating jobs. The wind industry job market saw a 30% increase last year, with over 70,000 Americans employed in the sector.
- The Interior and Great Lakes Soar: Over the last seven years, the Interior and Great Lakes regions are where the industry has seen the strongest growth. There, wind has made up 54% and 49% of all new electricity capacity, respectively. For a baseline, wind has made up 33% of nationwide generation additions. Turbine capacity factors from the last year also reflect this trend, as these two regions eagerly embrace new designs to boost generation. Meanwhile, the Southeast has yet to embrace wind energy – in the last seven years, wind has only comprised 2% of the region’s new generation additions.
- The Winds of Change Are Coming: The DOE maintains that wind energy’s future is blowing in the right direction, pointing to long term projections from its Wind Vision Report and Enabling Wind Power Nationwide. In the short term, the DOE sees wind additions motivated by lower costs, increased efficiency, corporate demand, and state level policies.