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Consultancy expects 8+ GW by year end

By Paul Dvorak | November 24, 2009

The U.S. wind energy market could reach 8 GW installed in 2009, (including project spill-over from 2008 and new wind build), despite initial fears of a major drop in megawatts resulting from the financial crisis, according to a brief just released from Emerging Energy Research, Cambridge, Mass., a market research and advisory firm analyzing the clean and renewable energy markets.

About 6.3 GW of wind have already been added in 2009, while more than 2 GW are under construction and scheduled for activation by year’s end. “At face value it appears that the US market could witness its second-best growth year to date,” says Senior Wind Analyst Matthew Kaplan. “However, if you remove spill-over build originally meant for completion in 2008, 2009 market activations will probably be closer to half of 2008 levels.”

Still, 2009 build-out has surpassed industry expectations. In the first quarter of this year, most market participants expected a significant drop in 2009 activations to well less than 6 GW based on frozen financial markets. However, a combination of projects planned for 2008 spilling over into 2009 and construction activity by developers eager to qualify for American Recovery and Reinvestment Act 2009 (ARRA – the stimulus bill) provisions, points to US market growth nearing about 8 GW in 2009, according to Kaplan.

Despite this strong growth signal, challenges for the US wind market remain. Falling electricity demand, unprofitable merchant wind prices, and declining fixed power-purchase agreement prices have vexed project developers. However, ARRA provisions and longer-term policy drivers, including RPS incentives, may help counter these short-term economic inhibitors, according to EER.

About 5 GW of wind projects are currently under construction and many will be activated in 2010. While project construction is picking up to obtain grant funding, delays due to the financial crisis indicate 2010 wind activations are more likely to remain stagnant compared with 2009. However, construction may surge so that projects meet grant requirements. “The 2010 picture is not yet complete. On one hand, the project development environment continues to face serious bottlenecks. On the other, the ARRA promises the wind industry more incentives than it has ever seen before,” says Kaplan.


Filed Under: News
Tagged With: ARRA, Emerging Energy Research
 

About The Author

Paul Dvorak

Comments

  1. Mhmd Musabeh says

    December 27, 2009 at 1:45 am

    we hope for a better 2010 for the wind industry

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