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North America to add 74.5GW due to positive policies

NORTH AMERICA: The five-year extension to the production tax credit (PTC) in the US and a new "climate-conscious" Canadian government will result in 74.5GW of new wind being added in the next decade, according to new analysis from Make Consulting.

Wind in the US and Canada is predicted to grow 74.5GW by 2025, according to Make Consulting
Wind in the US and Canada is predicted to grow 74.5GW by 2025, according to Make Consulting

Between 2016 and 2025, wind capacity in North America will grow from 85.8GW as at the end of 2015 – according to Windpower Intelligence, the research and data division of Windpower Monthly – to more than 160GW, Make's report predicted.

Most of the additional capacity will be as a result of the PTC extension, approved by the US government at the end of 2015. It will continue to support projects beginning construction until the end of 2019.

Make predicts 44.4GW of new capacity will be built thanks to the long-term certainty provided by the PTC. However, this total is dependent on other cost reductions to make up for the fall in PTC support over the five-year phase out.

"Turbine technology advancement and balance of plant (BOP) cost reductions will continue to drive down the levelised cost of electricity (LCOE) of wind power and offset a portion of the lost PTC value from 2019," according to Make.

In to the next decade, Make predicts the Clean Power Plan (CPP) will provide 12% of the ten-year growth in capacity. CPP still faces a number of legal challenges, highlights Make, and the presidential election in November could also affect the impact of the CPP.

Under the scheme, each state has been given a target to reduce climate emissions from power plants. The states are to create custom plans for reaching their goal, such as forming regional cap-and-trade programmes.

States must submit preliminary versions of their strategy by 2016 and final versions by 2018. They have until 2022 to comply.

The rules should enable the US to slash emissions by 32% below 2005 levels by 2030, said the White House, rather than the 30% that Obama proposed in June 2014.

In Canada, Make suggests provincial policies, some of which have already shifted since last year's elections, will also benefit wind capacity.

There is also the potential for wind to fill the gap left by the retirement of coal plants in Alberta and Saskatchewan from 2018, according to the report.

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