As before, that crossroads is fast approaching as investors, developers, manufacturers, advisors, and construction crews try to keep up with the current wind rush. But unlike before, there are signs that the industry has new pathways to further growth, which are driven by advancing technology, lower costs, and more buyers.
One of the more appealing trends in the US wind market is the increase in purchases of wind power by non-utilities. American corporations have made strong public commitments to shift to renewables, with tech giants like Google, Microsoft, and Apple leading the way. With the urgency to take advantage of PTC-eligible projects, developers have inked a flurry of deals with corporate purchasers.
Despite this momentum, some would argue that corporate purchasers will remain only a niche market, especially if social responsibility is the primary motivation for these corporations to purchase wind.
But there are two critical reasons to reject that argument, and why corporate purchasers are more likely to become a substantial market for the US wind industry.
First, onshore US wind power is now, undeniably, cost competitive. As recently articulated in the US Department of Energy's Wind Vision, the cost of wind-generated electricity has dropped substantially in recent years, and larger rotors and higher hub heights will continue to make wind a more attractive buy.
Second, the list of companies that are bypassing the traditional utility offering and directly buying renewable power continues to grow. Purchases by Dow Chemical Company, General Motors, and IKEA show that adding wind power has broad appeal across diverse industries, but the logic is universal: wind energy offers competitive long-term price stability and supply diversity.
At its heart, this trend is consistent with the larger transformation occurring in the power sector - the breakdown of traditional business models and the growing influence of residential, commercial and industrial consumers of power.
The PTC is no doubt important to wind's current competitiveness, and the lack of a renewal will have adverse consequences on the US market. But it is not the only policy driver to consider. President Obama's Clean Power Plan for power plants will be issued this summer, and every state has until summer 2018 to finalise how to comply with the rules on cutting carbon pollution.
Compliance with the rules starts in 2020, with states working towards achieving their individual clean energy targets by 2030. The wind industry expects this to buoy the wind market in coming years, but it will not happen overnight. Furthermore, opposition to the Clean Power Plan is vocal, and upcoming court battles, such as two already filed by the coal industry in the District of Columbia Court of Appeals, could determine its fate.
The Clean Power Plan brings to the fore both the opportunity and the challenge of integrating renewables at a high penetration level. With an eye towards influencing this debate, the American Wind Energy Association and the US Solar Energy Industries Association recently produced a handbook for states: Incorporating Renewable Energy into State Compliance Plans for EPA's Clean Power Plan, which describes how to meet the mandates of the Clean Power Plan.
Meanwhile, as details of the Clean Power Plan continue to be debated, high wind penetration is already happening across the US, particularly in the states of Texas and Iowa. Owing to the wealth of wind in the region, many central US states will likely beat their Clean Power Plan targets ahead of schedule, as corporate purchasers and forward-looking utilities invest in low cost wind power. To be sure, low cost alone will not allow the US wind industry to meet its wind penetration goals. A high renewables future demands more than simply "integrating" new wind farms with existing infrastructure. A well-executed Clean Power Plan will be critical.
Despite integration challenges and the usual political uncertainty, the current US wind rush has brought the industry to a promising junction where the path forward is increasingly based on a foundation of economic competitiveness and diverse market demand.
Clint Johnson is head of project development & engineering for DNV GL - Energy in Portland, Oregon