The second day of Windpower 2015 started with wind industry leaders emphasising America's leadership role.
"The fight to get the wind industry where it is today has been hard. But I can assure you we are winning," said Mike Garland, chief executive office of Pattern Energy Group and new chairman of the board of the American Wind Energy Association (AWEA).
America produces more wind than any other country, including China and Germany, he said. "We cannot afford to lose that role, especially to China," he stressed.
The US wind industry needs to drive down costs and become more demanding, including for a five-year production tax credit (PTC), he said.
A level playing field is needed, including access to master limited partnerships for wind — as well as for oil and gas — and polluters should pay the price especially for carbon pollution, he told the audience.
How does wind get to 30% of America's energy supply by 2030? During a panel session, James Murphy, executive vice president, CFO and COO of Invenergy LLC, said that the capital base of wind has to be expanded since a goal of 10GW a year of new wind will take $15 billion yearly in investment.
He cited the yieldcos that have already emerged.
Murphy also said that a 25% reduction in turbine cost is not enough — the cost of the wind plant must be similarly reduced.
Michael Storch, executive vice president of Enel Green Power North America, said that wind must wean itself from the PTC. "The PTC has to be ancient history," he said.
He also cited the negative perception of wind, such as bird kills, which are not seen in the context of how many more birds are killed by buildings and windows. "Donald Trump — he's not a big fan of wind — he's the problem," he added.
The Environmental Protection Agency's Clean Power Plan, to reduce emissions and phased in by 2020 or shortly thereafter, will be a major driver. It will help wind remain a sustainable business despite the phase-out of the PTC, said Mike O'Sullivan, senior vice president of development with NextEra Energy. But new installed wind will "perhaps not be as big as some folks in [the Department of Energy] Wind Vision report foresee", he said.
The report lays out a goal of wind being 10% of America's electricity supply by 2020 and 30% by 2030. Wind currently provides 4.5%.
At a press conference afterwards, Vestas' Chris Brown, stressed that wind must continue to reduce its levelised cost of energy (LCOE): "If we continue to drive down LCOE, wind becomes an economic story not a political story."
Wind advocates will meet with as many presidential candidates seeking the White House in 2016 as it can. "We have already met with some," said Pattern Energy's Garland. AWEA's Peter Kelley noted that the first vote for the candidates will be in Iowa, the state with most wind penetration — and thus wind will inevitably become an issue.
During a session on rallying support for wind’s future, Kevin Lynch, vice president of external affairs for Iberdrola Renewables, said that the industry needs to do even better on environmental issues and understand how to lighten its footprint. "Improve it!" he said.
Susan Reilly, president of RES Americas and a former AWEA chair, said that the most important policy in the next two to three years is getting state-level measures in place, so that wind is seen as a solution to carbon emissions. She also said that wind should sell itself as not consuming water, because of the number of areas that lack water — a situation that will only get worse.
Jose Zayas, DOE’s director of wind and water power technologies, noted a major challenge for wind. In 2008, US electricity demand was rising by 1.5-2% yearly whereas now it is lagging at 0.5%. "We need to create demand," he said.
Transmission was the main challenge noted by Elizabeth Salerno, product and marketing strategy manager at Siemens. She recalled that DOE’s Wind Vision report says that 29 million miles of new transmission lines will be needed for wind’s future. "That’s something we have to start today," she warned.
Afterwards, Reilly told Windpower Monthly that wind needs a level playing field. She cited a new IMF report that says that fossil fuel companies receive $5.3 trillion a year in global subsidies, or $10 million a minute.
This high cost is due to inclusion of "externalities" such as pollution. Their subsidy is greater than the total health spending of all the world’s governments, said the Guardian newspaper.
In a session on turbine maintenance, Steve Scott, general manager for Duke Energy Renewables, said that a weekly vibration report is the most important data that Duke receives from operating wind projects: "Is there a trend? Is there an issue and can we take action? We can be very proactive."
Justin Johnson, director of performance management with EDP Renewables North America, told the session that his company is running an experiment by de-rating a 10MW project by 25% to gauge the effect on gearboxes and generators. The loss of annual energy production is 3%, he said.
Meanwhile William Watts, director of wind service Americas with Siemens, said that his company is moving towards doing more "health checks" on turbines. That is, Siemens is moving towards more condition-based monitoring rather than relying upon time-based data.
Two owners with multiple turbine models in their fleets, however, talked about the pitfalls of sharing too much data with an OEM. "If we share too much data, it can help my competitor," said Duke’s Steve Scott.
All go for manufacturers
Yesterday, GE unveiled its Digital Wind Farm, and Siemens launched a 2.3MW turbine for the Americas.
"We're running flat out," Chris Brown, president of Vestas Americas, told Windpower Monthly. He added: "The outlook [in the US] is very strong in 2015-16."
Brown will be the chair of AWEA's board or directors next year.
America accounted for about 20% of Vestas' global order intake in the first quarter of 2015. And in Q1 2015, Vestas delivered around 600MW in the US, out of quarterly deliveries of 1,271MW globally — so the US was about 47%.
Sales for all OEMs will be hit in the US in 2017, after the current mini-boom ends with the expiration of eligibility for the PTC. Asked about this, Brown said: "You don't build a business on the basis of one policy. We're not a one-trick pony. Incentives come and go."
He said he expects the PTC to be extended, probably for a year. Analysts, however, are deeply divided about that, with some saying it will end.
A year ago, Brown told Windpower Monthly that wind was in a "battle of death" with shale gas and wind power.
"The gas business has not done too well. And we're still here," he said, adding that wind and solar are complementary.
How is Vestas faring compared with competitors? "The V110-2.0 is the turbine to beat," he said, citing Vestas recent sale of 200 V110s to Berkshire Hathaway Energy Renewables.
"Berkshire Hathaway was our competitor's market," he said. Indeed the company's sibling, MidAmerican Energy, has bought more than 2GW of Siemens' SWT-2.3 turbines.
What of yesterday's launchings of competitors' new products? GE is in talks with Invenergy about its new Digital Wind Farm, and Siemens' turbine will not be in serial production until 2017.
"I can [easily] introduce vapourware," he said scathingly. Vestas builds on previous models and only unveils turbines when they are ready commercially, he said.
Elsewhere, Acciona Windpower revealed plans to install 805.5MW in North America in 2015. As much as 94% of this capacity will be 3MW wind turbines, said Jose Luis Blanco, CEO of the Spanish-based turbine manufacturer. All of the facilities are owned by third-party customers. These installations represent almost 60% of the company’s planned global output for the year. Only 30MW of Acciona turbines were installed in the region in 2014, all on Prince Edward Island in Canada.