Wind plants have become commercially viable says new study

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Wind plants have become commercially viable sources of power for US and Canadian utilities, according to a new study by Emerging Energy Research (EER), a Cambridge-based research and advisory firm. The study, US/Canada Wind Power Markets and Strategies, 2004-2010, predicts record growth in 2005, with investment expected to pass the US$2 billion mark for the first time. "Wind plants are no longer the relics of environmental activism in the 1980s," says EER president William Ambrose. "Wind power has now become mainstream for US and Canadian utilities." The study suggests wind procurement leaders, like PacifiCorp in the US and Hydro-Quebec in Canada, will be joined by a "long list of utilities" that need to fulfil renewable energy mandates or are attracted by the growing competitiveness of wind technology. On the development side, wind power is increasingly capturing the attention of traditional energy companies. "As these corporate giants bring new scale to the wind industry, smaller wind IPPs [independent power producers] and developers will find it increasingly difficult to compete," the study says, predicting many will become prime acquisition targets for the larger players. However, uncertainty over the future of the US production tax credit, set to expire again at the end of this year, continues to have an impact on the industry's growth. "At this point the industry would fare better without a PTC altogether rather than with a start-and-stop policy that scares off investors and prevents manufacturers from scaling their business," says Ambrose. Over the longer term, EER expects US wind power capacity to grow from over 6800 MW in 2004 to more than 21,700 MW by 2010. Canada will experience faster growth, it says, from about 500 MW in 2004 to nearly 4500 MW in 2010.

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