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United States

A second wind

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Emerging markets like China present their own challenges to the international wind industry but the established ones are hardly a sure bet either. California, once the golden poster child for wind power worldwide, has seen but a flicker of development in recent years. Fresh policy tweaks -- particularly a strengthening of the state's renewables mandate legislation -- suggest change is in the air (page 47).

Wind power supply from out of state, delivered in blocks with traditional power, can now not only satisfy energy demand, but also the state's accelerated renewable energy mandate of 20% by 2010. What's more, since most power to satisfy the mandate will still come from within the state, an emerging California market for trade in unbundled green power credits will help shore up future development: wind projects can satisfy the power needs of non-mandated municipalities while selling green credits separately to utilities with a mandate to meet. It is just one less excuse for utility foot dragging. The policy changes reflect a broad shift in attitude to energy, evident in other legislation limiting coal fired power, but most prominently in a landmark greenhouse gas law which eclipses any existing national effort.

Another California wind rush will not happen overnight. A web of hurdles coupled with relatively greener pastures elsewhere in the country has wind developers turning a blind eye to the state -- especially into next year when priorities are pragmatically shifted to more welcoming markets like development-friendly Texas and America's farming heartland where land lease payments trump NIMBY attitudes. California is hardly the easiest state for project permitting. With so much of Californians' wealth amassed in real estate, any potential threat to home values is fought fiercely. And damaging reports of questionable repute (page 30) on bird deaths in wind farms continue to fan the flames of environmental opposition.

There are, however, thousands of megawatts of potential power in acceptable locations, especially the renowned Tehachapi Pass area. But lack of transmission capacity is the elephant in the drawing room. State regulators have been slow to find workable solutions. Yet they have been quick to accept lofty utility power purchase agreements as evidence of compliance with the mandate instead of insisting on seeing green kilowatts fed into the wires.

The challenges are not insurmountable, especially in light of the state's strengthened policies. California is better poised for a wind renaissance than at any time in the past decade. Stay tuned.

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