The Production Tax Credit (PTC) is needed to keep wind energy nationally competitive, said Tom Kiernan, CEO of the American Wind Energy Association (AWEA) and the keynote speaker at this year’s Financial Forum Luncheon at Power Generation Week.
Despite this assertion, Kiernan remains bullish on the national market for wind-generated energy, noting that two states in the country, Iowa and South Dakota, currently generate over 25 percent of their energy via wind, with nine states currently generating 10 percent or more of their energy using wind.
Kiernan also said that wind energy is cheaper than many other conventional energy sources. Referencing a bill stub that Xcel Energy recently mailed to its customers announcing a 30 percent increase in the utility’s wind generation capacity, Kiernan emphasized that the company would pass the cost savings on to the customer. “That’s right,” he said, “Wind energy is not only good for the environment, it can also be the most economical energy choice.”
Kiernan also noted that wind energy costs continue to go down. Comparing the price of wind energy in 2011 to that in 2013, Kiernan noted that the cost per megawatt hour (MWh) of wind energy in Power Purchase Agreements (PPA) has steadily decreased, starting as high as $47 per MWh, and finishing as low as about $25 per MWh in some instances.
Kiernan acknowledged that the wind energy industry is young relative to more conventional sources of generation, but said this results in an environment in which evolution occurs rapidly. Wind towers have grown taller, he said, and blade designs and computer systems have improved dramatically.
While many people associate wind energy with high intermittency that requires more conventional forms of generation for backup, Kiernan demonstrated that wind energy actually requires about half the cost in reserves compared to those needed for conventional energy generation.
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