Wind Power Market Update

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Wind Power Market Update
Harvesting Clean Energy Boise, Idaho February 10,
2003

• Larry Flowers

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Sizes and Applications

• Small (?10 kW)
• Homes (Grid
• connected)
• Farms
• Remote Applications
• (e.g. battery changing, water pumping, telecom
  sites, icemaking)

• Intermediate
• (10-500 kW)
• Village Power
• Hybrid Systems
• Distributed Power

• Large (500 kW 6 MW)
• Central Station Wind Farms
• Distributed Power
• Offshore Wind Generation
• Stations

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GE WIND 1.5 MW
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Growth of Wind Energy Capacity Worldwide
Jan 2002 Cumulative MW Rest of World
2,656 North America 4,459 Europe
17,812
MW Installed
Sources BTM Consult Aps, March 2002
Windpower Monthly, January 2002
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Wind Economics - Determining Factors

• Wind Resource
• Financing and Ownership Structure
• Taxes and Policy Incentives
• Plant Size equipment, installation and OM
  economies of scale
• Turbine size, model, and tower height
• Green field or site expansion
• What is included land, transmission, ancillary
  services

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Wind Cost of Energy
12
10
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Low wind speed sites
COE (/kWh constant 2000 )
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Bulk Power Competitive Price Band
High windspeed sites
4
2
0
1990
1995
2005
2010
2015
2020
2000
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U.S. Average Natural Gas Prices
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COOP vs. IPP Financing

• Larger plants are significantly less expensive
  per kWh
• Public power can own/ install smaller plants at
  comparable cost to large IPP projects
• Aggregation of demand reduces costs

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Economic Development Opportunities

• Land Lease Payments 2-3 of gross revenue
  2500-4000/MW/year
• Local property tax revenue 100 MW brings in on
  the order of 500-1,000k/yr
• 1-2 jobs/MW during construction
• 2-5 permanent OM jobs per 50-100 MW,
• Local construction and service industry
  concrete, towers, some electrical usually done
  locally
• Investment as Equity Owners production tax
  credit, accelerated depreciation
• Manufacturing and Assembly plants expanding in
  U.S. (Micon in IL, LM Glasfiber in ND)

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States Renewable Energy Policies
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Load Growth
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Transmission Growth
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Key Deployment Issues for Wind Power

• Permitting and Siting (visual, noise, avian, land
  use)
• Transmission capacity allocation, RTO formation,
  new line builds/planning
• Power Variability impact on utility operations
• Evolving competitive markets
• Green power markets
• Policy environment PTC, RPS, state tax
  provisions

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Resources On The Web

• AWEA Web site http//www.awea.org
• NWTC Web site http//www.nrel.gov/wind
• National Wind Coordinating Committee
  http//www.nationalwind.org
• Utility Wind Interest Group site
  http//www.uwig.org
• WPA Web site
• http//www. Windpoweringamerica.gov
• Homepower Web Site http//www.homepower.com
• Windustry Project http//www.windustry.com
• Best Links www.me3.org

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Carpe Ventem