Forces Driving Wind Power Development

1
Forces Driving Wind Power Development

• Pat Walsh
• UW-Madison/Extension
• Focus on Energy Program

2
Drivers for Wind Power

• Fuel Price Uncertainty
• Energy Security
• Federal and State Policies
• Economic Development
• Green Power
• Declining Wind Costs

3
US Escalating Energy Use
4
CHINARECENT ENERGY FACTS

• China accounts for at least 40 of the growth in
  global oil demand.
• In 2004 China will use 830,000 barrels a day more
  than last year which is about a third of world
  demand growth, which may soon be fifty percent.
• Chinese energy consumption will more than double
  in the next twenty years.
• Source US Energy Information Administration

5
(No Transcript)
6
Energy Security Issues Are Growing

• Three quarters of the worlds known petroleum
  reserves are in the Middle East
• Most of these are in three countries
• Saudi Arabia
• Iran
• Iraq

7
Natural Gas
Source Community Office of Resource Efficiency
8
Natural Gas Price Volatility
9
(No Transcript)
10
Carbon Growth Highest in Developing Countries
Annual Carbon Emissions
GT/yr
Industrialized
0.8
0.7
1.2
2.4
2.3
Developing
2.2
Developing Share
50 52 56 60
11
Shrinking Polar Ice
Extent of Arctic summer ice in 1979 (top
satellite image) and in 2003 (lower satellite
image).
NASA photograph
12
The Energy Policy Act of 2005Public Law 109-58
13
Renewable Depreciation Deductions

• Businesses can recover investments in solar, wind
  and geothermal property through depreciation
  deductions under the Modified Accelerated
  Cost-Recovery System (MACRS)
• For solar, wind and geothermal property placed in
  service after 1986, the terms are five years.

14
Renewable Electricity Production Tax Credit

• Provides a business tax credit of 1.5 cents/kWh,
  adjusted annually for inflation, for electricity
  generated by wind, closed-loop biomass and
  geothermal (1.9 cents/kWh adjusted for 2005)
• Electricity generated from open-loop biomass,
  small irrigation hydroelectric, landfill gas,
  municipal solid waste resources and hydropower
  receive half that rate (currently 0.9 cents/kWh).
• Available through December 31, 2007 for renewables

15
Renewable Energy Production Incentive

• New qualifying renewable energy generation
  facilities eligible for annual incentive payments
  of 1.5 cents/kWh for the first 10 years of
  operation.
• Qualifying facilities must use
• Solar
• Wind
• Geothermal
• Biomass
• Landfill gas
• Livestock refuse
• Ocean generation technologies (tidal, wave,
  current and thermal)
• Fuel cells using hydrogen derived from eligible
  biomass facilities

16
2005 Wisconsin Act 141

• Renewable Portfolio Standard- requires utilities
  to generate 10 of their power from renewable
  energy by 2015
• Requires state government to use renewable energy
• 10 by 2007
• 20 by 2012

17
(No Transcript)
18
Wind Cost of Energy
12
10
8
Low wind speed sites
COE (/kWh constant 2000 )
6
Bulk Power Competitive Price Band
High windspeed sites
4
2
0
1990
1995
2005
2010
2015
2020
2000
19
(No Transcript)
20
Growth of Wind Energy Capacity Worldwide
Jan 2003 Cumulative MW Rest of World
2,803 North America 5,018 Europe
21,319
Actual
Projected
Rest of World
Rest of World
North America
North America
Europe
Europe
MW Installed
Year
Sources BTM Consult Aps, March 2001
Windpower Monthly, January 2003
21
(No Transcript)
22
Wisconsin Wind Profile
23
Conclusion

• Many forces driving wind development
• Some areas of Northwest Wisconsin may be a good
  places for wind development
• Now is a good time for communities and citizens
  to learn about this technology