An Update on Wind Energy

Alternative energy from the skies gains momentum and popularity.

| April/May 1993

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    The wind industry moves inland.
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    One of the drawbacks to wind energy is residents near the towers find them ugly and noisy.

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Like many revolutions that are more than a few years old, wind energy has remained in the mountains gaining strength. It is now ready to move inland, however, to capture the hearts and minds of the rest of the country. After a decade of experimenting with wind farms in the hills of California, plans are now underway to utilize wind resources in in Washington state and Montana. Wind farms are also in the planning stages in Minnesota, Wisconsin, Wyoming, North Dakota, New York, Hawaii, Iowa, and Texas. There is even one planned to be online by 1994 on a breakwater around the port of Los Angeles.

Industry Breakthroughs 

During the late 1970s and early 1980s, the wind industry suffered the pangs of a premature birth. The need for new sources of energy prompted by the oil crunch of the late 1970s resulted in the application of immature technology, and from 1981 to 1985, attractive federal and state tax credits promoted a "wind rush" to build turbine at an average pace of five to six turbines a day.

The fledgling industry was plagued at the outset by the faulty notion that aviation technology was easily transferred to the design of wind turbines, and the misconception that bigger turbines would generate more electricity. Many of these early turbines stalled in high winds, while blades faltered in extreme weather.

Further damaging were opportunistic investors more interested in capitalizing on federal tax credits than on efficiently generating electricity. From 1981 to 1985, entrepreneurs were offered a 15 percent federal investment tax incentive to build wind farms. Unfortunately, this was valid even if wind farms never generated a kilowatt of electricity. Consequently, rich investors looked upon the wind industry as a lucrative tax shelter. According to the California Energy Commission, where 150 turbines were installed in that state in 1981, that number rose to 4,590 in 1985. When the tax credits were allowed to expire in 1985, the number of installations dropped by half the following year, and by 1987, the number of new installations had dropped to 1,392.

A federal law signed by George Bush last October, The 1992 Comprehensive National Energy Policy Act, allows a new tax credit for wind energy. This time, however, the tax credit is tied to electricity generated, not systems installed. The law allows a production tax credit of 1½ cents per kilowatt-hour of wind-generated electricity generated between January 1,1994 and June 30, 1999. The same law provides for greater access to use existing transmission lines in order to deliver electricity generated at wind farms to distant points of use.

Recent technical breakthrough have made wind-electric systems more efficient, however, and now, at about five cents per kilowatt-hour, they can compete economically with central coal-fired power plants for generating electricity in several parts of the United States. By 1994, with the economics expected to drop to four cents per kilowatt-hour, wind energy should be able to compete economically with central coal-fired power plants anywhere in the country.

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