Wind Power’s Growth in the U.Ss.

Lynne Kiesling

The WSJ Environmental Capital blog has been doing a great job of keeping up with the wind power industry in the U.S. lately. Today’s post about Iberdrola’s planned investment in wind power in the U.S. is a good summary, with links to some of their other recent posts on the subject.

How to read this? For starters, it’s another sign the U.S. wind power market is going great guns regardless of what Congress does for clean-energy tax credits. As we noted last week, the Department of Energy figures wind power could provide 20% of U.S. electricity by 2030–with or without subsidies. And T. Boone Pickens put the first $2 billion down on his $10 billion bet on the world’s biggest wind farm in Texas last week, without waiting for the tax credits to be renewed.

One interesting aspect of Iberdrola’s investment plans is how the New York Public Service Commission’s concerns about electricity prices may influence some of their investment decisions:

But the New York Public Service Commission, the five-person body that has to give the final green light, is leery. It’s worried Iberdrola’s deal could harm consumers by raising power prices; it argues the deal would give Iberdrola a virtual monopoly, since the Spanish utility could control both generation and transmission of electricity. So, the New York commission is proposing that the world’s biggest wind-farm operator divest some of its wind farms to win regulatory approval.

The post then goes on to note that those who are interested in environmental policy are upset about the NYPSC’s objections, because their highest priority is increasing renewable energy capacity to meet New York’s goal of having 25% of their power generated from renewable sources by 2013. I think increasingly we will see the tension between the regulatory objective of low electricity prices and the regulatory objective of reduced fossil fuel generation that is evident in this example.

2 thoughts on “Wind Power’s Growth in the U.Ss.

  1. NYPSC could rule that Iberdrola must allow access to any generators at “common carriage” rates. Surely wind turbines are faster to set up than even gas-powered plants. What they need to do is allow free entry AND high prices (set by market forces, not monopoly). The higher the prices, the more the entry, the lower the prices, etc.

  2. No mention if the investment plans include major transmission upgrades. Just take a look at the Midwest ISO queue problem: tens of thousands of MWs of wind waiting to be built because of a lack of adequate transmission infrastructure. This will add significant costs.

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