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2005 to be big year for wind energy; other news

(Friday, Dec. 10, 2004 -- CropChoice news) -- Below are two items dealing with wind energy.

1. Senators want ideas for cutting use of natural gas
2. Tax credit extension puts wind industry back to work: 2005 expected to break capacity installation records

1. Senators want ideas for cutting use of natural gas

By Tania Soussan, Albuquerque Journal, 12/07/04

Have an idea to increase the nation's natural gas supply or reduce gas use?

The Senate Energy and Natural Resources Committee wants to hear it. Committee Chairman Sen. Pete Domenici, R-N.M., on Monday invited everyone‹ from industry and government to public interest groups and private citizens‹ to send in their legislative proposals.

"We're purposely taking a fresh and creative approach," said Marnie Funk, a spokeswoman for the committee. "We're requesting these proposals from anybody and everybody."

Domenici wants innovative ideas that offer long-term solutions to what he and other national energy policy leaders consider a looming crisis in natural gas supply and demand.

Gas supplies have been tightening for years, and prices began climbing sharply in June 2001 and have continued to creep up, forcing some companies to move overseas, according to the committee.

Inviting the public to submit proposals is a way to "build consensus from the grassroots up," Funk said.

Gwen Lachelt, executive director of the Durango, Colo.-based Oil & Gas Accountability Project, welcomed the opportunity.

"It sounds good that they're soliciting ideas on how to reduce demand," she said. "We'll certainly put in our two cents."

Lachelt said conservation is the way to go because increased gas pumping is already harming the environment.

Bob Gallagher, president of the New Mexico Oil and Gas Association, also said it's good to ask the public for ideas but he said conservation alone isn't the answer.

"It's a very logical approach to take because people who understand the entire issue understand we are moving rapidly toward demand overtaking supply," he said.

Proposals are due Jan. 7. Committee staff will review the submissions and hold a half-day meeting to discuss the most promising ideas later in January.

The best proposals will be considered by the senators on the committee and could become part of a new comprehensive energy bill that will be drafted, starting in February, Funk said.

The committee will issue guidelines for the proposals later this week.

The contact on the panel is Lisa Epifani at lisa--epifani@energy.senate.gov.

Source: http://www.abqjournal.com/news/state/267665nm12-07-04.htm

2. Tax credit extension puts wind industry back to work: 2005 expected to break capacity installation records
New wave of projects brings clean energy, investment, jobs to rural America

With the extension of the federal wind energy production tax credit in September, capacity installations in 2005 look likely to beat all previous records, the American Wind Energy Association (AWEA) said today in its quarterly U.S. market outlook. The previous high for new wind power capacity installations in one year was 1,696 megawatts (MW) in 2001. Most industry participants agree that 2005 will be a better year, with some predicting installations to exceed 2,500 MW.

"Conditions are right for next year to be a record-breaking year," said AWEA Executive Director Randall Swisher. "We will see what the U.S. industry can do at a full-speed run for the next fourteen months. As natural gas prices continue to demonstrate volatility, and coal prices are increasing as well, wind power looks more attractive as a way to diversify a utility's supply portfolio."

The slow-down in installations in 2004 that resulted from the expiration of the production tax credit (PTC) means that many projects that have been in the development pipeline are now ready to move forward quickly. Wind power project developers and wind turbine and component manufacturers are now racing to lock up supply contracts for the coming year.

At the same time, rising and volatile natural gas prices make wind energy attractive in terms of the long-term stable energy price that the technology can offer. Once a plant is built, it requires no fuel and produces no harmful emissions. According to the Energy Information Administration, in the best wind resource areas such as the plains states and the upper Midwest, wind energy is the lowest-cost new electricity resource (with the PTC in place) when natural gas prices rise above about $3.50 per thousand cubic feet. On the New York Mercantile Exchange, natural gas prices topped $7 per thousand cubic feet in October, and most experts expect it to continue in the range of $5 for the foreseeable future.

The more wind energy capacity is installed, the more it will help to reduce the current natural gas supply shortage in the U.S., according to AWEA. The increasing use of natural gas to power electric generating plants is preventing the nation from building up its storage levels during the summer. But in many areas of the country where wind farms are generating electricity, they are directly helping to conserve vital natural gas supplies.

"We estimate that the wind farms already in place, and those that will be installed by the end of 2005, will be saving over 0.5 billion cubic feet (Bcf) of natural gas per day in 2006," said Swisher. "Using conservative growth estimates of 3,000 MW installed every two years for the next four years, the U.S. could top 15,000 MW of installed wind power capacity by the end of 2009, which would save nearly 0.9 Bcf/day by the end of this decade."

Because the tax credit was extended relatively late in the year, AWEA expects the U.S. to install approximately 480 MW of new capacity in 2004, well above its previous estimate of 350 MW but far below previous strong years such as 2001 (1,696 MW) and 2003 (1,687 MW). The full list of expected installations throughout the year is provided below. (See news release at http://www.awea.org

If installed wind power capacity were to consistently expand at a rate of 18% per year, AWEA said, six percent of the nation's electricity could be generated by wind power by the year 2020, resulting in over $100 billion of investment, in addition to saving millions of cubic feet of natural gas. AWEA is continuing to pursue policies - such as a long-term PTC extension and federal and state renewables portfolio standards (RPS) - that will move the wind industry beyond the boom-and-bust cycles that have resulted from short-term PTC extensions in the past.


AWEA, formed in 1974, is the national trade association of the U.S. wind energy industry. The association's membership includes turbine manufacturers, wind project developers, utilities, academicians, and interested individuals. More information on wind energy is available at the AWEA web site: http://www.awea.org