U.S. electric utilities are locking in fixed-price contracts for wind power, now more cost-competitive than ever, illustrating the success of the federal production tax credit (PTC) policy in holding down rates for consumers, according to the American Wind Energy Association (AWEA).
AWEA notes 66 U.S. utilities bought or owned wind power by the start of this year – nearly half for large amounts over 100 MW – up from 42 last year. In fact, since the extension of the PTC in January, utilities have continued to show interest in buying a wind project's output or owning the wind farm outright.
‘From Xcel Energy in Minnesota to OG&E in Arkansas, electric consumers are racking up the savings as a result,’ says Rob Gramlich, AWEA's interim CEO. ‘The wind energy industry looks forward to our continued partnerships with utilities across the country to lock in the economic development, rate stabilizing and environmental benefits of more wind power.’
As evidence, AWEA cites the following utilities, which are making major wind power purchases and reporting consumer savings:Â
- Xcel Energy, the No.1 wind energy provider in the U.S., is considering adding more wind generation in Minnesota and Colorado because of the PTC extension;
- MidAmerican Energy, the No. 1 company in the U.S. in terms of utility ownership of wind capacity, announced Dec. 31, 2012, that it had completed three more wind projects totaling 407 MW in Iowa. MidAmerican is a subsidiary of Berkshire Hathaway, the holding company controlled by investor Warren Buffett;
- Tri-State Generation and Transmission Association, which, citing the recently extended PTC and ongoing renewable portfolio standard requirements, is moving forward with a request for proposals for up to 100 MW of renewable energy;
- DTE Energy's ECHO Wind project, slated for 2013, will have a combined levelized cost of approximately $52.50/MWh, down substantially from power purchase prices several years earlier, according to the Michigan Public Service Commission. DTE says its investment in the wind farm – and two others – will contribute $150 million in economic benefits to Michigan; and
- Consumers Electric Power, which estimates that Macon County and the state of Michigan received an economic boost of nearly $10 million from the development of Lake Winds Energy Park, the company's first wind farm, AWEA notes.