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According to the American Wind Energy Association, Pennsylvania added 550 MW of installed capacity last year, making it one of the fastest-growing wind states in the U.S. In fact, last year’s bumper crop of new wind farms pushed Pennsylvania’s total to 1.3 GW, making it the 15th state to surpass 1 GW of installed capacity.

It’s fair to suggest that the concern over the expiring federal production tax credit (PTC) forced wind developers to push projects slated for 2013 into 2012. Just the same, last year’s total was the culmination of a decade’s worth of efforts to encourage wind energy.

The combination of good wind resources and turbine technology that features larger rotors capable of increased energy capture in lower wind speeds is gradually making Pennsylvania a top wind state. In 2010, the National Renewable Energy Laboratory (NREL) found that Pennsylvania has barely scratched the surface when it comes to meeting its potential. According to NREL, the state could install up to 3.3 GW of wind power at 80 meters.

Eric Thumma, director of policy and regulatory affairs at Iberdrola Renewables, explains that Pennsylvania’s success is largely a result of its often collaborative and practical approach to wind development.

When wind farms were beginning to sprout up in the state around 2005, a consortium of environmental groups, wind developers and state representatives worked to establish a wind ordinance – a best practices approach for responsibly siting wind projects.

“A lot of these townships didn’t have specific zoning requirements related to wind turbines, and they took the group’s suggestions and used an ad hoc document to serve as a guideline,” Thumma explains. “The ordinance was a voluntary document, and some communities tweaked it, which was the whole point.”

From a siting standpoint, Thumma says the state’s Department of Environmental Protection has been generally supportive of wind projects. “It begins with obtaining a water quality permit for your roads, and that serves as a gateway to other permits,” he says. “Relative to what we see in other states, the siting and permitting is just easier here.”

He says developers have worked hard to adhere to pre- and post-construction avian and bat monitoring protocols that have been largely followed by most, if not all, Pennsylvania wind developers.



Given the state’s landscape and rolling topography, wind farm construction can be tricky – not to mention expensive. And considering that many state wind farms are located atop ridgelines, crane costs for construction and maintenance can quickly escalate.

Another limiting factor in wind development relates to Pennsylvania’s 18% by 2021 Alternative Energy Portfolio Standard (AEPS). Unlike in other states, Pennsylvania’s portfolio standard includes not only renewable energy sources such as wind and solar, but also non-renewables.

The portion in the AEPS pertaining to wind, Tier 1 resources, has an 8% by 2021 requirement, including a 0.5% carve-out for solar. The portion for Tier 2 resources, such as waste coal and large-impact hydro, has a 10% by 2021 requirement.

Some, such as David Flitterman, chairman for Gamesa’s North American operations, suggest the AEPS is too low and does not do enough to incent wind development.

“When Pennsylvania passed its AEPS in 2004, it was one of the most progressive in the country – so much so that other states not only followed suit, but upped the ante,” explains Flitterman. “Other states have leaped ahead of Pennsylvania since the AEPS was enacted, and they have created policies that make wind development more attractive within their borders. We believe it’s time for Pennsylvania to do more and expand the AEPS to be more on par with other states in the region.”


However, Pennsylvania Gov. Tom Corbett opposes the idea and says he will not raise the AEPS beyond its current level.

“Renewables, especially wind, have found it difficult to compete in the current climate,” Flitterman says. “Unfortunately, there have been several legislative attempts recently, though unsuccessful to date, to roll back the state’s portfolio standard or at least to weaken it dramatically by adding more forms of energy that are not renewable by definition.”

John Hanger, the former secretary of the Department of Environmental Protection and a 2014 candidate for governor, says he’s not about to sit back and watch the state fumble away the years he spent helping enact the AEPS in 2004 and bringing the likes of Gamesa to Pennsylvania in 2005.

“Governor Corbett has refused to lift a finger to help wind energy,” says Hanger, adding that Corbett also refused to lend his signature to a petition calling for the extension of the PTC last year. “At times, he has even been hostile.”

For his part, Hanger aims to increase the state’s AEPS and double the amount of Pennsylvania wind power.

“Doubling the amount of wind power in Pennsylvania and the PJM Interconnection would save consumers $6.9 billion by 2026,” he says. “It would also cut carbon dioxide emissions by 14 percent.”


Other market factors

Despite its recent success, wind development in the state can be challenging. Like the Texas and Alberta energy markets, Pennsylvania lets the marketplace decide winners and losers.

Patrick Henderson, energy director for Gov. Corbett, explains that the state’s competitive electricity market allows consumers to choose their preferred method of generation, engendering innovation and competition. In Pennsylvania, that means competing with the plentiful natural gas resources of the Marcellus Shale, a wide swath of earth deep below the state.

Not surprisingly, the state has embraced the shale gas boom.

“As we say in Pennsylvania, we have an ‘all of the above and below’ approach to energy,” quips Henderson.

Such market dynamics have paved the way for state-based initiatives, such as ChoosePAWind, an initiative allowing state energy businesses and consumers to encourage state wind development through the purchase of renewable energy certificates.

No question, the presence of abundant – and cheap – natural gas has hampered the ability of wind developers to find off-takers for projects.

“In Pennsylvania, there are no opportunities for wind developers to sign long-term power purchase agreements with a traditional utility, meaning that owners and operators must sell their power on the open market,” Thumma explains. “That’s probably the No. 1 thing that must change here.”

He says recent efforts to change utilities’ procurement methods have been met with resistance from the Pennsylvania Public Utility Commission, which claims power procurement is a legislative issue as opposed to a regulatory matter.

“We’re all battling [natural gas], and it’s a really low price,” admits Thumma, adding that improved turbine technology has begun to close the gap somewhat. “Our cost per megawatt-hour is beginning to come down. So, we’ll see.”

“It’s all about fuel cost and energy prices,” explains Flitterman. “Natural gas is very cheap – below $4.00/MMBtu – and sets the price for electricity. The net result is lower power prices.”

“The shale gas boom in the U.S. is real, and [natural] gas is not going anywhere,” Hanger says. “The presence of natural gas has affected the energy markets, and both coal and wind have been hurt by the shift.” Hanger, nonetheless, insists there is a real opportunity for renewable energy to co-exist with natural gas in Pennsylvania.

For his part, Flitterman says natural gas prices will not stay down forever.

“We believe this is temporary and think that natural gas will settle at a price that will encourage an increase in renewables,” he explains. “The question is when.” w

Spotlight: Pennsylvania

An Overnight Success A Decade In The Making

By Mark Del Franco

After years of encouraging development, Pennsylvania had a record-breaking year in 2012. However, will the local wind sector become a victim of the state’s market-based approach?





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