The US production tax credit program continues to have a strong pull on wind energy activity in the country.
Receive daily email alerts, subscriber notes & personalize your experience.Register Now
There was just over 29,600 MW of wind capacity under construction or in advanced development in the US at the end of the third quarter, the highest level ever reported, according to the American Wind Energy Association's market report released Thursday.
AWEA said that 13,759 MW was under construction and 15,875 MW in advanced development at the end of September. That total represents a 27% increase over Q3 2016.
Project developers installed 534 MW of new wind generation in July, August and September. AWEA said that that brings to 2,892 MW of newly installed wind generation capacity in the first nine months of this year.
"There are now 84,944 MW of installed wind capacity in the US," said the report. The country's wind capacity has more than tripled over the past 10 years. In 2008 there was just over 25,000 MW of wind installed.
Of the 534 MW installed in Q3, 402 MW were installed in Texas, 100 MW in Indiana, 30 MW in New Mexico and 2 MW in California, the report. There are now 21,450 MW of wind capacity installed in Texas, according to AWEA.
In the third quarter, US utilities announced plans to develop and own 3,040 MW of wind capacity, which, AWEA said, brings to 8,840 MW in utility announcements made since the start of 2016.
"New announcements include AEP's 2,000-MW Wind Catcher project in Oklahoma and Alliant Energy's 500-MW New Wind II project in Iowa," AWEA noted.
There were also four requests for proposals, or RFPs, released during the quarter for up to almost 4,000 MW of wind-eligible capacity. PacifiCorp's request, AWEA noted, was for up to 1,270 MW.
The report says that project developers announced 1,337 MW of power purchase agreements signed in Q3, which brings to 4,697 MW of signed PPAs for the year.
"Six corporate customers signed PPAs during the third quarter, accounting for 62% of total project capacity contracted." The AWEA report noted that Anheuser-Busch, Cummins, JPMorgan Chase and Kimberly-Clark all signed US wind PPAs for the first time during the quarter.
The boom in construction is tied to the Congressionally approved federal PTC program that provides wind installation owners tax credit for every kilowatt-hour produced over the course of 10 years.
Big developers like NextEra Energy Resources use the tax credits to reduce their federal income tax exposure. The PTCs are also used to attract funds to projects in what are referred to as tax equity deals.
Projects that started construction in 2015 and 2016 received a full value PTC of 2.4 cents/kWh. This is now in phase-down. A project that begins construction this year receives a credit that is 80% of full value. In 2018 it is a 60% PTC, while in 2019 it is 40% of the full value PTC.
The AWEA report said that there was 638 MW in new construction announcements in the third quarter, and 70 projects in construction phase in 22 states. Illinois led with 212 MW in new construction activity begun in Q3.
The total amount of wind capacity under construction is 13,759 MW, "the fourth highest total on record," AWEA said. Of this total, 5,184 MW are under construction in Texas, 3,000 MW in Wyoming, 1,610 MW in Oklahoma and 1,028 MW in New Mexico.
There are now more than 52,000 wind turbines operating in 41 states plus Guam and Puerto Rico, the report said.
"GE Renewable Energy, Siemens Gamesa Renewable Energy, and Vestas installed a combined 98% of the 2,892 MW [of wind turbines] commissioned during the first three quarters of the year."