U.S. wind power drops off despite falling prices

What I find most interesting about this article is 1) how low some of the rates are in the US for wind power - 5-6 cents/kwh 2) that China has 41,800MW of installed wind capacity.

The American Wind Energy Association reported a substantial fall in U.S. wind power installations in 2010, saying some project developers held off from investing because of uncertain federal policies.

The trade association said that 5,115 megawatts of wind power capacity were put online last year, compared to 10,000 megawatts of capacity in 2009. The 2010 number also falls below annual installations for 2008 and 2007, according to AWEA data. (Click for PDF of report.)

At the same time, AWEA reported that the price for electricity from wind has fallen. Recent power purchase agreements to buy energy from wind farms have been in the range of 5 cents to 6 cents per kilowatt-hour, AWEA director of industry data and analysis Elizabeth Salerno said in a statement. That price, which includes the tax credit project developers receive, puts it below the price of electricity generated by natural gas in some parts of the country, according to AWEA.

Energy project developers receive a 30 percent tax credit for investing in wind farms, but the existing credit was set to expire at the end of 2010. The uncertainty over whether that investment tax credit would be renewed caused "a dampening effect on investment all the way around," said Peter Kelley, the vice president of public affairs at AWEA.

The lame duck Congress in mid-December passed an extension to the tax credit until the end of 2011. With that in place, AWEA says that utilities are locking in today's rates to purchase wind power, with 5,600 megawatts now under construction.

With the direction on national wind policy unclear, state-level policies, such as utility mandates for renewable energy, are becoming more important. Texas is by far the biggest wind power state, with 10,085 megawatts of capacity installed compared to 3,675 megawatts for Iowa and 3,177 megawatts in California.

The total U.S. wind capacity is now 40,180 megawatts, which is 15 percent higher than the start of 2010. Last year, China surpassed the U.S. for the most installed capacity which grew an estimated 62 percent last year to 41,800 megawatts.

Read more: http://news.cnet.com/8301-11128_3-20029343-54.html#ixzz1C1M3ZPCI

U.S. wind power drops off despite falling prices | Green Tech - CNET News

EDF's Solar `Time Bomb' Will Tick On After France Pops Bubble

Jan. 19 (Bloomberg) -- France’s solar power boom that’s led to farmers building unneeded barns just to cover them in panels is costing Electricite de France SA more than a billion euros ($1.3 billion) a year as it meets state pledges to pay above- market prices for renewable energy.
French payments for solar-generated electricity sold into the distribution grid were the highest in Europe in 2009, leading to a 10-fold capacity increase in two years. What’s been a boon for panel owners and manufacturers has hit EDF because a tax to cover the higher costs of renewable electricity has fallen short.
“This is a time bomb EDF needs to defuse as soon as possible,” Bertrand Lecourt, an analyst at Deutsche Bank AG, said by telephone from Paris. While “the totally out-of-control phase” could be over, “it’s still something to be watched carefully,” he said.
The cost is siphoning off funds from EDF as it plans to spend 35 billion euros to extend the life of France’s aging nuclear plants. Europe’s largest power producer also aims to invest tens of billions of euros building plants in the U.K., China and Italy. The tax shortfall will widen this year and last until 2017 even as the government moves to cool the solar rush, said Aurel BGC analyst Louis Boujard.
EDF shares have dropped 20 percent over the past year, compared with a 3.7 percent decline in Europe’s Stoxx 600 Utilities Index. The Paris-based company had net debt of $57 billion euros at the end of June, according to a company filing.
Elsewhere in Europe, governments have stepped in to contain spiraling growth in solar generation.
Spanish Limits
The Czech Senate introduced a temporary tax on solar producers in December, and Spain limited the hours during which existing solar parks can earn premium rates. Germany almost doubled the surcharge consumers have to pay in renewable-energy subsidies starting this year.
To end what it has called a “speculative bubble,” France on Dec. 10 imposed a three-month freeze on solar projects to devise rules that could include caps on development and lowering the so-called feed-in tariffs that pay the higher rate for renewable power. The tariffs were cut twice in 2010.
“We just didn’t see it coming,” French lawmaker Francois- Michel Gonnot said of the boom. “What’s in the pipeline this year is unimaginable. Farmers were being told they could put panels on hangars and get rid of their cows.”
Solar Projects
The French cuts haven’t slowed demand for new solar projects. EDF received 3,000 applications a day to connect panels to the grid at the end of last year, compared with about 7,100 connections in all of 2008, according to the government and EDF. France could reach its 2020 target of 5,400 megawatts of solar generating capacity by the end of 2011 if all proposed projects are completed.
France’s energy regulator estimates EDF will pay an average of 546 euros a megawatt-hour for solar power in 2011. That’s almost 10 times estimated spot market power prices of 55 euros, and the highest among renewable energy sources.
The promise of rich returns spurred suburban supermarkets to put photovoltaic panels in parking lots and farmers to install units on empty, purpose-built barns, according to a French parliamentary report.
“Most panels installed in France were made in China with a highly questionable carbon footprint,” Environment Minister Nathalie Kosciusko-Morizet told parliament last month. Policy must “create jobs in France, not subsidize Chinese industry.”
The higher payments for renewable power are supposed to be covered by a levy added to consumers’ electricity bills, which also pays for the supply of power to needy households. For the last two years the CSPE levy, which remained at 4.50 euros a megawatt-hour between 2004 and the end of 2010, failed to keep up with the mounting costs.
Raised Tax
France raised the tax to 7.50 euros a megawatt-hour from Jan. 1, short of the 12.90 euros the regulator estimates is necessary to eliminate the shortfall through the end of 2011.
The new level and further increases in the coming years may allow EDF to reach a “balance” in the system by 2017, Aurel BGC’s Boujard said by telephone.
“EDF shouldn’t have to pay for renewable energy development in France,” Boujard said.
EDF’s shortfall was 1.4 billion euros in 2009, and is estimated to exceed 1 billion euros in 2010, the Commission de Regulation de l’Energie said in a report published this month. With the CSPE set at 7.50 euros a megawatt hour this year, the shortfall will reach an estimated 3 billion euros at the end of 2011 because of the increase in solar capacity, according to data in the report.
The solar component of the tax shortfall will rise to about a billion euros in 2011 compared with 60 million euros in 2009, according to Philippe de Ladoucette, head of the agency.
The development of wind and solar energies is “widening a deficit considerably,” EDF Chief Executive Officer Henri Proglio told Senators Dec. 14. “One can’t ask EDF to be the banker for marginal or local industries,” he said.

China adding 140 GW of hydro by 2015

Zhang Guobao, China's top energy official, stated that China will increas its nuclear power capacity by 38 gigawatts and hydropower capacity by 140 gigawatts by 2015.  It was also suggested that there will be more large-scale windfarms installed in Inner Mongolia and Gansu province.