Installs of New Wind Farms Set To Dip In 2010, Study Says

Expected new wind power capacity for the 2010 — 2025 period

2009 was great, 2010 won’t be as good, that’s the key take away of a study (U.S. Wind Power Markets and Strategies: 2010-2025) released today by IHS Emerging Energy Research, a Boston-based market research firm.

IHS forecasts between 6.3 and 7.1 gigawatts of new wind installations in 2010, a 40- to -60 percent drop compared to the 9.8 gigawatts installed last year.

“2010 marks the first time since 2004 that the U.S. wind industry will not surpass the previous year’s growth level,” says IHS Senior Analyst Matthew Kaplan, one of the study’s authors, in a prepared statement.

Why the slowdown? Kaplan, in no particular order, cites the ongoing effects of the global financial crisis, which continue to make access to funding difficult and regulatory uncertainty. The closest thing the U.S. has to a long-term renewable energy policy are the temporary, stimulus-funded 1603 direct cash grants as well as the investment and production tax credits. Last summer the House passed the American Clean Energy and Security act and the Senate is set to debate its own version of a climate change and energy bill, however prospects for passage aren’t good.

Also to blame for the expected slow down are historically low natural gas prices. As huge shale gas reserves are starting to hit the market, electric utilities will likely favor backing cheaper natural gas-fired power plants over more expensive wind farms.

Overall, over the next 15 years, the IHS forecasts robust investments averaging more than $330 billion in new wind investments, of which 90 percent will support onshore wind projects. The Midwest, Great Plains and Rocky Mountain states will act as major wind export hubs. Offshore wind is expected to account for only 5 percent of total U.S. wind build by 2025.

Map: IHS Emerging Energy Research

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