- Mark McDowell
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Is Wind the New Oil?
After investing $16 billion in wind turbines, the United States has overtaken Germany as the world’s largest wind-power generator. Wind power accounted for 42 percent of new generating capacity last year, an increase from just two percent four years ago. The American heartland’s sparsely populated states — from Texas to the Dakotas — are the ideal locations for wind turbines.
The momentum for wind power is slowing, though, and in July, T. Boone Pickens – oilman and clean-energy entrepreneur – called off plans for the world’s biggest wind farm in Texas. His planned 687 turbines, valued at $2 billion, are now in search of a new location because the necessary transmission lines could not be built. Harnessing wind power requires extensive grid infrastructure, which involves a complicated and lengthy state and municipal approval process.
The credit crunch also has caught up with the ability of wind farms to come online. Wind is a capital-intensive business that requires long lead times. While 2008 was a good year for wind power and installations are still moving forward, a slowdown is anticipated as firms fail to obtain the financing they need to purchase additional turbines.
Wind capacity grew by 50 percent last year, according to the American Wind Energy Association (AWEA). In 2009, growth is expected to be around 20 percent. The AWEA notes that although 2,800MW of new turbines were installed during the first quarter, just 1,200MW came online in the second.