NewEnergyNews: 08/01/2012 - 09/01/2012

NewEnergyNews

Gleanings from the web and the world, condensed for convenience, illustrated for enlightenment, arranged for impact...

The challenge: To make every day Earth Day.

YESTERDAY

  • THE STUDY: WHY THE OIL & GAS INDUSTRY BACKS AN ALL-OF-THE-ABOVE ENERGY POLICY
  • QUICK NEWS, July 22: U.S. DOE FORESEES NEW ENERGY; THE BEST CITIES FOR NEW ENERGY; ENERGY STORAGE TO BE $50BIL MRKT
  • THE DAY BEFORE

  • THE STUDY: THE COST OF ADDING SOLAR TO A UTILITY’S OPERATIONS
  • QUICK NEWS, 7-21: U.S. WIND, SOLAR TO GROW THROUGH 2020; NEW GEOTHERMAL RISING; CHINESE HAVE RIGHTS IN OREGON WIND BUY
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    GET THE DAILY HEADLINES EMAIL: CLICK HERE TO SUBMIT YOUR EMAIL ADDRESS OR SEND YOUR EMAIL ADDRESS TO: herman@NewEnergyNews.net

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    THE DAY BEFORE THE DAY BEFORE

  • Weekend Video: Colbert Gets Into Coal Rolling
  • Weekend Video: How Solar Power Plants Store And Use Solar Energy
  • Weekend Video: A Story About People And Wind Energy
  • THE DAY BEFORE THAT

  • FRIDAY WORLD HEADLINE-THE CLIMATE CHANGED WORLD IS NOW 5 TIMES MORE DANGEROUS
  • FRIDAY WORLD HEADLINE-THE MONEY IN SOLAR, Q2 2014
  • FRIDAY WORLD HEADLINE-EU STILL GROWING OCEAN WIND
  • FRIDAY WORLD HEADLINE-$109MIL FROM GERMAN BANK BACKS KENYA GEOTHERMAL
  • AND THE DAY BEFORE THAT

    THINGS-TO-THINK-ABOUT THURSDAY, July 17:

  • TTTA Thursday-THE PREMATURE EVACUATION FROM CLIMATE CHANGE EXCITEMENT
  • TTTA Thursday-NEW ENERGY TO SUSTAIN BIG GROWTH – EIA
  • TTTA Thursday-SOLAR’S COST TO UTILITIES
  • TTTA Thursday-HOW UTILITIES CAN EVOLVE IN A NEW ENERGY WORLD
  • THE LAST DAY UP HERE

  • THE STUDY: HOW TO PROTECT A CAP AND TRADE PROGRAM
  • QUICK NEWS, July 16: 88% OF NEW U.S. POWER IN MAY WAS NEW ENERGY; THE FIGHT FOR WIND IN OHIO; U.S. CRITICAL SYSTEMS REGULARLY BREACHED
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    Anne B. Butterfield of Daily Camera and Huffington Post, is a biweekly contributor to NewEnergyNews

  • Another Tipping Point: US Coal Supply Decline So Real Even West Virginia Concurs (REPORT)

    November 26, 2013 (Huffington Post via NewEnergyNews)

    Everywhere we turn, environmental news is filled with horrid developments and glimpses of irreversible tipping points.

    Just a handful of examples are breathtaking: Scientists have dared to pinpoint the years at which locations around the world may reach runaway heat, and in the northern hemisphere it's well in sight for our children: 2047. Survivors of Superstorm Sandy are packing up as costs of repair and insurance go out of reach, one threat that climate science has long predicted. Or we could simply talk about the plight of bees and the potential impact on food supplies. Surprising no one who explores the Pacific Ocean, sailor Ivan MacFadyen described long a journey dubbed The Ocean is Broken, in which he saw vast expanses of trash and almost no wildlife save for a whale struggling a with giant tumor on its head, evoking the tons of radioactive water coming daily from Fukushima's lamed nuclear power center. Rampaging fishing methods and ocean acidification are now reported as causing the overpopulation of jellyfish that have jammed the intakes of nuclear plants around the world. Yet the shutting down of nuclear plants is a trifling setback compared with the doom that can result in coming days at Fukushima in the delicate job to extract bent and spent fuel rods from a ruined storage tank, a project dubbed "radioactive pick up sticks."

    With all these horrors to ponder you wouldn't expect to hear that you should also worry about the United States running out of coal. But you would be wrong, says Leslie Glustrom, founder and research director for Clean Energy Action. Her contention is that we've passed the peak in our nation's legendary supply of coal that powers over one-third of our grid capacity. This grim news is faithfully spelled out in three reports, with the complete story told in Warning: Faulty Reporting of US Coal Reserves (pdf). (Disclosure: I serve on CEA's board and have known the author for years.)

    Glustrom's research presents a sea change in how we should understand our energy challenges, or experience grim consequences. It's not only about toxic and heat-trapping emissions anymore; it's also about having enough energy generation to run big cities and regions that now rely on coal. Glustrom worries openly about how commerce will go on in many regions in 2025 if they don't plan their energy futures right.

    2013-11-05-FigureES4_FULL.jpgclick to enlarge

    Scrutinizing data for prices on delivered coal nationwide, Glustrom's new report establishes that coal's price has risen nearly 8 percent annually for eight years, roughly doubling, due mostly to thinner, deeper coal seams plus costlier diesel transport expenses. Higher coal prices in a time of "cheap" natural gas and affordable renewables means coal companies are lamed by low or no profits, as they hold debt levels that dwarf their market value and carry very high interest rates.

    2013-11-05-Table_ES2_FULL.jpgclick to enlarge

    2013-11-05-Figure_ES2_FULL.jpg

    One leading coal company, Patriot, filed for bankruptcy last year; many others are also struggling under bankruptcy watch and not eager to upgrade equipment for the tougher mining ahead. Add to this the bizarre event this fall of a coal lease failing to sell in Wyoming's Powder River Basin, the "Fort Knox" of the nation's coal supply, with some pundits agreeing this portends a tightening of the nation's coal supply, not to mention the array of researchers cited in the report. Indeed, at the mid point of 2013, only 488 millions tons of coal were produced in the U.S.; unless a major catch up happens by year-end, 2013 may be as low in production as 1993.

    Coal may exist in large quantities geologically, but economically, it's getting out of reach, as confirmed by US Geological Survey in studies indicating that less than 20 percent of US coal formations are economically recoverable, as explored in the CEA report. To Glustrom, that number plus others translate to 10 to 20 years more of burning coal in the US. It takes capital, accessible coal with good heat content and favorable market conditions to assure that mining companies will stay in business. She has observed a classic disconnect between camps of professionals in which geologists tend to assume money is "infinite" and financial analysts tend to assume that available coal is "infinite." Both biases are faulty and together they court disaster, and "it is only by combining thoughtful estimates of available coal and available money that our country can come to a realistic estimate of the amount of US coal that can be mined at a profit." This brings us back to her main and rather simple point: "If the companies cannot make a profit by mining coal they won't be mining for long."

    No one is more emphatic than Glustrom herself that she cannot predict the future, but she presents trend lines that are robust and confirmed assertively by the editorial board at West Virginia Gazette:

    Although Clean Energy Action is a "green" nonprofit opposed to fossil fuels, this study contains many hard economic facts. As we've said before, West Virginia's leaders should lower their protests about pollution controls, and instead launch intelligent planning for the profound shift that is occurring in the Mountain State's economy.

    The report "Warning, Faulty Reporting of US Coal Reserves" and its companion reports belong in the hands of energy and climate policy makers, investors, bankers, and rate payer watchdog groups, so that states can plan for, rather than react to, a future with sea change risk factors.

    [Clean Energy Action is fundraising to support the dissemination of this report through December 11. Contribute here.]

    It bears mentioning that even China is enacting a "peak coal" mentality, with Shanghai declaring that it will completely ban coal burning in 2017 with intent to close down hundreds of coal burning boilers and industrial furnaces, or shifting them to clean energy by 2015. And Citi Research, in "The Unimaginable: Peak Coal in China," took a look at all forms of energy production in China and figured that demand for coal will flatten or peak by 2020 and those "coal exporting countries that have been counting on strong future coal demand could be most at risk." Include US coal producers in that group of exporters.

    Our world is undergoing many sorts of change and upheaval. We in the industrialized world have spent about a century dismissing ocean trash, overfishing, pesticides, nuclear hazard, and oil and coal burning with a shrug of, "Hey it's fine, nature can manage it." Now we're surrounded by impacts of industrial-grade consumption, including depletion of critical resources and tipping points of many kinds. It is not enough to think of only ourselves and plan for strictly our own survival or convenience. The threat to animals everywhere, indeed to whole systems of the living, is the grief-filled backdrop of our times. It's "all hands on deck" at this point of human voyaging, and in our nation's capital, we certainly don't have that. Towns, states and regions need to plan fiercely and follow through. And a fine example is Boulder Colorado's recent victory to keep on track for clean energy by separating from its electric utility that makes 59 percent of its power from coal.

    Clean Energy Action is disseminating "Warning: Faulty Reporting of US Coal Reserves" for free to all manner of relevant professionals who should be concerned about long range trends which now include the supply risks of coal, and is supporting that outreach through a fundraising campaign.

    [Clean Energy Action is fundraising to support the dissemination of this report through December 11. Contribute here.]

    Author's note: Want to support my work? Please "fan" me at Huffpost Denver, here (http://www.huffingtonpost.com/anne-butterfield). Thanks.

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    Anne's previous NewEnergyNews columns:

  • Another Tipping Point: US Coal Supply Decline So Real Even West Virginia Concurs (REPORT), November 26, 2013
  • SOLAR FOR ME BUT NOT FOR THEE ~ Xcel's Push to Undermine Rooftop Solar, September 20, 2013
  • NEW BILLS AND NEW BIRDS in Colorado's recent session, May 20, 2013
  • Lies, damned lies and politicians (October 8, 2012)
  • Colorado's Elegant Solution to Fracking (April 23, 2012)
  • Shale Gas: From Geologic Bubble to Economic Bubble (March 15, 2012)
  • Taken for granted no more (February 5, 2012)
  • The Republican clown car circus (January 6, 2012)
  • Twenty-Somethings of Colorado With Skin in the Game (November 22, 2011)
  • Occupy, Xcel, and the Mother of All Cliffs (October 31, 2011)
  • Boulder Can Own Its Power With Distributed Generation (June 7, 2011)
  • The Plunging Cost of Renewables and Boulder's Energy Future (April 19, 2011)
  • Paddling Down the River Denial (January 12, 2011)
  • The Fox (News) That Jumped the Shark (December 16, 2010)
  • Click here for an archive of Butterfield columns

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    Some details about NewEnergyNews and the man behind the curtain: Herman K. Trabish, Agua Dulce, CA., Doctor with my hands, Writer with my head, Student of New Energy and Human Experience with my heart

    email: herman@NewEnergyNews.net

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    Your intrepid reporter

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      A tip of the NewEnergyNews cap to Phillip Garcia for crucial assistance in the design implementation of this site. Thanks, Phillip.

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    Pay a visit to the HARRY BOYKOFF page at Basketball Reference, sponsored by NewEnergyNews and Oil In Their Blood.

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  • Friday, August 31, 2012

    SOLAR’S WORLD

    Analysis of Worldwide Markets for Solar Products & Five-Year Application Forecast 2011/2012

    3Q 2012 (Pike Research/Navigant)

    “The solar power industry and its associated technologies, including concentrated solar power (CSP), photovoltaic (PV), and concentrated photovoltaic (HCPV and LCPV), are going through a significant correction as a seven-year period of capacity building, aggressive pricing, and promises of grid parity, driven largely by feed-in tariffs, comes to an end. As the profitable feed-in-tariff incentives fade, and deals that rely on bidding processes such as tenders and power purchase agreements (PPAs) emerge, many solar industry participants are recognizing the need to develop new business models and markets.

    “The solar industry remains incentive-driven for 99% of its demand. Reliance on incentives to drive demand has led to specific behaviors, including frantic buying when prices are low and installing into any available market…[T]he models for incentivizing solar in the industrialized world are changing and with these changes, more attention is being focused on the developing world as well as on the remote applications.”

    “Continued artificially low prices for PV technology and polysilicon have caused the collapse of several companies. Navigant anticipates that manufacturer failures will continue into 2013…

    “Low bidding on projects continues, leading to the concern that many of these projects may not be sustainable. Low priced natural gas in the United States threatens the viability of many solar projects. Low quality in PV technology and solar installations will increasingly be an issue from mid-2012 on. Navigant forecasts that growth in 2012 will be between 24-GWp (4% over 2011) and 31-GWp (31% over 2011), with modest growth continuing over the forecast period…”

    SUN’S HISTORIC SHIFT EAST

    Asia Pacific to Stimulate Strong Year-End Surge in PV Demand; 2H’12 PV Demand to Transition from Major European Countries to APAC and Other Emerging Regions

    August 27, 2012 (SolarBuzz)

    “PV demand from the Asia Pacific (APAC) region is forecast to grow by 80% Y/Y during 2H’12, driven by Q4’12 demand at the 5.3 GW level…While major European markets have historically fueled strong year-end PV demand, Q4’12 will represent a transition phase within the PV industry, as demand becomes increasingly global and further diversified across new and emerging PV regions…

    “Growth across APAC has already provided a significant boost to overall Q2’12 demand. The region showed more than 60% Y/Y growth, reaching 1.4 GW and compensating for the softening in demand across established markets…PV market demand in China grew by over 300% in Q2’12 to reach 0.6 GW…”

    “…Combined with the year-end projects planned within China and India, the new Japanese Feed-In Tariff (FIT) program is now setting up Q4’12 as a quarter of potentially massive PV demand pull across the APAC region. Over 50% (or 5.3 GW) of calendar-year 2012 APAC demand is forecast to occur in Q4’12.

    “…[This] provides both challenges and risks for module suppliers, balance-of-systems providers, and project developers…[because of] highly-competitive pricing with low-margin returns…[D]elays in project financing could lead to oversupply at year-end…The European PV market grew 32% Y/Y during 1H’12 to 8.5 GW. However, incentive reductions in Germany, Italy, and other major European PV markets continue to erode the demand-share…[Growth opportunities] are forecast to shift to emerging markets…[like] Austria, Denmark, Israel, and various countries in the east and southeast…”

    CHINA WIND SEES 1,300 GW IN ETHIOPIA

    Chinese study of Ethiopia shows 1300GW potential

    Jan Dodd, 17 August 2012 (Windpower Monthly)

    “Ethiopia's wind resource amounts to over 1,300GW according to an assessment study recently completed by HydroChina International Engineering Company (HCIE) financed by the Chinese government.

    “China is also assisting Ethiopia in developing this potential. HCIE in a joint-venture with Chinese construction group CGCOC recently completed a 51MW plant near Nazareth (Adama), equipped with 34 Goldwind 1.5MW turbines…China Exim Bank provided 85% of the $117 million project cost in the form of a loan, with the remainder coming from the Ethiopian government.”

    click to enlarge

    “HCIE and CGCOC also expect to start building another 51MW at Nazareth by the end of the year, again with Goldwind turbines and Chinese funding. The facility could eventually be expanded to 153MW. Further ahead, HCIE is developing a 51MW project at Messebo-Harena. It is also considering producing towers and blades locally.

    “…China is [not] the only country involved. French turbine manufacturer Vergnet is building a 120MW project at Ashegoda using Vergnet and Alstom turbines…Ethiopia is tabling an installed capacity of 800MW by 2015.”

    WHAT THE BRITS KNOW ABOUT SMART METERS

    Quantitative Research into Public Awareness, Attitudes, and Experience of Smart Meters

    21 August 2012 (Ipsos MORI for DECC)

    “…Installation of smart meters by energy suppliers has been adopted by the Government as a way of helping consumers have more control over their energy use and spending, while also helping meet environmental and security of supply objectives. The programme aims to ensure installation of smart meters in all homes in Britain by 2019…

    “Half of energy bill-payers living in Great Britain had heard of smart meters (49%), with one in twenty claiming that they have one installed (5%)…A third (32%) expressed support for the installation of smart meters in every home in the country, while one in five (20%) were opposed. Almost half (48%) of all respondents are undecided about smart meters.”

    “Four in ten (42%) of those without a smart meter in their home were interested in having one installed. Support for smart meters, and interest in installation, were both highly correlated to age and size of household; with younger and larger households expressing greater support and interest.

    “The perceived benefits of having a smart meter installed included being able to better manage household finances (33%), to help avoid waste (26%) and produce a greater accuracy of billing (19%). Perceived disadvantages included cost (either to themselves, the taxpayer, the government or the energy companies) (19%) and data security (10%)…Positively, the more respondents felt they knew about smart meters the more likely they were to support their roll-out and want one...”

    Thursday, August 30, 2012

    SOLAR KEEPS GROWING

    Americas PV Market Grew 120% in First Half of 2012; USA to Become 3rd Largest Market in 2012

    22 August 2012 (IMS Research)

    “The Americas photovoltaics (PV) market more than doubled in the first half of 2012 to reach 1.7 Gigawatts (GW) and is set to reach almost 4.3 GW for the full year…Installations grew by more than 120 percent in the first half of this year and will help drive the global PV market to grow by at least 3 GW in 2012, according [IMS Research]…

    “The latest quarterly report from IMS Research revealed that, for the first time, global installations exceeded 13 GW in the first half of 2012, with the German and Americas markets leading growth. The Americas market was found to have grown by more than 120 percent to reach 1.7 GW in the first half of 2012, compared to just 750 MW in the same period last year…”

    “Aside from China, the report found that the USA would be the largest single contributor to global PV growth in 2012, accounting for 40 percent of new capacity growth. In contrast, the European market is predicted to shrink by almost 3 GW in 2012, despite the strong start to the year in Germany…

    “Global demand is predicted to accelerate in the second half of 2012, despite the slowing of key European markets, Germany and Italy. IMS Research predicts installations will hit a new half-yearly record of almost 18 GW in the second half of 2012, driven by markets such as China and Japan, as well as the Americas. China recently approved 1.7 GW of Golden Sun projects which must be completed by the end of the year, whilst Japan’s new FiT became effective on 1st July and will help spark a surge in demand…”

    PHASE OUT BUT DON’T CUT OFF WIND SUPPORT

    Extend Wind-Power Tax Credit Now, So It Can Die Later

    Editorial, August 21, 2012 (Bloomberg News)

    “…[W]ind power has emerged as one of the most clear- cut issues of the political season…Obama wants to renew the technology’s soon-to-expire federal production tax credit. Mitt Romney, his Republican opponent, wants to let the credit lapse…[W]ind energy should receive continued federal support, as Obama says -- especially at a time when the industry’s tens of thousands of jobs are helping the U.S. economy. But wind power should also be expected to make it in the marketplace on its own one day, as Romney would have it.”

    “Onshore wind power has improved to the point where it is now the most competitive of all renewable energy sources except hydropower…[I]t is on a path to reach “grid parity” -- the point where its cost is equal to the baseline price of power on the grid…[By] 2016…wind can be expected to thrive without the tax credit…Renewing the tax credit would at least enable the wind industry to return to growth, adding 54,000 jobs over the next four years…Letting the credit expire, on the other hand, would mean losing 37,000 jobs in the sector…It’s [also] a clean energy source, with a promising economic future as the cost per turbine continues to fall…[and] natural gas prices, now extraordinarily low, rise…

    “If Congress takes the easy route and simply extends the credits for a year or two, it would only perpetuate the wind industry’s boom-and-bust cycle. A smarter solution is to apply the longer-term planning that is critical to good energy policy…Let the wind industry know the production tax credit will eventually die out, but over four years -- so companies are able to plan…”

    “Even smarter would be to ultimately replace the tax credit with market-based support for wind…[like a national] renewable portfolio standard…[or] a “clean energy standard,” requiring large U.S. utilities to derive an increasing share of their energy from cleaner energy sources -- not only renewables such as wind and solar but also natural gas and even coal with carbon capture and storage. No federal expenditure would be required…Politicians in both parties…could do far more for the U.S.’s energy future if they considered longer-lasting ways to help the wind business succeed.”

    THE THING ABOUT HOME ENERGY

    Is Cutting Energy Use in Homes Possible? The problem with two refrigerators

    Katherine Tweed, August 23, 2012 (Greentech Media)

    “There are many promises that a smarter grid could unlock…[but smart meters that] give us all insight into our energy use so that we can save money and energy…is far from a given if historic energy use in homes is any indication.

    “From 1978 to 2005, energy use in homes is essentially a flat line. There have been incredible efficiency gains, primarily in home heating and cooling, but that has been offset by bigger homes and more stuff that needs to be plugged in…Even companies that have built business models around helping people understand and reduce their energy see the problem. Opower recently estimated that all of the second refrigerators in America suck up the equivalent energy use of 1.7 million homes.”

    “…It's unrealistic that Americans will simply consume far less than they currently do. But the question of how to get real, meaningful energy reductions across the bulk of homes is a problem when efficiency standards can barely keeping up with all of the stuff we’re buying…Efficiency programs must decrease energy use not just from current products but from an ever increasing number of end-uses…One solution is to drive efficiency standards for new products as they come out…[though] smart appliances…would [likely] have a minimal impact on overall energy use, as large appliances (outside of water heaters and AC units) are not the energy hogs they once were.

    “…[I]t’s unclear if utilities are interested in funding tech-heavy [smart meter] programs, unless they have specific pain points, likeOklahoma Gas & Electric trying to delay new generation. Real efficiency will also likely take more than technology. Retrofits are where the real savings are, but again there needs to be money available and interest from homeowners…[C]ompanies in the home energy efficiency space claim millions of customers with lots of aggregate savings…[but] it is still entirely unclear if these platforms can offset the extra fridge in the garage, the third big-screen TV or one more laptop.”

    WHAT MOUNTAINTOP REMOVAL COAL MINING LOOKS LIKE

    Visualizing the Environmental Impacts of Mountaintop Removal

    August 24, 2012 (SkyTruth via EcoWatch)

    “…[W]ith LiDAR (Light Detection and Ranging) data and digital elevation models (DEMs)…[it is possible] to create a profile of the terrain of a mountaintop removal mine before and after mining activity…[SkyTruth used] the controversial Spruce No.1 mountaintop removal coal mine in Logan County, West Virginia as the test subject.”

    “Google Earth imagery showed that significant mining activity had occurred between 2003 and 2011…[A] digital elevation model (DEM) of the mine location that shows what the topography looked like in 2003, from the WV GIS Technical Center.

    “This elevation dataset was created from aerial survey photography that was flown in 2003…LiDAR data that was collected over the area in 2010 from WV View…[was] to a DEM using ArcGIS…[to visualize] the change in elevation over that seven year period.”

    “…[H]ill shades of the DEMs…better visualize the difference…[A]reas affected by mountaintop removal [were blued] and the areas affected by valley fill [were yellowed] and [both were] overlaid…over the hill shades of the mine in 2003 and 2010…[along with a profile graph of the elevation along two cross sections before and after mining activity…”

    “…[An analysis of the results] found that 7.4 million cubic meters of rock was removed by way of mountain top removal mining and 9.8 million cubic meters of rock has filled what once was a valley. Why the difference? The fill has a lot of gaps and spaces, so it’s not as compact as the original, mined bedrock…”

    Wednesday, August 29, 2012

    NEW ENERGY GENERATING JOBS IN MA

    Massachusetts Clean Energy Industry Report 2012

    August 2012 (Massachusetts Clean Energy Center)

    Introduction

    Massachusetts is a hotbed of innova¬tion and invention. From computers to life sciences to defense, the Com¬monwealth has been at the forefront of new, ex¬citing technologies for decades. With a robust ecosystem including world-class universities, abundant venture capital, a large professional services industry, and a deep and talented labor pool, Massachusetts has emerged as a leader in clean energy development and integration.

    The Commonwealth ranks second in the nation for private clean energy investment (and first on a per-capita basis), and Massachusetts-based companies have received 17%—or $62.8 mil¬lion—of the federal dollars awarded through the U.S. Department of Energy’s ARPA-E program, which is devoted to advanced energy research projects that are transformational, sustain¬able, and bridge the gap between basic energy research and developmental and industrial in¬novation. At the same time, the Bay State has significantly increased its pro¬duction of renewable energy, with a thirty-fold increase in installed solar megawatts and a 108% growth in electric energy savings from energy efficiency between 2007 and 2011. The clean energy industry creates jobs through¬out the state and keeps the Massachusetts in¬novation engine running.

    Market demand for clean energy products continues to increase. In 2011, the Massachu-setts Clean Energy Center (MassCEC) released a groundbreaking report as part of its require¬ment to conduct an annual accounting of the clean energy industry in Massachusetts. The report demonstrated that due to a mix of lead¬ing academic institutions; an active network of technologists, entrepreneurs, and investors; a highly skilled workforce; market-building public policy; and engaged government leaders, Massa¬chusetts was well positioned to take advantage of growing demand. The report also found that the Commonwealth is home to a large and diverse clean energy economy.

    Specifically, the 2011 report found 4,908 clean energy firms in Massachusetts employing 64,310 clean energy workers, or 1.5% of all employees in the Commonwealth. These jobs are found in every county in Massa¬chusetts, across activities ranging from engineer¬ing and research to manufacturing, and across industry sectors ranging from renewable energy to energy efficiency. And employers reported strong growth; at 6.7% growth from 2010, the report showed that clean energy firms were adding employees at a rate more than six times higher than in the economy overall.

    This 2012 report provides updated information regarding many of the findings in the 2011 re¬port. As with the 2011 report, this 2012 report is based on survey data gathered directly from clean energy employers that have been identi¬fied across a wide variety of industries in the Commonwealth. This differentiates the report from other studies, which typically rely solely on databases of known employers—those orga¬nizations that are members of industry associa¬tions, have signed up for various clean energy incentives or programs, or have been otherwise identified as conducting clean energy work. Though these known-employer lists are impor¬tant in researching the clean energy economy, analyses based solely on such lists can under¬count clean energy workers because they miss the large number of companies engaged in clean energy work that have not yet been iden¬tified as part of the cluster. Furthermore, most clean energy employment studies tend to rely on assumptions and economic models, or are based on incomplete or unverified employment counts from secondary sources. These sources cannot capture in-depth employer information because employers are not active participants in the research.

    In order to obtain a more complete picture of clean energy employers, the team conducted a survey of randomly selected Commonwealth employers from industries identified as being potentially related to clean energy. To capture the breadth of the cluster, surveys were administered online and by telephone to a list of known clean energy employers as well as to a representative, clustered sample of companies across the entire Commonwealth. This sample included companies from all across the value chain, from manufacturing to service and from research and development to construction. This same method of employer identification was used for the 2011 report, allowing us to effectively compare data from both years.

    The findings in this report are highly reliable because they come straight from the source: the clean energy employers of Massachusetts. Further, the research refines and validates the findings of 2011. Over the past two years, the research team attempted approximately 45,000 telephone calls and sent over 10,000 emails to employers. This massive survey effort, with a combined margin of error of approximately +/-3.1% at a 95% confidence interval, yielded 930 survey responses.

    As a result of this intensive research effort, the 2012 Massachusetts Clean Energy Industry Report provides comprehensive and reliable data on the number of clean energy firms and employees while validating the findings from 2011. This report finds that Massachusetts has a large clean energy cluster with 4,955 clean energy firms that employ 71,523 clean energy workers. For the purpose of this report, a clean energy firm is defined as an employer engaged in whole or in part in providing goods and services related to renewable energy, energy efficiency, alternative transportation, and carbon management. Clean energy workers are defined as spending at least a portion of their time supporting the clean energy aspects of their businesses.

    In addition to the overall numbers, there are several important findings from this research. First, the 71,523 clean energy workers in Massachusetts represent 1.7% of total employment in the Commonwealth, an increase from last year and a number large enough to warrant considering the clean energy cluster a key sector in Massachusetts. Though there are many reasons for the cluster’s strength, one factor is that the cluster has breadth and depth across multiple industries and technology areas. Despite uneven performance within value chain activities, the breadth allows for the cluster’s continued growth and strength in the Commonwealth.

    The research also finds that Massachusetts clean energy employers are growing significantly faster than their peers in other sectors. Since 2011, clean energy employment has grown by 11.2%, nearly 10 times faster than the overall 1.2% growth rate1 among all industries in the Commonwealth over the same period. The 11.2% employment growth rate shows that the pace is in fact quickening, outpacing the same period from 2010-2011 by more than 3,000 jobs. Employers are also optimistic about their future prospects, anticipating 12.4% growth over the coming 12 months.

    The following pages include detailed findings of the research, including a review of the size, growth, distribution, and workforce needs of clean energy employers in Massachusetts.

    Conclusion

    Clean energy continues to be a shining example of Massachusetts’s innovation economy, and this report underscores its importance to the Bay State. The Massachu¬setts clean energy cluster is growing at a rapid clip of 11.2%, outpacing the overall economy nearly tenfold. The 4,995 clean energy firms and 71,523 clean energy jobs in the Commonwealth are responsible for 1.7% of all employment in the state. The cluster shows no signs of slowing, either, with employers anticipating 12.4% growth over the next 12 months. Such impressive growth certainly cements the cluster’s place as a marquee industry in the Commonwealth.

    With only a few exceptions, this growth is spread evenly throughout the Bay State, creating jobs in manufacturing, engineering, sales, and professional services. The Commonwealth’s successes in the areas of renewable energy and energy efficiency technologies highlight a strong and vibrant ecosystem of firms.

    There are a few areas of concern. Despite dramat¬ic growth among most of the value chain activi¬ties, Massachusetts installation and maintenance firms report declining employment. Though the research suggests that this is mostly due to overall weakness in the construction industry, the Commonwealth should do more to spur residen¬tial and commercial installations of clean energy goods and services. Given the research findings, targeted help for small businesses will also pay dividends in this important cluster. Continued commitment to education is clearly critical to maintaining a thriving clean energy cluster in the Commonwealth. Employers in Massachusetts require more education than their counterparts in other states, and the importance of a college degree is in evidence. Though Mas¬sachusetts ranks first in the nation for college degree attainment, more should be done to teach students about STEM fields and clean energy ca¬reers at the K-12 level, increase access to college, expand clean energy baccalaureate programs at public universities, and develop targeted policies to maintain the Commonwealth’s high standard of living in order to ensure that the state is able to continue developing skilled workers and retain¬ing them after graduation.

    Massachusetts has long been a hub of technologi¬cal innovation. By continuing to support this growing cluster, the Commonwealth can build upon this success well into the 21st century.

    QUICK NEWS, August 29: SPANISH SOLAR POWER PLANTS SET OUTPUT RECORDS; WIND’S CEO TALKS ABOUT ENERGY INCENTIVES; THE BUSINESS OF MANAGING SMART BUILDINGS

    SPANISH SOLAR POWER PLANTS SET OUTPUT RECORDS CSP Plants Set Electricity Supply Record In Spain

    27 August 2012 (Solar Industry)

    “Spain's 35 concentrating solar power (CSP) plants reached two new milestones last month…On July 15, the projects met 3.25% of Spain's electricity consumption; on July 11, at 5:00 p.m., 4.1% of electricity fed into the grid came from the CSP plants.”

    “The CSP sector could be one of the most profitable for Spanish companies, provided that new regulations under consideration by the Spanish government do not create barriers…”

    WIND’S CEO TALKS ABOUT ENERGY INCENTIVES What Critics of Wind Power's Incentive Miss

    Denise Bode, August 22, 2012 (Huffington Post)

    “As the prospect of Congress extending wind energy's primary incentive, the federal Production Tax Credit (PTC), has grown in recent weeks, so have both support and criticism…Des Moines, Denver, Chicago, Oklahoma City, Houston, New York and other papers] have all editorialized in favor…[while The Wall Street Journal] continued its steady drumbeat of broadsides against renewable energy in general and the wind tax credit in particular…”

    “Historically, all energy sources have been encouraged by government, and for good reason. Ensuring a steady supply of domestic energy is vital to the productivity of our national economy…A recent study from the Congressional Research Service (CRS) points out that traditional energy sources enjoy an enormous advantage with regard to tax relief and other incentives…[because] federal energy tax policy focused almost exclusively [for over half a century] on increasing domestic oil and gas reserves and production…[and] remain in the tax code…

    “That advantage is permanent, allowing for a stable business environment that wind energy is deprived of because of on-again, off-again federal policies…Renewable energy sources are not receiving excessive support…[T]he federal commitment to [oil and gas] was five times greater than the federal commitment to renewables during the first 15 years of each [incentive's] life, and it was more than 10 times greater for nuclear…”

    “Wind energy's incentive is tax relief…in the form of a federal tax credit. To call tax relief a subsidy is to assume that all money belongs to the government. Rather, a tax credit simply leaves more money in private hands. In this case, anyone who makes renewable energy qualifies. The result has been the creation of over $15 billion a year in private investment and 75,000 privately financed jobs in wind power…[and wind's] incentive, the Production Tax Credit, has strong bipartisan support…[GOP strategist Karl Rove] called it something Republicans and Democrats can agree on…”

    THE BUSINESS OF MANAGING SMART BUILDINGS Smart Building Managed Services; Software as a Service plus Energy Management/NOC Services and On-Site Installation & Maintenance Services for Commercial Buildings: Global Market Analysis and Forecasts

    3Q 2012 (Pike Research/Navigant)

    “…[T]he adoption of sophisticated energy management systems in commercial buildings has been proven to reduce energy consumption and greenhouse gas emissions. The ability of these systems to process and analyze huge volumes of energy-related data has shifted the way buildings are designed, built, and operated, but it has also proven challenging for the people who operate buildings on a daily basis…

    “…Recent economic conditions have caused building owners to cut back on both the numbers and types of personnel that they hire, shifting operational priorities from efficiency generating projects to those that are an absolute necessity…Smart building managed service providers have stepped to the fore…[M]anaged service vendors work closely with clients, effectively becoming an extension of the building’s own staff…”

    “The competitive landscape for smart building managed services [SBMS] is evolving at a quick pace driven by new technologies, big data, and a wide variety of service models. Large established market players and OEMs such as Johnson Controls, Siemens, and Schneider Electric have a strong foothold…More focused companies such as Ecova and Pacific Controls have leveraged their independence from the larger OEMs to build strong relationships with their clients, while large IT companies such as IBM and HP have become strong competitors…

    “[Pike Research projects that SBMS growth rates from 2012 through 2020 will outpace projected growth rates for the BEMS [building energy management service] market and will signal increasing market demand for a more service-oriented approach…In 2012, SBMS market spending amounts to $291 million. It will grow to $1.1 billion by 2020, the end of the forecast period, representing a compound annual growth rate (CAGR) of almost 18%]…”

    Tuesday, August 28, 2012

    TODAY’S STUDY: WHO’S SPEAKING OUT

    Study: TV Media Ignore Climate Change In Coverage Of Record July Heat

    Jill Fitzsimmons and Max Greenberg, August 15, 2012 (Media Matters)

    Scientists say that human-induced climate change made this year's record heat more likely, and project that extreme heat will become more common in the United States. But a Media Matters analysis of media coverage of record-breaking heat in July finds that major television outlets rarely made the connection between heat waves and a changing climate.

    Climate Change Largely Absent From Media Reports On Extreme Heat

    Only 14% Of Heat Wave Stories Mentioned Climate Change. In a study of major media outlets, only 8.7% of television segments and 25.5% of print articles reported on record-breaking July heat waves in the context of climate change.

    CNN And ABC Stand Out In Their Incomplete Coverage. Of the six TV outlets included in our analysis, ABC mentioned climate change the least, in only 2% of coverage. Among the cable networks, CNN mentioned climate change the least, in less than 4% of coverage. MSNBC was the only television network to regularly incorporate climate change into primetime segments on extreme heat.

    Fox Mentioned Climate Change Once, Only To Dismiss It. In six primetime segments on extreme heat, Fox News raised climate change once. The Five's only liberal co-host Bob Beckel noted that record July heat is consistent with global warming, and was promptly dismissed by co-host Greg Gutfeld, who routinely denies that manmade global warming is occurring.

    Quality Of Heat Wave Coverage Varied Among Major Papers. Overall, the major print outlets mentioned climate change in just over a quarter of articles on extreme heat. The New York Times led the pack, mentioning climate change in more than half of its coverage (54.5%), and the Washington Post mentioned it in 26% of articles on July heat. But the Associated Press, the Los Angeles Times, and USA Today mentioned it in less than 15% of coverage. The Wall Street Journal didn't mention climate change at all, although the paper had significantly fewer stories on extreme heat.

    Only 8% Of Coverage Pointed Out That Human Activities Are Driving Climate Change. Only 6% of television segments and 12% of print articles noted that climate change is fueled by human activities including the burning of fossil fuels, which emit greenhouse gases that are warming the planet. The Associated Press, USA Today, Fox News and the Wall Street Journal never made that connection.

    METHODOLOGY: We searched Nexis and Factiva databases for articles and segments on (extreme heat or record heat or heat wave or record high!) between July 1, 2012, and July 31, 2012. Our analysis includes six major print outlets (New York Times, Washington Post, USA Today, Los Angeles Times, Associated Press and Wall Street Journal), the major broadcast networks (ABC, NBC and CBS), CNN and the primetime shows on MSNBC and Fox (daytime shows for these networks are not available in Nexis).

    NOAA: July 2012 Was The Hottest Month On Record In The U.S.

    Scientist: This Year's Extreme Heat Shows "Global Warming From Human Activities Has Reared Its Head." The National Oceanic and Atmospheric Administration recently announced that July 2012 was the hottest month in the contiguous United States since record keeping began in 1895. So far, this year has been the warmest on record in the U.S. As the Associated Press reported, scientists see a link between recent extreme heat and long-term warming trends:

    "This would not have happened in the absence of human-caused climate change," said Pennsylvania State University climate scientist Michael Mann. [NOAA's Jake] Crouch and Kevin Trenberth, climate analysis chief of the National Center for Atmospheric Research, said what's happening is a double whammy of weather and climate change. They point to long-term higher night temperatures from global warming and the short-term effect of localized heat and drought that spike daytime temperatures.

    Drought is a major player because in the summer "if it is wet, it tends to be cool, while if it is dry, it tends to be hot," Trenberth said.

    So the record in July isn't such a big deal, Trenberth said. "But the fact that the first seven months of the year are the hottest on record is much more impressive from a climate standpoint, and highlights the fact that there is more than just natural variability playing a role: Global warming from human activities has reared its head in a way that can only be a major warning for the future." [Associated Press, 8/9/12] [NOAA, 8/8/12]

    The Washington Post's Capital Weather Gang noted that while U.S. temperatures don't necessarily reflect worldwide trends, "global temperatures have also been running warm": When considering connections to global warming and increasing concentrations of greenhouse gases, it's important to recognize the area of the U.S. represents less than 4 percent of the globe and 2012 is just one year in a long history.

    Having said that, global temperatures have also been running warm. While NOAA's global report for July temperatures has not yet been issued, June ranked 4th warmest on record globally and marked the 328th consecutive month of above average temperatures. [The Washington Post, 8/8/12]

    Manmade Climate Change Has Increased The Likelihood Of Heat Waves

    IPCC: "Virtually Certain" That Heat Extremes Will Intensify. A 2012 Special Report by the Intergovernmental Panel on Climate Change (IPCC) deemed it "virtually certain" that heat extremes will become stronger and more frequent on a global scale in the 21st century, and "very likely" that heat waves will increase in "length, frequency, and/or intensity ... over most land areas." The report noted that "[p]rojected changes at subcontinental scales are less certain than is the case for the global scale" and that "[m]ean global warming does not necessarily imply warming in all regions and seasons." [IPCC, June 2012]

    Studies Project U.S. Heat Extremes Will Become More Frequent. A 2009 report to Congress and the White House from the U.S. Global Change Research Program stated: Scientific research has concluded that human influences on climate are indeed changing the likelihood of certain types of extreme events. For example, an analysis of the European summer heat wave of 2003 found that the risk of such a heat wave is now roughly four times greater than it would have been in the absence of human-induced climate change...

    …With rising high temperatures, extreme heat waves that are currently considered rare will occur more frequently in the future. Recent studies using an ensemble of models show that events that now occur once every 20 years are projected to occur about every other year in much of the country by the end of this century. In addition to occurring more frequently, at the end of this century these very hot days are projected to be about 10°F hotter than they are today.

    The report illustrated this increase in the frequency of heat extremes:

    [Global Climate Change Impacts in the United States, 2009]

    NASA Study: Heat Waves Are "Very Likely" A Consequence Of Global Warming. A study by the National Aeronautics and Space Administration's James Hansen and other scientists found that land areas across the globe are "much more likely to experience an extreme summer heat wave than they were in the middle of the 20th century":

    The statistics show that the recent bouts of extremely warm summers, including the intense heat wave afflicting the U.S. Midwest this year, very likely are the consequence of global warming, according to lead author James Hansen of NASA's Goddard Institute for Space Studies (GISS) in New York.

    "This summer people are seeing extreme heat and agricultural impacts," Hansen says. "We're asserting that this is causally connected to global warming, and in this paper we present the scientific evidence for that."

    The NASA report included this chart showing the shift:

    [NASA, August 2012]

    There Is "Strong Evidence" Linking Heat Waves To Manmade Climate Change. A review of extreme weather events published in Nature Climate Change in 2012 concluded that, for heat waves and extreme precipitation, there is "strong evidence linking specific events or an increase in their numbers to the human influence on climate." [Nature Climate Change, 3/25/12]

    NOAA: Some Heat Waves Now 20 Times More Likely. NOAA's "State of the Climate in 2011" report stated that although "scientists cannot trace specific events to climate change with absolute certainty," new research on the probability of those events found that "La Niña-related heat waves, like that experienced in Texas in 2011, are now 20 times more likely to occur during La Niña years today than La Niña years fifty years ago" due to broader warming. [NOAA, 7/10/12]

    Study: 80% Probability That Deadly 2010 Moscow Heat Wave Wouldn't Have Happened Without Climate Change. In a 2011 report published in the Proceedings of the National Academy of Sciences, scientists from the Potsdam Institute for Climate Impact Research found that record-breaking heat events, while not necessarily individually attributable to climate change, are made more likely by broader warming. Specifically, the report concluded with "approximate 80% probability" that the July 2010 heat wave that killed hundreds of people in Moscow and thousands throughout Russia "would not have occurred without climate warming." A 2012 study led by Oxford University scientists similarly concluded that Russia's 2010 heat wave was partly influenced by "manmade factors," and that "the frequency of occurrence of such heat waves has increased by a factor of three over recent decades." [University of Oxford, 2/21/12] [Proceedings of the National Academy of Sciences, September 2011]

    QUICK NEWS, August 28: ROMNEY’S ENERGY PLAN, SUN’S ANSWER; WIND SITING TOOL GETS BETTER; HOMES WIRED FOR EFFICIENCY

    ROMNEY’S ENERGY PLAN, SUN’S ANSWER Romney Reveals Plans For U.S. Energy Policy; SEIA Weighs In

    24 August 2012 (Solar Industry)

    “Republican presidential nominee Mitt Romney has revealed his detailed plans for energy policy in the U.S. if he is elected president… The Romney Plan For A Stronger Middle Class: Energy Independence stresses domestic production of oil and gas onshore and offshore. Through this strategy, Romney predicts the U.S. can become energy-independent by 2020…

    “The paper contains few specific mentions of solar power or other forms of renewable energy. However, several of Romney's proposals for removing regulatory hurdles to developing domestic sources of energy would likely apply to both fossil fuels and renewable energy sources…”

    “The Solar Energy Industries Association (SEIA) applauded Romney's plans to reduce red tape at the federal level. Despite efforts by the Obama administration to speed permitting, utility-scale solar energy projects have been no stranger to regulatory hurdles and long-permitting timelines…SEIA President and CEO Rhone Resch [said] SEIA plans to continue to work with lawmakers of all political stripes in an effort to reduce barriers to energy deployment, from the national level down to the local level.

    “…Citing infamous failed solar manufacturer Solyndra and job losses in the wind energy sector, Romney called for a reduced, revised role of government spending in the renewable energy sector…[T]he private sector can take the lead on energy technology advancement, and government-related investment in energy should focus on…basic, early-stage research for new technologies…SEIA voiced approval of Romney's acknowledgement that the federal government can help develop new energy sources but pointed out that all energy sources - including oil and natural gas - receive federal support…”

    WIND SITING TOOL GETS BETTER Mapping Tool Helps Wind Energy Companies Screen Early For Critical Habitat, Potential Wildlife Impacts

    August 23, 2012 (American Wind Wildlife Institute)

    “The Nature Conservancy (TNC) and the American Wind Wildlife Institute (AWWI)…[have upgraded] the AWWI Landscape Assessment Tool (LAT), the state-of-the art wind-wildlife GIS mapping tool that they have jointly created. The LAT is designed to help wind energy developers with early screening for possible wildlife and habitat impacts…”

    [Joe Fargione, Lead Scientist, The Nature Conservancy:] "The wind-wildlife mapping tool…just got more powerful with the addition of critical habitat overlays for 225 endangered species including numerous species of plants, insects, mammals, fish, birds, amphibians, and reptiles…”

    “Critical habitats are areas that the U.S. Fish and Wildlife Service designates ‘as necessary to the survival or recovery of an endangered or threatened species,’ and which therefore ‘may require special management and protection.’ The LAT upgrade features critical habitat maps for the species for which the U.S. Fish and Wildlife Service has designated such habitat and produced corresponding GIS layers.

    “In all, LAT users can now display web-based maps drawn from over 700 data layers including land use and ownership, the potential distribution of endangered and threatened species, and other relevant wildlife and habitat data. The LAT is intended to be used by wind energy companies as they undertake preliminary, ‘Tier 1’ assessments of potential sites…”

    HOMES WIRED FOR EFFICIENCY Networked Home Energy Management Devices and In-Home Displays Utilizing ZigBee, PLC, HomePlug, and Wi-Fi Connectivity: Global Market Analysis and Forecasts

    3Q 2012 (Pike Research/Navigant)

    “Home area networks (HANs) are localized systems of hardware and software that enable…consumers to access consumption information that, when acted upon, can result in reduced use of energy and lower costs. The HAN is seen as one of the last zones of technologies that complete the modern smart grid…[by leveraging] consumption information provided by smart meters…to HAN devices that can take advantage of the information – often resulting in both energy and cost savings for the consumer.

    “…[HANs] adoption has been slowed by a number of factors, including consumer indifference, the cost of new equipment, and evolving technology standards. Utilities themselves have taken a relatively slow approach…[and] concentrated initial efforts on the deployment of smart meters. A few utilities in North America have started to promote HANs…In Europe, HAN adoption has been sluggish…with the exception of the United Kingdom, where regulatory mandates require basic HAN gear to be part of new smart meter deployments…”

    “…[Networked home energy management (HEM) shipments will grow steadily, starting with worldwide volumes of nearly 18,000 in 2011 and growing to almost 4 million in 2020 at a compound annual growth rate (CAGR) of 81.8%. North America will lead, followed by Western Europe, as government mandates stimulate shipments…[I]n Asia Pacific…a 2011-2020 CAGR of 109.7% is expected. This growth is due in part, to Japanese utility giant TEPCO, which is seeking bids for deploying approximately 17 million smart meters by 2019; the smart meter deployment will drive increased HAN volumes…

    “Combined overall revenue…will grow from more than $24 million at the beginning of the forecast to $1.1 billion in 2020 at a CAGR of 53.4%. The total revenue for displays is expected to be greater than revenue for networked HEM because of lower prices and larger volumes]…”

    Monday, August 27, 2012

    TODAY’S STUDY: THE STATE OF WIND

    2011 Wind Technologies Market Report

    Ryan Wiser and Mark Bolinger, August 14, 2012 (Lawrence Berkeley National Laboratory)

    Executive Summary

    The U.S. wind power industry is facing uncertain times. With 2011 capacity additions having risen from 2010 levels and with a further sizable increase expected in 2012, there are – on the surface – grounds for optimism. Key factors driving growth in 2011 included continued state and federal incentives for wind energy, recent improvements in the cost and performance of wind power technology, and the need to meet an end-of-year construction start deadline in order to qualify for the Section 1603 Treasury grant program. At the same time, the currently-slated expiration of key federal tax incentives for wind energy at the end of 2012 – in concert with continued low natural gas prices and modest electricity demand growth – threatens to dramatically slow new builds in 2013.

    Key findings from this year’s “Wind Technologies Market Report” include:

    • Wind Power Additions Increased in 2011, with Roughly 6.8 GW of New Capacity Added in the United States and $14 Billion Invested. Wind power installations in 2011 were 31% higher than in 2010, but still well below the levels seen in 2008 and 2009. Cumulative wind power capacity grew by 16% in 2011, bringing the total to nearly 47 GW.

    • Wind Power Comprised 32% of U.S. Electric Generating Capacity Additions in 2011. This is up from 25% in 2010, but below its historic peak of 42-43% in 2008 and 2009. In 2011, for the sixth time in the past seven years, wind power was the second-largest new resource (behind natural gas) added to the U.S. electrical grid in terms of gross capacity.

    • The United States Remained the Second Largest Market in Annual and Cumulative Wind Power Capacity Additions, but Was Well Behind the Market Leaders in Wind Energy Penetration. After leading the world in annual wind power capacity additions from 2005 through 2008, the U.S. has now – for three years – been second to China, comprising roughly 16% of global installed capacity in 2011, up slightly from 13% in 2010, but down substantially from 26-30% from 2007 through 2009. In terms of cumulative capacity, the U.S. also remained the second leading market, with nearly 20% of total global wind power capacity. A number of countries are beginning to achieve relatively high levels of wind energy penetration in their electricity grids: end-of-2011 wind power capacity is estimated to supply the equivalent of roughly 29% of Denmark’s electricity demand, 19% of Portugal’s, 19% of Spain’s, 18% of Ireland’s, and 11% of Germany’s. In the United States, the cumulative wind power capacity installed at the end of 2011 is estimated, in an average year, to equate to roughly 3.3% of the nation’s electricity demand.

    • California Added More New Wind Power Capacity than Any Other State, While Six States Are Estimated to Exceed 10% Wind Energy Penetration. With 921 MW added, California led the 29 other states in which new large-scale wind turbines were installed in 2011, ending Texas’ six-year reign (Texas fell to ninth place in 2011). Other states with more than 500 MW added in 2011 included Illinois, Iowa, Minnesota, Oklahoma, and Colorado. On a cumulative basis, Texas remained the clear leader. Notably, the wind power capacity installed in South Dakota and Iowa as of the end of 2011 is estimated, in an average year, to supply approximately 22% and 20%, respectively, of all in-state electricity generation. Four other states are also estimated to exceed 10% penetration by this metric: Minnesota, North Dakota, Colorado, and Oregon.

    • No Offshore Turbines Have Been Commissioned in the United States, but Offshore Project and Policy Developments Continued in 2011. At the end of 2011, global offshore wind power capacity stood at roughly 4,000 MW, with the vast majority located in Europe. To date, no offshore projects have been installed in the United States. Nonetheless, significant strides have been made recently in the federal arena, through both the Department of the Interior's responsibilities with regard to regulatory approvals and the Department of Energy's investments in offshore wind R&D. Interest exists in developing offshore wind energy in several parts of the country – e.g., Navigant finds that ten projects totaling 3,800 MW are somewhat more advanced in the development process. Of these, two have signed power purchase agreements (a third offshore wind PPA was recently canceled).

    • Data from Interconnection Queues Demonstrate that an Enormous Amount of Wind Power Capacity Is Under Consideration. At the end of 2011, there were 219 GW of wind power capacity within the transmission interconnection queues administered by independent system operators, regional transmission organizations, and utilities reviewed for this report. This wind power capacity represented 45% of all generating capacity within these queues at that time, and was 1.5 times as much capacity as the next-largest resource (natural gas). Of note, however, is that the absolute amount of wind and coal power capacity in the sampled interconnection queues has declined in recent years, whereas natural gas and solar capacity has increased. Most (96%) of the wind power capacity is planned for the Midwest, PJM Interconnection, Texas, Mountain, Northwest, Southwest Power Pool, and California regions. Projects currently in interconnection queues are often very early in the development process, so much of this capacity is unlikely to be built as planned; nonetheless, these data demonstrate the continued high level of developer interest in wind power.

    • Despite the Ongoing Proliferation of New Entrants, the “Big Three” Turbine Suppliers Have Gained U.S. Market Share Since 2009. GE and Vestas both secured roughly 29% of U.S. market share (by capacity installed) in 2011, followed by Siemens (18%), Suzlon and Mitsubishi (both at 5%), Nordex and Clipper (both at 4%), REpower (3%), and Gamesa (2%). There has been a notable increase in the number of wind turbine manufacturers serving the U.S. market – those installing more than 1 MW has increased from just 5 in 2005 to 20 manufacturers in 2011. Recently, however, there is evidence of gains in the aggregate market share of the three leading manufacturers: GE, Vestas, and Siemens. On a worldwide basis, Chinese turbine manufacturers continue to occupy positions of prominence: four of the top ten, and seven of the top 15, leading global suppliers of wind turbines in 2011 hail from China. To date, that growth has been based almost entirely on sales to the Chinese market. However, 2011 installations by Chinese and South Korean manufacturers in the U.S. include those from Sany Electric (10 MW), Samsung (5 MW), Goldwind (4.5 MW), Hyundai (3.3 MW), Sinovel (1.5 MW), and Unison (1.5 MW).

    • Domestic Wind Turbine and Component Manufacturing Capacity Has Increased, but Uncertainty in Future Demand Has Put the Wind Turbine Supply Chain Under Severe Pressure. Eight of the ten wind turbine manufacturers with the largest share of the U.S. market in 2011 had one or more manufacturing facilities in the United States at the end of 2011. In contrast, in 2004 there was only one active utility-scale wind turbine manufacturer assembling nacelles in the United States (GE). In addition, a number of new wind turbine and component manufacturing facilities were either announced or opened in 2011, by both foreign and domestic firms. The American Wind Energy Association (AWEA) estimates that the entire wind energy sector directly and indirectly employed 75,000 full-time workers in the United States at the end of 2011 – equal to the jobs reported in 2010 but fewer than in 2008 and 2009. Though domestic manufacturing capabilities have grown, uncertain prospects after 2012 – due primarily to the scheduled expiration of federal incentives – are pressuring the wind industry’s domestic supply chain as margins drop and concerns about manufacturing overcapacity deepen, potentially setting the stage for significant layoffs. The growth in U.S. wind turbine manufacturing capability and the drop in wind power plant installations since 2009 led to an estimated over-capacity of U.S. turbine nacelle assembly capability of more than 5 GW in 2011, in comparison to 4 GW of under-capacity in 2009.

    • Over-capacity relative to U.S. turbine demand is anticipated to be even more severe in 2013 and 2014. As a result of this over-supply, coupled with increasing competition, including from new entrants from China and Korea, a wide range of turbine manufacturers have reported weakened financial results, with companies throughout the U.S. wind industry’s supply chain announcing cuts to their U.S. workforce.

    • A Growing Percentage of the Equipment Used in U.S. Wind Power Projects Has Been Sourced Domestically in Recent Years. U.S. trade data show that the United States remained a large importer of wind power equipment in 2011, but that growth in installed wind power capacity has outpaced the growth in imports in recent years. As a result, a growing percentage of the equipment used in wind power projects is being sourced domestically. When presented as a fraction of total equipment-related wind turbine costs, domestic content is estimated to have increased significantly from 35% in 2005-2006 to 67% in 2011. Exports of wind-powered generating sets from the United States have also increased, rising from $15 million in 2007 to $149 million in 2011.

    • The Average Nameplate Capacity, Hub Height, and Rotor Diameter of Installed Wind Turbines Increased. The average nameplate capacity of wind turbines installed in the United States in 2011 increased to 1.97 MW, up from 1.80 MW in 2010 and the largest single-year increase in more than six years. Since 1998-99, average turbine nameplate capacity has increased by 174%. Average hub heights and rotor diameters have also scaled with time, to 81 and 89 meters, respectively, in 2011. Since 1998-99, the average turbine hub height has increased by 45%, while the average rotor diameter has increased by 86%. In large part, these increases have been driven by new turbines designed to serve lower-wind-speed sites. Industry expectations as well as new turbine announcements (mostly surrounding additional low-wind-speed turbines) suggest that significant further scaling, especially in average rotor diameter, is anticipated in the near term.

    • Project Finance Was a Mixed Bag in 2011, as Debt Terms Deteriorated While Tax Equity Held Steady. After steady improvement in both the debt and tax equity markets throughout 2010, progress faltered somewhat in 2011 on the debt side as the latest Greek/European debt crisis drove a new round of retrenchment. At the same time, new banking regulations took hold, driving considerably shorter bank loan tenors (institutional lenders, meanwhile, continued to offer significantly longer products). In contrast to the weakened debt market, the market for tax equity improved somewhat in 2011, with pricing remaining fairly stable and a handful of new or returning investors entering the market. As the number of grandfathered Section 1603 grant deals begins to taper off in 2012, however, attrition in tax equity investors is possible, as some have indicated no interest in PTC deals.

    • IPPs Remain the Dominant Owners of Wind Projects, But Utility Ownership Increased Significantly in 2011, Largely On the Back of One Utility. Independent power producers (IPPs) own 73% of all new wind power capacity installed in the United States in 2011, and 82% of the cumulative installed capacity. Utility ownership jumped to nearly 25% in 2011 (as MidAmerican Energy alone added nearly 600 MW in Iowa), up from 15% in the two previous years, and reached 17% on a cumulative basis.

    • Long-Term Contracted Sales to Utilities Remained the Most Common Off-Take Arrangement, but Scarcity of Power Purchase Agreements and Looming PTC Expiration Drove Continued Merchant Development. Electric utilities continued to be the dominant purchasers (i.e., off-takers) of wind power in 2011, either owning (25%) or buying (51%) power from 76% of the new capacity installed last year. Merchant/quasi-merchant projects were less prevalent in 2011 than they have been in recent years, accounting for 21% of all new capacity. With power purchase agreements (PPAs) in relatively short supply in comparison to wind developer interest, wholesale power prices at low levels, and a scheduled PTC expiration looming, it is likely that many of the merchant/quasi-merchant projects built in 2011 are merchant by necessity rather than by choice – i.e., building projects on a merchant basis may, in some cases, simply have been the most expedient way to ensure the deployment of committed turbines in advance of the scheduled expiration of important federal incentives. Some of these projects are, therefore, likely still seeking long-term PPAs. On a cumulative basis, utilities own (17%) or buy (50%) power from 66% of all wind power capacity in the United States, with merchant/quasi-merchant projects accounting for 24% and power marketers 10%.

    • With Increased Competition among Manufacturers, Wind Turbine Prices Continued to Decline in 2011. After hitting a low of roughly $700/kW from 2000 to 2002, average wind turbine prices increased by approximately $800/kW (>100%) through 2008, rising to an average of more than $1,500/kW. Wind turbine prices have since dropped substantially, despite continued technological advancements that have yielded increases in hub heights and especially rotor diameters. A number of turbine transactions announced in 2011 had pricing in the $1,150-$1,350/kW range and price quotes for recent transactions are reportedly in the range of $900-$1,270/kW, depending on the technology. These price reductions, coupled with improved turbine technology and more-favorable terms for turbine purchasers, should, over time, exert downward pressure on total project costs and wind power prices.

    • Though Slow to Reflect Declining Wind Turbine Prices, Reported Installed Project Costs Finally Turned the Corner in 2011. Among a large sample of wind power projects installed in 2011, the capacity-weighted average installed project cost stood at nearly $2,100/kW, down almost $100/kW from the reported average cost in both 2009 and 2010. Moreover, a preliminary estimate of the average installed cost among a relatively small sample of projects that either have been or will be built in 2012 suggests that average installed costs may decline further in 2012, continuing to follow lower turbine prices.

    • Installed Costs Differ By Project Size, Turbine Size, and Region. Installed project costs are found to exhibit some weak economies of scale, at least at the lower end of the project and turbine size range. Texas is found to be the lowest-cost region, while California and New England were the highest-cost regions.

    • Newer Projects Appear to Show Improvements in Operations and Maintenance Costs. Despite limited data availability, it appears that projects installed more recently have, on average, incurred lower O&M costs than older projects in their first several years of operation, and that O&M costs increase as projects age.

    • Sample-Wide Wind Project Capacity Factors Have Generally Improved Over Time. Boosted primarily by taller towers and larger rotor diameters (relative to nameplate capacity), increased over time, from 25% in 1999 (for projects installed through 1998) to a high of nearly 34% in 2008 (for projects installed through 2007). In 2009 and 2010, however, sample-wide capacity factors dropped to around 30%, before 2011 brought a resurgence back to 33% (for projects installed through 2010). The drop in 2009 and 2010 was likely due to a combination of lackluster wind speeds throughout much of the U.S. in both 2009 and 2010 as well as wind power curtailment (particularly severe in 2009).

    • Some Stagnation in Wind Project Capacity Factor Improvement Is Evident Among Projects Built from 2006 through 2010, Due in Part to a Build Out of Projects in Progressively Weaker Wind Resource Areas. Focusing only on capacity factors in 2011 parsed by project vintage reveals that average capacity factors have been largely stagnant among projects built from 2006 through 2010 (though the maximum capacity factor attained by any individual project in 2011 increased noticeably among projects built in 2009 and 2010, and the fact that rotor scaling continued for projects built in 2011 suggests that further increases in capacity factors are likely in 2012, all else equal). Three main drivers appear to be behind this stagnation: the average hub height of wind power projects has only increased by a few meters since 2006 (after growing rapidly in earlier years), the average rotor swept area relative to turbine nameplate capacity (i.e., the inverse of “specific power”) also held steady during much of this period (though increased considerably in both 2010 and 2011), while the average quality of the wind resource among those projects built in each year has deteriorated significantly since 2008. This final trend of building projects in progressively less-energetic wind resource sites may be driven by the proliferation of low wind speed turbine designs (see above), siting challenges (including transmission constraints), and even policy design (the value of the Section 1603 cash grant does not depend on how energetic a given site is).

    • Regional Variations in Capacity Factor Reflect the Strength of the Wind Resource. Based on a sub-sample of wind power projects built from 2004 through 2010, capacity-weighted average capacity factors were the highest in the Heartland (37%) and Mountain (36%) regions in 2011, and lowest in the East (25%) and in New England (28%). Not surprisingly, these regional rankings are roughly consistent with the relative quality of the wind resource in each region.

    • Unlike Turbine Prices and Installed Project Costs, Cumulative, Sample-Wide Wind Power Prices Continued to Move Higher in 2011. After having declined through 2005, sample-wide average wind power prices have risen steadily, such that in 2011, the cumulative sample of 271 projects totaling 20,189 MW built from 1998 through 2011 had an average power sales price of $54/MWh. This general temporal trend of falling and then rising prices is consistent with – but lags, due to the cumulative nature of the sample – the turbine price and installed project cost trends (at least through 2008 and 2010, respectively) described earlier.

    • Binning Wind Power Sales Prices by Project Vintage Also Fails to Show a Price Reversal. The capacity-weighted average 2011 sales price, based on projects in the sample built in 2011, was roughly $74/MWh – essentially unchanged from the average among projects built in 2010 (the spread of individual project prices is also similar among projects built in 2010 and 2011), and more than twice the average of $32/MWh among projects built during the low point in 2002 and 2003. Although the similarity in pricing among 2010 and 2011 projects may actually portend a peak (with lower prices likely among 2012 projects), the fact that neither calendar year prices (among a cumulative sample) nor 2011 prices (binned by project vintage) show any sort of price reversal is nevertheless surprising, particularly given the degree to which turbine prices have dropped since 2008, along with growing evidence of aggressive pricing in wind PPAs.

    • Binning Wind Power Sales Prices by PPA Execution Date Shows Steeply Falling Prices. An abnormally long lag between when PPAs were signed and when projects were built appears to be largely responsible for the stubborn lack of a price reversal in 2011 when viewed by calendar year or project vintage. Only two projects within the sample that were built in 2011 actually signed PPAs in 2011. All other 2011 projects in the sample signed PPAs in 2010, 2009, or even back as far as 2008 – i.e., at the height of the market for turbines – thereby locking in prices that ended up being above market in 2011. Binning by PPA signing date reveals that the average price peaked in 2009 and then progressively fell in both 2010 and 2011. Among a sample of “full term” wind project PPAs signed in 2011, the capacity-weighted average levelized PPA price is $35/MWh, down from $59/MWh for PPAs signed in 2010 and $72/MWh for PPAs signed in 2009.

    • Wind Power PPA Prices Vary Widely By Region. Texas, the Heartland, and the Mountain regions appear to be among the lowest-price regions, on average, while California is, by far, the highest price region. California also accounts for nearly one quarter of the 2011 project sample, thereby disproportionately inflating the capacity-weighted average price in 2011 (as it also did in 2010, when it made up almost 20% of the sample).

    • Low Wholesale Electricity Prices Continued to Challenge the Relative Economics of Wind Power. Average wind power prices compared favorably to wholesale electricity prices from 2003 through 2008. Starting in 2009, however, increasing wind power prices, combined with a sharp drop in wholesale electricity prices (driven by lower natural gas prices), pushed wind energy to the top of (and in 2011 above) the wholesale power price range. Although low wholesale electricity prices are, in part, attributable to the recession-induced drop in energy demand, the ongoing development of significant shale gas deposits has also resulted in reduced expectations for gas price increases going forward. While comparing wind and wholesale electricity prices in this manner is not appropriate if one’s goal is to fully account for the costs and benefits of wind energy relative to its competition, these developments may nonetheless put the near-term comparative economic position of wind energy at some risk absent further reductions in the price of wind power and absent supportive policies for wind energy. That said, levelized PPA prices in the $30-$40/MWh range (currently achievable, with the PTC, in many parts of the interior U.S.) are fully competitive with the range of wholesale power prices seen in 2011.

    • Uncertainty Reigns in Federal Incentives for Wind Energy Beyond 2012. The Recovery Act enabled wind power projects placed in service prior to the end of 2012 to elect a 30% investment tax credit (ITC) in lieu of the production tax credit (PTC). More importantly, given the relative scarcity of tax equity in the immediate wake of the financial crisis, the Recovery Act also enabled wind power projects to elect a 30% cash grant from the Treasury in lieu of federal tax credits. More than 60% of the new wind capacity installed in 2011 elected the cash grant. However, in order to qualify for the grant, wind power projects must have been under construction by the end of 2011, must apply for a grant by October 1, 2012, and must be placed in service by the end of 2012. With the PTC, ITC, and bonus depreciation all also currently scheduled to expire at the end of 2012, the wind energy sector is currently facing serious federal policy uncertainty looking to 2013 and beyond.

    • State Policies Play a Role in Directing the Location and Amount of Wind Power Development, but Current Policies Cannot Support Continued Growth at the Levels Seen in the Recent Past. From 1999 through 2011, 65% of the wind power capacity built in the United States was located in states with renewables portfolio standards (RPS); in 2011, this proportion was 78%. As of July 2012, mandatory RPS programs existed in 29 states and Washington D.C., and a number of states strengthened previously established programs in 2011. However, existing RPS programs are projected to drive average annual renewable energy additions of roughly 4-5 GW/year (not all of which will be wind) between 2012 and 2020, which is less than the amount of wind capacity added in recent years and demonstrates the limitations of relying exclusively on state RPS programs to drive future deployment.

    • Despite Progress on Overcoming Transmission Barriers, Constraints Remain. Transmission development has continued to gain traction during recent years, with about 2,300 circuit miles of new transmission additions under construction near the end of 2011, and with an additional 17,800 circuit miles planned through 2015. The wind industry has identified near-term transmission projects that – if all were completed – could carry almost 45 GW of wind power capacity. In July 2011, the Federal Energy Regulatory Commission (FERC) issued an order that requires public utility transmission providers to improve transmission planning processes and to determine a cost allocation methodology for new transmission facilities. States, grid operators, utilities, regional organizations, and the Department of Energy also continue to take proactive steps to encourage transmission investment. Finally, construction and development progress was made in 2011 on a number of transmission projects designed, in part, to support wind power. Nonetheless, siting, planning, and cost allocation issues remain key barriers to transmission investment, and wind curtailment continues to be a problem in some areas.

    • Integrating Wind Energy into Power Systems Is Manageable, but Not Free of Costs, and System Operators Are Implementing Methods to Accommodate Increased Penetration. Recent studies show that wind energy integration costs are below $12/MWh – and often below $5/MWh – for wind power capacity penetrations of up to or even exceeding 40% of the peak load of the system in which the wind power is delivered. The increase in balancing reserves with increased wind power penetration is projected, in most cases, to be below 15% of the nameplate capacity of wind power, and typically considerably less than this figure, particularly in studies that use intra-hour scheduling. Moreover, a number of strategies that can help to ease the integration of increasing amounts of wind energy – including the use of larger balancing areas, the use of wind forecasts, and intra-hour scheduling – are being implemented by grid operators across the United States. With federal tax incentives for wind energy currently slated to expire at the end of 2012, new capacity additions in 2012 are anticipated to exceed 2011 levels and perhaps even the highs in 2009 as developers rush to commission projects. At the same time, despite the improved cost, performance, and price of wind energy, policy uncertainty – in concert with continued low natural gas prices, modest electricity demand growth, and the aforementioned slack in existing state policies – threatens to dramatically slow new builds in 2013 and beyond. Forecasts for 2013 and beyond therefore span a particularly wide range, depending in large measure on assumptions about the possible extension of federal incentives.

    Future Outlook

    Wind power capacity additions in 2011 – at 6,816 MW – fell within the range of market forecasts (4,450-8,000 MW) presented in last year’s edition of the Wind Technologies Market Report. Key factors driving growth in 2011 included: continued state and federal incentives for wind energy, recent improvements in the cost and performance of wind power technology, and the need to meet an end-of-year construction start deadline in order to qualify for the Section 1603 Treasury grant program.

    With the Section 1603 grant and federal tax incentives for wind energy currently scheduled to expire at the end of the year, 2012 is widely expected to be a strong year for new capacity growth, as wind energy purchasers take advantage of this potentially “limited time only” buying opportunity that combines federal incentive availability with lower PPA prices (from lower turbine costs and improved performance), and as developers rush to commission projects before the expiration of incentives. As a result, with the exception of the EIA (2012) “no sunset” projection, the remaining forecasts presented in Table 6 predict 2012 additions to range from 7,280 MW to 12,000 MW – i.e., in excess of 2011 additions, and perhaps even surpassing the previous record set back in 2009. With AWEA (2012c) reporting 1,695 MW installed in the first quarter of 2012, and another 8,900 MW under construction as of the end of the first quarter, the industry appears to be on track to fall within that forecast range.

    Projections for 2013 and beyond are much less certain, but generally show lower wind power capacity additions. Besides the possible expiration of federal incentives at the end of 2012, other challenges include: continued low natural gas and wholesale electricity prices; inadequate transmission infrastructure in some areas; modest electricity demand growth; existing state policies that are insufficient to support future wind power capacity additions at the levels witnessed in recent years;83 and growing competition from solar energy in certain regions of the country. Industry hopes for a federal renewable or clean energy standard, or climate legislation, have also dimmed in the near term.

    Given this challenging, but also uncertain, outlook, it is not surprising that forecasts for 2013 and beyond – as shown in Table 6 – span a particularly wide range, depending in large measure on assumptions about the possible extension of federal incentives. In a scenario with no PTC extension, for example, Bloomberg NEF (2012a) predicts a precipitous drop in wind power installations, with perhaps only 1,000 MW installed in 2013. BTM (2012), on the other hand, presumably assumes an extension of federal support, leading to relatively stable wind power additions from 2012 to 2014. Even with a PTC extension, however, most predictions are for more-modest wind power additions in the near term as the development pipeline takes time to recharge and considering the other challenges impacting the wind industry; this may be especially true if a longer term extension is achieved, as industry participants will then not need to rush to meet yet-another near-term expiration threat.

    Regardless of future uncertainties, wind power capacity additions over the past several years, as well as the additions predicted for 2012, have put the United States on a trajectory that may lead to 20% of the nation’s electricity demand coming from wind energy by 2030 (see Figure 41). In May 2008, the U.S. Department of Energy, in collaboration with its national laboratories, the wind power industry, and others, published a report that analyzed the technical and economic feasibility of achieving 20% wind energy penetration by 2030 (DOE 2008). In addition to finding no insurmountable barriers to reaching 20% wind energy penetration, the report also laid out a potential wind power deployment path that started at 3.3 GW/year in 2007, increasing to 4.2 GW/year by 2009, 6.4 GW/year by 2011, 9.6 GW/year by 2013, 13.4 GW/year by 2015, and roughly 16 GW/year by 2017 and thereafter, yielding cumulative wind power capacity of 305 GW by 2030. Historical growth over the last six years puts the United States on a trajectory exceeding this deployment path, a trend that is anticipated to continue in 2012. Nonetheless, all of the projections for annual capacity additions in 2013 and 2014 – even those that assume PTC extension (as denoted by the green, rather than red, circles in Figure 41) – fall short of the annual growth envisioned in the 20% wind energy report for those years, suggesting that there is a very-real risk that the market will not grow rapidly enough to maintain a long-term trajectory consistent with a 20% wind energy penetration level by 2030.

    Ramping up to the annual installation rate of roughly 16 GW per year needed for wind power to contribute 20% of the nation’s electricity by 2030, and maintaining that rate for a decade, would be a challenging task. This rate of deployment has not yet been witnessed in the U.S. market, and is not expected to be achieved in the near term, due to uncertainty in federal policy towards wind energy after 2012, market expectations for continued low natural gas prices, slow growth in electricity demand, and uncertainty surrounding future environmental regulations to limit carbon emissions.

    In addition to stable long-term promotional policies, the DOE (2008) report suggests four other areas where supportive actions may be needed in order to reach such annual installation rates. First, the nation will need to invest in significant amounts of new transmission infrastructure designed to access remote wind resources. Second, to more-effectively integrate wind power into electricity markets, larger power control regions, better wind forecasting, and increased investment in fast-responding generating plants will be required.

    Third, siting and permitting procedures will need to be designed to allow wind power developers to identify appropriate project locations and move from wind resource prospecting to construction quickly. Finally, enhanced research and development efforts in both the public and private sector will be required to lower the cost of offshore wind power, and incrementally improve conventional land-based wind energy technology.

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