May 23, 2003—During a presentation at WindPower 2003, a conference of the American Wind Energy Association (AWEA), E. Linn Draper, American Electric Powers (AEP) chairman, president and chief executive officer, recognized the progress that has been made in wind generation, but focused on the obstacles that must be addressed if the United States is going to significantly increase the amount of electricity generated from wind and other renewable sources.
According to Draper, one of the biggest obstacles to the development of large-scale wind generation is the lack of transmission resources in our nation’s windiest locations, which are sparsely populated and far from major load centers. Additionally, cost continues to be a factor. Although wind energy production costs have declined, the industry needs turbines that can operate cost-effectively in areas with lower wind speeds to allow large-scale wind farms to develop closer to major load centers.
Finally, Congress needs to pass a multi-year extension of the existing federal wind energy production tax credit (which is scheduled to expire Dec. 31, 2003) or make the credit permanent. Congress has twice allowed the credit to expire before renewing it—in 1999 and again in 2001. That uncertainty seems to be contributing to a pause in wind industry progress, according to Draper. Nearly 1,700 megawatts of new wind-powered capacity were added in the U.S. in 2001, while only 410 megawatts of new capacity came on line in 2002.
Draper said the following policy actions would promote additional investment in renewable generation:
- Making the renewable energy production tax credit permanent;
- Allowing and encouraging the trading of renewable energy credits nationally;
- Allowing construction of new, economically feasible hydroelectric projects and providing renewable energy credits for generating capacity increases at existing hydros;
- Including co-firing of biomass in existing resources as renewable energy;
- Ensuring the orderly development of transmission infrastructure necessary to support new renewable generation; and
- Providing assurance of cost recovery for transmission investments that support renewable generation.
For more information, contact AEP.
