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Wind industry growth offers glimmer of hope

Bryan Slagter (left) and Alex Mills work on wiring a new wind turbine at the Windy Flats wind farm near Goldendale, Wash., March 19. Wind farms added more than 2,800 megawatts of capacity in the first quarter, a trade group reported Tuesday.  AP Photo by Kris Holland for the Yakima Herald Republic

Bryan Slagter (left) and Alex Mills work on wiring a new wind turbine at the Windy Flats wind farm near Goldendale, Wash., March 19. Wind farms added more than 2,800 megawatts of capacity in the first quarter, a trade group reported Tuesday. AP Photo by Kris Holland for the Yakima Herald Republic

Sandy Shore
AP Energy Writer

Denver — Wind farms added more than 2,800 megawatts of capacity in the first quarter, a trade group reported Tuesday, offering a sliver of good news for an industry pummeled by frozen credit markets and the recession.

From January to March, about three dozen developers started wind farms in 15 states adding about twice the capacity that came on line last year during the same period, according to a report by the American Wind Energy Association.

The added megawatts are enough to power more than 816,000 homes.

Most projects were already under construction in 2008 as the economy weakened, said Kathy Belyeu, the group’s industry information services manager.

A number of companies were forced to shelve projects and lay off workers, particularly from October to December when credit became scarce.

Industry officials say investments began to taper off because of the way tax credits for projects are structured. Tax credits do not pack the same punch when the economy falters.

The Treasury Department is expected to release new rules as part of the U.S. stimulus package that would allow for something closer to a rebate for wind investments as an alternative to tax credits.

The stimulus package has already had an effect on the industry.

By the end of March, about three dozen new projects had been announced with a potential of 3,540 megawatts. Belyeu said some of those projects were motivated by the stimulus package.

“We’re definitely hearing about sort of a thaw, yes, I would say so,” she said.

The market could improve after the details of the stimulus financing are finalized, said New Energy Finance analyst Ethan Zindler.

“There is a lot of activity that could take place primarily in the second half of this year that is very much contingent on the stimulus package,” he said.

The industry is still wrestling in the current economic climate, however.

Vestas A/S, the world’s biggest wind turbine manufacturer, said Tuesday it would lay off 1,900 workers primarily in Denmark and Britain, because of sluggish demand in Europe.

The layoffs represent about 9 percent of Vestas’ global work force of 21,000.

“During the past six months, the wind power industry has suffered from a funding crisis — not a demand crisis,” according to information attributed to Denmark-based Vestas in a statement. “The projects that will help Vestas meet its forecast for 2009 are currently only awaiting funding.”

One comment

  1. wilsons@ayresassociates.com

    FYI

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