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US wind energy projects in 2005 to hit record level

03.11.2004
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US wind energy projects in 2005 to hit record level
WASHINGTON - A record number of new U.S. wind energy projects is expected next year, spurred by Congress' decision to extend a federal tax credit for wind energy production, an industry trade group said.

The projects would add about 2,500 megawatts of generating capacity worth more than $2 billion, breaking the old record of 1,696 megawatts in 2001, said the American Wind Energy Association.

Rising prices for natural gas and coal, which fuel most of America's power plants, make wind power more attractive as a way to diversify a utility's supply portfolio, the group said.

Helping make wind power more affordable was Congress' move last month to extend, through the end of 2005, the wind energy production tax credit.

Energy companies using wind power will get a tax credit of 1.8 cents per kilowatt-hour of electricity produced in the first 20 years of a project. One 50-watt light bulb left on for 20 hours consumes one kilowatt-hour of power.

A separate corporate tax bill signed into law last week by President George W. Bush extended the production tax credit to other renewable energy sources like solar or biomass.

The original wind tax credit expired at the end of 2003 and put many wind energy projects on hold. These are now moving forward and about 480 megawatts of new capacity will be installed in 2004. General Electric Co. (GE.N: Quote, Profile, Research) announced last week it has more than $1.3 billion in new orders and commitments for wind turbines.

U.S. wind energy capacity reached 6,374 megawatts at the beginning of this year, which is the amount of electricity used annually by about 1.6 million average American households.

The Energy Department has announced a goal for the United States to obtain 5 percent of its electricity from wind by 2020, up from less than 1 percent now and consistent with the current rate of growth for wind energy, the trade group said.

The industry could see much more business if Democratic presidential challenger Senator John Kerry wins in next Tuesday's election.

Kerry wants 20 percent of U.S. electricity supplies to be generated by renewable energy sources, like wind and solar, by 2020.


Story by Tom Doggett

REUTERS NEWS SERVICE
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