Forces Driving Wind Power Development Pat Walsh UW-Madison/Extension Focus on Energy Program

Drivers for Wind Power Fuel Price Uncertainty Energy Security Federal and State Policies Economic Development Green Power Declining Wind Costs

US Escalating Energy Use

CHINA RECENT ENERGY FACTS China accounts for at least 40% of the growth in global oil demand. In 2004 China will use 830,000 barrels a day more than last year which is about a third of world demand growth, which may soon be fifty percent. Chinese energy consumption will more than double in the next twenty years. Source: US Energy Information Administration

Energy Security Issues Are Growing Three quarters of the world’s known petroleum reserves are in the Middle East Most of these are in three countries Saudi Arabia Iran Iraq

Natural Gas Source: Community Office of Resource Efficiency

Natural Gas Price Volatility

Carbon Growth Highest in Developing Countries GT/yr Developing Industrialized Annual Carbon Emissions GT Emissions Growth ( ) Transport 27% Power Generation 47% Res/Comm 4% Ind. Economies Sectors Developing 75% Developing 75% Industrialized 25% Industrialized 25% Dev. Industrial 22% 2.2% 2.4% 2.3% 1.2% 0.8% 0.7% Developing Share 50%

NASA photograph Extent of Arctic summer ice in 1979 (top satellite image) and in 2003 (lower satellite image). Shrinking Polar Ice

The Energy Policy Act of 2005 Public Law

Renewable Depreciation Deductions Businesses can recover investments in solar, wind and geothermal property through depreciation deductions under the Modified Accelerated Cost-Recovery System (MACRS) For solar, wind and geothermal property placed in service after 1986, the terms are five years.

Renewable Electricity Production Tax Credit Provides a business tax credit of 1.5 cents/kWh, adjusted annually for inflation, for electricity generated by wind, closed-loop biomass and geothermal (1.9 cents/kWh adjusted for 2005) Electricity generated from open-loop biomass, small irrigation hydroelectric, landfill gas, municipal solid waste resources and hydropower receive half that rate (currently 0.9 cents/kWh). Available through December 31, 2007 for renewables

Renewable Energy Production Incentive New qualifying renewable energy generation facilities eligible for annual incentive payments of 1.5 cents/kWh for the first 10 years of operation. Qualifying facilities must use Solar Wind Geothermal Biomass Landfill gas Livestock refuse Ocean generation technologies (tidal, wave, current and thermal) Fuel cells using hydrogen derived from eligible biomass facilities

2005 Wisconsin Act 141 Renewable Portfolio Standard- requires utilities to generate 10% of their power from renewable energy by 2015 Requires state government to use renewable energy 10% by % by 2012

Wind Cost of Energy COE (¢/kWh [constant 2000 $]) Low wind speed sites High wind speed sites Bulk Power Competitive Price Band

Growth of Wind Energy Capacity Worldwide MW Installed Year Jan 2003 Cumulative MW Rest of World = 2,803 North America = 5,018 Europe = 21,319 Sources: BTM Consult Aps, March 2001 Windpower Monthly, January 2003 ActualProjected Rest of World North America Europe

Wisconsin Wind Profile

Conclusion Many forces driving wind development Some areas of Northwest Wisconsin may be a good places for wind development Now is a good time for communities and citizens to learn about this technology