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This is an excerpt from the Third Quarter 2012 edition of the Wind Program R&D Newsletter.

According to the 2011 Wind Technologies Market Report released by the U.S. Department of Energy (DOE) in August, the United States remained one of the fastest-growing wind power markets in the world in 2011—second only to China. Roughly 6,800 megawatts (MW) of new wind power capacity were connected to the U.S. grid in 2011, up from more than the 5,200 MW built in 2010.

Wind power comprised 32% of all new U.S. electric capacity additions in 2011 and represented $14 billion in new investment. At the end of 2011, wind power contributed more than 10% of total electricity generation in six states (with two of these states above 20%), bringing the nation's total wind-generating capacity to 47,000 MW. Since then, the total U.S. capacity has increased to 50,000 MW. That's enough to power more than 12 million homes annually, as many homes as in the entire state of California, and it represents an 18-fold increase in capacity since 2000.

Other key findings from DOE's report include:

  • A growing percentage of the equipment used in U.S. wind power projects is being sourced domestically: 67% in 2011, up from just 35% back in 2005–2006.
  • Since 1998–99, the average nameplate capacity of wind turbines installed in the U.S. has increased by 174% (to 1.97 MW in 2011), the average turbine hub height has increased by 45% (to 81 meters), and the average rotor diameter has increased by 86% (to 89 meters).
  • Turbine prices have fallen 20% to 30% from their highs back in 2008, but this decline has been slow to show up in installed project cost data, which only began to turn the corner (on average) in 2011. Data from a preliminary sample of wind power projects being built in 2012 suggest further reductions in installed project costs.
  • Among a sample of wind power projects with power purchase agreements (PPAs) signed in 2011, the capacity-weighted average levelized price is $35/megawatt-hour (MWh), down from $59/MWh for projects with PPAs signed in 2010, and $72/MWh for projects with PPAs signed back in 2009.
  • With key federal incentives for wind energy (including bonus depreciation and a choice of the production tax credit, investment tax credit, or Section 1603 Treasury cash grant) currently slated to expire at the end of 2012, new capacity additions in 2012 are anticipated to substantially exceed 2011 levels. However, with the possible expiration of these incentives at the end of 2012, in concert with continued low natural gas prices, and modest electricity demand growth, researchers expect new capacity additions to slow dramatically in 2013 and beyond, despite recent improvements in the cost and performance of wind power technology.

The annual Wind Technologies Market Report is funded by the DOE Wind Program and prepared by the Lawrence Berkeley National Laboratory. To download the 2011 Wind Technologies Market report, a summary presentation of the report, and an underlying data spreadsheet, visit the Information Resources page on the Wind Program website.

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