COST OF WIND DROPPING FAST

Cost Of Wind Power Expected To Drop 12% By 2016

30 May 2012 (North American Windpower)

“Global installed wind power capacity continued to grow in 2011, albeit at a slightly lower rate than in 2009 and 2010, according to new research conducted by the Worldwatch Institute …The world now has approximately four times the installed wind energy capacity that it did in 2005, reflecting the combined effects of falling prices, improved technology, global investment and various incentive programs.

“China led the way, with a 43% share of global capacity additions in 2011, followed by the U.S. (17%) India (7%) and Germany (5%)…Despite large increases in installed wind power capacity, several Chinese provinces - including Inner Mongolia and Gansu - have actually lost a significant portion of their generation capacity due to technical problems, according to Worldwatch. Over the next five years, China plans to invest more than $400 billion to make improvements to its electrical grid that will enable it to fully integrate its total installed wind capacity by 2015.”

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“In 2011, the U.S. accounted for approximately 17% of global wind power capacity additions. Although the country generated 27% more electricity from wind in 2011 than in 2010, wind power still accounts for less than 3% of total U.S. power generation, according to the report…In the European Union (EU), Germany regained its position as regional leader for installed capacity. Currently, wind accounts for almost 8% of the country's electricity consumption…Spain added…one-third of the EU’s total capacity since 2008…[and] wind power accounts for almost 16% of the country's electricity consumption…Economic instability has had some negative impacts on European wind power and has pushed future growth projections downward, the report adds.

“Worldwide, wind power prices fell to $1.2 million/MW in the first half of 2011, mainly because of improvements in supply-chain efficiency and economies of scale. Competition from Chinese manufacturers and their excess capacity to build machines and flood the market also played a role…In addition, the capacity factor of wind turbines continues to rise as better technologies enter the market, further driving down turbine costs. Combined, these factors are expected to bring down the cost of wind energy by 12% by 2016, making onshore wind cost competitive with coal, gas and nuclear power…”

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