The slow-down in installations in 2004 that resulted from the expiration of the production tax credit (PTC) means that many projects that have been in the development pipeline are now ready to move forward quickly. Wind-power project developers and wind-turbine and component manufacturers are now racing to lock up supply contracts for the coming year.
At the same time, rising and volatile natural gas prices make wind energy attractive in terms of the long-term stable energy price that the technology can offer. Once a plant is built, it requires no fuel and produces no harmful emissions. According to the Energy Information Administration, in the best wind resource areas such as the plains states and the upper Midwest, wind energy is the lowest-cost new electricity resource (with the PTC in place) when natural gas prices rise above about $3.50 per thousand cubic feet. On the New York Mercantile Exchange, natural gas prices topped $7 per thousand cubic feet in October, and most experts expect it to continue in the range of $5 for the foreseeable future.
The more wind energy capacity is installed, the more it will help to reduce the current natural gas supply shortage in the U.S., according to AWEA. The increasing use of natural gas to power electric generating plants is preventing the nation from building up its storage levels during the summer. But in many areas of the country where wind farms are generating electricity, they are directly helping to conserve vital natural gas supplies.
