Executive Summary
| The wind energy market in the US and Canada
is growing due to strong governmental and consumer support.
Governmental support includes the incentive systems such as
the Production Tax Credit (PTC) in the US and Wind Power
Production Incentive in Canada. The PTC particularly affects
the growth of wind energy market in the US as it plays a
major role in capacity expansion decisions of turbine
manufacturers. In addition, regulations such as Renewable
Portfolio Standards and Advanced Energy Initiative in the
US, and Feed in Tariff system in Canada aids in increasing
wind power generation. To increase consumers’ contribution
in wind power generation and consumption, the US government
had introduced the Net Metering System. Moreover, consumer
awareness regarding the environmental impact of conventional
energy has also resulted in an increased demand for wind
energy. |
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In Eastern Colorado and upstate New York ranch owners and
dairy farm owners are offering their land to wind power
generating companies for installation of wind turbines, as wind
turbines occupy minimum space and do not interfere with farming
activities. This also generates extra revenues for the land
owners.
One of the major reasons for development of wind energy is to
decrease dependence on fossil fuel for power generation.
Dependence on fossil fuel imports such as oil for power
generation may distort stability in power generation. This has
been emphasized by the US president through the Advanced Energy
Initiative. Development of renewable energy sources such as wind
energy can make the energy infrastructure more secure and
reliable. Rising cost of fossil fuel based power and decreasing
natural gas supply has increased the demand for wind energy.
Wind energy offers a stable price structure when compared to the
price of fossil fuel based power.
Wind power can be generated in both onshore and offshore
locations. In the US, offshore wind farms are being developed in
addition to onshore wind farms as flow of wind over the sea is
greater when compared to land. Offshore wind farms act as
supplementary to onshore wind farms. Currently, offshore wind
farms are being installed in shallow waters that have a depth of
20 meters. Technological innovations can result in installation
of offshore wind farms even in deep waters. This will result in
complete utilization of offshore wind power potential. Offshore
installation of wind farms can also help in eliminating visual
distortion and noise pollution caused by onshore wind farms.
On the power supply side wind energy market in US and Canada is
facing certain issues such as high cost of wind turbines due to
inadequate supply. The power distribution system is totally
centralized as per the requirements of the conventional energy
supply, while the wind power generation system is decentralized
in nature. This requires a revamp of the power distribution
system. Wind power generation depends on the flow of wind in a
particular region, hence the power supplied by a wind farm may
fluctuate in a given period of time. This creates the need for a
standby power generation system to ensure consistency in power
supply.
The US has an impressive wind power generation potential of
10,777 terawatt hours, but only 0.25% of this potential is
actually utilized. Hence, the US has plans to increase wind
power generation installed capacity by 6000 megawatts between
2006 and 2009. Multinational green power generating companies
such as the UK based British Petroleum and the Netherlands based
Shell Renewables are planning to enter the market, while AES
Corporation, an international power plant developing company had
established its operations in the US during 2004. This will
result in increasing wind power generation capacity. FPL Energy,
LLC a major wind energy manufacturer at the global level is
located in the US. Atlanta based GE Energy ranks among the top
five wind turbine manufacturers at the global level. Canada does
not feature any large scale integrated facility for wind turbine
production.
In North America excluding Mexico, the US dominated in terms of
wind power installed capacity for the period 2003 – 2005, while
Canada had only a small share. However, Canada has a higher
year-on-year growth when compared to the US. Globally, the US
occupied the third position behind Germany and Spain in terms of
installed capacity for wind power generation during 2005, while
Canada occupied the 14th rank.
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