EcoLogic Blog

The American Wind Energy Association (AWEA) held a press conference about the growing investment in wind energy and the Department of Energy’s report that 20 percent of America’s energy can come from wind by 2030.

Panelists included: Kansas Governor Kathleen Sebelius, Andy Karsner from the DOE, Randy Swisher of AWEA, Vestas CEO Ditlev Engel, GE Energy’s vice president for renewables Vic Abate, FPL Energy’s senior vice president of development Michael O’Sullivan, Horizon Wind Energy’s chief development officer Gabriel Alonso and Hunter Armistead of Babcock and Brown.

In his opening remarks, Engel explained why the United States is such a big market for Denmark-based Vestas, the world’s largest producer of wind turbines:

“The U.S. is our largest market, but having [wind energy] potential and realizing it are two different things. The U.S. has great potential. So this 20 percent report from the DOE is very important to plan what needs to be done. We need more long-term views. ”

He also noted that we need to stop calling wind power “alternative energy:” “What’s the alternative if you don’t go in this direction?” he asked, alluding to the dramatic energy changes that need to take place to slow global warming.

Gabriel Alonso from Horizon agreed that the U.S. is still very attractive despite the obstacles. We have some of the best wind resources in the world and we have a good infrastructure (although it needs improvement) and 29 states with renewable energy standards. So the fundamentals of the industry all come together: The resources, demand and need.

Again, a big topic of discussion was the production tax credit (PTC) that’s in a bill President Bush won’t sign (for other reasons; he supports the PTC). An AP reporter asked whether the uncertainty of the PTC effects the investments of foreign companies in the U.S. Abate responded “clearly it does.” For example, because there’s policy instability in the U.S., GE focuses on building capacity in Europe, China and India. They need to diversify the technologically across the globe to offset uncertainty at home.

A reporter from Reuters asked whether the PTC could drive too much investment in wind and drain subsidy money from the Treasury. Andy Karsner from the DOE answered that the more we scale the wind power industry, the more it will cost the Treasury. “So if we want to scale wind, we’ve got to have policies that aren’t based on a particular technology. That’s why policy has to be technology-neutral.”

The representative from Babcock and Brown chimed in that incentives are a good thing. Besides, the government also incentivizes the oil, gas, nuclear industry and wind is a relatively small cost. “There may be a better way, but this is what we have to work with now.”

Photo courtesy of AWEA

Next, the fiery and riveting Department of Energy (DOE) assistant secretary Alexander “Andy” Karsner (who was in the wind power business before going to the DOE) spoke passionately about the PTC:

“Take note all you media people out there. The [Bush] administration supports the extension of the PTC. We believe the PTC should be durable, reliable, improved…unreliable policy does nothing more than stave off growth in job creation…If we’re going to use tax policy, we at least have to make it reliable and durable.

But why would the [U.S. House of Representatives] put the same legislation before the president there or four times if you know it’s going to be vetoed but then bury the PTC in it?… It’s an old trick to use veto bait during an election year. The President just wants a clean bill with the PTC! The Senate did it and was more mature about it. Why can’t the House deliver on the same thing?

We want these things to succeed and out of the basket of politics. It is not the government’s role to select electricity winners. We need neutrality of government that ensures delivery of the attributes that we seek.

That means policy that’s carbon weighted and leans to emissions-free sources.”

He went to talk about the need of natural gas and wind power to be energy partners (using natural gas as a back up to variable wind power). “We are going to need every drop of domestic natural gas and we’re going to need wind.”

He concluded:

“We are facing a new energy reality. We are in a new and unknown era where we need your leadership. Urgency is what matters. All reports say we have 10 – 15 years to cut emissions to the point needed. We’ve got the first 7 percent of the next 10 years in the last days of this administration. Even if people are taking about lame duck, it doesn’t mean government can sit back and not take action [on the PTC].”

The American Wind Energy Association’s WINDPOWER 2008 conference and expo kicked off this morning with an opening session of top-notch wind power people. The languishing production tax credit for wind (PTC) (stuck in legislation that the president promises to veto) was a big topic of discussion. In fact, chairs in the auditorium had a card on it with all members of Congress’ phone numbers.

All the speakers were very good, but one of the most interesting was Kansas Governor Kathleen Sebelius (D): She and her state have done great things for renewable energy. She talked about the struggles and successes getting there:

“Five years ago, we decided to change the fact that we were so dependent on coal. But we had a hostile regulatory environment, transmission issues and financial uncertainty. So we had to define ‘cost’ in a broader sense; when taking into account jobs, environmental and health costs, you get a very different answer than coal.

We don’t have a majority of legislators ready to embrace a renewable portfolio standard [RPS]. So I had to work on the regulatory side. We created a voluntary RPS of 10 percent by 2010 and 20 percent by 2020.

By the end of this year we’ll be at 10 percent wind in Kansas already…We’re only one of two states to have achieved this without a legislative mandate.”

Regarding the coal plants Kansas denied based on global warming concerns (a first in the nation):

“There were two new coal plants cited for Kansas. But the power wasn’t for us, it was for another state; we wouldn’t actually need to build a coal plant for a very long time.

If we opened up our doors to become a coal exporter, that would send exactly the wrong signals to developers, regulators and the public looking to Kansas for clean technologies. [Our denial of the plants] produced a firestorm. They threatened legislation mandating that the coal plants be built. But the legislature adjourned last week and all of my vetoes were sustained…We were told that without new coal plants, we wouldn’t get the transmission needed that would also help wind. A week after I vetoed, a major transmission line was announced by Warren Buffet’s company in Kansas. This myth was debunked. We’re turning a corner in the heartland.”

Some say Governor Sebelius is a vice presidential contender.