Wind Energy Update Wind Energy Update Indiana Wind Working Group Meeting #2Indiana Wind Working Group Meeting #2

Ryan Brown Ryan Brown Indiana Office of Energy & Defense Development Indiana Office of Energy & Defense Development

December 21, 2006December 21, 2006Indianapolis, INIndianapolis, IN

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

50000

55000

60000

65000

70000

1982198319841985198619871988198919901991199219931994199519961997199819992000200120022003200420052006

Cap

acity

(MW

)

United States Europe Rest of World

1. Germany: 19540 MW2. Spain: 11340 MW3. United States: 10640 MW4. India: 5341 MW5. Denmark: 3127 MW

Source: WindPower Monthly

World total Oct 2006: 66869 MW

Total Installed Wind CapacityTotal Installed Wind Capacity

People Want Renewable Energy!People Want Renewable Energy!

Installed Wind Capacities (99Installed Wind Capacities (99--05)05)

2

4

6

8

10

12

1990

CO

E (¢

/kW

h [c

onst

ant 2

000

$])

Low wind speed sites

1995 2000 2005 2010 2015 2020

High windspeed sites

New Bulk Power Competitive Price Band

2006: New Wind

Depreciated CoalDepreciated Wind

Natural Gas (fuel only)

Wind Cost of EnergyWind Cost of Energy

Natural Gas Natural Gas –– Historic PricesHistoric Prices

0

2

4

6

8

10

12

14

16

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

Nom

inal

$/M

MB

tu (H

enry

Hub

)

0

2

4

6

8

10

12

14

16

Nom

inal

$/M

MB

tu (H

enry

Hub

)

Source: LBNL

NYMEXnatural gas futures strip

from 07/21/2006

Daily price history of 1st-nearbyNYMEX natural gas futures contract

Historical Coal PricesHistorical Coal Prices

Wind Energy InvestorsWind Energy Investors

State Goal

☼ PA: 18%¹ by 2020☼ NJ: 22.5% by 2021

CT: 10% by 2010

MA: 4% by 2009 + 1% annual increase

WI: requirement varies by utility; 10% by 2015 Goal

IA: 105 MW

MN: 10% by 2015 Goal +Xcel mandate of

1,125 MW wind by 2010

TX: 5,880 MW by 2015

*NM: 10% by 2011☼ AZ: 15% by 2025

CA: 20% by 2010

☼ NV: 20% by 2015

ME: 30% by 2000;10% by 2017 goal - new RE

State RPS

*MD: 7.5% by 2019

☼ Minimum solar or customer-sited requirement* Increased credit for solar

¹PA: 8% Tier I, 10% Tier II (includes non-renewable sources)

HI: 20% by 2020

RI: 15% by 2020

☼ CO: 10% by 2015

☼ DC: 11% by 2022

DSIRE: www.dsireusa.org October 2006

☼ NY: 24% by 2013

MT: 15% by 2015

*DE: 10% by 2019

IL: 8% by 2013

VT: RE meets load growth by 2012

SWH eligible

RenewablesRenewables Portfolio StandardsPortfolio Standards

Environmental BenefitsEnvironmental Benefits

• No SOx or NOx• No particulates• No mercury• No CO2• No water

VisionVision

Wind energy will provide 20% of U.S. electricity needs by 2030, securing

America’s leadership in reliable, clean energy technology. As an inexhaustible and

affordable domestic resource, wind strengthens our energy security, improves

the quality of the air we breathe, slows climate change, and revitalizes rural

communities.

20% Wind RPS Picture20% Wind RPS Picture

The white square in the center of a state represents the land area needed for a single wind farm to produce the projected installed capacity in that state.

• Black and Veatch, an engineering firm with large nuclear, coal, and gas businesses

• Finds 350 GW of wind available today for a delivered cost of under $85/MWh without any form of policy support

- 100 200 300 400 500 600 700 8000

10

20

30

40

50

60

70

80

90

100

Quantity Available, GW

Leve

lized

Cos

t of E

nerg

y, $

/MW

h

Class 6

Class 4Class 5

Class 3

Credible, Independent AnalysisCredible, Independent Analysis

Source: AWEA 20% Vision

0

50

100

150

200

250

300

350

400

450

500

2000 2005 2010 2015 2020 2025 2030

Cum

ulat

ive

Inst

alle

d C

apac

ity (G

W)

0

2

4

6

8

10

12

14

16

18

20

Ann

ual I

nsta

lled

Cap

acity

(GW

)

What does 20% Wind look like?What does 20% Wind look like?

Source: AWEA 20% Vision

Cost reduction and performance Cost reduction and performance improvement associated with R&Dimprovement associated with R&D……

Class 4 - Land-Based Wind Technology

0

200

400

600

800

1000

1200

1400

1600

1800

2000

2000 2005 2010 2015 2020 2025 2030 2035Year

Cap

ital C

ost (

$/kW

)

0

10

20

30

40

50

60

70

80

90

100

Cap

acity

Fac

tor (

%)

Baseline Capital CostTech1 Capital CostBaseline Capacity FactorTech1 Capacity Factor

-15%

+20%

Source: AWEA 20% Vision

20% Wind Scenario 20% Wind Scenario New Manufacturing JobsNew Manufacturing Jobs

>50k20 – 50k10 – 20k5 – 10k1 – 5k

New Manufacturing Jobs Created

by state

Source: REPP (extrapolated)

No Resource Show Stoppers to 20%No Resource Show Stoppers to 20%• With stable and predictable market, manufacturing is readily

expandable• Using a very aggressive 20% by 2020 Sustained Manufacturing

Model:~ 4% of 2005 U.S. annual steel production, 0.3% of 2005 world

annual production~ 32% of 2005 U.S. fiberglass production – no base material

limits~ 0.75% of USGS estimates of U.S. reserves for rare earth

magnets – no base material limits~ 150,000 FTE for a geographically dispersed industry – can

focus in rural areas where development is needed~ 4% of 2005 U.S. annual copper consumption and < 2.5% of

U.S. copper reserves – no base material limitsSteel and copper are needed for any generation technology

and are recyclable for future generations of turbines.

Further analysis and more detailed investigation required

ConclusionsConclusions

• 20% wind energy penetration is possible• 20% penetration is not going to happen under business

as usual scenarios• Policy choices will have a large impact on assessing the

timing and rate of achieving a 20% goal• Key issues: market transformation, transmission, project

diversity, technology development, policy, public acceptance

• 20% Vision action plan: WindPower 2007

Source: AWEA 20% Vision

Wind Powering America Priority StatesWind Powering America Priority States

HighMediumLow

State Maturity Index State Maturity Index –– 20062006Midwest Midwest

*based on data through 1/19/06

WWG Effectiveness

None

Formative

Maturing

Sustainable

Installed Capacity*

< 20 MW

20-100 MW

100-500 MW

> 500 MW

Policy Environment

Minimal

Selective

< 10% RPS

> 10% RPS

Installed Capacity*

WWG Effectiveness

Policy Environment

Illinois 107Indiana 0

Missouri 0

Iowa 836Kentucky 0Michigan 3Minnesota 744

Nebraska 73North Dakota 98Ohio 7South Dakota 44Tennessee 29Wisconsin 53

WWG Effectiveness

None

Formative

Maturing

Sustainable

Installed Capacity*

< 20 MW

20-100 MW

100-500 MW

> 500 MW

Policy Environment

Minimal

Selective

< 10% RPS

> 10% RPS*based on data through 12/31/99

State Maturity Index State Maturity Index –– 19991999MidwestMidwest

Installed Capacity*

WWG Effectiveness

Policy Environment

Illinois

Indiana

Missouri

Iowa 243KentuckyMichiganMinnesota 273

Nebraska 3North DakotaOhioSouth DakotaTennesseeWisconsin 23

Revised: 12-05-06 < 200620062007200820092010> 2010

> 100 MW Installed Capacity by Year (projected)> 100 MW Installed Capacity by Year (projected)

Indiana Wind Working Group ActivitiesIndiana Wind Working Group Activities• Kick-off meeting, Purdue University November 2005

– Tall towers study findings, 2004-2005– Richmond Power & Light tall tower study

• National and Regional meetings/workshops– American Wind Energy Association workshops/meetings

• See handout for upcoming events– Great Lakes Offshore Wind Collaborative

• AWS Truewind and DOE resource study– Educational presentations

• East Central Indiana landowners field trip, 1/13/2006• Spring trip to IL wind farm

• Office of Energy & Defense Development website– www.energy.in.gov

Indiana Wind Working Group ActivitiesIndiana Wind Working Group Activities

1. Introductions– Name, organization, interest in wind

power development in Indiana2. Networking/Bathroom break3. IWWG Planning Session for 2007

– Small group brainstorming– Sharing with the large group– Discussion– Next meeting

• Friday, February 16, 2007

IWWG Planning Session for 2007IWWG Planning Session for 2007

• What topics/issues should the IWWG address in 2007?

• Continue to meet as a large group or do we create sub-committees? How often?

• What kinds of activities should the IWWG engage in? e.g. meetings, workshops, conferences, studies, field trips, etc.

• How to best spend $50k/year IWWG budget?• Other ideas/issues?

Carpe Ventem

www.windpoweringamerica.gov