"The single-most reason for that is
the tax support system which we all rely upon is expiring at year-end,"
explains Jim Spencer, the president and CEO of New York-based EverPower, which
runs wind farms in Pennsylvania , New York , Ohio and California
The 2013 Windbreaker
The program — called a production tax
credit — expires on Dec. 31. It allows companies that get their wind farms
running before then to claim a 2.2-cent tax break for every kilowatt hour of
energy produced. That might not sound like a lot, but it keeps their business
costs down by about 30 percent.
So wind power is about to get 30 percent
more expensive for the utilities at a time when natural gas is very cheap.
That's bad news, Gramlich says.
"Utilities are looking at those
prices. And they simply won't buy nearly as much wind power without that
credit," he says.
The tax credit could still pass, likely as
part of the huge bills all the "fiscal cliff" agreements will be
stuffed into. A last-minute extension, however, won't help for 2013.
"It's really a black hole next
year," says EverPower's Spencer. "We have absolutely no construction
plans for next year."
So wind will slow down next year, but no
matter what happens with natural gas, you can still expect growth in
renewables, due to those state laws pushing alternative energy.
States are doing that because climate
change scientists around the world agree that if we don't find a replacement
for fossil fuels, our goose is cooked.
Natural gas may have reshaped the domestic
energy market in 2012, lowering energy prices and marginalizing the coal
industry, but America
In fact, while analysts were paying
attention to fracking this year, a record number of solar panel were being
slapped on roofs — enough to produce 3.2 gigawatts of electricity.
That sounds like a lot, but solar is still
providing just .05 percent of the country's total energy. Still, the solar
industry keeps expanding. Roan Resh, who heads the Solar Energy Industries
Association, said that's because solar panels are becoming cheaper to make and
to install.
"Just to give you perspective,"
Resh said, "in Washington ,
D.C. 14 a watt. Today it's about $4 a watt."
So if you're installing solar panels,
business is good. But there's a flip side to that equation. Prices are low
because of a global manufacturing glut. Solar manufacturers have the capacity
to produce way more panels than consumers are asking for right now, and many
panel producers are struggling.
The bulk of solar growth is happening at businesses;
companies are installing panels on roofs so that they don't have to buy as much
energy from the grid tie inverter State and federal policies are making that an easy
decision for companies. Businesses who install panels can qualify for grants
and tax breaks, and laws in 38 states require a certain amount of electricity
to be generated by solar, wind and other renewable sources.
A Good Year For Wind Power, Too
Wind was up this year, too. The federal
Energy Information Administration says the industry could add 1.2 gigawatts of
capacity this year. Wind only provides a small portion of domestic power inverter, about
3 percent.
Wind is on a strong streak with consumers
as well, says Rob Gramlich, a vice president at the American Wind Energy
Association. "Where we were serving the equivalent of 6 million homes at
the end of 2008, we're serving 13 million today," he says.
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In three of the last five years, wind has
been the fastest-growing energy sector. That was the case in 2012, but this
year's totals leave a bit of a false impression. There's been a flurry of
activity in December, and in fact more than half of new wind farms will likely
come online this month.
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