Wed Apr 21, 2010 1:27am IST
LOS ANGELES, April 20 (Reuters) - Demand for U.S. wind energy is likely to be sluggish in the coming years as power prices are low and a federal renewable energy mandate is unlikely, Bank of America Merrill Lynch Global Research said on Tuesday.
Wind is increasingly less competitive as power prices have dropped to between $40 and $50 per megawatt-hour -- some $20 less than what wind energy has historically sold for in recent years through purchase power agreements, the analysts said.
U.S. wind demand could still take off if the federal government were to set a renewable portfolio standard, which would require utilities to get a certain amount of their power from renewable sources such as solar or wind.
But passage of such a mandate looks unlikely and many states that have set individual standards have surplus renewable capacity, Bank of America Merrill Lynch analysts said in a research report.
"It seems likely, therefore, that the U.S. wind market will be tough in 2010 and remain tough in 2011 before beginning to pick up in 2012," they wrote.
The U.S. wind industry has grown 39 percent on average each of the last five years, but even with steady growth, wind power generation accounts for just 1.8 percent of the country's total, according to a recent report by the American Wind Energy Association.
More than 10,000 MW of wind power capacity were installed in the United States in 2009, the AWEA said, brining total U.S. capacity to 35,000 MW.
One megawatt is enough power for about 800 U.S. homes.
Analysts at Bank of America Merrill Lynch said they expected wind installations to fall to 7,000 MW this year and to recover more gradually than they previously forecast.
They forecast 8,000 MW of new capacity in 2011 and 9,000 MW in 2012 -- both below the level hit last year. (Reporting by Dana Ford; editing by Andre Grenon)
Source: http://in.reuters.com/article/rbssEnergyNews/idINN2018430420100420?sp=true
LOS ANGELES, April 20 (Reuters) - Demand for U.S. wind energy is likely to be sluggish in the coming years as power prices are low and a federal renewable energy mandate is unlikely, Bank of America Merrill Lynch Global Research said on Tuesday.
Wind is increasingly less competitive as power prices have dropped to between $40 and $50 per megawatt-hour -- some $20 less than what wind energy has historically sold for in recent years through purchase power agreements, the analysts said.
U.S. wind demand could still take off if the federal government were to set a renewable portfolio standard, which would require utilities to get a certain amount of their power from renewable sources such as solar or wind.
But passage of such a mandate looks unlikely and many states that have set individual standards have surplus renewable capacity, Bank of America Merrill Lynch analysts said in a research report.
"It seems likely, therefore, that the U.S. wind market will be tough in 2010 and remain tough in 2011 before beginning to pick up in 2012," they wrote.
The U.S. wind industry has grown 39 percent on average each of the last five years, but even with steady growth, wind power generation accounts for just 1.8 percent of the country's total, according to a recent report by the American Wind Energy Association.
More than 10,000 MW of wind power capacity were installed in the United States in 2009, the AWEA said, brining total U.S. capacity to 35,000 MW.
One megawatt is enough power for about 800 U.S. homes.
Analysts at Bank of America Merrill Lynch said they expected wind installations to fall to 7,000 MW this year and to recover more gradually than they previously forecast.
They forecast 8,000 MW of new capacity in 2011 and 9,000 MW in 2012 -- both below the level hit last year. (Reporting by Dana Ford; editing by Andre Grenon)
Source: http://in.reuters.com/article/rbssEnergyNews/idINN2018430420100420?sp=true
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