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2Annual Report on U.S. Wind Power Installation, Cost, and Performance Trends: 2007
Contents
Introduction ................................................3U.S. Wind Power Capacity Surged by 46% in 2007, with 5,329 MWAdded and $9 Billion Invested ..................................4Wind Power Contributed 35% of All New U.S. Electric GeneratingCapacity in 2007 .............................................4The United States Continued to Lead the World in AnnualCapacity Growth .............................................5Texas Easily Exceeded Other States in Annual Capacity Growth .......6Data from Interconnection Queues Demonstrate that anEnormous Amount of Wind Capacity Is Under Development ..........9GE Wind Remained the Dominant Turbine Manufacturer, buta Growing Number of Other Manufacturers Are CapturingMarket Share ..............................................10Soaring Demand for Wind Spurs Expansion of U.S. Wind TurbineManufacturing .............................................11Average Turbine Size Continued to Grow, Albeit at a Slower Pace.....12The Average Size of Wind Projects Expanded Significantly ..........12Developer Consolidation Continued at a Torrid Pace ...............13Comfort With and Use of Innovative Financing Structures Increased ..14IPP Project Ownership Remained Dominant, but Utility Interestin Ownership Continued, While Community Wind Faltered ..........15Though Long-Term Contracted Sales to Utilities Remained theMost Common Off-Take Arrangement, Merchant Plants andSales to Power Marketers Are Becoming More Prevalent ...........15Upward Pressure on Wind Power Prices Continued in 2007 .........16Wind Remained Competitive in Wholesale Power Markets ..........19Project Performance and Capital Costs Drive Wind Power Prices .....20Installed Project Costs Continued to Rise in 2007, After a LongPeriod of Decline ............................................21Project Cost Increases Are a Function of Turbine Prices, andTurbine Prices Have Increased Dramatically ......................22Wind Project Performance Has Improved Over Time ...............23Operations and Maintenance Costs Are Affected by the Ageand Size of the Project, Among Other Factors .....................24New Studies Continued to Find that Integrating Wind intoPower Systems Is Manageable, but Not Costless ..................26Solutions to Transmission Barriers Began to Emerge, butConstraints Remain .........................................27Policy Efforts Continued to Affect the Amount and Locationof Wind Development ........................................28Coming Up in 2008 ..........................................29Appendix: Sources of Data Presented in this Report ...............30Acknowledgements .........................................31
Primary authors
Ryan Wiser
Lawrence Berkeley National Laboratory
Mark Bolinger
Lawrence Berkeley National Laboratory
With contributions from
Galen Barbose (Berkeley Lab), Kathy Belyeu(AWEA), Ryan Cheney (George WashingtonUniversity), Lynn Coles (NREL), Sari Fink (Exeter Associates), Trudy Forsyth (NREL), MaureenHand (NREL), Donna Heimiller (NREL), MichaelMilligan (NREL), Andrew Mills (Berkeley Lab),Walt Musial (NREL), Kevin Porter (Exeter Associates), Ron Stimmel (AWEA), SuzanneTegen (NREL)
Annual Report on U.S. Wind Power Installation, Cost, andPerformance Trends: 2007
LBNL-275E
 
* Wiser, R.; Bolinger, M. (2007).
 Annual Report on U.S. Wind Power Installation,Cost, and Performance Trends: 2006
. 24 pp.; NREL Report No. TP-500-41435;DOE/GO-102007-2433,www.nrel.gov/docs/fy07osti/41435.pdf .
3Annual Report on U.S. Wind Power Installation, Cost, and Performance Trends: 2007
Introduction
 The U.S. wind industry experienced unprecedentedgrowth in 2007, surpassing even optimistic projectionsfrom years past. This rapid pace of development has madeit difficult to keep up with trends in the marketplace. Yet,the need for timely, objective information on the industryand its progress has never been greater. This report—the second of an ongoing annual series—attemptsto meet this need by providing a detailed overview of developments and trends in the U.S. wind power market,with a particular focus on 2007.As with the previous edition*, this report beginswith an overview of key wind power development andinstallation-related trends, including trends in capacitygrowth, in turbine make and model, and among windpower developers, project owners, and power purchasers.It then reviews the price of wind power in the UnitedStates, and how those prices compare to the cost of fossil-fueled generation, as represented by wholesale powerprices. Next, the report describes trends in installed windproject costs, wind turbine transaction prices, projectperformance, and operations and maintenance expenses.Finally, the report examines other factors impacting thedomestic wind power market, including grid integrationcosts, transmission issues, and policy drivers. The reportconcludes with a brief preview of possible developmentsin 2008. This version of the Annual Report updates datapresented in the previous edition, while highlightingkey trends and important new developments from 2007.New to this edition is a section on the contribution of windpower to new capacity additions in the electric sector, dataon the amount of wind in utility systems, a summary of trends in wind project size, a discussion of the quantity of wind power capacity in various interconnection queues inthe United States, and a section that underscores domesticwind turbine manufacturing investments.A note on scope: this report concentrates on larger-scalewind applications, defined here as individual turbines orprojects that exceed 50 kW in size. The U.S. wind powersector is multifaceted, however, and also includes smaller,customer-sited wind applications used to power theneeds of residences, farms, and businesses. Data on theseapplications are not the focus of this report, though abrief discussion on
Distributed Wind Power 
is providedon page 4.Much of the data included in this report were compiledby Berkeley Lab, and come from a variety of sources,including the American Wind Energy Association (AWEA),the Energy Information Administration (EIA), and theFederal Energy Regulatory Commission (FERC). TheAppendix provides a summary of the many data sourcesused in the report. Data on 2007 wind capacity additionsin the United States are based on preliminary informationprovided by AWEA; some minor adjustments to thosedata are expected. In other cases, the data shown hererepresent only a sample of actual wind projects installed inthe United States; furthermore, the data vary in quality. Assuch, emphasis should be placed on overall trends, ratherthan on individual data points. Finally, each section of thisdocument focuses on historical market information, withan emphasis on 2007; the report does not seek to forecastfuture trends.
Acronym List
 AWEA American Wind Energy AssociationBPA Bonneville Power AdministrationCOD commercial operation dateCREZ competitive renewable energy zoneDOE U.S. Department o EnergyEIA Energy Inormation AdministrationERCOT Electric Reliability Council o TexasFERC Federal Energy Regulatory CommissionIOU investor-owned utilityIPP independent power producerISO independent system operatorLBNL Lawrence Berkeley National LaboratoryMISO Midwest Independent System OperatorNREL National Renewable Energy LaboratoryPOU publicly owned utilityPPA power purchase agreementPTC production tax creditPUC public utility commissionREC renewable energy certiicateRPS renewables portolio standardRTO regional transmission organizationSPP Southwest Power PoolTVA Tennessee Valley AuthorityWAPA Western Area Power Administration
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