Wind energy muscled out of Pennsylvania market

Source: By David Conti, Pittsburg Tribune • Posted: Monday, May 18, 2015

After a decade of growth, Pennsylvania’s wind energy industry finds itself in the doldrums.

No new wind farms have come online in more than a year, and no development is expected soon. Advocates say cheaper fossil fuels have muscled wind out of the market, and uncertainty over government support of the sector makes utilities wary of long-term contracts that investors require.

“The market signals are not inducing new build,” said Jim Spencer, CEO of Strip District-based EverPower, an owner and developer of wind farms that include four sites in Pennsylvania. “It’s very difficult without relatively long-term secured revenue.”

Constant political battles over subsidies that would help wind compete cloud its financial future, supporters say. But wind’s failure to establish a foothold in Pennsylvania — it generates just 1.5 percent of the state’s electricity despite incentives — makes further subsidies unpopular, critics say.

“If this worked, I’d be for it. But from what I’ve seen, they don’t work enough,” said state Sen. John Eichelberger, a Cambria County Republican whose district is dotted by several wind farms.

He cited low output among his complaints about wind: The state’s 720 turbines have a combined capacity to produce 1,340 megawatts, enough to power about 300,000 homes. But that’s only when the turbines capture enough wind to spin 24-7, and a single coal- or gas-fired plant can produce more electricity more reliably.

“It’s not worth the public money and all the inconvenience that comes with it,” Eichelberger said.

Spencer has not given up on wind power, though, as he sees potentially good signs in government policy. Despite a cycle of expirations and renewals of a federal tax credit for producers, wind farm development is up in other states, including Texas, where wind accounted for 10 percent of generation last year.

EverPower’s next project coming online next year is in Grant County, W.Va., where Spencer said high winds on a ridge make greater output likely. The company also is eying a potential large project in Montana.

The Environmental Protection Agency’s proposed Clean Power Plan targeting greenhouse gases from coal-fired plants will force states to find more renewable sources of electricity.

“We’d be better off building the infrastructure that enables us to get wind from Pennsylvania to Kentucky and Virginia,” Spencer said of export possibilities.

A state law, the Alternative Energy Portfolio Standard, requires more renewables in the generation mix here over the next few years, so he expects demand to increase.

Gov. Tom Wolf’s administration appears supportive of the industry. Wolf’s proposed budget includes a bond program that would provide $20 million “to increase the state’s fleet of wind energy plants,” according to recent testimony from acting Department of Environmental Protection Secretary John Quigley.

He told lawmakers in March that the state could help revive the wind industry by providing assistance.

“I think there is a role for wind. Every increment in low-emissions or no-emissions energy generation is going to be important,” he said.