This is the type of news you'd expect in Europe, not the US, and it shows signs of a serious shift inside the world's largest fossil fuel consumer. It's not the tree-hugging arguments that are driving up wind power demand, but rather the soaring oil prices. Bringing wind power to the US electricity consumer as Xcel has done with its Windsource product will probably become the norm among utilities in states with RPS requirements, if it's not already.
Now, the bad news: unfortunately, the firm states in the article that it's not sure about adding more wind power to its portfolio because of soaring turbine prices. We've heard this before - and it's the old US energy policy chicken-or-egg quandary. Turbines are expensive because of raw material (steel) costs, yes, but also because there is a lack of competition in the market. There is a lack of competition in the market because it's risky for European suppliers to set up shop in the US. That risk is due to sporadic tax incentive support for wind.
There will be more and more consumers clamoring for cheaper, cleaner renewable energy over the next 2-3 years as oil and gas remain expensive. Turbine suppliers seeing this demand should, to some degree, factor it into their risk assessment when deciding whether or not to enter the US - popular and political momentum is building for a long term renewable incentive. As is, wind loses out on an early opportunity here to leverage its cost advantage.
Comments