Some are calling recent clean-energy actions by New York, Massachusetts and Iowa “game-changers.” That might very well prove true in the medium-term. But we can say with confidence that they are immediate game-advancers.
Why? Energy markets are affected by policy, but they are driven by price. The underlying business reality is that the real cost of wind power has dropped below that of new fossil-fuel generation. And it’s making wind and renewables a no-brainer choice for major corporations, utilities and power producers of almost every stripe.
Today, states are at the epicenter of America’s renewable energy revolution. And, because we have 50 state energy markets, big positive advances in state policy can accelerate the pace of this historic shift.
Consider that New York, the 3rd-largest U.S. state economy, has now committed to meeting 50 percent of its power needs from clean, reliable, low-cost energy sources such as wind by 2030. That makes it the 5th state to commit to a 50 percent or more target for clean power, joining Oregon, Hawaii, California and Vermont. Other states such as Kansas, whose wind energy production has nearly tripled in the past five years, have voluntary aims to achieve up to 50 percent of their electricity needs through wind energy.
In Massachusetts, the legislature approved and governor signed an energy bill committing to purchase 1,600 megawatts (MW) from the nascent U.S. offshore wind industry, an action that promises to extend large-scale U.S. wind energy development from the land to the sea and power dozens of East and West coast urban centers.
And just last week in Iowa, currently the only state to generate more than 30 percent of its energy from wind, the Iowa Utilities Board approved plans by MidAmerican Energy, a subsidiary of Warren Buffett’s Berkshire Hathaway Energy, to invest $3.6 billion for up to 2,000 MW of wind capacity. Once completed, the new 1,000-wind-turbine project promises to be the largest yet in MidAmerican’s history.
These states aren’t alone. Others also stand out for their leadership this year on renewable energy, including Maryland, Washington, D.C. and Oregon.
In fact, fully 29 states now have renewable energy portfolio standards designed to spur clean power development, diversify our electricity supply, generate local economic growth and jobs, conserve scarce fresh water and also reduce pollution.
Despite the drama playing out in the courts over implementation of the federal Clean Power Plan, most states are continuing to move forward with their plans to provide more domestic renewable energy to their constituents and ratepayers.
States are doing so because they have listened to the markets, and the marketplace has spoken. The smart money is backing low-cost renewable energy, especially wind. That includes major companies such as Amazon, Apple, Google, IKEA, Microsoft and Walmart.
Wind is winning in the marketplace because its real costs are down more than 66 percent since 2009. Wind is already the lowest-cost clean energy by a large margin. Indeed, across a large swath of central U.S., in states such as Texas, Oklahoma and Iowa, wind is now the cheapest source of newly installed power from any energy source — clean or fossil fuel.
In 2015, the low cost and long-term pricing certainty offered by wind energy made it the number one source of new U.S. electric capacity, supplying 41 percent of the nation’s generating capacity additions, ahead of natural gas, solar and all other energy sources.
States get it. They get the fact that renewable power, wind in particular, is the lowest-cost energy choice.
States also get that the American public is demanding it. Who wouldn’t want a clean-energy source that can save ratepayers dollars on their utility bills? Indeed, the Department of Energy’s (DOE) Wind Vision report projects that Americans will save almost $150 billion on their electric bills by 2050 in the switch to low-cost wind power.
Not surprisingly, polls show that wide majorities of voters — Republican, Democrat and Independent — strongly support continuing these successful clean-energy policies.
A growing number of utilities, including MidAmerican Energy, Xcel and Alliant, also get it. AWEA’s U.S. Wind Industry 2nd Quarter 2016 Market Report confirms utilities are moving forward with 2,600 MW of new wind investment. Last year more than 4,300 utility-scale wind turbines were installed in 20 states, says DOE’s 2015 Wind Technologies Market Report, helping drive America’s world leadership in wind electricity generated.
As more and more states see their neighbors passing legislation and taking other steps to encourage more wind and other renewable energy, they don’t want to risk being left behind. A dozen states already meet more than 10 percent of their energy needs with wind power. The switch is on.
Recalling the words of the recent Broadway hit ‘Hamilton’, America’s clean energy revolution is being led by states whose leaders are “young, scrappy and hungry.”
Like the American revolution that Alexander Hamilton and others led more than two centuries earlier, the switch to low-cost renewables to power America’s energy future is undeniable. And it just makes sense.