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FIGURE 6.1 The expiration of Production Tax Credits in 1999, 2001, and 2003 impacted wind power growth in the United States 0.7 0.6 0.5 0.4 0.3 0.2 0.1 Year-on-year installed capacity growth (%) Total installed capacity (MW) 50,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 Percent MW 00 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Source: U.S. Energy Information Administration database (accessed May 30, 2013). to build turbine blades (which are similar to propellers) and large steel wind towers in their shipyards.16 Other factors that influence regional adoption of renewable energy include energy security (net fossil fuel importers are more likely to deploy renewables),17 expertise in high-tech manufacturing (which is correlated with how long countries have been using renewable energy technology),18 and income (which may help countries afford high energy prices and/or high regulatory costs related to the use of renewable energy).19 One study found that U.S. states’ use of renewable energy was negatively correlated with electricity use per capita, the percentage of petroleum and coal manufacturing in the state product, and deregulation.20 Incentives are often tailored to specific phases of renewable energy deployment.21 Initially, incentives try to provide the industry with a “jump start,” aiming to create consumer confidence, insulate investors from some financial risks, and overcome the lack of supply chains and other supportive infrastructure. Then, once the industry is established, policies become more focused on reducing costs, often through scheduled reductions in incentives based on fixed time periods or on installed-capacity benchmarks. Finally, in mature energy markets, policies try to accommodate daily fluctuations in supply and demand, facilitate the use of least-cost solutions for the system as a whole, 16 Industry representatives, interview by USITC staff, Hamburg, Germany, May 15, 2013. 17 IEA, “Renewable Energy: Policy Considerations,” November 2011, 27. 18 Widiantoro et al., “Porter’s Diamond,” November 6, 2011. 19 Marques et al., “Motivations Driving Renewable Energy in European Countries,” 2010. 20 Carley, “State Renewable Energy Electricity Policies,” 2009. 21 Industry representatives, interview by USITC staff, Bonn, Germany, May 14, 2013. 6-4PDF Image | Renewable Energy and Related Services: Recent Developments
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