- Wind is on a pathway to exceed gigaton scale by 2020 and attract $1.38 trillion in investment.
- Current projections show wind delivering approximately 1.5 gigatons of CO2e reductions in 2020.
- There is enough wind resource available for many times annual global energy consumption.
- There is enough wind resource available for more than 4 times projected annual global energy consumption in 2020.
- Wind could be cost competitive with fossil-fuel generation without subsidy in the next 10 years.
Global installed wind capacity of 560 gigawatts (GW), a little more than half a terawatt (TW), could avoid 1 gigaton of carbon dioxide equivalent (CO2e) emissions, assuming uniform displacement across the global emissions mix. With a constant annual growth rate of almost 14% - less than half the 28% annual growth of the last 12 years - wind power's CO2e abatement would reach a gigaton sometime in 2020. There is no shortage of wind resources to meet and exceed this goal. Roughly 72 TW of economically viable wind resources are estimated to exist on land alone, amounting to more than 4 times projected total world energy demand in 2010.
Wind power is the only large-scale, low-carbon generation technology that approaches cost competitiveness with existing fossil-fuel generation. Capacity-weighted wind power prices already are at or below annual average U.S. wholesale block rates at nearly two dozen locations nationwide.
The overall competitiveness of wind still depends heavily on policy support and subsidies such as the production tax credit (PTC) in the U.S. and renewable power quotas in China's Renewable Energy Law. But if current cost reduction trends continue and energy markets begin operating under a moderate carbon price, then wind power could be competitive without subsidy by 2020. The downsides of wind development - noise, visual intrusion, low capacity factor, high land intensity, and wildlife impacts - are balanced by co-benefits that include free, domestic fuel; modularity and easy scalability; very low life-cycle carbon emissions; conservation of fossil fuels and water; availability for centralized or distributed generation; and increased energy security.
Total investment required to reach the half- TW level globally from 2010 to 2020, with 10% real cost reductions and some improvement in capacity factors, would be just over $827 billion in undiscounted 2006 dollars, not including finance charges. Using U.S. median transmission costs and assuming those costs remain constant over time, total global transmission costs would add about $127 billion. If capital costs, transmission costs, and capacity factors are assumed flat over time - no technological gains, economies of scale, or other cost reductions - it would take almost a year longer to obtain a gigaton of CO2e abatement through wind power, and total costs including transmission would be $1.14 trillion.
If wind development remains on a likelier trajectory, as in the Global Wind Energy Council's moderate scenario revised for 2008 growth, then capital requirements in 2020 will be $1.38 trillion plus $210 billion in transmission, for a total of $1.6 trillion. These figures may underestimate necessary transmission investment overall, especially in China and India, and are based on assumptions that all renewable energy support policies remain in place, no significant new political opposition arises, and all renewable targets are achieved.
Reaching gigaton scale would take roughly 185,000 to 370,000 wind turbines. For comparison, U.S. factories turned out 300,000 military aircraft between 1939 and 1944 for World War II. Manufacturing these turbines by 2020 could create more than 1.3 million direct jobs, with an additional 560,000 jobs in installation, operations, and maintenance. The land footprint would be an estimated 113,400 square kilometers - about 3.1% of the land area in the U.S. or about 1% of the combined land area of the U.S., China, and the European Union (EU), for the use of 2-megawatt (MW) turbines on flat, windy land.
Significant, near-term barriers to continued rapid growth for wind power include managing variability at increasing penetrations and greater need for transmission. Wind resources often are far from load centers, and uncertain transmission siting and permitting can slow wind farm development. Wavering policy support - the on-again-off-again tax credits in the U.S. are a prime example - can stymie investment and development. Pricing carbon can stimulate wind development without other support policies, but the combination is especially effective. Our analysis suggests that typical Class 4 wind sites would become widely competitive at U.S. wholesale electricity prices if carbon prices were in the range of $42 to $56 per ton of CO2e, without tax credits or other subsidies, though other estimates based on very low, sustained natural gas prices can range almost twice as high.
Regardless of policy support on the supply or demand side, wind power is unlikely to continue to grow at current rates without addressing transmission and grid integration. The challenge of wind variability presents opportunities for innovation in storage, operations, and transmission that are shared by many other renewable and conventional energy sources. Although wind accounts for less than 5% of total energy in Europe and less than 3% in the U.S., utilities in Denmark, Germany and the U.S. Midwest and Southwest are finding large-scale wind produces vast energy at moderate costs. Expanding transmission and improving the coordination of renewable and conventional generators over larger regions, in concert with carbon pricing, hold significant promise for large-scale carbon emissions abatement.