Familiar holiday rush a little different this time around

3 January 2014 by Carl Levesque Carl Levesque

If you’ve been around wind energy a little while, you know that it’s not unusual for the industry to rev up in the fourth quarter of a given year. The industry turned a little frenetic at the end of 2013, all right, but the nature of the activity was quite different from the usual holiday rush. Rather than reports streaming in about new projects going online, this year’s holiday news was filled with construction starts, turbine orders, and power purchase agreements.

Photo credit: David K. Clarke

The reason: the all-important tweak to the most recent Production Tax Credit (PTC) extension, which required that projects start construction by the end of 2013. Prior extensions required that projects must be completed and online by the deadline, usually December 31 of the year that the PTC was to expire. (The constant short-term, one- and two-year extensions—often enacted just prior to or even after expiration—and the resulting late-year construction rush and boom-bust cycle for the industry is a topic for another discussion.)

The start-construction language was crucial for the industry during 2013 and beyond because the latest extension did not come until Jan. 1 of last year. As a result, the industry operated for months during 2012 with the uncertainty of a scheduled Dec. 31 expiration. That caused the entire supply chain and development pipeline to virtually grind to a halt, and so it took months for the industry to ramp back up again in 2013. A one-year extension requiring that projects be completed by the end of 2013, therefore, would have had little impact on an entire industry that needed to start up again from a stationary position.

Thus, the deadline has passed, yet there’s plenty of work to be done for months to come. So let’s take a look at some of the activity that made up this year’s holiday rush. The industry developments discussed below, of course, merely add on to news already reported in the last issue of the Wind Energy Weekly for 2013, such as Vestas’s two orders announced in mid-December (one with EDF and the other with Enel), a First Wind power-purchase agreement, and a construction start by RPM Access on a Kansas project.

Vestas finishes 2013 with flurry of orders

Vestas kicked off the holiday week of Dec. 23 with the announcement that it received a 150-MW order from First Wind for multiple U.S. projects. That’s a solid order, but it gets better: The company could ultimately supply First Wind with up to 568 MW of additional turbines for multiple projects, the turbine manufacturer said. As part of the master supply agreement, Vestas will supply 75 V110-2.0 MW turbines to the 150 MW Route 66 project near Amarillo, Texas. Deliveries are expected to occur for Route 66 in early 2015 with commissioning in mid-2015.

The next day, on Dec. 24, Vestas announced an order that it said made 2013 its second-best year ever for the region. The company received a 110-MW order for 55 V100-2.0 MW wind turbines for a new project in the U.S. That order put Vestas over the 1,700-MW threshold for the year—second only to the 1,883 MW in sales the company recorded in 2010.

Gamesa secures turbine order with EDPR

Vestas wasn’t the only original equipment manufacturer (OEM) to add some late-year orders to its 2013 books. On Dec. 26, Gamesa said it has signed a framework agreement with EDP Renovaveis (EDPR) for the supply of up to 450 MW for EDPR U.S. projects that could go into 2016.

Under terms of the agreement, the OEM will supply up to 225 of Gamesa G114-2.0 MW wind turbines. The agreement represents the largest contract for Gamesa's G114-2.0 MW turbines to date.   

PNE WIND USA starts work on Chilocco Wind Farm Project

PNE WIND USA, a subsidiary of the Cuxhaven, Germany-based wind farm developer PNE WIND AG, said on Dec. 20 it has begun construction on the Chilocco wind farm project lin Oklahoma. During development of the 153-MW project, PNE worked closely with the Kaw, Otoe-Missouri, Ponca, Pawnee and Cherokee Native American tribes.