In America, the average cost of a kilowatt hour of electricity is now under $0.10 per kWh, according to reports from the New York Times and Bloomberg. This reduction in price since 2005 is a result of technology improvements and the expansion of wind power generation capacity. Additionally, the U.S. Federal Government has encouraged home owners to generate their own electricity at no cost to them as a result of renewable energy tax credits.
In Australia, the average cost of a kilowatt hour of electricity is now $0.16 per kWh, according to reports from the Australian Institute of Energy Management. Wind power now supplies 1% of the nation’s electricity needs. Australia’s population is about 30 million people. If the same percentage were applied to Australia’s total area, the nation would have an installed wind power capacity of 3.9 gigawatts (GW) of the nation’s electricity needs.
What is the current status of wind power in Europe? The average cost of wind power in Europe is $0.19 per kWh, according to information provided by the Renewable Energy Association of Europe. This is a 14% reduction since 2006 and represents 30 GW of the current installed capacity of 4.4 GW. Wind power contributes about 2.3% to Europe’s electricity consumption.
There are new statistics regarding the cost of wind energy from China. It is now cheaper to buy electricity from China than from France, Spain or the United Kingdom. Wind energy from China is expanding rapidly in that country. In 2007, China added 2.9 GW of wind power capacity. The expansion has been fueled by feed-in tariff programs. The government is currently offering tariffs of 3.9 cents per kWh to small wind power producers. The tariffs are set to decline to 0.3 cents per kWh over 4 years. The installed capacity of wind power from China is 7.3 GW.
How are wind turbines and wind farms financed in Europe? The cost of wind energy is not a major concern in Europe. It is more concerned with having a functioning wind farms. There are both public and private financing mechanisms. Countries such as France are promoting a feed-in tariff as a primary mechanism for financing new wind energy facilities.
In 2007, France set up 12.3 billion Euro as a wind farm fund. This fund is available to fund new wind energy projects. The European wind energy industry is growing. It is supported by various European governments, regional governments, municipalities and industries. The wind industry supports 100,000 jobs and contributes a minimum of 750 million Euro per year to the European GDP.
In the United Kingdom, the government is presently consulting on the introduction of a feed-in tariff. The UK government is well versed on how it can promote the “green” aspects of energy. For the moment, the feed-in tariff is being offered to smaller scale projects and wind farm developers. However, to capture the larger scale projects that will drive the future of wind energy, the UK government is offering a 30 year fixed price tariff.
The UK government is contemplating to make financial the installation of wind farm as they believe that this will encourage more entrepreneurs to invest in wind energy and grow the industry.