Presentation by: Randall Swisher, Executive Director American Wind Energy Association

1. Wind Market Overview COG Renewable Energy Seminar June 22, 2005 Presentation by: Randall Swisher, Executive Director American Wind Energy Association

2. American Wind Energy Association • The National Trade Association representing the Wind Industry in the U.S. • Over 700 Business Members, including: • Turbine Manufacturers • Component Suppliers • Project Developers • Electric Utilities • Lawyers, Consultants, Investors, etc.

3. Benefits of Renewables • Economic Development • Energy Cost Stability • Resource Diversity & Conservation • Environmental

4. Renewable Technologies Aren’t All the Same • Applications are Different • Economics are Different • Market Barriers are Different

5. Turbines: Different Sizes and Applications • Small(10 kW) • Homes (Grid-connected) • Farms • Remote Applications • (e.g. battery changing, water pumping, telecom sites) • Intermediate • (10-500 kW) • Village Power • Hybrid Systems • Distributed Power • Large (500 kW – 5 MW) • Central Station Wind Farms • Distributed Power • Offshore Wind

6. Different Types of Wind Power: Large Utility Power Plants Single Large Turbine Vermont Wind Farm Wind Farm Danish Offshore Wind Farm

7. Different Types of Wind Power: Small Small Turbines Serve Individual Customers Water Pumper Customer-Owned Small Generator

8. Different Types of Wind Power Individual Large Turbines for Municipal Needs Spirit Lake Schools, Iowa Traverse City, Mich. Utility

9. Wind Power Isn’t Perfect • Wind Power output varies over time • Wind Power can only meet part of your load • Wind Power is location-dependent • Wind Power is transmission-dependent • Wind Power has environmental impacts . . . But Wind Power has a Great Future!

10. Wind Is Growing Worldwide Global Wind Capacity More Than Tripled in Last Five Years • Germany: 16,629 MW • Spain: 8,263 MW • United States: 6,740 MW • Denmark: 3,117 MW • India: 3,000 MW Global Cumulative Total Over 47,300 MW by end of 2004 Source: AWEA’s Global Market Report

11. Wind Has Hit Sustained Takeoff in the U.S. • 2005 will be a record year – about 2,500 MW • 6,740 MW now installed • Market fundamentals are strong • Wind’s Competitive Posture Strong and Improving • No Longer “Alternative Energy” • Growing Interest Within Financial Community • U.S. Should be World’s Largest Wind Market Over Next Decade • Consistent policy is key current constraint

12. Inconsistent Policy Yields an “Up and Down” Market

13. Driving Forces Behind Wind’s Growth in U.S. • Wind’s Steadily Improving Economics • State Policy • Gas Price Volatility • Utility Experience and Perspective • Environmental Issues

14. Renewable Energy Standards MT: 15% by 2015 ME: 30% by 2000 MN: 19% by 2015 • 19 state standards • Technology, vintage, credit trading, sunset, location eligibility requirements differ RI: 16% by 2019 WI: 2.2% by 2011 MA: 4% by 2009 NY: 25% by 2013 CT: 10% by 2010 NV: 15% by 2013 NJ: 6.5% by 2012 MD: 7.5% by 2014 PA: 8% by 2020 CO: 10% by 2015 CA: 20% by 2017 IA: 2% by 1999 HI: 20% by 2020 AZ: 1.1% by 2007, 60% solar NM: 10% by 2011 TX: 2.7% by 2009

15. Wind Insures Against Fuel Price Risk • Platts “conservatively estimates that generating electricity from renewable sources can ultimately save consumers more than $5/MWh by eliminating fuel price risk”* *4/8/03 announcement re “Power Price Stability: What’s it Worth?” Great River Energy

16. Different Ways to Buy Renewable Energy • Rate Based as Part of Utility Portfolio • Green Pricing • No competition, monopoly utility offers customers choice of supporting wind power construction. • Green Marketing • In competitive market, customers empowered to choose service providers that contract to purchase renewables • Green Tags • Environmental attributes divorced from energy

17. Wind Energy is the Star of the Green Market! Represents 93.8%* of Green Power in the U.S. • Environmental Benefit • Cost-Competitive • Popular • Visual Appeal • Hydro and Gas Resources Complementary *Source: NREL, Sept. 2004

18. Benefits of Wind: Environmental • Reduced Greenhouse Gas Emissions 30,000 MW of wind energy in U.S. = 100 MMT/year cut in CO2 emissions • Reduced Air Pollution 30,000 MW of wind energy in U.S. = 250,000 tons/year cut in NOx emissions • Reduced Water Pollution U.S. wind capacity at 30,000 MW = reduced mercury emissions and healthier water for all Americans

19. What is Wind’s Market Potential? • At least 20,000 MW total installed by 2010 in U.S. • 6% of electricity supply by 2020 = 100,000 MW of wind power installed by 2020 = a $150 billion market!

20. What are the Barriers to a $150 Billion U.S. Wind Market? • Inconsistent Policy • Transmission constraints • Electric Industry Operational Rules • Siting

21. Wind Development in the Mid-Atlantic • Siting often challenging • Projects often smaller • Wind speeds lower than Great Plains • Green Market Important

22. Mid-Atlantic Wind Issues:Regional Collaboration is Essential • A Working Green Market in PJM Region • Implement a certificates-based energy tracking system • Green Power Standard Offer Service • Coherent Regional Policy • Regional RPS • Regional CO2 cap & trade • Clean Air credits/allowances for renewables • Transmission expansion and rules • Thanks for leadership

23. Contact AWEA www.AWEA.org RSwisher@awea.org Or write to American Wind Energy Association 1101 14th Street NW, 12th Floor Washington, DC 20005