Wind Power

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 90 companies in the US use wind power to drive a turbine and produce electric energy, which is provided to electric power transmission systems or electric power distribution systems. Utility-scale turbines are generally defined as turbines that exceed 100KW in capacity, but typically range from 1.5 to 7.5MW. Wind energy accounts for about 8.4% of total US electricity generation and about 55.6% of electricity generation from renewable energy, according to the EIA.

“NIMBY” Opposition

Wind farms often face opposition from local residents concerned about noise, aesthetic impacts, and harm to bird populations.

Dependence on Government Support

The Inflation Reduction Act (IRA) was signed into law in 2022 and it extends tax credits for renewable energy projects for 10 years, which the IRA’s supporters say will bring certainty to project planning instead of Congress needing to renew the credits every few years.

Industry size & Structure

The average wind electric power generator employs about 75 workers and generates about $88 million annually.

    • The wind electric power generator industry consists of about 90 firms that employ about 6,900 workers and generate almost $8 billion annually.
    • The industry is highly concentrated; the top eight companies account for 84% of industry revenue.
    • Large firms include Clearway Energy, Energy Capital Partners, and Caithness Energy.
    • Large owners of wind capacity include NextEra Energy, Berkshire Hathaway Energy, Avangrid, and EDP.
    • Wind energy accounts for about 10.2% of total US electricity generation and about 47.6% of electricity generation from renewable energy, according to the EIA.
    • More than 70,800 land-based wind turbines operate across 44 states, Guam, and Puerto Rico and represent more than 435 billion kilowatt hours (kWh) of electricity generation capacity.
    • Texas, Oklahoma, Iowa, Kansas, and Illinois produced about 57% of total U.S. wind electricity generation in 2022.
    • Alta Wind Energy Center in California is the world’s second-largest wind farm generating 1,548 MW of electricity. Block Island Wind Farm off the coast of Rhode Island was the US’ first offshore wind farm.
                              Industry Forecast
                              Wind Power Industry Growth
                              Source: Vertical IQ and Inforum

                              Recent Developments

                              Mar 8, 2024 - Pace of Wind Development Lags Projections
                              • After the passage of the Inflation Reduction Act (IRA) in 2022, several research groups created projection models for anticipated gains in renewable energy and electric vehicle (EV) deployments, according to Utility Dive. Researchers have found that while 2023 solar installations, EV purchases, and battery storage kept pace with or surpassed projections, wind development fell behind, according to Anand Gopal, executive director of policy research at Energy Innovation. Wind generation capacity additions fell to 6.3 gigawatts (GW) in 2023 compared to 14.5 GW deployed between 2020 and 2021. A lack of transmission availability near ideal wind farm locations and higher costs have hindered wind development.
                              • Grids expect strong electricity load growth in the coming years amid increased investments in manufacturing, data centers, and the electrification of transportation and buildings, according to construction consultancy and investment banking firm FMI. Load growth, including that powered by renewables, is expected to see an average annual growth of 5% after remaining closer to 0% over the past decade. Total US spending for power projects is forecast to increase by 11% in 2024, according to FMI. Power spending growth will slow to 2% in 2025, 3% in 2026, and 2% in 2027.
                              • A recent report by Wood Mackenzie suggests that while the Inflation Reduction Act will likely continue to guarantee renewable energy tax credits at least through 2050, the decarbonization of North America’s energy sector faces challenges. Key headwinds include prolonged processes for connecting new energy sources to the grid, higher long-term costs for development across all power sources, and concerns about grid reliability. While efforts to streamline the grid interconnection process are ongoing, the benefits of reforms are unlikely to be felt until the late-2020s or early 2030s. Natural gas is expected to remain the leading determinant for all energy prices as coal is phased out, and gas remains the only bridge source for energy amid ongoing renewables development.
                              • A renewable energy transmission line start-up recently announced a fresh round of funding from European investors that the company hopes will help it break the bottleneck of bringing solar and wind energy to large cities from remote generation sites, according to The Wall Street Journal. Local opposition has been a major hurdle for the permitting of transmission lines required to bring renewable energy to population centers. Meanwhile, the wait for renewable projects to connect to the grid keeps growing. In December 2023, start-up firm EnergyRe raised $1.2 billion from European investors to help bring more renewable energy to market, primarily by focusing on projects that face the fewest potential permitting roadblocks. An EnergyRe project in New York is moving ahead as transmission lines will run mainly through state-owned land. Another transmission line that will bring power from Iowa to Chicago will run along railroad tracks.
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