A new report from Bank of America Merrill Lynch Global Research (NYSE:BAC) suggests that America's wind industry will endure a sluggish 2010.
For the past five years the U.S. wind industry has grown an average of 39% annually. The Bank of America Merrill Lynch analysts do not foresee that growth continuing this year. In fact, they do not see industry growth picking up until 2012.
The analysts point to a couple of indicators as the basis for their conclusions. First, power prices for wind energy are much less competitive than they have been in the past. Current prices for wind power have dropped to between US$40 and US$50. This is close to US$20 less than wind energy has sold for in recent years through power purchase agreements.
Second, the BoA Merrill Lynch report states that a national renewable portfolio standard, which would spark instant demand for wind power, will not be passed this year.
As a result, the report concludes that only 7,000-megawatts of new capacity will be installed in the United States in 2010, lower than other estimates, and lower than last year's total -- largely considered a slow recovery year for the industry.
Read the full story at Reuters: BoA Merrill Lynch says bearish on U.S. wind demand
Nathanael Baker is the Managing Editor of EnergyBoom. He has researched and reported on the issues of renewable energy, sustainability, and climate change for over two years. He has provided research to the New York Times and The Economist, as well as being published on different media outlets including, The Energy Collective.
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