By Ehren Goossens - Feb 5, 2013 10:48 AM ET
The U.S. will install more solar power in 2013 than wind energy for the first time as wind projects slump and cheap panels spur demand for photovoltaic systems, according to the head of Duke Energy Corp. (DUK)’s renewable-energy development unit.
The U.S. may install 3 gigawatts to 4 gigawatts of wind turbines this year, and solar installations will probably exceed that, said Gregory Wolf, president of Duke Energy Renewables.
U.S. wind projects have come to a near-standstill this year after the scheduled Dec. 31 expiration of a federal tax credit. Wolf anticipates more solar projects going into operation in 2013 than wind farms after panel prices fell more than 60 percent in the last two years.
“I would expect a lot of momentum still on solar,” Wolf said in an interview yesterday.
“We really ramped up our solar in 2010,” said Wolf.“Today most of the projects are half or less of the cost now than then.” Duke Renewables’ portfolio of renewable-energy projects exceeds 1.7 gigawatts.
The production tax credit, which provides 2.2 cents a kilowatt-hour for electricity from wind farms, was extended for a year on Jan. 1. Uncertainty over its fate spurred developers to race to complete wind farms by the end of last year and to not plan new ones. U.S. wind installations reached an estimated 11.8 gigawatts in 2012, according to data compiled by Bloomberg.
The U.S. installed about 3.2 gigawatts of solar power last year and may reach 3.9 gigawatts this year, according to Bloomberg New Energy Finance. Cheap panels and lower construction costs have been aided by policy support that “has been a little more consistent and long-term,” Wolf said.
Duke invested more than its $500 million target in renewable energy last year, and more than $2.5 billion to date, Wolf said.
“We’re not in this business just because we want a green halo for Duke,” he said.
The largest U.S. utility owner by market value enters into long-term power purchase agreements for wind and solar plants that have “an attractive profile in terms of risk and returns,” Wolf said. “If we find really good projects, we’ll see if we can find a way to make them work.”