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Wind energy vs. natural gas – Comparison in costs

Wind energy is often touted as the most cost-competitive renewable source of energy but is wind power really in the same range of prices as the natural gas is? If we are to believe Elizabeth Salerno, AWEA’s director of industry data and analysis then “if you’re going to build a new wind farm, it is going to be competitive with any other new form of generation.” But things are not that simple as there are many factors that need to be included in this equation in order to work.

Wind energy is indeed cost-competitive with natural gas but only with subsidies. According to the official EIA's estimation the cost of a new onshore wind installation is at 9.7 cents per kilowatt-hour, while a natural gas plant has costs at 6.3 cents per kilowatt-hour.

Wind energy despite being the most competitive of all renewable energy sources still needs incentives to achieve cost parity with natural gas (for instance renewable energy production tax credit alone decreases wind power costs by 2.2 cents per kilowatt-hour).

It is true that natural gas (as well as other fossil fuels) is also subsidized but not as heavily as wind energy. However wind energy technologies are still developing while fossil fuels technologies are already developed and this is the main reason why wind power needs large subsidies.

If natural gas (readily available across the United States, and less polluting than coal) continues its current trend of popularity this could significantly slow down the further development of wind energy industry in United States.

Many Americans are not convinced that wind energy is the right answer for clean energy future, not only because of the higher costs but also because of the intermittency issue, which sometimes makes wind unreliable compared to natural gas and other fossil fuels.

There is no doubt that wind power requires science and technological innovations, not only to improve cost-competitiveness with fossil fuels but also to become more efficient and most of all more reliable.

 

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