Association for Public Policy Analysis & Management

In response to global climate change and energy security concerns, increasing the share of renewable energy in the electricity supply has been proposed as a promising solution in the United States. Among all types of renewable energy technologies, US has experienced tremendous technological progress in wind power over the past two decades and has become the world’s largest wind power country in terms of annual wind generation since 2008. This paper examines the determinants of technological change of wind power in US from a learning perspective. Based on technological learning theories and collaboration theories, this paper uses a panel of 576 utility-scale wind projects between 2001 and 2012 to test the effects of state level energy policies, as well as the impacts of different learning channels – learning through R&D in wind turbine manufacturing (learning-by-searching), learning from a wind farm operator’s previous installation and operation experience (learning-by-doing), learning from the experience of other firms (knowledge spillovers), and learning through collaboration among wind turbine manufacturer, project operator, and the transmission distribution system owner (learning-by-interacting) — on technological change in the US wind industry. This paper focuses on two aspects of technological change, which are the performance improvement in wind farm installation and wind farm operation respectively.

Preliminary results suggest that a turbine manufacturer’s R&D improves the wind farm performance right after the installation stage. However, experience from the wind farm operator matters more for the operational performance over time. Particularly, the wind farm operator’s interaction with turbine manufacturers and the transmission distribution system owners greatly improves wind farm productivity. In addition, the evidence of knowledge spillovers within a state and the impacts of production-based policies including production tax credits and the RPS policies provide supports for state level energy policies that encourage wind power generation.