Each year, the U.S. Department of Energy's Energy Information Administration (EIA) publishes a forecast of the domestic energy economy in the Annual Energy Outlook (AEO). During the forecast period of the AEO (currently through 2020), renewable energy technologies have typically not achieved significant growth. The contribution of renewable technologies as electric generators becomes more important, however, in scenarios analyzing greenhouse gas emissions reductions or significant technological advancements. We examined the economic assumptions about wind power used for producing forecasts with the National Energy Modeling System (NEMS) to determine their influence on the projected capacity expansion of this technology. This analysis should help illustrate to policymakers what types of issues may affect wind development, and improve the general understanding of the NEMS model itself. Figure 1 illustrates the model structure and factors relevant to wind deployment. We found that NEMS uses various cost multipliers and constraints to represent potential physical and economic limitations to growth in wind capacity, such as resource depletion, costs associated with rapid manufacturing expansion, and grid stability with high levels of capacity from intermittent resources. The model's flexibility allows the user to make alternative assumptions about the magnitude of these factors. While these assumptions have little effect on the Reference Case forecast for the 1999 edition of the AEO, they can make a dramatic difference when wind is more attractive, uch as under a carbon permit trading system. With $100/ton carbon permits, the wind capacity projection for 2020 ranges from 15 GW in the unaltered model (AEO99 Reference Case) to 168 GW in the extreme case when all the multipliers and constraints examined in this study are removed. Furthermore, if modifications are made to the model allowing inter-regional transmission of electricity, wind capacity is forecast to reach 214 GW when all limitations are removed. The figures in the upper end of these ranges are not intended to be viewed as reasonable projections, but their magnitude illustrates the importance of the parameters governing the growth of wind capacity and resource availability in forecasts using NEMS. In addition, many uncertainties exist regarding these assumptions that potentially affect the growth of wind power. We suggest several areas in which to focus future research in order to better model the potential development of this resource. Because many of the assumptions related to wind in the model are also used for other renewable technologies, these suggestions could be applied to other renewable resources as well.

This article summarizes a comprehensive empirical analysis of U.S. Energy Service Company (ESCO) industry trends and performance. We employ two parallel analytical approaches: a comprehensive survey of firms to estimate total industry size and a database of ~;1500 ESCO projects, from which we report target markets and typical project characteristics, energy savings and customer economics. We estimate that industry investment for energy-efficiency related services reached US $2 billion in 2000 following a decade of strong growth. ESCO activity is concentrated in states with high economic activity and strong policy support. Typical projects save 150-200 MJ/m2/year and are cost-effective with median benefit/cost ratios of 1.6 and 2.1 for institutional and private sector projects. The median simple payback time is 7 years among institutional customers; 3 years is typical in the private sector. Reliance on DSM incentives has decreased since 1995. Preliminary evidence suggests that state enabling policies have boosted the industry in medium-sized states. ESCOs have proven resilient in the face of restructuring and will probably shift toward selling "energy solutions," with energy efficiency part of a package. We conclude that a private sector energy-efficiency services industry that targets large commercial and industrial customers is viable and self-sustaining with appropriate policy support both financial and non-financial.

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