The US wind power industry had a banner year in 2012, as developers raced to bring on projects before the federal production tax credit was set to expire at the end of the year. The frantic rush to take advantage of the tax incentive resulted in some impressive statistics highlighted in the American Wind Energy Association’s U.S. Wind Industry Annual Market Report for 2012, released Thursday.

Breaking Energy recently sat down with AWEA’s vice president of public affairs Peter Kelley ahead of the launch to gain some insight into what made 2012 so important and what to expect from the industry going forward.

The US wind power industry broke the 60 GW installed capacity threshold last year when it brought on an incremental 13,131 MW, which required over $25 billion in private capital investment, according to the market report. To put this in perspective, the Bureau of Economic Analysis twice revised its US GDP estimate upward in Q4 2012, partially due to the proliferation of wind projects, Kelley said.

“Kansas doubled installed wind power capacity which cost $3 billion,” said Kelley. Much of that investment is attributable to MidAmerican Energy, which is owned by Warren Buffet’s Berkshire Hathaway holding group.

Another famous US billionaire, Phil Anschutz, who made much of his fortune in oil & gas is getting into the wind business with construction of the nation’s largest wind farm in Wyoming. Technology-driven cost declines appear to be part of what is attracting investors to large-scale wind projects. Costs have decreased by 33% in the past 3 years said Kelley.

Indeed, declining costs related to advanced technology was the first thing Kelley mentioned when asked about major wind industry trends. “The industry will continue to wring out costs as economies of scale are built,” he said, and provided the following examples:

• Higher turbines – the industry standard used to be 80 meter towers and companies are now building 100 meter towers with longer blades, which take advantage of the stronger winds found at higher altitudes

• The new standard capacity nationwide is 2 MW and Vestas is even making 3 MW turbines, said Kelley, while GE was the top supplier last year. Higher towers and stronger turbines mean fewer units are required, increased efficiency and reduced wind farm footprints

• Carbon fiber materials and advanced shaping techniques are improving blade efficiency

• Gear box design is improving and some companies including Siemens are removing gear boxes all together in favor of direct-drive technology. Direct drive is attractive because there are fewer moving parts to lubricate and maintain over the 25- to 30-year wind farm lifetime.

• Sophisticated siting design is helping improve capacity factors by funneling wind more effectively through the farms

• Wind speed analysis and predictability has improved with the benefit of over 30 years of data

But while 2012 was a seminal year for US wind due to the pressure created by looming PTC expiration, many expect to see a dip in 2013 as the industry catches its breath. The US wind business has historically been characterized by PTC-driven boom and bust cycles and the future of the PTC remains a question mark.

“Who knows what congress will do?” asked Kelley, “right now [the industry] is trying to build as many wind farms as possible.”

He said the wind business wants predictability – something to plan long-term investments around – and uncertainty will hurt the US manufacturing base that has developed over the past few decades. Domestic manufacturing of wind turbines, parts and associated equipment has played a major factor in recent cost reductions because transporting equipment can account for up to 20% of a wind farm’s construction costs.

“At the end of the day the PTC is working. It’s possible something else could work, but there’s no use talking about it without a legislative vehicle to get there,” said Kelly.