What can surface wind observations tell us about interannual variation in wind energy output?

The past decade of wind power growth was supported by capacity factor improvements and associated cost reductions. But are higher capacity factors a technology success story or, as suggested by recent research, has the influence of technology been overstated by ignoring positive surface wind speed trends? The answer could influence estimates of wind energy's cost and even future deployment rates. We find that US surface wind speed observations imply a 2.6% improvement in capacity factors from 2010 to 2019. Yet newer vintages of wind plants have recorded capacity factors that are ~25% larger than plants built close to 2010. It follows that technological factors and improved site quality, not higher wind speeds, drove most of the improvement in capacity factors. Additionally, we match hundreds of meteorological stations to nearby (<25 km) wind plants and compare annual estimated generation, based on a function of surface wind speed observations, to annual recorded generation. Researchers rely on this publicly available surface data because measurements co-located with wind plants are generally considered proprietary. Our analysis addresses a research gap: interannual variation in observed surface wind speeds is rarely compared to observed data at wind plant locations and turbine heights. We find that despite its common use for this purpose, generation estimates based on publicly available surface observational data provide a poor proxy for interannual variability in recorded wind generation. These findings suggest that caution is generally needed when researchers use surface wind speed measurements to investigate long-term wind energy trends.