The AWEA Blog: Into the Wind


Fact check: Chesser misinforms on wind incentives

Posted: 2011-10-19 Tom Gray

Relying on a mentor with a checkered past (Robert Bryce, whose misstatement and errors we have often commented on here), Paul Chesser of the National Law and Policy Center yesterday attacked Duke Energy CEO James Rogers for investing in renewable energy projects that receive federal incentives.

The answer is simple. As we have stated here repeatedly, recent studies show that renewable sources of electricity actually receive far LESS federal support than did “conventional” sources during similar periods in their development. As one particularly informative study by DBL Investors states: “Current renewable energy subsidies do not constitute an over-subsidized outlier when compared to the historical norm for emerging sources of energy. For example: … the federal commitment to [oil and gas] was five times greater than the federal commitment to renewables during the first 15 years of each [subsidy’s] life, and it was more than 10 times greater for nuclear."

It's hard to believe that the National Law and Policy Center would recommend a massive tax increase on an emerging energy industry, wind power, that has been extremely effective at keeping Americans at work and fostering a whole new American manufacturing sector. With the U.S. economic recovery still proceeding at a snail's pace, now is not the time to be boosting taxes on any industry that is growing and providing jobs.

Wind power's record in boosting economies, both rural and urban, is impressive.  Farmers and ranchers receive lease payments of up to $120,000 over 20 years for each wind turbine on their property.  At the same time, a growing number of Americans are working in the wind energy industry, especially in manufacturing.  Over 400 factories across 43 states now manufacture wind equipment, and 60% of a wind turbine’s value is produced here in the U.S., compared to 25% prior to 2005.
 
Wind energy’s cost has been reduced over 90% since 1980, driven by a continuing stream of game-changing technology advances.  Utilities are increasingly choosing to rely on wind, recognizing its ability to guarantee low electricity rates for the long term.  In fact, wind power has provided 35 percent of all new electric capacity in America over the past four years, more than coal and nuclear combined.
 
The federal wind Production Tax Credit, wind power's primary incentive has been allowed to expire periodically since its inception in 1992, creating a boom-bust cycle. When taxes on the industry have increased, wind energy installations have dropped as much as 93%. Extending the PTC will help wind power become increasingly cost-competitive and keep generating badly needed income and taxes for rural communities. Failure to extend it will roll back the progress America has made in diversifying our electricity generation portfolio with this clean, affordable, homegrown energy source.

More reading:

Fact check: Bryce errs on incentives, wind's popularity, October 13, 2011
Don't increase taxes on clean energy, September 26, 2011
New report gives best 'apples to apples' picture to date of federal support for all energy sources, September 23, 2011
Wind incentives: Leveling the playing field, August 17, 2011


4 responses

  1. Jon Boone October 19, 2011 05:25PM
    Tom Gray has long been an AWEA disinformationer. Wind technology differs only in degree, not kind, from its performance in 1811. It remains a misfit in any modern power portfolio, since it cannot produce modern power without huge supplementation, which supplementation almost wholly subverts its reason for being. The diffuse energy from the wind and the fact that any wind machine's energy conversion is held hostage to the cube of the wind speed along a narrow speed range, means that wind must always be a hiccuping, tail-wagging-the-dog contributer to any grid system where supply and demand must always be perfectly matched. Attempting to stiff arm the stern reality of wind subsidies, which the EIA has stated are 26 times greater than for fossil fuel generation on a per kWh production basis, by stating that wind receives less than conventional power at similar periods in its development, is risible. It's utter nonsense, given that wind technology has been at the public trough in the United States for more than 40 years and has received scores of billions of dollars for "research and development." Every five years or so, people like Gray proclaim that wind will soon be able to compete on its own, without subsidies, This mantra began in the 1970s and reached fever pitch in the 1990s as Enron took up the chant. Such a ploy can only be successful in a society without a functional sense of history. Or a mainline media that couldn't hit water with an accurate story about "renewables" if it fell out of a boat. Gray and his ilk should be prosecuted for bunco, since none of their claims about this dysfunctional technology can withstand scrutiny.
  2. Tom Stacy October 19, 2011 03:51PM
    It is encouraging to see AWEA jumping out with character attacks as their leading defensive statement to Robert Bryce's recent article. Only when a party such as AWEA realizes they have lost on technical and scientific grounds, would they attempt to distract their audience from the technical and scientific reality. In usual AWEA style, the only "simple" argument they make, is made inaccurately, non-specifically, and without the references and citations required to back up their claims. This section is particularly egregious: "The answer is simple. As we have stated here repeatedly, recent studies show that renewable sources of electricity actually receive far LESS federal support than did “conventional” sources during similar periods in their development." If subsidies for nuclear power were ten times those for Shepard's Flat Wind, they would amount to 600% of project costs! The proper metric for subsidies is $/MWH of CAPACITY VALUE - not energy.
  3. Russell C October 19, 2011 02:11PM
    Not sure what relevance Paul Chesser / Robert Bryce have to do with the wisdom of investing in wind power, when this source of energy faces the more problematic question of why ANYBODY would want to invest in it, considering how the entire industry would probably die outright in the open marketplace without Federal subsidies. Having some familiarity with the wind turbines in western Pennsylvania, it didn't especially surprise me that a decision was made in recent days to shut them down at night because one of them diced up some rare bat. Combine this with environmentalists' growing protests about wind turbines chopping up various other endangered birds during the daytime, complaints of people living nearby about the incredibly annoying noise they make, complaints of how rows and rows of them aren't very nice to look at, and the lack of power they make when it isn't windy, and you have an industry that doesn't make particularly good economic sense for James Rogers or anybody else for that matter.
  4. John Dorz, jr. October 19, 2011 01:55PM
    I had an interesting conversation with the head engineer of NYSERDA. I asked him where was the scientific proof that wind energy was cost-beneficial? His answer: "Wind energy has been around for over a thousand years, so that's enough proof in itself." I then asked him" Well if that is your position, then why does wind energy need such subsidies and support (e.g. more 2010 federal subsidies than all conventional sources combined: EIA"? Without batting an eyelash he said: "Wind needs a lot of subsidies because it is an infant industry." The authors here evidently support that same inconsistency as they are comparing apples to oranges. Nuclear (for example) is reliable — wind is not. Nuclear is dispatchable — wind is not. Nuclear is concentrated — wind is not. etc. Those are some of the many good reasons to support them during their infancy. We abandoned wind energy over a hundred years ago (just like we did horse-drawn vehicles) to become a modern society. Should we subsidize the horse vehicle industry as well? Doing so will reduce fossil fuel use and produce LOTS of jobs! Using the thinking from the wind lobbyists, the answer would be a resounding yes.

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