The Great Texas Wind Swindle: Property Owners vs. the State (Part I)
Editor Note: Sam Pakan (full biography below) is a rancher and writer living in Wheeler County, Texas. Part II discusses the environmental controversy regarding Texas’s latest wind development push.
The eastern Texas Panhandle, a land of rolling sand hills, tree-lined creek beds and tall grass vistas, may seem a desolate place to outsiders. Still, it has its beauty, especially to the cattle ranchers and wheat farmers who work and live on it. But not for long.
Much of this land–the fragile habitat of the Lesser Prairie Chicken and the Whooping Crane–is scheduled to become industrialized if the Texas Public Utility Commission (Texas PUC), the Department of Energy (DOE) and Federal Energy Regulatory Commission (FERC) have their way. Incongruously, the demolition of this mostly native grassland is being proposed in the name of green energy. And this project is wholly government-dependent in a sector where suppliers do not have to be taxpayer enabled.
The Competitive Renewable Energy Zone (CREZ), a name not without irony, was initiated by $10 million from DOE. In December of 2009, plans were expanded when Secretary Chu joined Jon Wellinghoff of FERC in a Memorandum of Understanding to coordinate efforts to interconnect several transmission lines. The CREZ line, part of the larger Electrical Reliability Council of Texas (ERCOT) system, is to help supply the Dallas/Fort Worth Metroplex with wind-generated electricity from the northern Texas Panhandle.
There are problems, however, with the multi-billion-dollar nowhere-to-somewhere transmission project. Protests from disgruntled landowners have greeted Cross Texas Transmission (CTT), the developer of the Gray-to-Tesla and Gray-to-White Deer lines.
Fanning that resistance, landowners received a “Access Consent Form” the day before Thanksgiving insisting that their lands be made available for survey. With the long weekend, landowners had only two working days to find representation, prepare a response, and still meet CTT’s deadline.
CTT, acting under the auspices of the Texas PUC, has been given the power of eminent domain (compulsory acquisition). With that looming over their heads, most landowners signed but added wording insisting Cross Texas Transmission follow established environmental laws, the same wording and the same laws now required on state-owned lands. Cross Texas responded to their request by issuing restraining orders and suing for entry without restraint.
The action was not surprising. Since having been awarded the contract to construct, operate, and maintain these lines in October of 2009, Cross Texas has consistently reminded landowners that they have no options and has refused to address any of the economic or environmental problems created by the transmission lines.
Taxpayer Subsidies, Ratepayer Pain
According to the Texas Public Policy Foundation, wind energy in Texas will have in excess of $28 billion in subsidies, federal and state, poured into its development by 2025. When tax breaks, market disruptions, increased production and ancillary costs are added in, the taxpayer’s bill could top $60 billion.
In spite of the massive funds being thrown its way, wind-generated electricity remains far more expensive for consumers than that produced from coal, gas or from nuclear facilities. It’s also severely compromised by its intermittency (the wind does not always blow).
As a result, continued expansion of wind fields could raise rates paid by consumers by as much as 50 percent, even with the massive federal and state subsidies. The impact to small businesses and to those on fixed incomes could be devastating. Moreover, many experts believe that, due to the intermittent flow and low energy flux, wind generated electricity can never be competitive.
Energy Density: Nuclear vs. Wind
Science and Technology writer Gregory Murphy compared the energy flux density of the Comanche Peak nuclear plant south of Dallas to a hypothetical wind installation. The nuclear plant has two units capable of generating 2,500 megawatts and sits on only 4,000 acres which includes a man-made cooling lake that is open to the public and is used for recreation. Taking into account that the average wind turbine has a capacity of only 25 percent of its nameplate rated output, it would take 6,668 1.5 megawatt wind turbines to equal the output of the Comanche Peak station.
Spacing wind turbines at five per section of land, a rate somewhat higher than the density landowners were promised by wind farm developers, a wind installation equaling the output of the Comanche Peak plant would require well over 13,000 sections of land or 8.6 million acres. That is an area roughly 1/20th the size of Texas. All this land, plus the lands decimated by the transmission lines carrying electricity to major metropolitan areas, would have reduced productivity, severely increased erosion and drastically reduced property values—certainly no boon for landowners.
“Wind works only 25 percent of the time,” said Jeff Haley, rancher and Commissioner in Gray County, Texas. “And the CREZ line alone will cost 4.9 billion dollars. That’s a projected cost in 2008 dollars. It will almost certainly be more, but whatever it turns out to be, it will have to be paid for.”
“Don’t kid yourself,” said David Hall, another Gray County rancher. “The consumers will pay for much of this, and we’ll all pay for the rest with our tax dollars. It’s not just that I don’t want them on my land. It’s that this kind of government boondoggle is wrong. The politicians supporting these things don’t understand them. They’re being advised that this or that is the right thing to do, and they’re not informed enough to make the right decisions.”
“We’re dealing with Soviet-style technocrats,” Haley added.
The metaphor isn’t without basis. Cross Texas Transmission is a wholly owned subsidiary of J. L. Power Group, a Delaware shell corporation with no board of directors and only a few employees. SEC filings list Mikhail Segal, a one-time official in the Ministry of Energy in the former Soviet Union and Michael Liebellson as founders. From the outset, landowners say, Cross Texas Transmission has acted every bit the oligarch and used the PUC’s power of eminent domain as a weapon.
“These technocrats understand how to maneuver through the technicalities of the law.” Haley said. “It’s their job. They do it every day. How can we run our businesses and spend the time this is requiring to stand up to this kind of abuse?”
One of the maneuvers he is referring to is the Texas PUC hearings held last August. Three routes had been selected for the proposed Gray to Tesla line with one listed as the “preferred route.” Multiple landowners and attorneys were present to defend their properties from damage along this route. Without discussion, the Public Utilities Commission chose an alternate route automatically subjecting those properties not represented to eminent domain. The landowners on the route selected had received a notice that their lands could, at some point, be affected, but all assumed that only the preferred route would be considered at the hearing. None realized they would not have an opportunity to intervene specifically for their properties should the preferred route be rejected.
Beyond Property Rights: Performance
In addition to the issues of land spoilage and the usurpation of private property rights, the issue of viability is very much at the forefront. A number of wind power companies are currently being sued by utilities companies and municipalities for not being able to deliver the electricity they promised.
In Texas, three wind farms owned by NextEra Energy Resources LLC agreed to sell specified amounts of power annually to Luminant Energy Company beginning in 2002. When they failed to deliver the contracted amount, Luminant sued for $29 million in liquidated damages and won. A similar case occurred years earlier in Washington state, and observers of the wind industry are predicting a deluge of such cases in the future.
Headed Towards the Junk Pile
The Waxman-Markey Cap-and-Trade Bill may be momentarily dead, but there are persistent rumors of its resurrection. Even without it, proposals are floating through the halls of Congress which would offer billions more to wind developers and demand that as much as 20% of our electricity be generated from renewable sources. While these proposals are being discussed, three wind farms are cluttering the landscape of Hawaii, monuments in rust to the government’s imposition of a technology that simply does not work.
A similar situation exists in California. In a recent edition of The American Thinker, Andrew Walden discusses what was once the largest collection of wind farms in the world. “In the best wind spots on earth,” he writes, “14,000 wind turbines were simply abandoned. Spinning, post-industrial junk which generates nothing but bird kills.”
If and when federal funds cease to be shoveled into the wind projects now underway in Texas, most industry observers believe they will also be abandoned leaving the once swaying prairie an industrial junkyard of concrete, steel and fiberglass. Wind’s entry is bad for the environment; its exit will be the same. And this is “green”?
Sam Pakan is a rancher and writer living in in Wheeler County, Texas. He is currently producing beef for the health market, while writing a series of historical novels set in WWII. He also edits books for selected novelists.
Pakan holds a B.A. degree in English and political science and an M.A. in English literature from West Texas A&M University.