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Local Wind Subsidies: New York State’s Money-Road to Nowhere

Special political favor at the local, state, and federal levels have created an artificial industry: industrial windpower. Massive turbines have resulted in negative ecological and economic effects. Rural towns and countryside across the USA have become the dumping grounds for massive infrastructure producing a paltry amount of remote, unreliable energy.

For many enjoying rural life, in particular, an invasion by industrial wind installations has turned environmentalism on its head.

New York State has more than its share of such malinvestment and damage. State Comptroller Thomas DiNapoli recently reported that tax exemptions by NYS’s Industrial Development Agencies (IDAs) were not creating jobs and shifting tax burdens from mega-corporations to local residents.

As a result, we have the spectacle in Upstate New York of taxpayer-subsidized industrial wind installations driving people from their homes — while further endangering the populations of eagles, hawks, herons, cranes, bats, and all magnificent flying creatures. Rural wind power, in short, is not only a fiscal fairness issueit is an environmental issue of the first order. Washington, D.C. environmental groups, are you listening … ?

Background: Wyoming County Subsidies

The Wyoming County Industrial Development Agency (WCIDA) was established under New York State legislation and regulation as a “public benefit corporation.” Its mission “is to promote, encourage and attract economic development projects in Wyoming County that result in the retention and/or creation of job opportunities that will generate additional tax revenues.”

Supporting and attracting job-creating businesses is one thing, the IDA’s methodology is another, as told in a WCIDA recent press release: “Wind energy powers agency’s loan program.” In it, the WCIDA proudly reported redistributing “$3.2 million dollars over the last six years” that it had received from wind developers, to various businesses in the county.

The part they left out was that the money was first taken from taxpayers, ratepayers, and successful businesses. It was then given to Big Wind developers, who gave a tad bit of it back to the County, who then recycled some of those revenues back to businesses and people with the right connections.

What has been going on in our towns and counties (and across the nation) with industrial wind flies in the face of any meaningful concept of “public benefit.” By relying almost solely on Big Wind projects for funding, the WCIDA has blinders on when it comes to the numerous larger issues — civil, economic, and environmental– surrounding industrial-scale wind energy.

Furthermore, as reported in a May 2nd news article, NYS Comptroller Thomas DiNapoli found that

tax breaks provided by the state’s IDAs are not effective in creating jobs…. DiNapoli’s office has found no significant correlation between the provision of tax exemptions and the creation of new job opportunities. Since IDA tax breaks reduce the overall amount of taxable land and enterprises within New York municipalities, they effectively shift the burden of taxation onto local residents and small businesses.

In addition to providing few jobs and ultimately “shifting the tax burden onto local residents,” the IDA’s actions impose many other immeasurable negative impacts on the area. Besides making people ill and driving some from their homes, trashing peoples’ property values, and forever changing the character of the area – these giant bird killers (“Cuisanarts of the air,” as a Sierra Club official described wind turbines in a moment of candor) slaughter countless eagles, bats (already under serious threat from disease) and other magnificent flying creatures worldwide.

The mammoth footprints of industrial wind installations fragment prime habitats, drive species out of their nesting areas, and further threaten already endangered species with extinction.

Corporate Welfare ($billions, not millions)

The real “economics” of wind power are negative and hard to justify. Simply consider just a few of the taxpayer-funded corporate welfare programs that enable the industrial wind boondoggle to exist.

The $2.2 billion dollars of stimulus money given to renewables (mostly wind), 80% of which ended up going overseas. The “Section 1603 Direct Cash Grant Program” from the U.S. Treasury is worth 30% of the value of these industrial wind projects. The Production Tax Credit – PTC (aka: “Permanent Tin Cup”) pays another 2.2 cents per kilowatt hour.

Applying this to the Lackawanna Steel Winds Project in Lackawanna, New York), the project manager told us (in 2008) that each turbine cost approximately $5 million. (Could be much more by now, as in December 2010, the U.S. Energy Information Administration determined that the cost of new wind projects increased by 21% in the previous year.) That makes Invenergy’s proposed ‘Stony Creek’ project of 59 industrial wind turbines in Orangeville, New York worth approximately $295,000,000 – the 30% Direct Cash Grant totaling $88,500,000. There are nearly 250 wind turbines already up in Wyoming County. Do the math.

The PTC and 1603′s direct cash is a levy that all taxpayers must pay for an otherwise nonviable venture. Their real function is to generate income via tax avoidance schemes for rich multi-national conglomerates – and enable those conglomerates to use our tax and rate money as campaign contributions to ensure that friendly legislators and bureaucrats remain in power.

Still More Subsidies

In addition, the state of New York is involved. With the blessing of the NYS Public Service Commission, NYSERDA administers System Benefits Charges (SBC), Renewable Portfolio Standards (RPS) and a market in Renewable Energy Credits (RECs) – all subsidized by fees collected through your electric bills.

On a per kWh basis, wind receives 80 times the public subsidies received by fossil fuels, but produces no reliable electricity capacity and very few American jobs. In fact, for every green job that wind supposedly creates, it destroys two to four regular jobs – in large part due to “skyrocketing” electricity rates.

Why would anyone willingly pay for such an obvious “lemon”? Government is subsidizing defective machines, not because it will improve electricity generation (quite the contrary), but rather because politicians are enriching their friends in Big Wind– and in turn, Big Wind helps them get re-elected. They are pretending to challenge the status quo, while in fact they are reinforcing it big time, while playing shell games with ratepayer and taxpayer money via the IDA’s nefarious loan programs.

The IDA is now trying to convince us that our recycled taxpayer money is creating secondary jobs across the county, thanks to wind. Most likely, these jobs will be added to the Administration’s list of supposed “green jobs,” in continued attempts to hoodwink the American public as to how many jobs the Green Scam is actually producing.

Four Questions for WCIDA

In the face of this overwhelming evidence that wind power is a civilly, economically, and environmentally destructive energy option, the Wyoming County IDA wants us to believe that it is somehow a good idea to keep pouring money into a one-dimensional economic development plan.

The WCIDA needs to answer some critical questions:

1) Shouldn’t the IDA be worried about what happens to a county that is so heavily dependent on a single government program, when the government could suddenly end that program – which in the case of industrial wind is inevitable, because it is simply NOT economically sustainable?

2) Shouldn’t the IDA be concerned about the growing negative public realization that payoffs are being made by corporate interests to government agencies and elected officials, who then have a vested interest in perpetuating and expanding this taxpayer-funded industry in return for “donations”?

3) Doesn’t the IDA have a responsibility to ensure that the programs, projects and industries it supports and subsidizes first and foremost do not harm people, or destroy vital ecological resources – including bird and bat species that are vital to the county’s and region’s agricultural base, tourism and ecosystem?

4) Would the IDA support any other industry that had such harmful impacts on people and the environment?

Why should Wyoming County, the State of New York, the United States Congress and the US Fish and Wildlife Service be subsidizing, protecting and promoting the destruction of both peoples’ lives, and these valuable and endangered species? Why should they do it on the backs of taxpayers and ratepayers? New Yorkers and indeed, all Americans, need to know.

On July 13, the Ithaca Journal article, “Report says IDA investment fails to create jobs,” stated:

The annual analysis of Industrial Development Agency data, produced since 2009 by the statewide Getting Our Money’s Worth Coalition, shows ‘a widespread failure of New York’s main economic development tool to meet job creation goals.’ The analysis shows $182 million in IDA tax breaks went to companies that cut jobs, failed to create jobs, or didn’t promise to create any jobs.

All this suggests that the WCIDA would much better serve all of us by developing a comprehensive and diversified economic development plan that does not rely on recycled tax dollars from the wind farm scam– which will inevitably disappear.

Time for Change

A blowback has begun regarding the naked wealth transfer from taxpayers to Big Wind corporations, including from IDAs. On the Federal side, the U.S. House Energy Committee recently delivered a blistering report about the Section1603 wind energy subsidy program: Where Are The Jobs? In another recent article, “Wind Energy Jobs Mythat MasterResource, Lisa Linowes reported: “Seventy-five percent of the Section 1603 largesse was lavished on Big Wind, yet, despite billions of taxpayer dollars, the [wind] sector experienced a LOSS of 10,000 direct and indirect jobs in 2010.”

Thankfully, more and more U.S. taxpayers and ratepayers are waking up to the fact that our $16 trillion indebted nation cannot afford further taxpayer-generational theft. As a result, both the PTC and Direct Cash Grants corporate welfare programs are set to expire at the end of 2012. Still, fiscal conservatives have work to do to dismantle a highly-evolved system of state- and federal-financed corporate welfare.  The time for science-based energy policies is now.

——————

Mary Kay Barton, a retired health educator and small business owner in New York State, is a tireless advocate for scientifically sound, affordable, and reliable electricity for common Americans. She has served over the past decade in local Water Quality organizations and enjoys gardening and birding in her National Wildlife Federation “Backyard Wildlife Habitat.”

17 comments

1 Willem Post { 08.01.12 at 12:14 pm }

An excerpt from this article:
http://theenergycollective.com/willem-post/98061/irelands-wind-energy-export-plan

An Eight Billion Euro Tax Shelter: The financing would be primarily by Greenwire’s wealthy partners, many of them in the US, who use LLC-type entities created by financial sector firms on Wall Street and in London to enable wealthy individuals and others to take tax credits and depreciation write-offs to reduce taxable incomes; by special provision, almost the entire project can be written off in 5 years; so-called “5-year accelerated depreciation”.
http://www.telegraph.co.uk/earth/energy/windpower/9336027/Subsidies-for-onshore-wind-farms-to-be-axed-by-2020.html

All others, i.e., the other 99% of households and smaller businesses, would bear the brunt of the health, noise and visual impacts and the energy generating inefficiencies. See below. 

Note: Instead of the US government collecting proper taxes from these wealthy individuals, it would rather have greater budget deficits by subsidizing wind turbine buildouts and creating jobs abroad, instead of in the US.

Greenwire’s wind turbine project is an example of the undesirable outcomes of combining inequitable income and wealth distribution policies, flawed energy policies and ineffective economic development policies.

UK Government Support: The UK government needs to meet its 2020 RE targets, including 28,000 MW of wind turbines, in the face of increasing opposition to onshore wind turbines and decreasing wind turbine subsidies.

Because this project would require little investment by the UK goivernment and because the wind turbines would be located in Ireland, the government eagerly welcomed the proposed project.

Element Power, parent of Greenwire, and National Grid UK quickly signed a grid connection agreement to feed up to 3,000 MW of power into the UK grid; une fait accompli.

http://www.earthtechling.com/2012/07/ireland-prepares-to-feed-uks-wind-power-appetite/
http://www.masterresource.org/2012/08/local-wind-subsidies-more-waste-new-york-states-money-road-to-nowhere/

2 Mary Kay Barton: Local Wind Subsidies: New York State’s Money-Road to Nowhere | JunkScience.com { 08.02.12 at 8:49 am }

[...] MasterResource Share this:PrintEmailMoreStumbleUponTwitterFacebookDiggRedditLike this:LikeBe the first to like this. This entry was posted in Clean energy and tagged energy subsidies, government subsidies, really stupid idea, Wind power. Bookmark the permalink. ← Mine Succumbs To Obama’s War On Coal, Ohio [...]

3 New Mexico News and Views - Bringing You the News You Need to Know { 08.06.12 at 2:55 pm }

[...] York State, where they are dumping these giant wind installations throughout entire townships and rendering people’s homes worthless.” The aide replied, “Well, Senator Grassley is responsible for Iowans.” To which she said, [...]

4 Big Wind Boondoggle Supported By Big-Spending Republicans | The Strident Conservative { 08.06.12 at 9:29 pm }

[...] York State, where they are dumping these giant wind installations throughout entire townships and rendering people’s homes worthless.” The aide replied, “Well, Senator Grassley is responsible for Iowans.” To which she said, [...]

5 Big-wind boondoggle supported by big-spending Republicans | EPA Abuse { 08.07.12 at 7:11 pm }

[...] York State, where they are dumping these giant wind installations throughout entire townships and rendering people’s homes worthless.” The aide replied, “Well, Senator Grassley is responsible for Iowans.” To which she said, [...]

6 Big-wind Boondoggle Supported by Big-spending Republicans { 08.08.12 at 10:49 am }

[...] York State, where they are dumping these giant wind installations throughout entire townships and rendering people’s homes worthless.” The aide replied, “Well, Senator Grassley is responsible for Iowans.” To which she said, [...]

7 Recent Energy and Environmental News – 14th August 2012 « PA Pundits – International { 08.15.12 at 5:02 am }

[...] NYS Subsidies — a Road to Nowhere. [...]

8 Green fail … | pindanpost { 08.26.12 at 8:38 pm }

[...] Green Fail: Wind power subsidies become a sizable drain at all levels of government [...]

9 Local Wind Subsidies: New York State’s Money-Road to Nowhere | Madison Matters { 08.30.12 at 10:50 am }

[...] Click here to read the entire article. The article is from “MasterResource” – a blog dedicated to analysis and commentary about energy markets and public policy. This entry was posted in Uncategorized and tagged IDA, industrial windpower, Production Tax Credit, tax subsidies, wind energy. Bookmark the permalink. ← Permit annulled for Town of Richfield wind turbines [...]

10 Stanley H Roe { 08.30.12 at 2:41 pm }

Public support to develop renewable energy (wind, solar, bio-fuels) is a proper government function; it is part of a move towards energy independence and a better environment. Our state and local government has been investing in our future for a long time: think about the Erie and Chenango Canals. Remember that our towns floated bond issues so railroads could be built. Both brought jobs.

Fossil fuels leave a deposit over all our lands. Nuclear energy waste is concentrated and we know where it is and know how to isolate it, though we lack the political courage to act. Wind and solar have the least harmful environmental impact; renewable fuels are better than coal, gas and petroleum.

Windmills in our area are typically erected on hilltops where farmland is marginal at best, the poorest land is reverting to scrub and forest. A local benefit not mentioned in the article is a fair return to land owners who lease to the wind companies.

I agree that our tax codes should be changed so that wealthy people pay a fair tax on their income.

I also note that our town government has a responsibility to garner a reasonable tax benefit for our towns and school districts. No agreement should be written for more than five years at fixed ‘payment in lieu of taxes.’ There must be some kind of escalation clause that recognizes the point when ‘return on investment’ for the windmill investor increases and for inflation and other factors. The model should be that used by the county industrial development corporation now used to help other businesses grow and create jobs.

11 Mary Kay Barton { 09.01.12 at 12:52 pm }

Mr. Hoe,

You have repeated typical wind sales hype here. You are focused on getting money, while being completely ignorant of the realities of wind — i.e.: wind has virtually NO Capacity Value, costs more jobs than it creates, has NOT significantly reduced CO2 emissions anywhere, causes many ill effects in those stuck living within the massive footprints, depreciates property values, kills hundreds of thousands of birds and bats a year — thereby destroying the very environment wind proponents claim they wish to save.

The chump change communities receive for agreeing to prostitute their land and communities to Big Wind developers is first stolen out of the pockets of ALL taxpayers & ratepayers. Robbing Peter to pay Paul doesn’t benefit anyone – especially when they’re both already $16,000,000,000,000 in debt! See: http://windtoons.com/images/Wind-farm-tax—Farmers-Wallet-150.gif

NYS wind’s average output from 2008 – 2010 was an absolutely pathetic 18%. Only the government would steal our money to give it to rich, mega-corporations for something that is only 18% efficient. What a joke! See: NYS Wind: Much Ado for So Little at: http://www.windaction.org/faqs/31912 .

After more than 20 years, and $Billions and $Billions in tax breaks, grants and loan guarantees to already RICH mega-corporations — which the NYS Comptroller said is “shifting the tax burden onto local residents and small businesses” — wind provides a paltry 1% of nationwide output. Wind is a failure on every single metric except CORPORATE CRONYISM, or as Mussolini called it, “corporatism.”

As DeTouqueville said, “A republic will crumble when the government can bribe the people with their own money.”

Elected officials have been buying in on what is a complete scam because they have not done the research. You might start by reading any number of the excellent articles here on MasterResource.org.

Also see: Wind Power: How We Got Here, by John Droz at http://www.windpowerfacts.info, and pages 12 & 13 at: http://www.warsawpennysaver.com/wps/wps9_2_12/main.swf

12 Stanley H Roe { 09.03.12 at 11:29 am }

Who are you calling a ‘Hoe?” It is ‘Roe’, with an ‘R’.
About birds and bats. Get permission from Madison Windpower and we’ll walk their site. For every bird or bat you collect in one day that’s dead from blunt force trauma, I’ll donate a dollar to Madison Matters. Small, high RPM mills built in California bird flyways a generation ago were deadly, but I’ve heard no such claims about our larger, slower moving blades killing birds and bats.
About windmill efficiency. I believe that utilities are required to pay more for electricity generated from wind and nuclear than for the market price of that generated by coal, gas or oil. So the utilities buy the more expensive power only when they have to. So the mills operate only when someone is buying their output, therefore, they are less ‘efficient’ in your eyes. The sane solution is to adopt laws now that establish a date after which the price guarantee will begin to diminish, then cease.
Please remember that we citizens participated in building the TVA, Hoover Dam and the Eisenhower Locks.

13 Mary Kay Barton { 09.04.12 at 2:41 pm }

Mr. Roe – while I might call you misinformed, I would never call you derogatory names. The facts speak for themselves. I’m sorry I misread your name in my first post.

Regarding wind-induced avian mortality – tall structures along migratory flyways are among the leading causes of bird deaths. Birds of prey especially are susceptible to being thrashed by these giant rotor blades – that are moving nearly 200 miles per hour at their tips (longer, more slowly rotating propellers still move this fast, contrary to your assertion). Wind machines along California’s Altamont Pass continue to kill thousands of birds annually, many of them protected raptors. See: http://www.SavetheEaglesInternational.org

There are numerous studies and reports out there documenting the very negative effects of these bird “Cuisinarts of the Air” – as they were dubbed by a Sierra Club official in a moment of candor. The American Bird Conservancy reports that hundreds of thousands of birds and bats are being killed annually by industrial wind turbines. Wayne Weggner, “The Wildlife Wizard,” wrote a comprehensive report, “Location, Location, Location — Migration, Migration, Migration,” that you should read.

Windscraper efficiency is not the problem. Rather, it’s their high output volatility. And clearly, your opinion about the pricing of electricity is based upon belief, not fact.

Wind subsidies are so high that wind developers could give their generation away, and still make hefty profits. That they seek long term guaranteed prices for their output, which is passed along to consumers, is simply manifest greed.

Wind machines operate randomly in a hiccuping fashion when the wind speed moves in the right range; they are never dispatchable to engage any part of demand, particularly peak demand (which is typically covered by short duration/fast reacting/highly expensive per unit cost machines).

Sure, citizens participated in the making of the only really effective renewable – hydro, which has high levels of firm, effective capacity. Wind, however, has NO effective capacity. It can only be an occasional supplement to the grid — that requires substantial supplementation, thereby increasing both consumer cost, and subverting virtually all claims made for the daffy technology.

For those who believe that wind is a great idea for electricity, why not demand copious tax payer support for gliders, requiring a substantial percentage of air transport to be fueled only by the energy of the wind.

14 END the wind PTC and business/government cronyism! - Eco-Imperialism { 12.13.12 at 1:20 am }

[...] reported in the article NYS money road to nowhere, “On a per kWh basis, wind receives 80 times the public subsidies received by fossil fuels, [...]

15 End the wind Production Tax Credit { 12.13.12 at 3:50 am }

[...] reported in the article NYS money road to nowhere, “On a per kWh basis, wind receives 80 times the public subsidies received by fossil fuels, but [...]

16 Blowhards & Coruptocrats Blowin’ (your money) in the Wind Tax Credits at US Action News { 12.13.12 at 8:05 am }

[...] reported in the article NYS money road to nowhere, “On a per kWh basis, wind receives 80 times the public subsidies received by fossil fuels, but [...]

17 http://www.highland2007.com/0211/1550.htm { 02.11.14 at 6:05 am }

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