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Ohio’s Blue Creek Wind Farm: Predictable Underperformance

“Many people point to the mandates of Ohio Senate Bill 221 or other such legislation in other states, which require the use of fashionable generation methods for electricity, as justification for subsidizing investment into economically questionable energy generation projects.

To me this is an exercise in circular logic, mandating that we have to use more expensive means of generating electricity, and then using the rising cost of electricity to justify subsidizing more expensive means of generating electricity.”

Jerry Graf – Effective Energy Strategy (March 2013)

In an editorial response printed in the Fort Wayne Journal Gazette (10/21/2013), four co-authors make the following points with regard to the Blue Creek Wind Farm and wind energy in general.

I have rearranged their words for brevity and direct the reader to the Journal Gazette website to read verbatim. Our rebuttal letter follows:

Electricity from wind is very high in true cost and low in true value

Electricity from wind turbines is low in value because it can’t be counted on to be available when needed, and it is most likely to be produced at times when it is least needed. Wind turbines tend to produce most of their electricity at night in cold months, not on hot weekday afternoons in July and August when demand for electricity is highest. Furthermore, the electricity from wind tends to be low in value because the output can’t be counted upon to be available at the time of peak demand, unlike reliable (“dispatchable”) generating units that can be called upon to produce whenever needed.

 

Wind turbines produce electricity only when wind speeds are in the “right” range. Other generating units, powered by conventional energy sources (such as natural gas, coal, oil, hydropower, nuclear energy, and perhaps biomass) must always be immediately available to compensate for the intermittent, volatile output from wind turbines. This necessity adds to the true cost of using wind energy, and the unreliability of output from wind turbines adds to the burden on grid managers in keeping electrical grids in balance (supply and demand, voltage, frequency).

 

The principal reasons that companies such as Iberdrola build wind farms (including Blue Creek) are generous government tax breaks and subsidies provided to wind farm owners………….The cost of government financial subsidies for wind energy is borne by taxpayers, including Ohio taxpayers, and is in addition to the cost of electricity from wind that shows up in electric bills.

 

- Tom Stacy, Glenn R. Schleede, Joan Null, and Larry Long, Wind farm endorsement blows past facts – October 2013

Digging deeper into the subject of the Blue Creek Wind Farm; there is now evidence the 304 MW (nameplate capacity) wind farm in western Ohio is producing at a capacity factor of only 29.7 percent.

In other words, the actual electricity produced in a year is less than one-third of what would be expected if this facility produced at nameplate capacity around-the-clock for 8,760 hours per year.

In practical terms, this means we can expect that the wind farm is only capable of providing around 790,000 MWh of intermittent electricity per year. (Reference: U.S. EIA, EIA-923 2012 Data and also EIA-923 2013 Data ; and my Blue Creek Wind Farm Analysis.

The real output capacity factor of 29.7 % stands in contrast to the projected and advertised capacity factor of 34.7% (see AMP Presentation); although one wonders why anyone was ever excited about 34.7% in the first place.

The Blue Creek Wind Farm required an investment of $600 million, touted as the largest investment in wind in Ohio in 2011. This was offset, in part, by a federal stimulus grant for more than $172 million; and other government dictated incentives, such as Ohio’s SB 221 renewable energy mandates, played a key role. Unfortunately, once again, there is no hope of paying back the $600 million investment thru the sale of useful electricity at market rates (please see cash flow ROI in Blue Creek Wind Farm Analysis).  As always, there must be heavy doses of subsidies from the taxpayer and individual customers to offset the losses and provide Iberdrola with a profit.

Despite their supposed presentation as power sources for average everyday power needs, wind turbine projects are often granted special Power Purchasing Agreements (PPAs) which allow prices for their electricity that are guaranteed and higher than average wholesale price. It is disconcerting that large portions of the feasibility studies and the on-going discussions are often devoted to proposals making the projects appear viable with public spending and it is evident that, to make these projects work, massive government subsidies and large increases in the cost paid for electricity will be required to offset the investment losses and attract investors.

Once again, other than the damage to the economy of the waste itself, the real problem with mandating and subsidizing non-viable energy technology projects is that this distracts us and diverts resources from other efforts to improve our energy production strategy. 

In how many different ways could we have spent this money and committed these resources, to produce far more reliable electricity and, at the same time, improved our energy strategy and reduced emissions of pollutants into our atmosphere?

As I have stated many times before. Public policy must be based on scientific evaluation of fact and logical analysis of performance and economics; not by emotion, political considerations, and ‘feel good’ methodologies.

5 comments

1 Tom Tanton { 12.03.13 at 8:28 am }

many that have been arguing against wind for a variety of reasons have NREL to thank, both for the challenge and this morning’s vindication.
http://www.latimes.com/nation/la-na-grid-renewables-20131203,0,1019786.story#axzz2mMC57iYY

2 Charles Battig { 12.03.13 at 10:38 am }

“Public policy must be based on scientific evaluation of fact and logical analysis of performance and economics; not by emotion, political considerations, and ‘feel good’ methodologies.” Absolutely!

However, politicians, in general, exist to get re-elected. They have a long track record, antedating even Machiavelli, of knowing that the public responds most readily to emotional arguments, especially ones seen as satisfying a personal moral need or cause…saving the planet??

Traditional, scientific ration argument has a tough time winning the attention and the hearts of the populous. A tough task, but not impossible.

3 Ray { 12.03.13 at 5:47 pm }

304 MW is about 1/4 of the power that a moderately large nuclear or coal fired power plant produces. When you consider the capacity factor, the windmills produce the power of a dinky 100 MW power plant. When I was in the navy our destroyer had steam turbines that produced 60,000 shaft horsepewer. A horsepower is about 750 Watts. That’s 45 megawatts from a little destroyer steam power plant. The aircraft carriers had 4 times our horsepower. That wind farm produces a piddling amount of expensive unreliable power.

4 Jerry Graf { 12.04.13 at 8:26 pm }

Tom / Charles / Ray,

Thank you for reading and commenting.

Since these projects cannot produce enough revenue to pay for themselves, through the sale of reliable electricity at market prices, one is left to conclude that the only reason they are pursued is the availability of taxpayer funding to prop them up and provide the developers with profit at our expense.

All we can do is continue to stress how the scientific, economic, and rational analyses do not support this.

5 hitssquad { 12.05.13 at 5:34 am }

@Ray “304 MW is about 1/4 of the power that a moderately large nuclear or coal fired power plant produces.”

No. It’s even less than that, because nuclear- and coal-fired power plants are typically composed of more than one unit.

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