A free-market energy blog
Random header image... Refresh for more!

Category — Virginia

Virginia Renewables: Taxpayer Santa

Bridging the gap between the insightful analyses at MasterResource and what emanates from the halls of government remains a challenge. No matter how clear the issue might be to those who follow this and similar logic-based web sites, the formulation of public policy seems to rely on overt political calculation and tailored science in the service of a political objective.

Free market logic needs to reach beyond our own “choir of believers.” And this means improving our penetration with the general media, a challenge indeed.

In Hoodwinking the Nation, Julian Simon noted that even after he had so convincingly debunked the “vanishing farm land” scam, and the U.S. Department of Agriculture reversed its original position, the press largely ignored the correction. Simon ruefully noted “false bad news” sells.

In the case of the official position of Virginia, as documented in the 2010 Virginia Energy Plan, one sees the 2007 plan scripted under a Democratic Governor carried forward under a proclaimed conservative Republican governorship. The tax carve outs for renewable energy interests continue under the guise of the “all of the above” energy sourcing mantra of Governor McDonnell.

Special interests find favor no matter the administration. The 2007 “Virginia Re-regulation” of utilities legislation illustrates the success of the regulated to shape legislation on their terms. Now the same core of Virginia utility producers have been given “enhanced rates of return” in the renewables market, and other taxpayer funded incentives. Wind farms are promoted as job building enterprises.

The VA Scientists and Engineers for Energy and Environment (VA-SEEE) has sought to have the Commonwealth identify the source of their science data, if any, used to formulate public policy. The vast majority of ranking state officials are lawyers by training.

My letter published in the Richmond Times Dispatch, on Christmas Day, is an attempt to educate the public, and call the Commonwealth to task on the use ( or misuse) of taxpayer funds to the benefit of corporate interests. It is perhaps a quixotic effort confined to the publication limit of 350 words or so. However, as the Tea Party movement has demonstrated, it is only by direct public involvement and engagement that the political class will take notice, no matter what the topic, be it energy, climate, or health care. [Read more →]

December 29, 2010   2 Comments

Dear Virginia: Beware of a Windpower Racket in Your State

[Editor note: This was sent as a July 12, 2010, letter from Mr. Schleede to Virginia's Governor Robert McDonnell and  Lieutenant Governor Bill Bolling]

SUBJECT: Federal and State Tax Breaks and Subsidies for Wind Energy

Introduction:

Both of you have made statements indicating that you favor greater use of wind energy in Virginia and you have used our tax dollars[i] to promote wind energy. However, if you consider objectively the true costs and benefits of electricity from wind, you will conclude that greater use of wind energy is NOT in the best interests of Virginia’s taxpayers or electric customers.

Recently, I have sent you several emails demonstrating that:

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

· The wind industry and other wind energy advocates greatly overstate its benefits and understate its adverse environmental, economic, energy, scenic, and property value impacts.

· Claims of job and economic benefits from “wind farms” are greatly exaggerated.

· “Wind farms” are being built primarily for lucrative tax benefits and subsidies for their owners – not because of their environmental or energy benefits.

This email elaborates on the last point, above, because it is apparent that many in the public, media, and government do not yet understand:

· The extent and cost of existing federal and state tax breaks and subsidies for wind energy.

· The cost of tax breaks and subsidies are a part of the full, true cost of electricity from wind.

· When all the true costs are counted, the cost of electricity from wind far exceeds the cost of electricity from existing generating plants powered by traditional energy sources.

· Wind energy is unlikely to ever become a commercially viable way to generate electricity except for users who are beyond the reach of electric distribution lines or those few people who are willing to either (i) install expensive battery storage systems, or (ii) have electricity only when the wind blows.

· Tax breaks and subsidies for wind energy are:

· Transferring wealth – millions of dollars annually — from ordinary taxpayers and electric customers to “wind farm” owners and their financiers.

· Distorting capital investment decisions, with billions of dollars being spent on “wind farms” that produce very little electricity — which electricity is low in value because it is intermittent, volatile, unreliable and most likely to be produced when least needed.[ii]

· Adding to federal and state budget deficits.

Background

When initially proposed, the rationale for providing tax breaks and subsidies for wind energy was to help a relatively new technology for producing electricity compete with established electric generating technologies until advances in technology would permit wind to compete without subsidies.

However, the tax breaks and subsidies for wind energy have grown and grown. The massive tax breaks and subsidies now available and the wind industry’s well-financed lobbying efforts to preserve, expand, and extend them makes clear that there is no longer any serious expectation that electricity from wind will become commercially viable without massive subsidies or that significant advances in wind technology are likely to ever permit wind to become a competitive source of electricity. [Read more →]

July 14, 2010   3 Comments