Category — General problems of windpower

This month, two subcommittees of the House of Representatives Science, Space, and Technology Committee [1] held a joint hearing,  “Impact of Tax Policies on the Commercial Application of Renewable Energy Technology.”

I was one of nine witnesses testifying. In addition to myself, the let-the-market-decide witnesses were Dr. Benjamin Zycher, Visiting Scholar, American Enterprise Institute, Tax and Other Subsidies for Renewable Energy Should Be Abandoned; and Margo Thorning, Senior Vice President and Chief Economist, American Council for Capital Formation (testimony here).

The subcommittee Republicans were prepared, well informed, and interested in drawing out the facts. The Democrats, on the defensive, complained that the hearing was happening, argued the subcommittees lacked the jurisdiction to hold the hearing, and claimed that renewables were being short-changed compared to oil and gas.

A summary of my testimony (full version here) follows:

Background and Purpose

Energy policy in the United States calls for the aggressive deployment of renewable generation which has led to an explosion of expensive renewable resources that are variable, operating largely off-peak, off-season and are located in rural areas with limited transmission. [Read more →]

It was an opinion-page editorial that was not warmly received by my employer at the time, Enron Corp. “Wind power poses several major dilemmas,” my Washington Times piece read.

Among them, it remains uneconomical despite heavy subsidies from ratepayers and taxpayers over the last two decades—through 1995 the Department of Energy (DOE) had spent $900 million in wind energy subsidies. Second, wind farms are noisy, land intensive, unsightly, and hazardous to birds, including endangered species.

In response, Ken Karas, chairman & CEO of Enron Wind Corporation, wrote to Tom White, chairman & CEO of Enron Renewables Corporation:

Does Bradley still work for Enron? If so, I believe he should be terminated. This article is pure yellow journalism….

I was not terminated, but I reached a (fair) agreement with Enron CEO Ken Lay that I would stop writing about windpower given the obvious commercial interest and stockholder stake Enron had in this sector. My job was important to me, and I was able to advance my ideals in other ways by remaining an internal voice for free markets and climate realism (versus alarmism).

Here is the Washington Times article reprinted with slight revision by the Michigan-based Mackinac Center for Public Policy. At the (almost) 15-year mark, and as an early windpower ‘expose’, how do the arguments hold up today? [Read more →]

This [new report on advances in wind integration] will make uncomfortable reading for those on this list who appear to be religiously opposed to wind energy, i.e. irrespective of the objectively verifiable facts. Wake up people, wind energy is growing world wide at 22% with 194 GW installed already, and “grid operators are increasingly positive about integrating wind power….”

- Wind advocate email, January 4, 2012

The communication concerned a new report sponsored by the U.S. Department of Energy’s Office of Energy Efficiency and Renewable Energy: Strategies and Decision Support Systems for Integrating Variable Energy Resources in Control Centers for Reliable Grid Operations.

Subtitled Global Best Practices, Examples of Excellence and Lessons Learned,” the report admits that “there is no ‘silver bullet’ solution to successful wind integration that applies to all power systems.” But that is about all that can be said about, as John Droz puts it below, trying to pound a square peg into a round hole. Another analogy: integrating agriculture on ocean liners. (Any more analogies welcomed in the comments.)

Two Responses

The advocates’ email drew this response from Thomas Marks, Executive Director of Great Lakes Wind Truth; New York Director,  Great Lakes Sport Fishing Council and North American Platform Against Windpower: [Read more →]

The Federal agency charged with protecting endangered species under the Endangered Species Act is evaluating a plan to allow a 200-mile wide corridor for wind energy development from Canada to the Gulf of Mexico. The draft land-based guidelines–made ostensibly to avoid, minimize, and compensate  for effects to fish, wildlife, and their habitats” — represent one more example of overt and destructive favoritism for an industry that already benefits from fat tax subsidies and mandated market purchases.

U.S. Fish and Wildlife Service Plan

The plan by U.S. Fish and Wildlife Service (FWS) would allow for killing endangered whooping cranes. The government’s environmental review will consider a permit, sought by 19 energy developers, which would allow constructing turbines (over 300 feet tall) and associated transmission lines on non-federal lands in nine states from Montana to the Texas coast, encroaching on the migratory route of the cranes.

The permit from the FWS would allow the projects to “take” an unspecified number of endangered species. Under the Endangered Species Act, “take” is just the euphemism for killing or injuring an endangered species. The government can issue permits to kill or injure listed species with no penalties or risks of lawsuits to developers if they agree to craft conservation plans.

The Administration’s latest wind energy proposal raises concerns because the developments would imperil the habitat of the whooping cranes, including the Central Flyway (shown in purple), a migratory path that cuts through North America, not surprisingly where wind developers want to build, because of prevailing winds. [Read more →]

“The interventionist in advocating additional public expenditure is not aware of the fact that the funds available are limited. He does not realize that increasing expenditure in one department enjoins restricting it in other departments. In his opinion there is plenty of money available. The income and wealth of the rich can be freely tapped…. It never occurs to him [think Obama] that grave arguments could be advanced in favor of restricting public spending and lowering the burden of taxation. The champions of cuts in the budget are in his eyes merely the defenders of the manifestly unfair class interests of the rich.”

- Ludwig von Mises, Human Action: A Treatise on Economics (1949), 1966, pp. 856–57.

“This is where we stand in our current debt ceiling debate. Government is too big, too bloated. Washington faces a spending problem, not a revenue problem.  But too many within the economy depend on the government transfers to live and to work. Yet the economy is not growing at a rate that can afford the illusion. Where are we to go from here?”

- Peter Boettke, “Why The Great Stagnation Thesis is the Most Subversive Libertarian Argument of Our Age,” July 15, 2011.

Energy subsidies are now on the table in the debt-ceiling debate now raging before Congress. But a macro approach needs to be taken to encompass subsidies in the electric generation market (wind and solar in particular), not only in the transportation fuels (oil and ethanol).

Background

Congressional lawmakers interested in budget reduction have set their sights on eliminating ethanol subsidies and oil and gas tax breaks. But renewable energy subsidies–the holly grail of Big Environmentalism and the Obama Administration–are also under pressure.

Earlier this year, the Department of Energy’s Section 1705 loan guarantee was cut. The popular Section 1603 cash grant program created under ARRA is expected to expire later this year. And some industry insiders indicate the federal production tax credit, in effect since passage of the Energy Act of 1992, will be allowed to sunset at the end of 2012.

Indeed, the moment has come to consider eliminating all of the energy subsidies–simultaneously–to let the natural economics of a freer market prevail.

Consumer-driven energy decisions will create winners and losers, for sure. That is the creative destruction of the marketplace. The public is far better served when industries compete for market share and profits rather than fight for political favoritism and handouts.

Windpower: A Trail of Broken Promises

The U.S. wind market, which has relied on public funding since its inception in the 1970s, has a long trail of false expectations and broken promises.

[Read more →]

[Editor note: Mike Riley, editor of Fabricating & Metalworking magazine (bio at end), took a neutral look at a new major manufacturing project and offers his opinions here.]

The total government subsidy given to industrial windpower rivals the price of natural gas paid by power generators– yet wind still cannot compete without mandates. With our nation being challenged to reduce its debt and shrink the federal budget, realistic business economics is confounding the hype about this once darling of renewable energy.

New Wind Plant for Port of Muskogee?

Muskogee is an economic center in eastern Oklahoma that country singer Merle Haggard commemorated in the old country song “Okie from Muskogee,” a hit back in 1969. Now the city is better known for operating the Port of Muskogee that is located at the edge of North America’s wind corridor. This strip of land is often referred to as the “Saudi Arabia of Wind” and is one of the primary reasons why Eagle Claw Fabrication LLC chose the Port in June 2010 to build a 150,000 sq ft facility on 47 acres that will manufacture 220 to 250 wind turbines per year.

Targeting the $2 billion domestic wind farm market, Tom Word, the founder of Eagle Claw, told the daily newspaper Tulsa World that he decided on Muskogee because of its access to international inbound and outbound barge traffic through the Port, the railcar marshaling yard at the Port that connects to the Union Pacific Railroad, and interstate roads heading to wind farm sites.

That’s not all. Eagle Claw will have access to markets not otherwise accessible from an inland location. “This provides us with unique and substantive competitive advantages over other turbine tower manufacturers. We can greatly reduce the cost of transporting our product to the point of usage, including towers to be built in the Gulf of Mexico. These are substantial transportation cost savings that can be passed along to our clients,” explained Word.

$28 Million Project Delayed

The $28 million facility represents the first stage of an overall project planned for over 100 acres on the McClellan-Kerr Arkansas River Navigation System. “Phase Two, which should begin after the first year of operation, will double the size of the new plant. Then Phase 3, which will follow after another year of operation, will increase it to a total of 450,000 sq ft,” noted Word.

Phase One of the new Eagle Claw Fabrication Wind Tower Division complex will create approximately 175 jobs and was originally scheduled to begin operations as early as this spring. According to the Indian Capital Technology Center, which will coordinate a training program for Eagle Claw employees, plate operators will draw wages up to $23 per hour. There will also be openings for plate cutters, welders, fitters, painters, blasting equipment operators, and material handlers.

The new fabrication facility will utilize a “Straight-Thru-Flo” lean shop layout and use cutting edge equipment and technology. According to Word, Eagle Claw expects to devote 100 percent of its capacity to wind turbine tower construction, selling to wind turbine system manufacturers and engineering, procurement and construction firms. The plant will also have capabilities to fabricate offshore wind towers and numerous other heavy tubular structures for geothermal, tidal, solar, hydrokinetics, biomass and carbon capture industries.

All of this big news about these grand plans from a start-up fabricator in a green industry is exciting, except for one thing: Big Wind is unable to make it in the marketplace. [Read more →]

“… paying anything for resources that yield no or little effective capacity seems deranged as a means of promoting economic recovery for the most dedicatedly modern country on the planet.”

In energy debates (such as held recently by the Economist), arguments can be made against government-dependent renewables on grounds that coal and natural gas are in abundant supply and fossil fuels are being burned cleaner and cleaner.

These arguments, however, are mere body blows. Robert Bryce (see Part I) should have supplied the knockout punch by reminding all that any meaningful discussion of electricity production, which could soon embrace 50% of our overall energy use, must consider the entwined goals of reliability, security, and affordability, since reliable, secure, affordable electricity is the lynchpin of our modernity.

Effective Capacity

Economic recovery must be built upon such a foundation. At the core of this triad, however, resides the idea of effective capacity—the ability of energy suppliers to provide just the right amount of controllable power at any specified time to match demand at all times. It is the fount of modern power applications.

By insisting that any future technology—clean, cleaner, or otherwise, particularly in the electricity sector—must produce effective capacity, Bryce would have come quickly to the central point, moving the debate out of Wonderland and into sensible colloquy.

Economically and functionally, comparing wind and solar with conventional generation is spurious work. Saying that the highly subsidized price of wind might, maybe, possibly become, one day, comparable to coal or natural gas may be true. But even if this happens, if, say, wind and coal prices become equivalent, paying anything for resources that yield no or little effective capacity seems deranged as a means of promoting economic recovery for the most dedicatedly modern country on the planet. [Read more →]

March Hare (to Alice): Have some wine.

(Alice looked all round the table, but there was nothing on it but tea.)

Alice: I don’t see any wine.

March Hare: There isn’t any.

Alice: Then it wasn’t very civil of you to offer it.

March Hare: It wasn’t very civil of you to sit down without being invited.

— From Lewis Carroll’s Alice in Wonderland

Energy journalist Robert Bryce in Power Hungry foretells an electricity future anchored by natural gas that will bridge the transition to nuclear power. With his third book in less than a decade, Bryce is now a leading light of the energy policy debate, appearing regularly on op-ed pages and on news shows.

Bryce recently participated in two debates. In one hosted by The Economist, he argued for the proposition that “natural gas will do more than renewables to limit the world’s carbon emissions.” In a second debate, an Intelligence Squared forum sponsored by the Rosenkranz Foundation, Bryce and American Enterprise Institute scholar Steven Hayward argued against the proposition that “Clean Energy can drive America’s economic recovery.”

The Economist Debate

There’s more evidence that the enchanted Easter bunny brings children multi-colored eggs than there is that those renewable-energy darlings wind and solar can put a dent in CO2 emissions despite their massively intrusive industrial presence.

The first debate was little more than a curiosity. No one mentioned hydroelectric–the most widely effective “renewable” (it now provides the nation with about 7% of its electricity generation)–because it is an environmental pariah to the likes of The Sierra Club and has little prospect for growth.

Nuclear, which provides the nation’s largest grid, the PJM, with about 40% of its electricity, is not considered a renewable, despite producing no carbon emissions; it is also on The Sierra Club’s hit list. Geothermal and biomass, those minor league renewables, were given short shrift, perhaps because no one thought they were sufficiently scalable to achieve the objective.

So it was a wind-versus-gas scrum played out as if the two contenders were equally matched as producers of power.  And here is where I must complain. [Read more →]

Remember all this? America is running out of natural gas. Prices will soar, making imported liquefied natural gas (LNG) and T. Boone Pickens’ wind farm plan practical, affordable and inevitable. Well, reality intervened. We are having an energy transformation, but just the opposite of what the non-market energy planners predicted.

Shale Gas Revolution

Barely two years later, America (and the world) are tapping vast, previously undreamed-of energy riches – as drillers discover how to produce gas from shale, coal and tight sandstone formations, at reasonable cost. They do it by pumping a water, sand and proprietary chemical mixture into rocks under very high pressure, fracturing or “fracking” the formations, and keeping the cracks open, to yield trapped methane.

Within a year, U.S. recoverable shale gas reserves alone rose from 340 trillion cubic feet to 823 tcf, the Energy Department estimates. That’s 36 years’ worth, based on what the USA currently consumes from all gas sources, or the equivalent of 74 years’ of current annual US oil production. The reserves span the continent, from Barnett shale in Texas to Marcellus shale in Eastern and Mid-Atlantic states – to large deposits in western Canada, Colorado, North Dakota, Montana and other states (and around the world).

Instead of importing gas, the United States could become an exporter. The gas can move seamlessly into existing pipeline systems, to fuel homes, factories and electrical generators, serve as a petrochemical feedstock, and replace oil in many applications. States, private citizens and the federal government could reap billions in lease bonuses, rents, royalties and taxes. Millions of high-paying jobs could be “created or saved.” Plentiful gas can also provide essential backup power for wind turbines. [Read more →]

Setting aside the matter that wind turbines are not an effective means to supply utility-scale electricity, the claims of job creation and 21^st century industrial development are equally illusory. A New York Times (NYT) article last month spoke volumes on this.

I have frequently claimed that the recently created wind turbine manufacturing industries in Europe (Denmark, Germany and Spain) are in jeopardy from competition by the emerging giants, China, India and the U.S. The Times article reports that China now controls almost half of the global market, having absorbed billions of dollars in government assistance and consumer subidies.

The wind businesses in these European countries have existed for little more than a decade, and having saturated their domestic markets, have enjoyed a brief, and unsustainable, dominance of global markets. I may have been mistaken in including the U.S. in the emerging giants list, but one cannot realistically exclude it, at least at first glance.

I now suggest it should be added to the same list as the European countries. [Read more →]