A Free-Market Energy Blog

Dear Michigan: Why Wind? (natural gas is better all ’round)

By Kevon Martis -- March 13, 2013

“Suggesting that renewables will let us phase rapidly off fossil fuels in the United States, China, India, or the world as a whole is almost the equivalent of believing in the Easter Bunny and Tooth Fairy.”

– James Hansen, Baby Lauren and the Kool-Aid, July 29, 2011.

Climate-change activist James Hansen speaks truth to power when he tells wind + solar = energy advocates “renewable energies are grossly inadequate for our energy needs now and in the foreseeable future.”  He adds

Recently I received a mailing on the climate crisis from a large environmental organization. Their request, letters and e-mails to Congress and the President, mentioned only renewable energies (specifically wind and solar power).

Such a request offends nobody, and it is worthless. Indeed, it is much less than worthless. If you drink the kool-aid … you are a big part of the problem.

But this has not prevented the Michigan Environmental Council and its affiliates from making a full-throated appeal for far higher renewable energy mandates at Gov. Rick Snyder’s statewide series of energy roundtable meetings.

The Michigan Environmental Council (MEC) and its allies have chosen one unifying theme for these events: coal-fired electrical generation kills people, and renewable energy (wind) is the cure.

To that end, the MEC commissioned a report called: “Public Health Impacts of Old Coal-Fired Power Plants in Michigan.” Analyzing the health care impacts of fine particulate emissions from Michigan’s nine oldest coal-fired generation plants, MEC concludes that : “the Michigan-specific health-related damages associated with [fine particulate] emissions from the nine coal-fired facilities [are] $1.5 billion annually…” [and cause] … 180 premature [coal emissions] deaths per year in Michigan.”

Such large numbers certainly deserve scrutiny. For the sake of argument let us assume that fine particulate emissions truly do have such an outsized financial and human impact. If so, what is the cheapest and most effective means to protect our citizens?

The MEC has consistently promoted renewable energy as the best cure for these coal emissions. But is this just faith in James Hansen’s “Tooth Fairy”?

$2.5 Billion for What?

By the end of 2013, roughly $2.5 billion will have been spent in Michigan on industrial wind turbines, including the $500 million “Thumb” transmission loop. These 900 megawatts (MW) of wind turbines will combine to create a wind plant that will have an annual capacity of just one fourth that size, perhaps 225 MW.

This is because wind is a fuel that has a mind of its own, often showing up at the wrong time and wrong quantity — and always the wrong quality — when it is there at all.

The nine Michigan coal plants in MEC’s study have an effective capacity of approximately 4,200 MW. Charitably assuming that 225 MW of wind generation replaces the same quantity of coal generation, those $2.5 billion in wind turbines plus transmission will have eliminated only 5 percent of the fine particulate emissions from coal.

This means $2.5 billion of wind turbines and transmission lines will at best save only $75 million per year in coal emissions related health costs, or nine lives annually.

Opportunity Cost: Gas-Fired Plants

What the MEC wishes for us to ignore is that there is a far more efficient way to combat those emissions: natural gas-fired combined cycle gas turbine plants (gas plants), which emit almost no particulates or mercury.

Modern gas plants are among the lowest cost ways to generate electricity. CMS Energy is currently constructing a new 750 MW gas plant at a cost of $1 million per megawatt. By way of comparison, CMS Lakewinds wind farm near Ludington cost $2.5 million per megawatt, or two-and-a-half times the price of gas plants.

Not only are gas plants cheap to build, they produce our cheapest electricity. The federal Energy Information Administration projects that by 2017 the cost of energy from gas plants will be only two-thirds the cost of wind energy.

This is a serious blow to MEC’s renewable energy “Easter Bunny.”

By the end of 2013, and despite having spent $2.5 billion, Michigan’s nine oldest coal plants will continue to operate while having their emissions trimmed by no more than 5 percent. But had we chosen to build gas plants instead of wind plants, that same $2.5 billion could build 2,500 MW of gas generating capacity instead of only 225 MW. This is enough to permanently close half of the nine “dirty coal” plants in question.

Doing so would, according to MEC’s own data, slash Michigan’s health care costs from coal by $750 million annually. It would also save 90 lives per year at a cost of $27 million per life.

But under MEC’s renewable energy plan, 81 of those 90 lives would be sacrificed. And the nine people saved would cost a staggering $277 million per life. That is 10 times the price per life.

Further, had we constructed 5,000 MW of gas plants instead of wind turbines, we would close all nine coal plants and thereby lock in annual health care savings of $1.5 billion dollars per year while simultaneously extending the lives of 180 people each year in Michigan. Just those health care cost savings alone would pay for the construction costs of those new gas plants in only 3.3 years.


While our cost-benefit analysis is simplified to be sure, we are still forced to face some sobering conclusions.

Because wind generation cannot replace coal plants but gas plants can, we are currently wasting $1.42 billion per year in health care costs that could have been eliminated without renewable energy mandates.

By following the MEC’s lead and mandating wind energy instead of encouraging the construction of natural gas plants, we continue to needlessly kill nearly 180 people per year.

In truth, no one knows the true health care costs of coal emissions. But we know that whatever that true cost is, wind energy is the most expensive and least effective means of eliminating those costs and certainly should not be mandated by state policy.

It is high time the MEC and its affiliates like the Michigan Land Use Institute, League of Conservation Voters, Union of Concerned Scientists and the Sierra Club abandon childlike faith in fairy tales and start endorsing a science-based “no regrets” energy policy for grownups.


Kevon Martis is the senior policy analyst for the Interstate Informed Citizen’s Coalition Inc., a bipartisan grassroots renewable energy watchdog group based in Blissfield. The IICC is not sponsored by any industry or advocacy group and is funded by a tiny stream of small donors across the states.

This revised piece originally appeared in CAPCON (Michigan Capital Confidential), published by the Mackinac Center for Public Policy.


  1. Michael Spencley  

    Refreshingly to the point, in what amounts to a “cage-match” between wind and gas, Martis’s piece leaves us with a sense of just how badly Municipal, State and Federal governments are being duped by the industrial wind lobby.

    The article begs the question, at the risk of being oxymoronic; Where are all the clear-minded, truth seeking individuals in the political, scientific and academic communities in the midst of this boondoggle and why on earth does reason not prevail? The public deserves answers to these questions, if only to restore some faith in the effectiveness of the institutions that our forefathers created to serve us. Continual erosion of our economic competitiveness base with this scam will lead to nothing short of selling out the future of our sons, daughters and grandchildren.


  2. Sally Rochotte  

    Finally, the facts no one is talking about.


  3. Michael Goggin, AWEA  

    First, the numbers used here to calculate cost for the gas plants do not include fuel and other operating costs, a major component of the cost of natural gas electricity. Without those numbers included, it’s like comparing the price of a gas guzzler against a hybrid without paying attention to the cost of fueling the car.

    Once those operating costs are added and compared against the cost of operating a wind plant, wind energy looks much more attractive. If one includes gas price volatility, and wind’s role in protecting consumers from that volatility, the value of wind power is even clearer. Mr. Martis also completely ignores the pollution and other environmental impacts associated with natural gas power plants.

    Second, in calculating how much coal generation can be offset, Mr. Martis assumes that the existing coal plants and any new natural gas plants are operating at full power 100% of the time. Government data confirms that the real number for coal plants is closer to 60% (and the number for natural gas plants is under 25%), so correcting for the coal number alone means that wind’s health benefits are 40% larger than claimed in the article.

    Using the MEC data and Mr. Martis’s own calculations, wind energy in Michigan is providing more than $100 million in annual health benefit, including preventing 15 premature deaths. That’s without even factoring in the value of the electricity provided by the state’s wind plants, which is large because adding wind energy to the grid displaces the most expensive and least efficient power plant that is currently operating. In fact, analyses such as a May 2012 Synapse Energy Economics report have found that adding large amounts of wind energy in Michigan and other parts of the Midwest would save a typical household between $65 and $200 per year.


  4. kmartis  

    Nothing Mr. Goggin shared discredits my premise of lost opportunity costs, namely: had we spent $2.5 billion on CCGT plants rather than wind and transmission, the emissions of the nine coal plants in question would now be reduced by 50% rather than the VERY generous 5% credit I gave MI wind in the article. That is beyond dispute. And could we really protest the cost of natural gas fuel if in exchange hundreds of lives per year were spared?

    My purpose was not to evaluate the value of the energy produced but the value of the emissions reduced, and wind is at a huge disadvantage using that metric.

    Further, I addressed the cost of the energy referencing EIA which projects that in 2017, the LCOE of CCGT will be 2/3 the cost of wind. That includes fuel.

    Mr. Goggin also neglects the balance of MEC’s study. It priced the REGIONAL health care impacts at $5.4 billion per year. Thus, had Michigan spent the $5 billion necessary to replace all 9 coal plants with CCGT plants in 2008, the eastern US, downwind from MI, would have profited $400,000,000 the first year and $5.4 billion every year since. The gas plants would have been free. And we would be saving $5.4 billion each year regionally and $1.5 billion in MI. That would buy a lot of natural gas. In fact, using MEC’s logic, it would be wise policy for the impacted states to each mail an annual check for $2-300 million to pay for new CCGT plants. They would actually be money ahead.

    And why is a 5% emissions credit generous? It is generous because it assumes MI wind has EVER forced a MI coal plant to spin down to the point emissions savings were realized. But in truth, MI’s wind generation is so trivial, it has likely never disrupted much more than some occasional gas generation.

    It could even be fairly argued that wind thus far has given MI ratepayers zero environmental benefit. But I chose to generously give it a 1MW:1MW credit. That (and lack of space) is why I chose to not factor in the fuel savings of wind versus gas. Would it benefit the wind side? Somewhat. But even taking fuel savings into account, wind is at best a 1:7 loser compared to CCGT in terms of price/particulate reductions.

    And finally, if Michigan had replaced all 9 coal plants with CCGT plants, we would be netting $1.5 billion per year in alleged health savings IN ADDITION to the savings to taxpayers/ratepayer by deploying CCGT rather than mandated and subsidized wind which is far more costly than gas according to EIA. The theoretical healthcare savings alone would amount to $600.00 per MI household of four or 3-9 times the value of Goggin’s preposterous ratepayer savings from wind.


  5. Kent Hawkins  

    Michael Goggins

    For once I do have to acknowledge you have a point. Operating cost considerations should be included in cost comparisons. Given that the author admits his analysis is simplified, in some sense his overall argument stands.

    However, from there your arguments do not withstand scrutiny.

    For starters you cannot compare the costs of electricity generation plants that can be reliably called upon when needed, and perform as expected, with those that cannot, such as wind. Even the DOE/EIA now recognizes that this cost comparison cannot be made. As well, when producing electricity, wind production is persistently erratic on a continuous basis. Please do not claim increased/geographically dispersed wind offsets this. There is too much evidence to the contrary.

    For the likes of wind, there must be an associated cost due to these characteristics, as well as a grid cost to accumulate the highly dispersed supply of wind energy. Then there is the otherwise not needed expanded grid capabilities to transmit wind production to distant markets, as well as other grid components, such as smart meters, in part, to assist in managing demand in the face of unreliable supply.

    The capacity factors that the DOE/EIA uses in calculating the costs of various generation plant types is coal, 85%, combined cycle gas, 87%, combustion turbine, 30%. It is reasonable to use the combined cycle gas plant number in this case to compare non-peaking generation plants. The point being is that plant types are being compared and the wind production is limited by the availability of the fuel, wind itself, not system operator discretion.

    However this raises the point that some plants may not be used to their full capacity all the time, ignoring of course some allowance for scheduled and unscheduled maintenance. I strongly suspect delving into your much lower use information (1) will not withstand scrutiny, and/or (2) will be small in a comparison with all the other considerations of unreliable generation plant types.

    Now let’s return to an overarching point. Making the cost comparisons is a very complex task. In the face of this, I would argue that it is better to be approximately right than wrong with considerable precision alone.

    Finally wind production does not displace the most expensive and least efficient generation plants, but those which can be most easily altered to respond to wind’s erratic behaviour in real time. This varies considerably depending on the generation plant portfolio, what is online at the time, and the time of day. For example at night when wind is often most active, typically only baseload plants are producing.

    I know there are reports to the contrary of what I say. Such do not alter the reality of the case against unreliable and persistently erratic renewables, especially wind.


  6. Jon Boone  

    Although I applaud Kevon Martis’ pluck, I think it’s a mistake to concede, for the sake of advancing one line of thought, anything to this awful “industry.” Giving wind a 1:1 substitution for coal–and assuming that 225MW of wind “replaces the same quantity of coal generation”–simply adds to the fantasy promoted by MEC’s commissioned report that claimed coal caused 180 premature deaths (yet another politically-induced projection that has questionable basis in reality, if only because such reports rarely factor all relevant variables, cherry picking those that support their position, while seemingly immune from accountability).

    As it is, AWEA’s spinmeister Goggin could counter (and be applauded by many whose wits have been dimmed by greenwash) with a promotion that Michigan erect 5600 3.0MW wind turbines to REPLACE the entire 4200MW fleet of coal production in the state. But since all that wind has no effective capacity and its actual production would flutter between zero and 16,800MW, and no one can foretell what the production would be at any future time, all that wind couldn’t replace a single generating machine that produced effective capacity, despite having a 25% capacity factor that would yield an average annual generation of 4200MW. Moreover, as Tom Tanton and George Taylor showed in their excellent recent paper, wind cannot replace anything 1 to 1: http://www.atinstitute.org/wp-content/uploads/2012/12/Hidden-Cost.pdf.

    This being said, Martis is spot on when he states so succinctly:

    “Because wind generation cannot replace coal plants BUT GAS PLANTS CAN (my caps), we are currently wasting $1.42 billion per year in health care costs that could have been eliminated without renewable energy mandates.” His point is clear, even if no one really knows (or seems to care much about) what anyone is paying in health care costs because of electricity generation. [Indeed, the benefits from having electricity, no matter how it is produced, likely far outweigh any particular negative health subset, if one exists. Candidly, I’m surprised Michigan didn’t play the asthma card.]

    With natural gas, wind would be an additive—not an alternative—energy source. And virtually all emissions reductions in a wind/gas tandem (assuming a tactical interplay of both CCGTs and OCGTs) would come from natural gas–not wind. To the extent natural gas plays footsy with this cynical idea, it is embracing tax shelters via wind’s tax avoidance power, and getting PR points based upon deceptive half truths.

    As I once wrote:

    “Although natural gas can indeed infill wind’s relentless volatility, the costs would be enormous, while the benefit would be inconsequential. And ratepayers and taxpayers ultimately pay the substantial capital expenses of supernumerary generation.”

    With wind, the world gets one for the price of two….


  7. JohnInMA  

    From WNA (www.world-ncuelar.org)
    Brazil gets almost 85% of its electricity form hydropower, and single digit amounts from thermal systems, including just 3% from nuclear. They have 4 new nucelar units schedule to come online by 2020.

    This is a remarkable chart than explains all that I need to know about current and future nuclear power plant plans:

    I am not familiar with the exact details of the MISO regulations and what applies in MI, but I’ll assume it operates like most wholesale electricity markets. So, isn’t it true that, as Mr. Goggins highlights, the “value of electricity provided by the state’s wind plants” is equal to the highest priced alternative in any purchase period? In other words, while wind farm operators may ‘zero bid’ their output, they are paid at the going rate for the period. So, unless every bit of electricity is provided by wind, then wind’s cost impact equals that of the set marginal price. And that is most likely tied to other fossil plants (or nuclear?). Wind’s cost impact, therefore, is no better than at least some other baseload source. It might still be cheaper than, say, direct-fired gas turbines used for peaking, to some degree during some periods. But it also seems a fair assumption that some, if not all, of the gas replacement for coal-fired plants would be designed for baseload generation, making that most likely the least expensive gas technology (combined cycle, perhaps). In the end, the cost benefit is not so large. In addition, there are opportunity costs associated with the stated net capacity factors as a result of wind additions. Even if the reference Synapse Energy Economics study takes all this into account, the theoretical ratepayer savings are still smaller than the health benefit cost reductions as Mr. Martis points out.

    Perhaps more important, I am not aware of any real world analysis of large networks/grids with significant amounts of wind penetration (> 10%?) that show emissions reductions that are even within fractions of the projected amounts (excluding mercury). Granted, most of what I have read analyses the UK, Ireland, Scandinavia, and Germany no more recently than 2010-2011. And granted their non-renewable mix is quite different. Not surprisingly, equivalent data for analysis seems unavailable from U.S. operators and utilities. If it is, I would certainly appreciate a link or a point in the right direction.

    Even if the hypothetical cost savings as per the referenced study were accurate, and even if the theoretical but unproven emissions reductions were realized (being “40% larger than claimed in the article”), the cost benefit still favors replacing coal with some assortment of gas-fired systems. At this point in history, the value for wind systems at best seems to come from their ability to provide additional energy in networks with safe capacity margins and reserves. It seems a folly to try justify their inclusion for almost any other reason, and certainly not for realistic firm capacity, or as the most economic route to reducing operating and ‘external’ costs in most networks in the U.S. There may be options for getting to that point, but wind farms using modern technology by themselves are not able.


  8. JohnInMA  

    Please note that the first two paragraphs of my above post are extraneous and not a part of the intended post. It should begin, “I am not familiar with the exact details….” I don’t know where the preceding words came from.


  9. Ray  

    “and cause] … 180 premature [coal emissions] deaths per year in Michigan.”
    I have asked on many blogs how to tell when a death is premature and have never received an answer. Here’s what I ask. George burns the comedian smoked all his life and died at age 100. Did he die prematurely, maturely or postmaturely and how do you tell? I have never received an answer.


  10. MCT Ahead Of The Curve On Natural Gas Electrical Power Generation | motorcitytimes.com  

    […] Via Master Resources: Modern gas plants are among the lowest cost ways to generate electricity. CMS Energy is currently constructing a new 750 MW gas plant at a cost of $1 million per megawatt. By way of comparison, CMS Lakewinds wind farm near Ludington cost $2.5 million per megawatt, or two-and-a-half times the price of gas plants. […]


  11. Bob  

    As other commenters have noted the premature death fantasy. Instead of counting all the 180 premature deaths, how about just those from the Lansing power plant? Surely, with such a few number, you can count them. Otherwise, it is nothing more than a made up number.


  12. Koch groups try debunked wind attack for a fourth time – Into the Wind  

    […] the levelized cost of generation, particularly for natural gas generation. Notably, Stacy, his allies, and others they cite to have previously used best-case gas capacity factor assumptions to argue […]


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