Tax Breaks & Subsidies or Australia / New Zealand
It is six years since I first referred here to "the great wind scam" - the bonanza enjoyed by the developers of wind turbines, thanks to the hidden subsidy we all give them through our electricity bills. Under the Government's Renewables Obligation, they receive twice as much for such electricity as they produce as the owners of conventional power stations: a 100 per cent top-up which makes our wind energy the most heavily subsidised commodity in history.
No matter how many billions you spend on a wind farm, no matter how much landscape you sacrifice in the name of this particular renewable energy source, you have to build something else to cut in when it cuts out - and it has to be constantly at the ready to go. Not switched off, but warmed up and spinning - consuming, in other words, fuelled by something else more dependable.
Don't be fooled by the "dry year" threat, either: we're in a La Nina summer now, and there's no evidence yet presented to indicate that a dry year is a windy year, as the Meridian theory requires: the theory is that in a dry year for southern lakes, the wind turbines will allow the dams to be rested and water to be stored for later use. ...So, in essence, wind farms cost you double, at least: the $2 billion for Hayes, (though it's odds on it'll be more) will be necessarily followed by a blank cheque for whatever dependable base-load generation is going to back it up, unspecified hundreds of millions for Transpower's necessary upgrade of the grid, and God knows how much for the replacement Cook Strait cable. This is what happens when the south is plundered to power the north, as it has been for decades.
There is no doubt that the wind farm industry has a zealous pecuniary interest in covering as much of Australia and the world with their huge wind turbines as possible.
They are not altruistic enough to warn prospective hosts and neighbours of the known downsides, but worldwide, have included secrecy clauses in their hosts' contracts.
They deny wind farms are noisy. Sales are priority. Those registering their legitimate complaints concerning noise, do not consider their experiences "myths". ...Beware the spin doctors for snake oil cures to climate change.
The wind rush is on. Plans to erect sweeping wind farms are being unfurled at a rate of knots. But is this really clean green energy, or just another case of greedy corporates trashing our landscapes for profit? Anton Oliver argues it's about time New Zealanders woke up to the dark side of wind power.
... to my bewilderment, then subsequently dismay and disillusionment, I have been angered by the way we continue to squander our environmental inheritance.
One of the priceless things that makes Central Otago unique and so captivating and gives it the world of difference that the brand-assigners and the Central Otago District Council use to proudly advertise and promote the area is that most of its hills and block mountain ranges aren't badly polluted visually. It gives them an extraordinary and memorable aura, one that's often grand.
But is building what would so far be, in the case of Meridian's Project Hayes, the biggest wind farm/factory in the Southern Hemisphere, thus opening the door to still more of them, the world of difference we want? Is that what the district council has, or had, in mind? Is that what thinking people want? Meridian's Project Hayes and TrustPower's Mahinerangi Wind Farm proposals between them covering more than 120sq km of countryside - would have a major rather than a minor detrimental effect in all respects. ...Our oft-warbled claims to be ahead of the game and clean and green are no more than self-congratulatory chitter. Sort out what you think our legacy ought to be, people, and stand up for it before it's too late.
Few might guess, from the two-dimensional reporting of these plans in the media, just what a gamble with Europe's future we are undertaking - spending trillions of pounds for a highly dubious return, at a devastating cost to all our economies.
The targets Britain will be legally committed to reach within 12 years fall under three main headings. Firstly, that 15 per cent of our energy should come from renewable sources such as wind (currently 1 per cent). Secondly, that 10 per cent of our transport fuel should be biofuels. Thirdly, that we accept a more draconian version of the "emissions trading scheme" that is already adding up to 12 per cent to our electricity bills. The most prominent proposal is that which will require Britain to build up to 20,000 more wind turbines, including the 7,000 offshore giants announced by the Government before Christmas. To build two turbines a day, nearly as high as the Eiffel Tower, is inconceivable. What is also never explained is their astronomic cost.
At the end of 2007, the WilderHill New Energy Global Innovations Index (NEX), a composite of 86 new energy companies covering wind, solar, biofuels, efficiency, and hydrogen, was up by 58%, year-on-year. As of yesterday, however, it was off almost 20% for 2008 so far, compared to a drop of about 8% for the S&P 500. Why would a sector so favored by politicians, environmentalists, and socially-conscious investors suddenly appear to have diminished prospects, just when it seemed perfectly geared for growth? Unfortunately, renewables and the entire alternative energy sector are vulnerable to two of the same principal factors undermining confidence in the economy as a whole: the availability of credit and higher inflation at the wholesale level.
If you thought the 2008 presidential race was shattering all records for windy rhetoric, it's nothing compared to the political eco-rhetoric being spun to US taxpayers -- to get them to cough up billions of dollars to fuel a renewable wind power industry boom sensible investors won't touch with a turbine's rotor blade. ...Wind power sounds a great European success story -- one to be echoed in the US, it seems, as 2008 is set to see wind power developments shatter records for the fourth consecutive year. However, a closer look at the European "success" story reveals that all is not quite as it seems. Wind seems to be blowing in the mind of the politically correct and those on the recent environmentalist bandwagon but the cost is going to be huge, no companies will plunge into it without massive government subsidies and, if actually built, power reliability will take a nosedive. ...The bottom line is that the renewables debate, and investment in it, is as much about ideology and political belief as it is about economics and environmental issues. When the real cost of turbine power as a major player toward our future power needs is assessed, the answer just ain't "blowing in the wind".
The starting point is the broad brush statement in the paper that no power supplies are perfectly reliable. This is correct provided you don't ask about the details. If you did, the devil would point out that there is a difference between a naturally intermittent supply and a supply which trips or goes off line unexpectedly. There is a difference in scale and time. Contemporary distributed electricity systems have devised ways of insuring continuity of supply for the latter events but are struggling to deal with the former. This is not comparing like with like. ...Intermittent supply adds an extra stretch for the control of a network. Wind farms illustrate the problem. A standard measure of the performance of a generator is the capacity factor. This is the annual averaged power achieved as a percentage of the installed (or maximum) capacity. ...But this factor gives no indication of the detailed performance. A measure that helps give an indication of this is a reliability figure. This is the minimum percentage of power that may be relied upon for 90 per cent of the time. For wind farms it is about 5 to 10 per cent
When there is considerable debate over future financial prospects of an industry, it's hard to argue over the present value of an asset.
But some Scottish & Southern Energy investors are bound to raise eyebrows over the €1.46 billion it's just paid for wind-farm operator Airtricity.
After all, it costs roughly £1 million/MW to set up a modern windmill. Airtricity has 600 MW of assets built up and permission to build another 963 MW of assets. Which means that if Scottish & Southern had set up the mills on its own, it would have cost roughly £1.6 billion. In buying Airtricity, it's now likely to end up paying nearly £3 billion. Scottish & Southern has warned investors the deal won't enhance earnings until 2011.
Scottish & Southern's problem is the scarcity value of wind-power assets as the EU's energy policy makers have set a renewable-energy target of 20 per cent of total supply by 2020. The UK has a self-imposed target of 10 per cent by 2010.
According to an article printed in the Deseret Morning News on Dec. 21, the wind farm planned for the Milford area will receive tax subsidies from the state of Utah to the tune of $4.3 million. Since all of the electric power from this subsidized project will be sent to California, it is akin to exporting Utah money, by wire, to the Golden State.
Fraser also thundered how the Macarthur wind farm could have a generating capacity of up to 450MW -- enough "clean energy capacity to power approximately 250,000 average Australian households".
When of course, he somehow failed to add, the wind blows.
When it doesn't, those 250,000 households will be getting their electricity from dirty old coal.
The 450MW sounds impressive. About a quarter the size of a Loy Yang, for perhaps half the cost.
But AGL -- and the rest of us paying for it -- would be lucky to average 150MW over a year. So about half the upfront cost of a Loy Yang for about 8 per cent as much power.
Let's face it: Most homeowners don't buy wind generators or solar energy systems simply for environmental reasons.
They make the investments because they're banking on a payoff in the form of lower energy costs.
Westar Energy is no different in wanting a bang for its green-energy bucks, which is why it's seeking a rate increase to support an $830 million wind energy project.
But just how much of a payoff should Westar receive? And at what risk? ...To some extent, it's reasonable to place the cost of wind power on the shoulders of ratepayers. After all, wind could provide Kansans with an abundant, environmentally friendly energy source to offset the cost of fossil fuels.
Westar and its stockholders should be given the chance to obtain a fair return on the company's investment. At the same time, though, the company bears a responsibility for keeping cost increases to a minimum for its customers.
A state consumer agency is demanding to know whether Gov. Kathleen Sebelius and her lieutenant governor have tried to influence state regulators who are about to decide how much consumers will have to pay for wind power from Westar Energy.
The concern stems from a once-confidential memo written by the former chief executive of Westar Energy indicating that Sebelius and Lt. Gov. Mark Parkinson influenced utilities to pursue large-scale wind power by promising they would be "fully compensated" for any added costs of building wind plants.
A dozen wind power projects generating close to 2700MW at full capacity are on the drawing board or have planning approval. The first of the big ones is not due for completion until early next decade, if it is not held up by objectors concerned about the visual impact and noise pollution. ...But just as there are high costs and climate constraints with hydro power, so there are with wind.
The worldwide shortage of wind turbines is driving up price and generators are looking outside traditional suppliers in Denmark and Germany to other manufacturers in China and India.
Regulators recently dealt a serious blow to a proposed offshore wind farm in Delaware, criticizing the plan as too financially risky to consumers. ...what's significant about the news from Delaware is that the Public Service Commission used a team of independent consultants to determine the project's costs and their effect on consumers.
That's not the case with the Cape Wind project. So far, the developer has refused to provide financial data that would help the public consider the definition of economic viability. As a result, how can the public fully consider the project if it does not have the appropriate economic information on which to judge it? The point at which the project becomes economically viable is critical to the public's consideration of the project as this private venture seeks to use public lands. ..."After six years of 'exhaustive' review of Cape Wind, we are still getting stonewalled," said Mark Forest, Delahunt's chief of staff.
Some Franklin County legislators were angry when the final tax-break agreement was reached for the Noble Chateaugay Windpark and Noble Bellmont Windpark.
During talks to determine how much Noble would pay taxing jurisdictions in lieu of full tax value, the Franklin County Industrial Development Agency, each township and the Chateaugay Central School District had representatives there, but no one apparently represented the county. ...We would seem to be in the middle of a jurisdictional collision. Individual taxpayers may compute or consult their tax bills to see where their allegiance lies, but, when the negotiations are eventually concluded, all parties should realize that the interests of those taxpayers are more important than it is for any of the boards to look good to their constituents by having forged the best deal.
This very much needs to be a cooperative arrangement.
There is a painfully inconvenient truth for many Australian politicians and climate change activists facing the 2007 federal election. It is that international scientific opinion and technical experience clearly indicate that the pivotal solution to both energy security and climate change is the increasing use of nuclear power technology. ...In Australia, the Labor Party's proposal to have a mandatory renewable energy target of 20 per cent of electrical energy to be provided from wind, solar and geothermal sources by the year 2020 is far more impractical and ambitious than the targets of the European model. It could become a huge financial burden on energy users unless massively subsidised by an incumbent government.
Typically, wind power with an average capacity factor of say 25 per cent will need back-up generators prior to grid connection.
Much of what is passing for debate about climate change in the election is just too silly for words. ...In 2003 an independent inquiry chaired by a former Coalition Senator, Grant Tambling, found that "by 2007 sufficient capacity is expected to have been installed to meet the target. As a consequence, investment is expected to fall away rapidly."
It recommended doubling the target and extending the scheme to 2020 in order to stop the renewables industry collapsing.
Last week a newspaper reported that that warning was backed up by then Environment Minister Ian Campbell, who wrote a secret memo to the Prime Minister in December 2005 expressing concern that investment in renewable energy would "come to a halt"' within 12 to 18 months.
"Since wind energy has been the main beneficiary of MRET, this industry is likely to be the most affected, though there will also be important impacts for solar hot water heaters, energy generation from sugar by-products and other producers," he wrote.