Library filed under Taxes & Subsidies from Denmark
The Danish wind turbine giant could run out of puff as a result of a new Republican tax proposal.
The statistics from Denmark's statistics are scary: In 2016, Danish households paid an average of 17,700 DKK (2,714 US$) in so-called "green" taxes or a total of 47 billion. kr. (7 billion US$)
"You have to remember this is a billion-figure cost that we’re passing on to the Danes," said the party’s leader, Kristian Thulesen Dahl. "While some investors may be annoyed by the fact that they won’t make as much money, that’s no biggie, it’s just business. We also have a responsibility to discuss the costs we impose on Danes over the next 10 year."
Denmark will scrap the “expensive and ineffective” tariff that has been financing renewable energy development since 1998, the government has announced. ...“The PSO tariff is expensive and ineffective. We have long believed that the rising costs are unsustainable and now it is abundantly clear that we have to find an alternative. Therefore the government is ready for a showdown over the PSO levy.”
It is not possible to lie to the people forever about whether wind turbines can compete on equal footing with other forms of energy when the reality is that wind power - for the first 40 years of development - and forever after, will require billions in direct and indirect support.
The Danish Minister of climate and energy, Lars Christian Lilleholt, is talking about creating peace on the energy agreement from 2012, but he's also discussing saving 5 billion Danish kroner in green taxes by dropping wind farms already agreed upon. The savings delighted the Energy minister but the wind industry is seeing red.
“I think the criticism is over the top,” Lars Christian Lilleholt, Denmark’s energy minister, told the Politiken newspaper last month. He said the country still planned to invest 800 million krone, or $114 million, in green energy research in the coming year. “There is less money, but it is still a lot. And I sit in a government that must find a way for the Danish economy to make ends meet.”
At least one green energy developer recognizes that these stimulus subsidy programs have a record of doing more harm than good, and he isn't reluctant to say why. Patrick Jenevein, CEO of the Dallas-based Tang Energy Group, posted a Wall Street Journal article arguing that "the sequester offers Washington a rare opportunity to roll back misguided subsidies and maybe help reverse wind power's stalling momentum."
“Margins and pricing continue to remain pressured across the sector which, along with policy uncertainty such as the renewal of the U.S.’s production tax credit, have weighed on the wind industry.” James Evans, solar and wind analyst at Bloomberg Industries.
The Liberal Party wants to cut state funding for land-based wind turbines in favour of financing biogas, hydrogen and solar cell development. Several parties oppose the idea. ...Party group chairman Kristian Thulesen Dahl said consumers had paid huge additional charges on their electric bills for almost three decades, based on an ideological desire to promote the development of wind turbines.
Canadian investors looking for exposure to the booming alternative energy sector have a handful of domestic players to choose from, but the local pickings are pretty slim and most of the companies are small. So why not look overseas, to one of the green behemoths that has sprung up on the international scene? ...The fast-growing U.S. wind power industry, driven by favourable government tax policy, is Vestas' largest current market. ...Some analysts are also urging caution over Vestas' high price. "We find the shares are fundamentally overvalued," said analyst Christian Nagstrup of Jyske Bank, a Danish financial institution. The biggest risk he sees at Vestas is a bottleneck in getting parts to build the turbines. Subcontractors have been slow in delivering key components, and that could slow delivery of complete turbines, Mr. Nagstrup said in a recent report.
Since the oil shocks of the 1970s, governments around the world have paid plenty of lip service to renewable energies such as wind and solar power. But only a few governments have been able to engineer policies that have begun to bring alternative energies into wider use. Renewable fuels provided 18% of the world’s total electricity supply in 2004, according to figures from the International Energy Agency, a Paris-based intergovernmental organization. Almost all of that, though, came from hydropower, a source with limited growth potential because of geographic constraints. The use of wind and solar power is growing, but they still generated only 1% of global electricity production in 2004, the latest year for which figures are available.
The government’s plan to increase the nation’s reliance on green power could expand a black hole that already sucks nearly two billion kroner out of consumers’ pockets annually. In order to promote construction of wind turbines, the government has agreed to purchase the electricity they generate at a minimum price. The guaranteed prices have had the desired effect: some 5300 wind turbines dot the Danish countryside, producing 18.5 percent of all electricity generated. The practice has its downside, however. The guaranteed prices for wind power results in an overproduction that cost the state an excess DKK 21.6 billion between 2001 and 2005, according to figures from the National Audit Agency. Due to the uncertainty of whether the wind will blow, Energinet.dk, the organisation responsible for ensuring that the country can meet its electricity demand, has to keep a reserve of conventionally produced electricity in case the wind dies down. The extra cost is typically passed on to consumers in the form of higher electric bills.
Rube Goldberg would admire the utter purity of the pretensions of wind technology in pursuit of a safer modern world, claiming to be saving the environment while wreaking havoc upon it. But even he might be astonished by the spin of wind industry spokesmen. Consider the comments made by the American Wind Industry Association.s Christina Real de Azua in the wake of the virtual nonperformance of California.s more than 13,000 wind turbines in mitigating the electricity crisis precipitated by last July.s .heat storm.. .You really don.t count on wind energy as capacity,. she said. .It is different from other technologies because it can.t be dispatched.. (84) The press reported her comments solemnly without question, without even a risible chortle. Because they perceive time to be running out on fossil fuels, and the lure of non-polluting wind power is so seductive, otherwise sensible people are promoting it at any cost, without investigating potential negative consequences-- and with no apparent knowledge of even recent environmental history or grid operations. Eventually, the pedal of wishful thinking and political demagoguery will meet the renitent metal of reality in the form of the Second Law of Thermodynamics (85) and public resistance, as it has in Denmark and Germany. Ironically, support for industrial wind energy because of a desire for reductions in fossil-fueled power and their polluting emissions leads ineluctably to nuclear power, particularly under pressure of relentlessly increasing demand for reliable electricity. Environmentalists who demand dependable power generation at minimum environmental risk should take care about what they wish for, more aware that, with Rube Goldberg machines, the desired outcome is unlikely to be achieved. Subsidies given to industrial wind technology divert resources that could otherwise support effective measures, while uninformed rhetoric on its behalf distracts from the discourse.and political action-- necessary for achieving more enlightened policy.
The country’s pioneering role in wind energy is threatened unless local governments ease building codes, warns the minister of the environment. Strict zoning codes have virtually halted the construction of new wind turbines in Denmark, according to Marianne Bender, the chairperson of the Organisation for Sustainable Energy. While 748 turbines were put into operation in 2000, that number fell to a mere 6 in 2006. ‘Protests from citizens and lobby organisations have hindered the building of wind turbines many places in the country,’ she told daily newspaper Nyhedsavisen. ‘At the same time, one of the government’s first actions was to remove subsidies so turbines had to compete on market conditions.’
SAMSOE, Denmark -- In the late 1990s, Denmark set out to turn this farming and summer-vacation island in the Kattegat Sea into a showcase for clean energy. The government dangled generous financial subsidies. A former environmental studies teacher, Soren Hermansen, was hired to persuade residents to invest in wind turbines, solar panels, electric cars and giant straw-burning furnaces.