Thursday, January 6, 2011

Wind Energy: But It Still "Feels Good"

As a former vice-president would say, "Hey, it's an inconvenient truth."

The story says it all. Hardly any need to comment.
One would think that by now Obama Administration officials would admit that “wind farms” do not provide large economic and job benefits. However, recent Administration statements suggest the delusion continues and, perhaps, that officials do not understand why their expectations are unrealistic.

The story goes on to provide several reasons why folks were wrong:
  • Ignoring the fact that much of the capital cost of “wind farms” is for equipment purchased elsewhere, often imported from other countries.
  • Assuming that employment during project construction results in new jobs for local workers — most "wind farm" jobs require specialists.
  • Assuming that the very few permanent “wind farm” jobs are new jobs filled by local workers – there are very few permanent "wind farm" jobs; those that are permanent are filled by those who come from "outside"
  • Assuming that temporary workers who are brought in for short periods live and spend their pay checks — and pay taxes — locally; most spend their money where their permanent residence is.
  • Assuming that the full purchase price of the goods and services purchased locally (often minimal in any case) has a local economic benefit.  In fact, only the local value added may have a local economic benefit. 
  • Assuming that land rental payments to land owners for allowing wind turbines all have local economic benefit. In fact, these payments will have little or no local economic benefit when the payments are to absentee landowners OR if the money is spent or invested elsewhere or is used to pay income taxes that flow to Washington DC or state capitals.
  • Using “input-output” models that spit out “indirect” job and other economic benefits that, in effect, are bogus.
  • Ignoring the environmental and economic COSTS imposed by “wind farm” development, which are conveniently overlooked. Gee, I wonder why?
  • Ignoring the fact that electricity produced from wind turbines, has less real value than electricity from reliable generating units — because that output is intermittent, volatile and unreliable. We've said this over and over.
  • Ignoring the “backup power” costs; i.e., the added cost resulting from having to keep reliable generating units immediately available (often running at less than peak efficiency) to keep electric grids in balance. Yup.
  • Ignoring the fact that electricity from “wind farms” in remote areas generally results in high unit costs of transmission. In fact, environmentalists have stopped new transmission lines, or new transmission lines are prohibitively expensive. 
  • Ignoring the fact that the higher true cost of the electricity from wind is passed along to ordinary electric customers and taxpayers who then have less disposable income to spend in the local area.
But the last comment, printed verbatim, is right on target:
  • Perhaps most important, ignoring the fact that the investment dollars going to “renewable” energy sources would otherwise be available for investment for other purposes that would produce greater economic benefits. “Wind farms” have very high capital costs and relatively low operating costs compared to generating units using traditional energy sources. They also create far fewer jobs, particularly long-term jobs, and far fewer local economic benefits. “Wind farms” are simply a poor choice if the goals are to create jobs, add local economic benefits, or hold down electric bills. 

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