Texas Wind Rips off Taxpayers and Rate Payers, Money to Flow to China

In 2006, the Electrical Reliability Council of Texas (ERCOT) published a study that showed that while West Texas Wind resources were considered among the best in the United States, they were poorly matched to the needs of Texas Electrical consumers. The ERCOT staff reported:

These data indicate that the representative areas in West Texas have their highest monthly capacity factors in the spring months and in late fall. . . . None of these patterns has a high correlation with the typical ERCOT monthly energy demand pattern, with maximum electric demand occurring in July and August.

Not only did the ERCOT staff find that West Texas wind was the most productive during seasons of slack consumer demand, but that the West Texas Wind blew blew was the most productive during the hours of the day when consumer demand was low.

during the month of April, typical wind resources in West Texas have significantly higher average output in the early morning hours in April than during the afternoon. . . . for July, . . . typical wind generation in West Texas peaks in the early morning hours.

These findings pointed to an inescapable fact, West Texas wind would be least available when electricity in the ERCOT system would be most in demand, on hot summer afternoons. Other ERCoT studies showed that based on a review of historical data of actual wind turbine generation during ERCOT system peaks (from 4 p.m. to 6 p.m. in July and August), the average output for wind turbines was 16.8% of capacity. However, the data also showed that for any hour during these months, the output of the wind turbines could range from 0% of installed capacity to 49% of installed capacity. Because of wind's intermittency, the ERCOT Technical Advisory Committee, considered recommending a wind capacity value of 2%. This problem was by no means localized to Texas, and has been observed for New England Off shore wind, the upper Great planes, Tennessee, California, and Canada.

Last year T. Boone Pickens was interviewed by Fast Complany.com's David Case. Pickens was candid

Pickens: "I'm not going to have the windmills on my ranch. They're ugly. . . ."

Question: "So whose land is it going on?"

Pickens: "My neighbors', . . ."

Question: "What happens if Congress doesn't extend the $20-per-megawatt-hour Production Tax Credit for wind -- set to expire December 31? On a project this size, that's an $80,000 deduction every hour at full capacity."

Pickens: "Then you've got a dead duck. It would be hard to go without a subsidy."

Question: "What about when the wind doesn't blow?"

Pickens:"That's the problem with wind generation. You've got to supplement it with a gas-fired or coal-fired source so whoever buys it gets continuous 24-7 generation."

So West Texas Wind is not about meeting consumer demand, it is about subsidies. This was amply illustrated by Michael Giberson, who discovered that during the first six monthsof 2008, West Texas Wind

prices were below zero nearly 20 percent of the time. During March, when negative prices were most frequent, prices were below zero about 33 percent of the time.

Giberson observed,

ven if the market value of the power is zero or negative, the subsidies encourage wind power producers to keep churning the megawatts out.

Evidence from market data suggests that wind power producers will accept prices down to about negative $35 MWh before they shut down, since marginal operating costs are very low for wind power we can conclude that the subsidies are worth about $35 – $40 for each MWh of wind output.

Giberson in another post noted,

Unfortunately for wind power producers in the region, their output was higher during times that the price was low and their output was lower during times that the price was high.

Well of course. Wind generation is not about making money from the market, it is about subsidies as T. Boone Pickens admitted.

So do the tax payers get good value in terms of the dollars they spend on C02 mitigation by wind? Not according to Australian engineer Peter Lang, who has researched cost and benefits of wind generation. Lang found that the cost of wind generated electricity, with natural gas back up was 224% higher than the cost of natural gas generated electricity alone, Thus not only does wind electricity at the wrong time, and thus the heavy lifting of electrical production with wind has to be performed by fossil fuels, but electricity generated by wind and fossil fuels costs far more than electricity generated by fossil fuels alone. But how much CO2 does the use of wind save us? The answer is very little. Lang looked at three estimates, the first, suggested by Lang himself, suggested with a wind and gas combination CO2 savings would be in the order of 0.058 tons of CO2 per MWh id electricity generated. A second estimate from an Australian government report determined that wind without considering back up, would lower CO2 emissions by 0.5 tins of CO2 for every MWh of electricity generated. Finally Lang turned to a Royal Academy of Engineering report that found wind with fossil fuel backup lowered CO2 emissions by 0.09 tons per MWh generated.

Given this data Lang calculated that given his assumptions, using wind to mitigate CO2 emissions cost $1,149 per ton of CO2 eliminated, while using the Royal Academy of Engineering's estimate using wind backed by natural gas would cost $830 per ton. The United States Energy Information Agency estimates that the levelized cost of nuclear power will be 107 in 2016. That would yielded a cost of around $100 per ton of CO2 saved. (Lang reported a lower estimate for nuclear based on older Australian studies. Lang concludes

Only nuclear and the fossil fuel technologies with carbon capture and storage can make substantial reductions in emissions.

Well there you have it. Earlier this week, I reported on an absurd scheme to build windmills in West Texas, using wind generators made in Chinese factories and 30% paid for by U.S. stimulus funding. Electricity produced by the turbines would be heavily subsidized. Most of the jobs created by this project would go to Chinese workers, and profits created by tax payer subsidies would flow to Chinese investments. Is anyone else outraged?