US Wind Industry Under Siege: Congress Set to Cut Subsidies as Communities Boil Over

turbine collapse 9

Cut the subsidies and the whole rort collapses.

Wind power opponents seek repeal of tax credit
The Seattle Times
Hal Bernton and Erin Heffernan
21 September 2014

FOREST, Wisconsin — When wind-power developers prospected the rolling hills around this small dairy town, they found plenty of gusty sites for turbines. In 2011, they proposed a $250 million project with up to 44 turbines that could produce enough energy to power thousands of homes.

Since then, nothing has come easy for the developer in a state that has emerged as a stronghold of resistance to the spread of wind power.

In Forest, opponents gained enough votes to take over the town government, sued in state court to try to block the project, and added their support to a national movement that seeks to end the federal tax credit for the wind-power industry.

“We are here to protect our property values, our eagles, our health and our town,” said Brenda Salseg, spokeswoman for the Forest Voice, the local opposition group, which posted online a form letter urging the Wisconsin congressional delegation to oppose the tax credit.

The tax credit was passed by Congress in 1992 and has been periodically extended. It is currently set at 2.4 cents per kilowatt hour, and, during times of glutted electricity markets, can be worth more than the wholesale price of power.

This tax credit has helped catapult wind power to the front of the U.S. efforts to launch a renewable-energy industry.

By the end of 2012, wind power represented 43 percent of all new U.S. electric generation installed that year and was hailed by the Obama administration as a key in the global effort to combat climate change.

Wind power also has been bolstered by state mandates that require utilities to acquire a certain percentage of the power from renewable-energy sources.

The turbines operate in more than three dozen states, from Washington’s Columbia River Plateau to the Allegheny Mountains of Maryland, and in 2013 provided more than 4 percent of the nation’s power, according to a Lawrence Berkeley National Laboratory report.

In many areas, wind turbines have been welcomed as an economic boon to landowners who are paid for leasing acreage.

But as wind power has grown, so, too, has the opposition.

In some communities, such as Forest, developers have faced a backlash from residents concerned about the noise and health effects of living near wind-power projects.

The toll on birds and bats killed by turbine blades has drawn scrutiny.

Critics have attacked wind power as a fickle source of electricity that ebbs whenever the wind dies down. They fault the tax credit for encouraging new projects when many utilities have plenty of power.

Over time, the politics of wind power have become more partisan.

Most of the wind-power capacity is within Republican congressional districts, but many politicians in the party have made ending the tax credit part of their agenda. This year, efforts to extend the tax credit have made little headway in the Republican-controlled House.

Some House Republicans such as Rep. Dave Reichert, R-Wash., still back the tax credit, according to Reichert’s spokeswoman. But some former supporters have turned against it.

Rep. Kevin McCarthy, the House majority leader, once advocated the tax credit that helped spur investment in wind farms in his California district. But before his June election to his leadership position, he told the Wall Street Journal he thinks wind companies no longer need the tax credit.

“My feeling is the current situation is as bad as it has ever been,” said Robert Kahn, a Seattle consultant who represents wind-power developers. “Congress is so polarized about so many things that if some people are for it, other people are going to have to be against it.”

The fight against the tax credit also has been championed by Americans for Prosperity. One of the nation’s most prominent conservative advocacy groups, it was co-founded by billionaire David Koch, who has extensive interests in the fossil-fuels industry.

The organization last fall sent an open letter to Congress signed by more than 100 groups, including many smaller groups formed to fight wind power.

Wind-power advocates note that fossil-fuel industries have received federal subsidies for decades, such as a tax provision that allows favorable write-offs of oil-drilling costs. They say the government should put a price on carbon, or continue offering incentives for technologies that produce energy without carbon emissions. “We don’t want to lower or eliminate our tax credit when everyone else gets to keep theirs,” said Jim Reilly, a senior vice president of the American Wind Energy Association.

The wind-power tax credit extends over the first 10 years of a project’s operation. Congress has typically extended the credit a few years at a time, creating financial uncertainties for the wind-power industry.

In 2013, installations of wind farms declined by more than 90 percent from the previous year, reflecting concerns that the credit would not be extended.

Congress did extend the credit that year, eventually prompting many companies to break ground on projects.

Many are going in this year, putting the industry on a record pace for construction, according to the American Wind Energy Association.

The cost of new power has plummeted to record lows. The average price of about $25 per megawatt hour for power-purchase agreements in 2013 was nearly a third less than in 2009, according to a study by the Lawrence Berkeley lab.

What would happen if the tax credit dies?

Ryan Wiser, a co-author of the Berkeley report, said that would push the price of wind power past $40 a megawatt hour, and cool investor interest.

“The number of projects would be much less, but there is no doubt there would be some,” Wiser said.

Even without a tax credit, wind power also would receive a boost from President Barack Obama’s proposed rule to limit emissions from existing power plants. It could prompt the closing of some coal plants and open up more demand for turbine power.

But the proposed rule is opposed by many Republicans, and already is facing court challenges.

Conflict still rages Wisconsin once was swept up in the wind-power boom. But it’s now an example of how a state, even with federal incentives in place, can put the brakes on turbines. Many wind-power projects in Wisconsin are on relatively small properties, increasing the potential for conflicts with neighbors who don’t receive any lease payments but find themselves living next to turbines.

“The first day the turbines came on, I thought it was a jet plane taking off,” said Gerry Meyer, a retired mail carrier who complains of health effects from living near turbines in rural southeast Wisconsin.

Meyer has testified at state legislative hearings and also networked with Forest activists seeking to block the wind-power project proposed there by Emerging Energies.

These opponents have found some powerful allies among state Republican politicians.

“Wind turbines have proved to be an expensive, inefficient source of electricity, and thus any future construction of turbines simply is not a policy goal or object that should be pursued further,” Gov. Scott Walker wrote in a 2010 campaign memo obtained by the Milwaukee Journal Sentinel.

Walker, once in office, backed a legislative effort to increase setbacks for turbines by increasing the distance they must be located from a neighbor, and measuring that setback from the neighbor’s house rather than property line. That 2011 effort failed.

But a legislative committee voted to suspend the state’s wind-siting rule to study the health effects of wind turbines.

By the time the rule was reinstated a year later, five Wisconsin wind projects had been suspended or canceled, according to Clean Wisconsin, a wind-power advocacy group. New installations of turbines plummeted in the state.

In the months ahead, developers’ attorneys will argue in court for the right to finally move ahead on the Forest project.

Meanwhile, an emotional battle over the project continues to rage within the community. “It’s been devastating for the town,” said Carol Johnson, a Forest resident who supports the project. “Many family members will never speak again … It’s just torn the town apart.”
The Seattle Times

As it goes in Wisconsin, it goes all around the globe: spear giant fans into closely settled rural communities and the only thing guaranteed to be generated isn’t meaningful power, but a constant source of anger, hostility and community division. What makes these people so wild is that all their suffering has done nothing for the economy or the environment, leaving them feeling like dupes in the greatest fraud of all time (see our post here).

We love the line about how closing coal plants would “open up more demand for turbine power”. We think that’s a form of flattery best reserved for first dates. There is no “demand for turbine power”. In the absence of mandated targets (shortfall charges, penalties and the like) or massive subsidies there is NO demand for an unreliable and intermittent power source that can only ever be delivered at crazy, random intervals (see our post here). Wind power is not an alternative energy source (unless you’re prepared to sit in the dark for hours and days on end?) and will never be a substitute for conventional generation sources available on demand (see our post here).

We note a lot of “brave” talk about the wind industry being able to survive if the US Congress does away with the Production Tax Credit (PTC).

If the tax credit dies, the US wind industry dies – it will not be a case – as Ryan Wiser asserts – that: “The number of projects would be much less, but there is no doubt there would be some”.

What utter piffle. Cut the subsidies and there will never be another wind turbine erected anywhere, ever again.

The massive stream of subsidies – like the REC and PTC – provide the ONLY explanation for the wind industry – as recognised by the “Sage of Omaha”, billionaire Warren Buffett – whose company Berkshire Hathaway has invested $billions in wind power in order to get at federal subsidies – namely the PTC – which is worth US$23 per MW/h for the first 10 years of operation.

A subsidiary of the Buffett-owned MidAmerican Energy Holdings owns 1,267 turbines in the US with a capacity of 2,285 MW – eventually when the company’s Wind VIII expansion is finished, MidAmerican will own 1,715 turbines with a capacity of 3,335 MW. Buffett has piled into giant fans for one reason only: to lower the tax rate paid by Berkshire Hathaway.

As Buffett put it earlier this year at his annual investor jamboree in Omaha, Nebraska:

“I will do anything that is basically covered by the law to reduce Berkshire’s tax rate. For example, on wind energy, we get a tax credit if we build a lot of wind farms. That’s the only reason to build them. They don’t make sense without the tax credit.”

There, Warren Buffett said it, not us.

At least he had the honesty and integrity to explain the only conceivable basis for the greatest rort of all time. And isn’t it so much better when those that profit from it choose not to speak with “forked tongue”. Maybe Ryan Wiser, the CEC and AWEA can take a leaf out of Warren’s book?

subsidies

A universal wind industry fear.

About stopthesethings

We are a group of citizens concerned about the rapid spread of industrial wind power generation installations across Australia.

Comments

  1. ‘What have I done?’

    Landowners in the same situation should not have to carry the guilt that justly lurks for the operators, owners and supporters of IWEF’s. In our case landowner hosts are absentee and no-one actually lives on properties hosting the turbines. It is all very convenient and satisfactory for them. They don’t even live in the local community, don’t see the impacts and all is rosy in the green dream.

    Landowners wanting more installations who continue whole-heartedly supporting this faulty industry with absolutely no regard for friends or neighbours and with full awareness of the damage being done to the people nearby; should read this man’s statement and learn how to be a person who lives with integrity and good purpose and have real care and concern for land entrusted to all of us.

    Some want more, more, more, and have no regard for the consequences and when it’s too late don’t have the courage or constitution like this man and others like him who admit the mistake. Company representative are trained to blind and literally deceive communities and use all kind of tactics including the fostering of guilt in decent people to feel responsible for…wait for it… the state of our planet, or the number of local jobs, if they don’t support this industry.

    For decent people learning the truth, the more you are shocked by the deceits. For indecent, opportunistic people the more you learn, the more you rubbed your hands in glee and perpetuated the deceptions. It won’t be a good idea to remove the 2km or 5km setback zones, it really won’t because the more people you expose to the noise and vibration and health issues the less likely the deceptions stick. The more you ignore or degrade the people advocating the truth the less opportunity to degrade other communities.

    Once the concrete and cabling and infrastructure is in place it is there for good. Our home-lands and even the wildest, remotest and to the folk who live there, the most beautiful back water places are being changed forever. The tonnes and tonnes of concrete are implanted in soil and wont be removed or restored to it’s previous natural state …ever. Not caring for the planet and not caring for the people and creatures on it. To live there becomes hell, night after night and day after NOISY day. It wouldn’t be allowed in the city and shouldn’t be allowed anywhere in the country.

    One more thing; some landowners are ‘gagged’ by signing contracts and I think also community groups accepting money from IWEF in community funding also sign a contract that prohibits portraying the company in any kind of negative light. Eventually making it difficult to get a true picture of community reaction to whopping great big noisy harmful machines in places near people where they just don’t belong. Causing all kinds of havoc in an energy system where they just don’t work. It’s no longer about ‘what have I done’, what’s being done to fix it?

  2. Writing this with a political slant is totally preposterous. Politics plays no part in citizen complaints against the raping of fertile farm land, killing birds and bats, causing assorted health problems, and landowners being forced to sign documents forbidding them from publicizing anything negative about the turbines. When the turbine is producing power, the backup system has to keep operating anyway, but inefficiently, raising the cost of energy when it does have to come back online. And the wind farm tycoons are under no obligation to furnish proof that carbon emissions have been reduced. Besides, think of all the fossil fuels involved in mining the metals for the turbines, transporting the parts, manufacturing the turbines, transporting and planting them. Then there is the maintenance, which requires vehicles of various kinds – all using fossil fuels.

    Read this man’s lament after sacrificing his precious farm land to a wind farm.
    https://www.wind-watch.org/alerts/2007/12/27/what-have-i-done/

  3. Mary Kay Barton says:

    Residents compare living under turbines to the “Deep, Dark Depths of HELL”:
    http://www.times-news.com/news/article_3fe338ec-3ba5-11e4-85b6-df77572b34a3.html

    New lawsuit [against Invenergy] filed in Orangeville, NY:
    http://www.thedailynewsonline.com/news/article_326873a8-2a7a-11e4-8f8b-001a4bcf887a.html

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