Wednesday, August 21, 2013

Wind Turbine Construction Slows: Guest post by Willem Post

This guest post by Willem Post appeared as a letter to the editor in our local paper, the Valley News.  (I have a subscription, but the letter may be behind a paywall for most people.)  Post has allowed me to republish it in this blog.


To the Editor:

Things are looking up. There is a major slowdown in wind turbine construction all over the U.S.

In the first quarter of 2013, only 1.6 megawatts of wind turbine capacity was built and in the second quarter, zero was built. The main reason is the expiration of the Section 1603-c program at the end of 2012, which gave federal cash grants of about 30 percent of the project capital cost to wind turbine project developers.

This infusion of cash grants to Big Wind under the American Recovery and Reinvestment Act of 2009 changed the economics of the industry overnight. Projects that made no economic sense became viable with the cash grant (Lowell Mountain, etc.) In many cases, applications were rushed to take advantage of the cash grants before deadlines. The industry’s project pipeline was emptied, rushed to approval and built by the end of 2012.

During the cash grant program period, about 30,000 megawatts of new wind turbine capacity was built, more than doubling U.S. wind turbine capacity. The U.S. had never experienced that rate of growth with just the production tax credit (PTC).

With domestic, abundant, low-CO2 emitting (compared with coal), no-particulate emitting, low-cost natural gas , and continued flat demand for electricity, it’s no surprise the cash-grant-induced wind turbine bubble collapsed and will likely push installations back to mid-2000s levels, or less, if the PTC is finally allowed to expire after 24 years.

If extended, the PTC, set to expire at the end of 2013, will offset above-market wholesale prices for wind energy, but will drive just moderate levels of wind turbine capacity growth.


Willem Post is a frequent guest blogger on this blog.  His most recent post was Off-Shore Wind Versus Nuclear. Another recent guest post is Wind in Vermont is Oversold.  Many of his posts appear at The Energy Collective, where he is a high-ranked blogger.


jimwg said...

Wonder how much it's going to cost to decommission and haul away all those monstrous whirligigs (like those rusting away in Hawaii!) and refurnish the scarred landscape to a halfway pristine state -- and who'll get stuck paying for this knee-jerk response to nuclear fear?

James Greenidge
Queens NY

trag said...

As James alludes to, there is no built-in decommissioning fund for wind and solar. Wind turbines have a predicted lifetime of 20 years -- solar 30 years. When they wear out, who will pay to dispose of them properly? How many of them are sitting on leased land, and will be left there for the land owners to dispose of at their own expense?

Every nuclear reactor in the USA has a trust fund to pay for its eventual decommissioning, returning the land to a state usable for other purposes. These trust funds are filled by a small fee on the electricity produced. Every nuclear reactor, including Vermont Yankee, also pays into a federal fund to pay for the disposal of all nuclear electricity generator waste.

These decommissioning trust funds and the federal waste disposal fund, combined with zero emissions of air pollution, make nuclear electricity generation the most ecologically responsible electricity generation available.

I made this point in my letter to the PSB.

Atomikrabbit said...

The owners aren't worried about what will happen in 20 years. Their machines have already reaped their intended harvest - subsidies.

Anonymous said...

The State of Hawaii had to go to court to get a court order declaring the abandoned windmills at Ka Le to be a public nuisance. The process took years but they got the order and then the taxpayers had to pay to have the junk hauled away. The owners collected their subsidies and walked away. Hundreds of windmills are rusting away at Tehachapi Pass in CA, but there are no laws on the books, either locally or at the state level, that requires owners of defunct windmills to clean up their sites after they are abandoned. The solar PV facility at Carrizo Plain is basically a boneyard for used solar panels after it went bankrupt and was abandoned. It never ceases to amaze me that anti-nuclear kooks hammer nuclear power yet it is the only industry that plans ahead for managing its (small volume of) waste and decommissioning and restoring the sites of its plants.