An Open Letter To Amazon about the NC Desert Wind project

 

9/1/15

To: Amazon CEO Jeff Bezos

Mr. Bezos:

I’m an energy expert, a longtime Amazon customer, and an ardent company supporter. As such I’ve read with great interest some breathless press releases about your recent procurement into the NC Desert Wind project.

Due to your careful management Amazon is now a large, successful company, that has made many good economic decisions. During your tenure, the company has publicly portrayed itself as not only environmentally sensitive, but also concerned for the national welfare. All this makes Amazon’s involvement with the Desert Wind project quite puzzling.

After you were approached by Iberdrola to partner with them, one would assume that you utilized a battery of lawyers on your payroll to do a thorough due-diligence on the Desert Wind project — what is apparently “Amazon’s largest renewable energy project to date.” Here are some facts that question the wisdom of Amazon’s subsequent decision to go forward:

Fact #1 – Iberdrola originally made three separate sales pitches to sell the electricity from this project to the NC utility companies: Duke, Dominion, and Progress.

Interestingly, each one separately declined Iberdrola’s solicitation. In each case the reason given was that the cost was uneconomical.

Following that, Iberdrola reportedly complained to the NC Governor at the time, Beverly Perdue. She then wrote a pointed letter to the CEOs of each of those three companies, pressuring them to them to reconsider. To their credit, after a second evaluation, each of the three utility companies again declined to participate with the Desert Wind project.

Question #1:

Is Amazon really smarter about electricity economics than the first and third largest utility companies in the US — who carefully checked out and then rejected involvement with this project because it did not make economic sense?

———————————————————————————-

Fact #2 – For years now, Amazon has gone to great lengths to convey the impression that they are a champion of the environment. From packaging to drone delivery, the mantra is that “Amazon is environmentally sensitive.”

Question #2:

Why would Amazon partner in a huge 20,000± acre industrial project that has had absolutely no independent environmental assessment? None. In fact Iberdrola strenuously objected when NC-DENR asked for one.

———————————————————————————-

Fact #3 – In a similar vein, Amazon has communicated that security is a top priority to them. For example, you have gone to great lengths to protect the personal information of your customers.

Question #3:

Why would Amazon participate in a major development that is a known substantial national security risk (e.g. see this 30 page report)? If Amazon is genuinely interested in their customer’s security, why would they invest in a business that degrades our country’s protection from terrorists, drug traffickers, unfriendly nations, climate change, etc?

It seems that there are two possible explanations for this strange situation:

a) Amazon failed to do a proper due diligence, and instead unduly relied on the assurances of Iberdrola that there was nothing to worry about.

b) Amazon was fully aware of these serious economic, environmental and security liabilities, and decided that the benefits of greenwashing, exceeded those liabilities.

I’m hoping that the answer is “a” and that on further investigation Amazon will immediately disassociate itself from this problematic venture.

Sincerely,

john droz, jr.

physicist

Morehead City, NC

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confusedphoton
September 3, 2015 3:19 am

Let us hope there are no rare raptors near the wind project, otherwise it will be bye bye birdie

Bloke down the pub
Reply to  confusedphoton
September 3, 2015 5:43 am

Let’s hope that Amazon don’t try to fly any drones near by either, or someone won’t be getting their goodies on time.

Scott
Reply to  Bloke down the pub
September 3, 2015 5:57 am

Yes, but the nice wrapping paper will dress up the “Wind Kill” nicely enough to make the green environment not clash with the red blood splattered on the hideous wind farms. Why the Green Monsters will sell it as Christmas comes early to a wind farm near you.

Joe Crawford
Reply to  Bloke down the pub
September 3, 2015 7:04 am

Many years ago I worked with a guy who, when in the service, had been assigned to one of the radar stations on the DEW line in northern Canada. If a sea gull flew between the feed horn and the sail it was immediately fried. While there, one of his jobs was to go out and clean up the mess.

Luther Bl't
Reply to  Bloke down the pub
September 3, 2015 10:57 am

Green Monsters have stopped doing Christmas: they now do winter vacation. (Often, jetting away to ski).

DAV
September 3, 2015 3:23 am

Obviously, the subsidies outweigh any other consideration. So, yeah, because of them, Amazon makes more money.

BFL
Reply to  DAV
September 3, 2015 7:50 am

That should have been one of the facts.

Reply to  DAV
September 3, 2015 3:31 pm

Just following the lead of Warren Buffet.

Karl
Reply to  DAV
September 3, 2015 9:18 pm

What subsidies? US Federal Subsidies for Commercial Wind ended in 2014.

Keith Enright
Reply to  DAV
September 7, 2015 7:00 am

Amazon don’t make money. I think they may have made a small profit last year, but I can’t be arsed checking. I’ll let you guys do that

September 3, 2015 3:25 am

Apple is the acknowledged expert at Greenwashing.

And we’re making real progress towards running all our facilities on 100 per cent clean and renewable energy.

They boast to the world they ” ….run facilities on 100 per cent clean and renewable energy” rather than ” ….run facilities 100 per cent on clean and renewable energy”.
http://www.apple.com/uk/environment/renewable-resources/

RockyRoad
Reply to  Joe Public
September 3, 2015 4:44 am

No wonder their products are so expensive.

Chris
Reply to  RockyRoad
September 3, 2015 6:26 am

They have targeted high end products for 30 years, long before they ventured into renewable energy.

George Lawson
Reply to  RockyRoad
September 3, 2015 8:25 am

There is method in Apples apparent madness.. They see that all the Greenies, misguided do gooders and other camp followers will buy their products because they are more green than their competitors. It is a hard nosed but deceitful marketing policy to attract business on lies and mis-information.

David Smith
Reply to  RockyRoad
September 3, 2015 12:43 pm

+1 to George
The greenies (and all of us) need to remember: no company is your friend.

Broady
Reply to  RockyRoad
September 3, 2015 1:42 pm

Yes David. The Government is your ownly true friend, and they have access to nice people in uniforms. People who can come around and make sure you understand the correct message. No system is perfect, but I can choose not to agree with a company.

Gary Pearse
Reply to  Joe Public
September 3, 2015 4:18 pm

For some unknown reason, people think Apple is a nice cuddly soshulist company. I’ve been perplexed by the virtual monopoly they have on university faculty and other left organizations. Politically correct optics is of course the perceived method of schmoozing with their customers.

Editor
September 3, 2015 3:30 am

An excellent letter!. There is no reasoning behind Amazon’s insistence to support this project, in the same way there is no reasoning behind AGW. Anything to do with climate change is based on hysteria and belief not reasoning and logic.

johnmarshall
September 3, 2015 3:42 am

I await their reply but Amazon should realise what a nil return will do.

George Tetley
September 3, 2015 4:41 am

sounds like Amazon is attempting to reinvent the wheel , with some ignorant over-payed “genius” deciding to make it oblong instead of square, long live birds and government subsides.

September 3, 2015 4:45 am

How in the Devil did they come up with a name like “Desert Wind?”
Do they know that hurricanes sometimes ‘brush’ that area?

Dawtgtomis
Reply to  Slywolfe
September 3, 2015 7:05 am

That confused me (in my usual morning stupor) when I read NC desert. We are talking about North Carolina, right?

Reply to  Dawtgtomis
September 3, 2015 8:33 am

Yes, NE NC near Pamlico Sound.

juandos
September 3, 2015 4:59 am

The referenced study: US Military vs a Political Fad (Renewable Energy) could have easily been titled: “How to Be Stupid with Somebody Else’s Money”…

Djozar
September 3, 2015 5:04 am

The leading utility companies probably did their LCCA (Life Cycle Cost Analysis) without the “Green” modifiers imposed on government projects. LCCA take into account factors usually overlooked or exaggerated by their proponents, such as on going maintenance, delivery and installation costs and replacement costs. Government LCCA programs typically evaluate not just the real cost but use carbon to modify the results in their favor by up to a factor of 3.5; this makes a project with a 20 year payback look like a 6 year payback. I would love to see true renewables, wind has not proved itself anywhere to my knowledge, nor is any renewable truly “free” energy.

richardscourtney
Reply to  Djozar
September 3, 2015 5:20 am

Djozar:
I agree all you say – indeed, I applaud it – but I write to comment that it is best to avoid addressing the issues in terms ‘framed’ by Greens. For example, you write

nor is any renewable truly “free” energy

All energy is “free”: it was all created at the Big Bang and now cannot be created or destroyed.
But it is expensive to collect energy and to concentrate it so it can do useful work.
Fortunately, nature has done much of the collection and concentration for us.
The energy concentrated in ancient stars is available in radioactive materials, notably uranium. Energy from formation of the solar system (including collected radioactivity) is available as geothermal energy. Solar energy collected by photosynthesis over geological ages is available as fossil fuels. Solar energy collected by evapouration of water over large areas is available as hydropower.
Diffuse energy sources were used for millennia because higher energy densities were not available. These diffuse sources included wind power, solar power, biomass and power of the muscles of slaves and animals.
These diffuse sources were abandoned when the greater energy intensity in fossil fuels became available to do work by use of the steam engine. But, of course, hydropower was not abandoned because it has high energy intensity.
There is no possibility that an industrialised civilisation can operate if it abandons the sources of high energy density collected by nature and returns to using the energy that humans collect themselves.

Add to that the fact that wind and solar are intermittent so real power stations must operate all the time to ensure there is power when e.g. there is no wind at night and it is unavoidable that wind power and solar power are not needed and provide expensive additional cost for power generation.
Simply,
If wind power were economic and viable then oil tankers would be sailing ships
And
Most people want to switch their lights on – not off – when the Sun goes down.
Richard

Djozar
Reply to  richardscourtney
September 3, 2015 5:43 am

While I understand and generally agree with your comment, I’m looking at free as economically free, not free as a part of physics. The energy obtained by a windmill or solar array may be free, but there are costs associated with the physical equipment. While I was going to college, I was a technician on a solar energy research project. While inexpensive materials were used to construct arrays (such as silicone and aluminum foil), they still had to use furnaces and hazardous oxidizers in the production process. So while the energy collection was “free”, there was never an economic payback due to the cost of producing the materials and treatment of the waste products.
In general, I believe that one day we will have renewable energy that conserves energy, protects the environment and actually has an economic payback. I just don’t think that day has come yet.
And thanks again for the comment.

ferdberple
Reply to  richardscourtney
September 3, 2015 6:24 am

There is no possibility that an industrialised civilisation can operate if it abandons the sources of high energy density
=====================
absolutely correct. population density can only be maintained by the addition of energy. the denser the population, the more energy that must be added. either this energy must be collected from sunlight, or using a stored natural source such as radiation of fossil fuels.
the problem with energy from sunlight is the area required for the collectors and the associated costs. especially in areas where sunlight is in limited supply. hydro-power minimizes the cost problem by using a natural collector, but this also is only available in limited areas.
so while it is theoretically possible to build solar collectors and solar energy storage on the scale required to support modern cities, there is a real question of whether the surplus created by the city is sufficient to pay for the cost of the collectors with existing technology.
a solution that bankrupts the economy is no solution.

mothcatcher
Reply to  richardscourtney
September 3, 2015 7:32 am

That’s a very nice precis, Richard, and well put. But you do realise that a very large part of the voting public – almost everybody with an arts or humanities-led education, or none at all, and even some science-oriented people – would be quite impervious to the import of such a magnificent summary? Somehow, we are being led into an area of completely different logic, and it isn’t easy to see where it ends.

richardscourtney
Reply to  richardscourtney
September 3, 2015 7:41 am

mothcatcher:
You ask me

But you do realise that a very large part of the voting public – almost everybody with an arts or humanities-led education, or none at all, and even some science-oriented people – would be quite impervious to the import of such a magnificent summary?

Yes, I am fully aware.
As I said, my reason for making the point(s) is “that it is best to avoid addressing the issues in terms ‘framed’ by Greens”.
To date the issue has been ‘framed’ by Greens such that as you say

Somehow, we are being led into an area of completely different logic, and it isn’t easy to see where it ends.

I am claiming we should loudly protest against being led into a morass of madness and destitution.
Richard

Michael C. Roberts
Reply to  richardscourtney
September 3, 2015 10:17 am

Mr. Courtney – Spot on evaluation. When I perform adult continuing educational/vocational training, I speak of the industrial revolution – and use very similar terminology and analogy as you have posted here. This is the truth of the progression of man from muscle/diffuse power sources to the concentrated and relatively mobile power contained in liquid and solid ‘fossil’ fuels (notwithstanding the validity of ‘Gold’s Theory’ or the various Russian theories regarding the origination of oil and methane) – and the resultant modern world that we enjoy today. This fact is lost on those that want to ‘change our world’ to a more socialist one, sans the concentrated power of fuels that have allowed us to live as we do now.
MCR

Luther Bl't
Reply to  richardscourtney
September 3, 2015 11:03 am

You miss out the metaphorial inference at work. Low energy density implies and is implied by low population density. Inferential rubbish, I know.

Reply to  richardscourtney
September 3, 2015 11:45 pm

Richard, you make the assumption that your government and the green blob want industrialised civilisations to operate. Do you have evidence to support this assertion?

richardscourtney
Reply to  richardscourtney
September 4, 2015 1:07 am

John Law:
Your question is based on a false claim that I make an assumption when – in reality – I don’t. Hence, I refuse to provide an answer.
As explanation for my refusal, I reply to you with a similar question to that which you posed to me;
Have you stopped beating your wife?
Richard

Crispin in Waterloo
September 3, 2015 5:43 am

I was making a calculation today analysing the claim that China’s power stations were running at 53% of capacity and they have a lot of windmills that are parked in winter because the power stations heat the cities with waste heat (CHP). What popped out was this:
Windmills are made using cheap energy from coal, ultimately. The price they have is related to the energy cost to build them, all things considered. A windmill will never generate enough energy to create another whole, erected, maintained windmill. In short you have to generate enough cheap energy in advance and get the energy invested back over time in an unreliable, expensive way. That we knew for a while.
But let’s try to buy a windmill made with power from a windmill, supposing that eventually it could be done. As it costs about four times as much to generate power using a windmill made with cheap energy, a windmill made by a windmill would cost four times as much if all the inputs came from other windmills: all the schools, factories, civil infrastructure, wires, transport and so on.
The second windmill would cost four times as much as the first and generate the same power. So the cost of the electricity from the second would be four times as much per KHW as the first windmill’s which is in turn four times as expensive as the energy that built it. The electricity from the second windmill is therefore 16 times the cost of the original windmill.
Now make a new third windmill using electricity from the second, which will cost 16 times as much as the first one, and it’s power output will have to be sold at four times the cost of energy that goes into it, which is 64 times the cost of the original energy, to be ‘economically viable’. I am not invoking a subsidy here because ‘subsidy’ already means it does not offer a viable business case.
It is rather obvious that anything approaching a modern economy can be operated on windmills.
A nuclear power station can produce multiple nuclear power stations each producing energy at the same cost as the original. Similarly hydro power stations. That is how we got to where we are now. It seems the big power companies understand this.

dp
Reply to  Crispin in Waterloo
September 3, 2015 8:24 am

Rubbish. https://en.wikipedia.org/wiki/Wind_power_in_Denmark
The Danes use wind power to build wind turbines and sales have been brisk. This of course is because their turbine sales are possible only through government subsidies in the consumer nations. The normal rules of economics to not apply to green energy.

ScottR
Reply to  dp
September 3, 2015 9:25 am

DP: Are you crazy? Subsidies don’t eliminate cost, they just hide it. The cost still degrades the entire economy. When a technology is not economically viable according to the “normal rules of economics”, it means that in REALITY, it is not economically viable. Windmills are expensive toys that clutter the landscape and eat up resources to no good end. If we attempted to generate all our power with windmills, people would die in droves. Wind energy is simply not sustainable.

Auto
Reply to  dp
September 3, 2015 12:08 pm

ScottR
dp assumed – I think – that he did not need an egregious, shouted /SARC! tag .
My evidence: –
QUOTE
This of course is because their turbine sales are possible only through government subsidies in the consumer nations.
END QUOTE
May I emphasise –
“The normal rules of economics to not apply to green energy.”
My conclusion is that there is a non-trivial amount of fraud involved in ‘green energy’.
Auto

ralfellis
Reply to  dp
September 3, 2015 1:14 pm

>>The Danes use wind power to build wind turbines and sales have been brisk.
The Danes have never used any of their wind power, because it is too variable. Instead, they sell it (at a loss) to the Scandinavians and Germans. Danish wind power must be the most expensive white elephant ever devised by man.
http://incoteco.com/upload/CIEN.158.2.66.pdf

Crispin in Waterloo
Reply to  dp
September 3, 2015 2:04 pm

dp – The Danes used to farm Greenland. Now they farm subsidies. Business is brisk. If they are making wind farmers rich, who are they impoverishing? The money to come from somewhere.

Reply to  dp
September 3, 2015 3:41 pm

Please list the name of ten wind farms that are making a profit – from mine to grid – AFTER subtracting ALL subsidies, rebates, and tax credits other than those given to any other power generation facility (e.g. deprecation, normal expenses, etc – NOT Renewable Energy credits etc.) keep reading that they are selling electricity for less than – fill in the blank. But it always seems that, upon close review, they always factor in all of the government handouts to get this so-called low price.

Reply to  Crispin in Waterloo
September 3, 2015 9:28 pm

I do not know where you got the idea that China has a lot of wind and solar generation. During a recent trip I saw none. In Lhasa, I saw a few very small domestic solar water heaters on houses (but none in other parts of China). I saw at least one Nuclear power plant and several power plants using coal. I also saw the 22,000 MW 3 Gorges Hydro power and heard about the planning for more Hydro in the Himalayas in Tibet and southern China. My thoughts are that any published figures on wind and solar in China are propaganda. China are building coal fired and nuclear power plants which will be base load. Hydro will be to a small extent base load but mainly to serve peak power.

VicV
September 3, 2015 5:53 am

Another example of buying in to a company (via subsidies) with the object of eventual government control? It makes one wonder what the powers-that-be use to as persuasion on people who should be immune to it: Threats against status (John Roberts?), or threats against the well-being of family, which, if carried out, could never be traced to their source?
Naw, it couldn’t be. Collectivist dictatorships and oligarchies are always benevolent, as has been demonstrated by the Russian Revolution, the Chinese Cultural Revolution, and, currently, Iran and ISIS.
What gets me is that these people who rise to power, many or most of them, truly believe they are doing good and are only stopping those who cling destructively to the past. What they in their intellectual conceit fail to realize is that human nature remains timeless, that “Progressiveness” is a self-righteous, self-serving illusion.

Burch
September 3, 2015 5:57 am

And there was this, showing Amazon’s careful management and good economic decision making 🙂
OK, not everything we do will be a raging success, but it does show that falling in love with an idea, despite the realities of the situation, can be a recipe for a costly failure.
http://www.cnet.com/news/fire-phone-one-year-later-why-amazons-smartphone-flamed-out/

Bruce Cobb
September 3, 2015 6:05 am

Renewables aren’t about economics; they are about a false ideology based on lies. Without subsidies they wouldn’t even exist.

oeman50
Reply to  Bruce Cobb
September 3, 2015 6:28 pm

You got it, Bruce. When two 6-MW off shore wind turbines off Virginia received bids of almost a half-billion dollars, Dominion blinked and said they had to go back to the drawing board. The greenies immediately said Dominion “didn’t really care about wind power” and were “never really interested.” There isn’t anything too unimportant to spend someone else’s money on.
BTW, gas-fired combined cycle plants that produce 1300 MW at a >80% capacity factor are being built in Virginia for about $1 billion. Compare that to 12 MW with a 30% capacity factor at $420 million. Hmmm…..

Karl
Reply to  oeman50
September 3, 2015 9:21 pm

Please provide a citation for the 500 million cost for two 6 MW turbines.

September 3, 2015 6:08 am

Perhaps they should promise to switch off their server farms/websites and warehouses when the wind stops blowing?
/thought not.

herkimer
September 3, 2015 6:08 am

It would appear that Amazon decided to proceed with this project for reasons other than best economical option for its share holders. and the local community . Subsides and government benefits seem to be involved here to still go ahead with the project despite its obvious flaws.
Important piece of information about hidden costs of wind projects
The INSTITUTE FOR ENERGY RESEARCH in their report called HARD FACTS state
The American Tradition Institute conducted a study
to calculate wind’s “hidden costs” They found
that when the hidden costs were taken into account,
including
• the cost of fossil fuel power as back-up
when the wind is dormant,
• the additional cost of transmission that frequently occurs with wind farms
due to the inaccessibility of the best wind resources,
• the cost of wind’s favorable tax benefits in
‘accelerated depreciation’,
• and a shorter estimated life of a wind turbine of 20 years (versus 30 years
assumed in most cost estimates)
• the cost of wind power is if natural gas is used to back-up the wind
energy or 19.2 cents per kilowatt hour if coal is used as the back-up fuel
then the costs are 1.7 to 2.2 times the 8.66 cents per kilowatt hour estimate the
EIA is using for generating electricity from wind in its models
http://instituteforenergyresearch.org/wp-content/uploads/2014/05/Hard-Facts-May-2014-Final.pdf
If you also read the IER report called WHAT IS THE TRUE COST OF ELECTRICITY
Electricity from New Wind Three Times More Costly than Existing Coal
WASHINGTON – Today, the Institute for Energy Research released a first-of-its-kind study calculating the levelized cost of electricity from existing generation sources. Our study shows that on average, electricity from new wind resources is nearly four times more expensive than from existing nuclear and nearly three times more expensive than from existing coal. These are dramatic increases in the cost of generating electricity. This means that the premature closures of existing plants will unavoidably increase electricity rates for American families.
http://instituteforenergyresearch.org/analysis/what-is-the-true-cost-of-electricity/
The graph below further illustrates how the EIA data is distorted.
http://www.eia.gov/todayinenergy/detail.cfm?id=22452
This graph clearly shows that the average monthly or yearly capacity factor is not 35% which EIA use for their levelized electricity calculations and comparisons for wind turbines vs conventional options like coal and nuclear . Using the 35% factor instead of 20- 25% lowers the cost per kwh and makes it look more competitive when in fact it may not be so.

ferdberple
Reply to  herkimer
September 3, 2015 6:36 am

nearly three times more expensive than from existing coal.
==============
what is missing from this analysis is the wholesale price of electricity. when the wind blows the windmills will produce power. At this point there will be a surplus on the grid and the wholesale price will drop to zero, or even negative. this is to prevent the grid from overloading. the low/negative price forces generators to shut down, as no power plant wants to pay people to take their power.
what this means however, is that the power produced by the windmills has close to zero market value at wholesale prices. its value may in fact be negative, because wind power is only available at times when there is lots of surplus power on the grid. at times when there is no wind, there is no surplus and wholesale prices will be high, but the windmills cannot take advantage of the high prices.
it is much like being a fruit grower. all your fruit ripens over a couple of weeks in the summer. and so does the fruit of all your competitors. so when you go to market everyone has a surplus of the same fruit and prices are low and you are lucky to make any profit. but come winter, when there is no fruit the prices are high, but you cannot produce fruit at that time to take advantage of the high prices.

RACookPE1978
Editor
Reply to  herkimer
September 3, 2015 6:56 am

Thank you, good information.

Auto
Reply to  RACookPE1978
September 3, 2015 12:22 pm

RA
Of course, in olden times, fruits were conserved, with sugar or honey, and laid by – covered in straw, in dark lofts (where it was cooler) – and so could be eaten, at least locally, until well into winter.
Hard fruits, at least – apples and pears and so on.
The same applied to vegetables.
Ahhh – but we want strawberries in December, and raspberries in February.
No true greenie would ever eat fruit out of local (well-conserved) season.
That does mean a lot of turnips and swedes in February, March and April. Even mashed with pepper . . . . .
Auto

Chris4692
Reply to  herkimer
September 3, 2015 8:29 am

Why is it that you think these are things that are unknown to those power companies, and their engineers, who are evaluating projects? There is nothing in this list that will not be known to those who work with windmills and see their operation. Yet the projects go on with only a 2.3 cent per kilowatt hour subsidy. That should be a clue that perhaps the evaluations in the studies you list are a bit questionable. You have the authors of the above studies who have a political point to make, versus engineers who are going to spend real money to make a profit, and whose careers depend on not being wrong too often.

Djozar
Reply to  Chris4692
September 3, 2015 12:25 pm

I am an degreed, licensed engineer – that’s how I know the manipulations that are made to show unrealistic paybacks.

Catcracking
Reply to  Chris4692
September 3, 2015 2:12 pm

Chris…
The decisions are not made today based on economics or good engineering. The decisions are made on mandates for an ever increasing % for renewable energy. To survive, the companies have to comply with the horrible ideas from the politicians, who are in the hands of the greenies and the MSM that are in the pockets of the green agenda.
Surely you don’t think that the gasoline suppliers are incorporating 10% ethanol because they want to.
Interesting, a business that supplies fuel to the public is required to incorporate 10% of their competition’s horrible ethanol which has 2/3 of the energy content for an imagined environmental benefit. No alternatives permitted.
Any company would love to get the same deal, requiring their competition to buy 10% of your product to incorporate your inferior produce in their content.

Ed
Reply to  Chris4692
September 3, 2015 3:11 pm

The primary subsidy is, of course, the mandate that renewable energy constitute a certain percentage of a utility’s sales. Similar to the law requiring that all gasoline sold in this country have at least 10% ethanol content. The industry itself would not exist without such subsidies.

Reply to  Chris4692
September 3, 2015 5:41 pm

Chris: Here in Illinois the General Assembly mandates wind and solar and the Commerce Commission sets rates. Why would decision makers care what engineers believe?
The General Assembly came within 3 votes of giving AFSCME a blank check in negotiations with the State. More than one third of all State taxes go to pay PENSIONS. Same with Chicago, 35% to pensions. Not those who do something, those who moved to Arizona.
So the General Assembly allows 15% overhead and profit on windmills and legislates fines for deuterium at just about background near nuke plants.
So what do engineers have to do with Exelon/ Commonwealth Edison’s power generation decisions?

oeman50
Reply to  Chris4692
September 3, 2015 6:36 pm

You are spot on, Chris. This is not about making an investment in energy with a known rate of return. It is an investment in PR and a response to pressure from the NGOs who are constantly waging e-mail and petition campaigns on Amazon, Google, Apple, you name it. They can say, “See, we did it.” But is never enough to satisfy the pressure groups, they always want more. And If Amazon went to 100% wind/solar somehow, the NGOs would find a new issue to egg them about.

RACookPE1978
Editor
Reply to  oeman50
September 3, 2015 6:50 pm

oeman50

And If Amazon went to 100% wind/solar somehow, the NGOs would find a new issue to egg them about.

Yeah.
Like no lights. No motors. No trucks and no packages. No orders. No computers. No email. No web pages.

Reply to  herkimer
September 3, 2015 3:50 pm

Also not factored in is the fact that there will be fewer fossil plants providing base loads or reliable electricity. Winter and summer are always heavy load periods. Utilities always scheduled maintenance outages in spring and fall – the season when AC and Heating were not used as much. I have overheard the dispatchers at work discussing that they were paying $2000.00, – $4,000.00 per kWh for purchased power to prevent rolling blackouts – while we were in a brownout (reduced voltage). There are going to be many more of these periods and the price will be several times as much,maybe 10 times as much. And the consumer pays for that.

Lauren R.
Reply to  herkimer
September 3, 2015 5:33 pm

Your raise some good points, but be careful comparing levelized cost of electricity. To compare new wind turbines to existing coal and natural gas plants is not valid. The existing plants will be cheaper because much of the original investment was made a long time ago and cost less to build. The proper comparison is levelized cost of new plants. Onshore wind is still more expensive, but not by much.
The bigger problem is its intermittent production of electricity which makes it less economical in the long run. Not to mention the ugly towers that impact much more area than a coal or natural gas plant. But a coal plant produces pollution that impacts an even larger area, though newer plants are much cleaner than older ones. There are tradeoffs for each kind of power generation. And if pie-in-the-sky fusion technology actually becomes viable, we’ll rejoice to see all those wind towers disappear. No power plant is permanent.
At any rate, wind and solar will never be a replacement for coal, natural gas, nuclear fission and hydroelectric, no matter how much the greenies wish it.

Pamela Gray
September 3, 2015 6:18 am

Reduced to one sentence:
You Amazon, can be fooled.

Tim
September 3, 2015 6:26 am

Good luck with an Open Letter…
“Desert Wind project can only be temporarily shut down by a “special” National Security declaration — one signed by the president.”
http://www.breitbart.com/national-security/2015/08/29/how-obamas-environmental-policies-are-undermining-the-us-military-and-national-security/

TonyL
September 3, 2015 6:53 am

Crispin in Waterloo brings up a key point. Are windmills net energy positive or net energy negative? A good accounting would be all inclusive from mining raw materials through refining, manufacturing, fabrication, installation, and commissioning. Including transportation at all stages, and then energy costs of maintenance and repair. We note for the record that windmills never seem to last anything like their rated lifespan. I have not seen any good breakout of energy inputs (or outputs/inputs, EROI, as they call it) for windmills.
I think the topic would make a fine feature article for WUWT.

asybot
Reply to  TonyL
September 3, 2015 8:06 am

I have brought up these facts many times during conversations with friends that are “greenish”. If you want to find out what the expression and ” Their eyes glazed over” means?. You should try it, it is a really neat process to watch (well at least as long as they can see you eye to eye)..

TonyL
Reply to  asybot
September 3, 2015 8:22 am

Heh, Heh.
I like it, I will give it a try. I love inducing brainlock in greenies. It is easy and it shuts them up for a while.

Chris4692
Reply to  TonyL
September 3, 2015 8:32 am

There is an index available to balance all the resources that go into a product. It is called “price”.

TonyL
Reply to  Chris4692
September 3, 2015 8:49 am

Well aware that price is a proxy for the energy cost of any produced goods. Sometimes we like to take a closer look at one aspect of production costs.

mikewaite
Reply to  TonyL
September 3, 2015 10:11 am

I believe that it has been discussed fairly recently , in the course of which discussion we were introduced to this paper by a dr weissbach which may answer some of your questions:
http://festkoerper-kernphysik.de/Weissbach_EROI_preprint.pdf
He discusses all major sources of energy , including renewables, and concludes that the most efficient combination in EROI terms is nuclear and hydro , which happens to be the combination that France is fortunate (or clever) to have invested in (approx 85% and15% respectively). Incredibly their Govt is intending to dismantle these power stations in favour of , presumably, wind , solar and bits of twig from South Carolina’s forests (what is left of them after Drax has had its share).

Karl
Reply to  TonyL
September 3, 2015 9:24 pm

Windmills from the 1980s still operate in Tehachapi.

JohnWho
September 3, 2015 6:55 am


richardscourtney
September 3, 2015 at 5:20 am

Most people want to switch their lights on – not off – when the Sun goes down.
Richard

Well, Richard, I suspect most “greens” would prefer to remain in the dark than see the light.
/grin

Auto
Reply to  JohnWho
September 3, 2015 12:25 pm

John
+ a goodly few!!
Thanks – a good giggle.
Auto

Catcracking
Reply to  Auto
September 3, 2015 2:18 pm

Yes a good giggle, but they are affecting everyone’s life style and driving up cost.

JohnWho
September 3, 2015 6:57 am

Maybe if the company was named “Mississippi”
it would care more about what happens
in NORTH America.

Dawtgtomis
Reply to  JohnWho
September 3, 2015 7:17 am

I always had the impression Amazon was started by a big, burly woman named Valkyrie. 😉

September 3, 2015 7:09 am

“…one would assume that you utilized a battery of lawyers…”
Hey – hook up the lawyer battery to the windmills!

asybot
Reply to  Mark and two Cats
September 3, 2015 8:16 am

Mark and 2 felines: I doubt that even during a sustained period of usable wind it would improve the lawyers. Lawyers tend to be useless no matter what kind of energy runs them but then again $$$ seem to. ( in these cases taxpayers provided subsidies are handing them with lots of that “green”)

Reply to  asybot
September 3, 2015 12:00 pm

Ah but if they are in a battery, they would be in cells!

kwinterkorn
Reply to  asybot
September 3, 2015 2:18 pm

Having been around lawyers all too much, I can confirm that they are an unending source of hot air. So just line up your battery in front of a windmill and the energy will flow.

mkelly
September 3, 2015 7:11 am

Following that, Iberdrola reportedly complained to the NC Governor at the time, Beverly Perdue. She then wrote a pointed letter to the CEOs of each of those three companies, pressuring them to them to reconsider.
==========
This the saddest part of the post. The government inserting itself into the decision process of private companies. This needs to be condemned most harshly.
Yes I am aware that it happens but still is wrong no matter who does it. Free markets should prevail.

Reply to  mkelly
September 3, 2015 3:54 pm

“This the saddest part of the post. The government inserting itself into the decision process of private companies.” and are not these private companies subject to Public Utility Commission oversight and – coercion.

Ian Goddard
Reply to  mkelly
September 3, 2015 7:25 pm

This was One of the reasons Purdue was voted out of office, notwithstanding massive support from Obama and greenies?

Lee
September 3, 2015 7:12 am

I would think that Amazon invests in much riskier projects than a utility company. A utility company needs a near 100% chance of success. This is probably 10% or less, but I imagine the chance of Amazon covering the country with delivery drones is even less, but they are investigating it (and apparently investing in it).
It’s like google moonshots, unlikely to succeed, but when it does…
Amazon is exactly the right type company to try these things.

TonyL
Reply to  Lee
September 3, 2015 8:11 am

We would have to see what the package of subsidies, load guarantees, and tax breaks Amazon will be able to harvest from the deal. It looks like a classic “Public-Private Partnership” shaping up, here. Amazon gets a huge, and hugely profitable package of ‘incentives’, that is the “Private” part. Meanwhile, the taxpayer get stuck with the bill for the subsidies, load guarantees, and everything else, that is the “Public” part. These projects *always* turn out to be huge boondoggles, with the taxpayers forced to clean up the mess.
If Bezos were to put up a few Billions of Amazon’s money, and put that money at risk, the shareholders would lynch him.

Auto
Reply to  TonyL
September 3, 2015 12:37 pm

TonyL,
Thanks.
We know Public Private Partnerships [PPPs] here in the UK.
Started by the Tories in the 1990s, I think (possibly earlier), but magnified by Labour thereafter [and not fully ended by Cameron in either guise], they will kill the NHS.
PPPs mean that the public purse pays a pittance (up front) for a public good – like a hospital – then pays interest on the outstanding, [at a special rate!], plus maintenance charges for the twenty or thirty year duration of the PPP.
If it costs £500 – yeah, five hundred quid – to get a dead light bulb changed – guess how much of a maintenance department could have been paid for.
And mostly the contracts were agreed between very bright, but somewhat commercially naïve, civil servants, and commercially on top-of-their-game accountants, engineers, lawyers, and architects for the private sector company.
Three guesses which party got the better end of the deal.
[To avoid a /Sarc – I do a story spoiler – It wasn’t the taxpayer.]
Surprised?
Auto

fretslider
September 3, 2015 7:26 am

Amazon? The only Amazon I’d be interested in would be beach body ready

Harry Passfield
Reply to  fretslider
September 3, 2015 11:02 am

As long as you don’t mind a mono-mammarian.

Auto
Reply to  Harry Passfield
September 3, 2015 12:38 pm

Classic!
Auto

Dodgy Geezer
September 3, 2015 7:39 am

To: John Droz, physicist
Dear Mr Droz,
I understand that you are concerned that Amazon are investing in a Wind Farm project after several major energy companies turned the proposal down.
The reason for this is that our advisers have told us that Climate Change is the greatest threat that faces humanity at the moment, and that our great-great-grandchildren will suffer major calamities in hundreds of years time if we do not take action now. This threat is just too large to ignore.
They have also told us that you run a web-site dedicated to attacking wind-power. Under those circumstances you will understand that we cannot believe a word you say, since you are obviously funded by anti-science interest groups. So we will continue to support the 97% consensus of science.
Yours,
J Bezos

Auto
Reply to  Dodgy Geezer
September 3, 2015 12:40 pm

I cry SPOOF!
And – If the Real Jeff Bezos – he spells his forename the wrong way.
Auto.

johndroz
Reply to  Dodgy Geezer
September 7, 2015 4:07 am

Dodgy Jeff:
1 – The WiseEnergy.org website is about promoting science-based solutions. The fact that industrial wind energy is not a science-based energy solution is a fact-of-life.
2 – It’s fine if you are an AGW believer. However there is zero scientific proof that industrial wind energy saves any consequential amount of CO2.
3 – If in fact you are genuinely environmentally concerned, then what’s the answer to the letter’s second question?
4 – You did not seem to address the fact that this Amazon “investment” will likely result in a national security reduction for EVERY US citizen. Does it really make sense to expose us to more terrorist threats, when pursuing a non-scientific AGW solution?
Inquiring minds want to know!

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