A Subsidy That’s Blowin’ in the Wind

Guest post by Steve Goreham

Logo of the American Wind Energy Association.
Logo of the American Wind Energy Association. (Photo credit: Wikipedia)

The U.S. wind industry is in despair. The Production Tax Credit (PTC), a subsidy of 2.2 cents per kilowatt hour to producers of electricity from wind turbines, is set to expire at the end of this year. The American Wind Energy Association cites a study by Navigant Consulting, claiming that, “…37,000 Americans stand to lose their jobs by the end of the first quarter of 2013 if Congress does not extend the PTC.”

The Natural Resources Defense Council, the Sierra Club, and other environmental groups have rushed to the defense of the PTC. The Sierra Club states, “At a time when we need clean energy more than ever, we simply cannot afford to let the PTC expire.” The PTC is the cornerstone of President Obama’s green energy program and a key measure supported by environmental efforts to fight global warming.

The Production Tax Credit was established by the Energy Policy Act of 1992 to support the nascent wind industry. But twenty years later, is this subsidy still needed? By the end of 2011, 39,000 wind turbine towers were operating in the United States and about 185,000 turbines were in operation worldwide, according to the International Energy Agency. This is no longer an infant industry. Despite the large number of wind towers, wind provides less than one percent of U.S. energy and less than one percent of global energy. A one-year extension of the PTC would cost American taxpayers over $12 billion.

In September, 19 companies sent a letter to the leaders of the U.S. House of Representatives, urging extension of the PTC. Why would Johnson & Johnson, Sprint, Starbucks, and other signers of the letter support subsidies for another industry? They voiced concern that “Failure to extend the PTC for wind would tax our companies and thousands of others like us that purchase significant amounts of renewable energy…”

Never has corporate America been so misguided. Foolish policies like the PTC and proactive company programs to buy “green” renewable energy are based on Climatism, the belief that man-made greenhouse gases are destroying Earth’s climate. An increasing body of science shows that climate change is natural and that human emissions are insignificant. Nevertheless, Johnson & Johnson’s web site claims a reduction of 23 percent in carbon dioxide emissions from 1990‒2010. That emissions reduction and two bucks might get you a cup of Starbuck’s coffee.

While many people would like to power the world with zephyrs, the intermittency of the wind means that wind turbines cannot replace conventional nuclear, natural gas, or coal power plants. The 39,000 U.S. wind turbines generated only 29% of their rated output during 2011. When the wind doesn’t blow, conventional power plants must provide backup power if continuity of electrical supply is to be maintained.

In fact, electricity sourced from wind turbines does not cut CO2 emissions from a power system. Because of the rapid variation in the wind, backup coal or natural gas power plants must frequently and inefficiently cycle on and off to support demand. Studies from electrical power systems in Netherlands, Colorado, and Texas show that combined wind-conventional systems emit more CO2 and use more fuel than conventional systems alone.

Wind is also more costly than conventional systems. Analysis from the U.S. Department of Energy (DOE) shows that electricity from both coal and natural gas is much less expensive than from wind power, without requiring subsidies for operation. The DOE estimates the world has 200 years of technically recoverable reserves of natural gas, thanks to the hydraulic fracturing revolution. If the theory of man-made global warming is wrong, why subsidize another wind turbine?

The government can always provide subsidies to create jobs or to sustain jobs, but this may not be the best public policy. Thomas Jefferson was correct when he said, “It is error alone which requires the support of government. Truth can stand by itself.” Suppose we let the wind industry compete on its own merit?

Steve Goreham is Executive Director of the Climate Science Coalition of America and author of the new book The Mad, Mad, Mad World of Climatism: Mankind and Climate Change Mania

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Billy
November 27, 2012 1:09 pm

MattS says:
November 27, 2012 at 8:51 am
Nothing to do with windmills.
Anyways, on ethanol, the benefits of high octane/high compression only occur at wide open throttle. At part throttle cylinder filling is reduced hence lower effective compression ratio. Most of the time the high octane is not neccessary/wasted. In any case lower energy fuel has to be injected at a higher volume to match the oxygen in the cylinder. In current closed loop injection engines high octane fuel can provide more peak horsepower but no benefit in part load economy driving.

November 27, 2012 1:10 pm

“Wind mills keep on turnin’
Long as the cash keeps flowin’
Flowin’, flowin’, flowin’ from tax payers
Flowin’, flowin’, flowin’ from tax payers”

November 27, 2012 1:30 pm

: Most statistics on renewables are based on capacity factor, not actual output. A quick check of IEA statistics shows the actual percentage of wind/solar/renewables Jan through August was closer to 14 % of the electrical generation in Germany this year. Wind is not separated out.

kadaka (KD Knoebel)
November 27, 2012 1:30 pm

From MattS on November 27, 2012 at 8:51 am:
Pure ethanol has an octane rating of around 150.
Cow pucks!
http://www.ethanol.org/index.php?id=50
Because ethanol has an octane rating of 113, adding 10% ethanol to gasoline raises the finished fuel’s octane rating by 2 or 3 points, improving the fuel’s performance.
A website MADE to promote ethanol is only claiming 113 octane for ethanol. A value of 150 is obviously complete garbage.
===
Roger Knights:
Quick question: Just wondering, how do you feel about Intrade getting rid of US customers after the federal charges? So much for betting on the climate issues. Hopefully this hasn’t affected your retirement income plans.

November 27, 2012 1:51 pm

Since others are posting their musical rewrites, here’s mine:
They graded paradise and put up a turbine plot.
With red blinking lights, shadow flicker–ecofriendly they’re just not.
Don’t it always seem to go that you don’t know what you’ve got till it’s gone.
They graded paradise and put up a turbine plot.
Senator, Senator, put away those subsidies now.
Let the monstronsities die, you’ll be saving the birds and the bees.
Don’t it always seem to go that you don’t know what you’ve got till it’s gone.
They graded paradise and put up a turbine plot.

DR
November 27, 2012 3:36 pm

To say ethanol is no longer subsidized is not really true. The government mandates ~40% of corn to be used as fuel. Brilliant!

KLA
November 27, 2012 3:38 pm

Billy says:
November 27, 2012 at 10:51 am
……Logic and engineering are not relevant concepts

Hmm, “Logic” is an organized way to wrong with confidence, and engineering is the art of finding loopholes in Murphy’s law :-).
A typical greeny is convinced that the technology he/she wishes, using fairydust as fuel, doesn’t exist because nefarious capitalists prevent it from working.
From discussions with a lot of them I found they they cannot grasp a basic fact:
Natural laws cannot be broken.
The typical green thinks they can be mandated. Megalomaniacs with a Messiah-complex describes them best.

richardscourtney
November 27, 2012 4:52 pm

KLA:
I was amused by your post at November 27, 2012 at 3:38 pm which included

A typical greeny is convinced that the technology he/she wishes, using fairydust as fuel, doesn’t exist because nefarious capitalists prevent it from working.
From discussions with a lot of them I found they they cannot grasp a basic fact:
Natural laws cannot be broken.

It reminded me of a briefing in the 1980s that was provided to a UK Government Minister by scientists of the then government –owned UK coal industry. The briefing was to explain to him why it was that if the AGW-hypothesis turned out to be true then it would require significant and expensive change to energy policy.
Having been told how GHGs have potential to raise global temperature and that CO2 is a GHG, the Minister asked,
“OK. So why wouldn’t we just burn the CO2?”
The scientists providing the briefing exchanged glances, then made excuses and left the meeting.
Since then the AGW-hypothesis has turned out to be not true but UK government is distorting energy policy on the assumption that it is true.
Richard

MattS
November 27, 2012 8:40 pm

,
I don’t plan on converting existing cars for pure ethanol fuel. I didn’t say it was a practical alternative to gasoline on a large scale. It would be grotesquely expensive to convert the exsiting fleet, since you would basically have to replace the entire engine. There isn’t much that could be salvaged from an 85/87 octane ICE that would be useful in building a 150 octane ICE. From what I have read, for full optimization to 150 octane even the engine block itself would have to be redesigned. You might be able to save the transmission but I wouldn’t even swear to that.
I just pointed out that simply stating that ethanol contains less raw energy per unit volume is overly simplistic.

MattS
November 27, 2012 8:54 pm

@Billy,
“In current closed loop injection engines high octane fuel can provide more peak horsepower but no benefit in part load economy driving.”
The key work in the statement above is current. I stated from the beginning that the entire engine would have to be redesigned more or less from scratch.
In current “High Octane” street cars the ICE is designed for 90-95 octane which is the octane range for premium gasoline and is well short of being able to handle pure ethanol efficiently even at full throttle.

MattS
November 27, 2012 9:37 pm

@kadaka,
That site is mostly promoting ethanol as a blending agent for gasoline. Boosting the octane rating too much actually lowers efficiency (running a higher octane fuel than the engine is designed for) so it could be in their interests to downplay the octane level of pure ethanol. Still even if I was high by that large of a margin that doesn’t change the basic point that an ICE specifically designed for pure ethanol would be more efficient than an ICE designed for gasoline which maxes out at around 95 even with a E10 blend still well below what your source quotes as the octane rating of pure ethanol.

kadaka (KD Knoebel)
November 27, 2012 11:43 pm

From MattS on November 27, 2012 at 8:40 pm:
There isn’t much that could be salvaged from an 85/87 octane ICE that would be useful in building a 150 octane ICE. From what I have read, for full optimization to 150 octane even the engine block itself would have to be redesigned.
More cow pucks!
I already said above about ethanol having only a 113 octane rating, not 150. Do some research, I gave you that link.
As I said, that was from a site made to promote ethanol. See the Wikipedia Octane rating entry. Utilizing how octane ratings at the pump are figured in the US ((R+M)/2), ethanol only has a 99 octane rating. That’s not much more than “premium” US gasoline.
Octane rating says how well the fuel burns, higher ratings mean the fuel/air mix can withstand higher compression before problems with pre-detonation. Octane says nothing about the available energy in the fuel. “Performance” engines squeeze more power out of a certain size engine by using higher compression (more fuel/air mix compressed in the cylinder) thus they need higher octane fuels.
Thus with a Plain Jane engine, there is no penalty for using higher octane fuel in an engine designed for lower octane (crappier burning) fuel. Problems may arise these days with idiotic computerized emission controls that get confused by the good stuff, but that’s a different issue. Using higher octane fuel will not cause your engine to explode, the engine will not mistakenly believe it can run at a much higher compression than possible.
Do you have fuel like gasoline, with no more available energy per volume than gasoline, that’s rated 150 octane? Go ahead and pour it into that 85/87 octane engine, it can take it.
You might be able to save the transmission but I wouldn’t even swear to that.
Ah the ignorance, it is so great… Ethanol has less energy per volume than gasoline, if the tranny is built to handle the output of a performance engine using premium gasoline, it can handle that engine using ethanol. With the decreased output, with a 100% ethanol-only vehicle that will never use any gasoline, the tranny might even be considered overbuilt.
From MattS on November 27, 2012 at 8:54 pm:
In current “High Octane” street cars the ICE is designed for 90-95 octane which is the octane range for premium gasoline and is well short of being able to handle pure ethanol efficiently even at full throttle.
So much ignorance, it is nigh overwhelming.
That is still below the octane of ethanol, those high-compression engines can handle ethanol. It’s a simple rule, higher-rating fuel can go in lower-rating engines, lower-rating fuel doesn’t go in higher-rating engines.
However, despite what was said, you may still have to somewhat redesign a commercial engine for ethanol. But that relates to the plastic/rubber components as ethanol is a more active solvent than gasoline, and as it readily absorbs water there are additional issues with metal corrosion that may need considering. Manufactures are already complaining that even recently made vehicles can’t handle the planned 15% ethanol blends, let alone straight ethanol. But as there are already race cars that can handle ethanol, the needed changes are known.

kadaka (KD Knoebel)
November 28, 2012 1:46 am

MattS on November 27, 2012 at 9:37 pm:
Looks like I just missed this comment before posting mine. Moderation lag?
You said: Boosting the octane rating too much actually lowers efficiency (running a higher octane fuel than the engine is designed for) so it could be in their interests to downplay the octane level of pure ethanol.
From Engen, South African petroleum company that would benefit from people buying more octane than needed, note their “regular” with their octane rating system is 95 for coastal areas, lower for inland (bold added):
Where a vehicle is fully satisfied by 93 octane, in the sense that it delivers optimal performance and fuel economy on that grade, using a higher octane than 93 will not result in any improvement in performance or fuel economy, neither will it result in a decrease, but using the higher octane is unnecessary and inherently wasteful.
I’ve been searching for “higher octane decreases efficiency”, looking for something more than an anecdote mentioned in comments to something else. The closest I’ve come is that bit from Engen, which is saying it doesn’t. Even Consumer Reports, known for their penchant for giving their readers all the facts, even those you didn’t know you should know, didn’t mention it when pointing out when premium gas is a waste of money. If too much octane lowered efficiency, Hell Yeah CR would’ve noted it.
It’s late, and much searching later, the absolute nearest I can find is not that there is lower efficiency, but possibly lower energy density. Octane doesn’t say anything about energy density. You can boost octane with additives, like ethanol, that will give you the higher octane rating but will lower the energy density. This might explain the anecdotal range where using higher-octane gasoline yields better, worse, or no change to mileage.

Chris Wright
November 28, 2012 4:34 am

Roger Knights says:
November 27, 2012 at 12:34 pm
“Could someone report on whether this story is similarly mendacious:…”
.
Roger,
I was intrigued by your question, so I looked into it. My conclusion is that the claimed generation, specifically for wind, is probably correct. Quite possibly the German wind industry is considerably more honest than our own.
On their site the pie chart gives a wind power percentage figure of 25.97 * 0.36, which is 9.35%
So the question is: is German wind power actually generating around 10%
.
I couldn’t find exactly what I wanted, but these are my sources after a quick Google (specifically for wind power):
.
Christopher Booker:
http://www.telegraph.co.uk/comment/9559656/Germanys-wind-power-chaos-should-be-a-warning-to-the-UK.html
He states that in 2011 Germany had an installed wind power base of 29 Gw, but that the average actually generated was just 5 Gw. The utilisation factor in Germany, at 17%, is significantly lower than for the UK (20 to 25 %)
Of course, German wind power generates far more than our own: the UK has 3500 turbines while Germany has 23000.
.
This source shows a graph of German wind generation for March of this year:
http://www.theoildrum.com/node/9205
.
After glancing at this graph the obvious question is: how can anyone with two brain cells to rub together take wind power seriously? Anyway, the average generation amount does look to be around 5 Gw, which confirms Booker’s figure.
.
So, if the average is 5 Gw and it represents 9.3% of the total (as claimed by the pie chart), the total German power consumtion would be 5 / 0.093 Gw, which is 54 Gw.
.
The UK’s NETA web site is extremely useful:
http://www.bmreports.com/bsp/bsp_home.htm
It shows that right now the UK is consuming about 46 Gw. Quite likely Germany consumes somewhat more, so a figure of 54 Gw for Germany seems quite reasonable (after a quick search I didn’t find a specific figure for German total power consumption).
.
My conclusion is that the claim for actual wind power generation in the pie chart really does represent actual power generated, and not the installed base. Unlike the gentleman on the Today program, the pie chart tells the truth, at least for the wind component.
.
But having said that, my quick Google showed that Germany is facing an enormous crisis caused by their mad energy policies. It seems that in Germany quite a lot of chickens are coming home to roost….
Chris

John in L du B
November 28, 2012 6:31 am

Reality check says:
“Since John in L du B seems a reasonable sort who is not a NIMBY, maybe we can find out where he lives and put in a nuclear power plant next door.”
Many of us here have lobbied for a nuclear generating station. Would ½ mile from MBY be close enough? Unfortunately, a government with a long eco-socialist history of flooding native peoples off their traditional lands seems to have made such an installation totally redundant

Chuck Nolan
November 28, 2012 7:54 am

richardscourtney says:
November 27, 2012 at 3:04 am
The steam engine is a much more modern technology than windpower and is inherently more economic and practical than windpower. Clearly, according to the arguments of windpower advocates, steam engine technology should be subsidised so it can “mature”.
——————————–
We do use steam engines to generate electricity.
We use coal and nuclear power to heat the boilers to get steam for the steam driven turbine generators.
That’s how we did it on US submarines.
cn

Chuck Nolan
November 28, 2012 8:04 am

Forgot to mention that it’s pretty efficient, too.
cn

John M. Chenosky, PE
November 28, 2012 9:37 am

The ONLY wind device that provides economic power generation is the proprietary turbine built by Sauer Energy. Utilizing storage devices ( batteries ) there is minimal supplemental grid power required in small commercial and residental applications. The reason being they operate in low wind conditions. The downside is that they are not in full scale production. But the stock is a bargain at $0.22 a share. I own 1000 shares, all though I am not promoting it in case you’re interested.

November 28, 2012 10:18 am

How much of the low wind production goes to converting from DC to AC? Some of the small turbines I have read about use the first 3 to 6 mph winds to accomplish the conversion, so you really don’t get usable power until 7 or 8 mph. How many batteries would be required? I am curious because I know several people who use turbines for their electricity and it seems to take a large number of batteries, controllers, etc. Are these any different?

george e. smith
November 28, 2012 10:28 am

“””””…..John M. Chenosky, PE says:
November 28, 2012 at 9:37 am
The ONLY wind device that provides economic power generation is the proprietary turbine built by Sauer Energy…….”””””
So John, you’re only out $220 (so far). So now where is the big payoff here ? They don’t make anything; well so they kluged together a “proto-type”.
So it operates in low wind conditions ! Earth to John PE ; there’s very little energy available in low wind conditions; that nasty v^3 thing. Ah, but it has storage batteries. There is usually a presumption of some time elapse process with storage batteries; just like with Electric/pseudo-electric/hybrid electric-fossilfuel/whatever cars. So what is the replacement life of the batteries ?
Sounds like a real winner. I’m going to go out and buy $5 quickpicks for the 1/2 gigabuck “Powerball” lottery, and then I’ll be right back to give you maybe $50 for your shares; (after I win, that is).

richardscourtney
November 28, 2012 10:39 am

Chuck Nolan:
re your posts at November 28, 2012 at 7:54 am and November 28, 2012 at 8:04 am.
Yes, I know. That is what I meant.
We don’t subsidise – and don’t need to subsidise – the less “mature” steam technology but we do subsidise the much more “mature” wind technology. And the subsidy to windpower is said to be a method to nurture “an emerging industry”.
The stated reason for subsidising windpower is daft.
Richard

richardscourtney
November 28, 2012 10:56 am

John M. Chenosky, PE:
Your post at November 28, 2012 at 9:37 am says in full

The ONLY wind device that provides economic power generation is the proprietary turbine built by Sauer Energy. Utilizing storage devices ( batteries ) there is minimal supplemental grid power required in small commercial and residental applications. The reason being they operate in low wind conditions. The downside is that they are not in full scale production. But the stock is a bargain at $0.22 a share. I own 1000 shares, all though I am not promoting it in case you’re interested.

I accept that you are not promoting the stock, but I write to ask some questions because I am minded that when something seems too good to be true then it usually is. My questions are as follows.
Why is the company’s stock at “bargain” levels if its product is as good as you say?
Why is the product “not in full scale production” either by the company or under license by a larger company if it is as good as you say?
How are you defining “economic”; e.g, what is the return on investment in the purchase and use of a ‘Sauer Energy device’, and how does that compare to a low-risk return on savings?
Importantly, does the investment in such a device recover the purchase, operation and maintenance costs of the product and with what profit rate during the lifetime of the product?
Richard

george e. smith
November 28, 2012 10:57 am

“””””…..
kadaka (KD Knoebel) says:
November 28, 2012 at 1:46 am
MattS on November 27, 2012 at 9:37 pm:
Looks like I just missed this comment before posting mine. Moderation lag?
You said: Boosting the octane rating too much actually lowers efficiency (running a higher octane fuel than the engine is designed for) so it could be in their interests to downplay the octane level of pure ethanol.
From Engen, South African petroleum company that would benefit from people buying more octane than needed, note their “regular” with their octane rating system is 95 for coastal areas, lower for inland (bold added):
Where a vehicle is fully satisfied by 93 octane, in the sense that it delivers optimal performance and fuel economy on that grade, using a higher octane than 93 will not result in any improvement in performance or fuel economy, neither will it result in a decrease, but using the higher octane is unnecessary and inherently wasteful……”””””
I believe that EPA regulations mandate that all cars sold in the USA, shall run properly on ordinary 87 octane unleaded fuel.
Manufacturers may “recommend” that you run premium in their “fancy” car; well that is like a status symbol isn’t it; but their car still has to run properly with the ordinary dealer maintenance on 87 octane. They have 85 and 86 octane in some Western Mountain States, due to the lower atmospheric pressure.
If you check the difference in heats of combustion between Ethane, and Ethanol, you will find that Ethanol fall short of Ethane by the energy you get by burning H2 to get water; well ethanol is just Ethane with water added; that’s why you get lower gas mileage. So they burn up part of your gasoline before you even put it in your tank. Most cars are built with a contrivance for “oxygenating” fossil fuels. You can find it usually upfront in the battery compartment along with the alternator , air conditioner, and power steering system. It’s usually called an engine or motor, depending on the car’s price.
High octane fuels can boost engine power only if they are specifically designed with higher compression ratios (and still no pinging) and operate at higher compression pressures, and Temperatures; and that’s why the EPA requires normal operation capability on 87 octane. They don’t want all the NOx that comes from high pressure high temperature chemistry, that literally burns the air, to combine atmospheric N2 with atmospheric O2. The NOx emissions don’t come from any nitrogen in the gasoline. Well I think Shell claims they put Nitrogen in their gasoline. Maybe they use a Tri-Nitro-Toluene additive or something to give you more bang for your buck.
So we are all (in California) paying for water in our gasoline.
Actually, it would be far better if they left the water out of the “oxygenated” fossil fuel, and put a water injector on the oxygenator contrivance (motor), to create evaporative cooling of the intake air, to increase the mass of air taken into the cylinder, which gives more power.
The reason that all the snobby cars “recommend” that their owners burn premium gas (high octane) is to perpetuate the myth that they can go 50,000 or 100,000 miles without a tuneup.
With standard gas, your oxygenator contrivance will start pinging when it starts to get all carboned up inside, and high octane will hide that fact for longer, so you think you don’t need a tuneup. It’s a scam; but you overpaid for your velocipede, so why do you care about getting ripped off for boutique gasoline.

Roger Knights
November 28, 2012 10:57 am

Kadaka says:
Roger Knights:
Quick question: Just wondering, how do you feel about Intrade getting rid of US customers after the federal charges? So much for betting on the climate issues. Hopefully this hasn’t affected your retirement income plans.

I think they’ll be back with another model within a year. That’s what they’re saying, anyway.
On climate, I avoided betting much on arctic sea ice–I think I lost about $50. On temperature, where I bet much more, I bet that this wouldn’t be the hottest year, that it wouldn’t be among the top 5 hottest, that it wouldn’t exceed an anomaly over 0.55 (per GISS) (this is more or less equivalent to the top-5 bet), and that it wouldn’t exceed 0.50. The last one looks sure to lose; the others are sure to win. Unfortunately, I sold my three winners early on when their payoff was less (in order to make (losing) bets on non-climate matters) and I let my losses run on the last one.

Gail Combs
November 28, 2012 10:58 am

DR says:
November 27, 2012 at 3:36 pm
To say ethanol is no longer subsidized is not really true. The government mandates ~40% of corn to be used as fuel. Brilliant!
____________________________________
And then subsidized the corn! – just search ADM biofuel.