Comprehensive Consumer Cost and Value Analysis of Industrial Wind Energy
Industrial wind energy projects in the Untied States receive numerous and substantial sources of revenue beyond free market sales of their product. Most of these sources of revenue result from acts of law from local through federal levels which, through various programs, award the wind LLCs with tax collections from US citizens and corporations, or their equivalent.
"Sources of revenue" as defined here means streams of positive cash flow as well as means and quantities of expense avoidance. Since a dollar today is worth much morethan a dollar ten or twenty years from now, we endeavor to estimate the "present value" of future revenue streams wherever practical.
First we must establish a fair figure for "average wholesale market price" of electricity today. This estimate can be found HERE. (non-specific link requires updating. Awaiting reply from EIA author)
Next we must estimate the equivalent revenues from non free-market-sale sources. A division of the US Department of Energy called DSIRE shows some of these sources. After navigating to the DSIRE chart at the link in the preceding sentence, click on the numbers in the shaded boxes to see more specifics about each form of revenue.
A BRIEF PREPARED BY GLENN R. SCHLEEDE shows an example of the profit potential for deployment of industrial wind energy projects, and lists some of the revenue sources of interest, and how they are leveraged by wind LLCs. Additionally, utility property taxes collected for the benefit of the townships and counties where electricity generators are located, are often negotiated away, significantly reduced or replaced with a promise of benefit by the wind LLC. This promise often takes the form of PILOT, or "Payment In Lieu Of Tax."
Another form of revenue received by wind LLCs is the premium created by mandated use of renewables by states, usually referred to as the RPS, or "RENEWABLES PORTFOLIO STANDARD." These state laws impose a fiancial penalty per unit of electricity sold on energy retailers for failing to purchase certain, annually progressing, benchmark amounts of "renewable energy" for resale to end users. Retailers are compelled to bid up the price of renewables whenever there is a shortage, up to the a price equal to the RPS penalty that would otherwise be assessed.
Some corporate entities feel their image will be enhanced by entering into a "green credits" contract with wind LLCs, and then advertising their products as "made with renewable energy" or similar allusions. The contracts imply that the corporation is supportive of wind energy as evidenced by some financial gift to a wind LLC in exchange for some "amount" of wind energy product that is never actually delivered. This practice sets up the "purchasing" corporationan to make inaccurate claims about "buying" or "using" wind energy. The NATIONAL ENVELOPE CORPORATION is one entity engaged in this arguably fallacious practice. If the claim "made with 100% Wind Power" were true, the company's plant would need to be scheduled according to wind availability, sending it's workers home and idling it's machinery each time the air stilled, precisely as the 140 year old Jevon quote on our HOME PAGE describes. Furthermore, the machinery, plant and raw materials for making the envelopes, as well as the transportation infrastrucuture involved, would all have to be made awith "100% wind power."
Other "costs" borne by tax and rate payers include:
- transmission grid upgrades specific to bringing remotely sited wind energy to regions of high demand
- electricity resistive losses associated with longer transmission distances
- additional maintenance and fuel costs imposed on load balancing resources across the grid due to the volatile output of wind energy
- foregone investment in responsive, efficient, compact energy facilities with a proven track record of free market success
In summary, and as will be shown in future revisions to this page, we assert that three quarters of all revenues to wind LLCs come from sources other than selling elecricity into the grid at market rates, almost all of it funded through the taxpayer. Without the overwhelming financial support of taxpayers, industrial scale wind energy would not exist in the US, yet public access to the technical and financial records of these companies is unilaterally denied.