Pickens Mesa Power Orders 1,000 MW of Wind Turbines

Per press release, edited slightly:

Mesa Power LLP, a company created by T. Boone Pickens, has placed an order with General Electric to purchase 667, 1.5 megawatt wind turbines for the worlds largest wind farm, capable of generating 1,000 megawatts, nameplate, of electricity, enough to power more than 300,000 average U.S. homes. The order is part of the $2 billion first phase, see previous post, of the Pampa Wind Project planned in the Texas panhandle by Mesa.

When all the phases of the project are completed it will become the world's largest wind energy project, with more than 4,000 megawatts, nameplate, of installed capacity. When completed, projected to be in 2014, the wind farm will be five times as big as the nation's current largest wind power project, now producing 736 megawatts.

Pickens said he expects that first phase of the project will cost about $2 billion. When complete, the Pampa Wind Project will cover some 400,000 acres in the Texas Panhandle.

Pickens envisions that large scale renewable energy projects like his Pampa Wind Project will permit the United States to become less dependent on foreign oil. Large scale renewable energy projects such as this are difficult to execute because they rely upon the Federal Production Tax Credit, which provides incentives for development of renewable energy. However, large scale renewable energy projects require commitments years in advance, while Congress has only extended the Production Tax Credit one or two years at a time.

Mesa Power is hopeful that the Pampa Wind Project will qualify for the Federal Production Tax Credits in 2010 and 2011 when the project will begin commercial operations. "I believe that Congress will recognize that it is critical not only to this project, but to renewable energy in this country, that they enact a long-term extension of the Production Tax Credits," Pickens said.

"You find an oilfield, it peaks and starts declining, and you've got to find another one to replace it," said Pickens, who once operated one of the largest independent oil and gas production companies. "It can drive you crazy. With wind, there's no decline curve."

An Austin-based Resource Inc. economic impact study, commissioned by Mesa Power, projects that the Mesa Power wind farm will bring significant increases in jobs and income for the five counties of the project investment zone (Carson, Gray, Hemphill, Roberts and Wheeler counties).

The study forecast the project would generate an estimated 1,500 jobs during the construction phase, and 720 during a typical year of the operation phase; personal income in the project investment zone will rise by $68.7 million per year during the construction phase, and $120 million during the operation phase. The more significant impact during the operation phase is largely due to lease payments to be made to landowners in the project area amounting to $65.3 million per year.

Resource Economics estimates that the total value of economic output in the region due to the project will be $380 million per year during the construction phase and $1.6 billion per year during the operation period, and additions to the tax rolls of school districts in the project investment zone will amount to $2.4 billion by 2018, assuming the school districts approve an application to limit appraisal values during the project's first 10 years.

Lots of news about big wind projects lately.  Pickens claim that the project is dependent on Federal Production Tax Credits is disappointing. It is too bad that wind power is not commercially viable without subsidies on a project of this size.  Others have claimed that it is competitive with natural gas power plants, I suppose that is dependent on the cost of power where the plant is built. Pickens said “I believe that Congress will recognize that it is critical not only to this project, but to renewable energy in this country, that they enact a long-term extension of the Production Tax Credits." The WSJ commented ". . . state-level incentives, such as laws requiring utilities to purchase clean energy, are bolstering growth in the sector."

Too avoid some comments, it must be remembered that with wind power, most of the news uses the  nameplate or nominal capacity, the power produced when the wind is blowing at some stated value, rather than the actual power that is produced.  The actual production is 25% to 35% of the nameplate capacity because the wind does not blow hard enough, all of the time.  This means that wind power especially, and to nearly the same extent solar power, must be backed up by some other generation means, unless it is tied into an extensive grid that uses geographical distribution, over a large region or even nationally, or combined with energy storage, to compensate for the intermittency of wind and solar power. Solar has the advantage of being fairly predictable as to when the sun will shine. Without backup power, energy storage or geographical diversity, it is usually estimated that sun and wind power can only be used for 20% to 30% of total power requirements. Tidal or wave power have some advantages that I will not go into here because their use is very dependent of favorable geographical conditions. Progress is being made on energy storage, but it is not quite ready for prime time. I support using  hot dry rock, HDR, geothermal power as baseline power to reduce the expense of interconnecting transmission lines, which will always be required to some extent. 

Comments

[Sebastien]

I really like your blog but if I may give you a piece of advice, you should add more pictures to your blog entries... I looked for a contact form to email you and couldn't find anything, which is why I'm reaching out to you on this comment form. Keep up the good job (hopefully with more pix ;-)

[Mike]

One pic is fine with me; I learned how to read books without pictures when I was 8.

[Kit P]

More evidence that the United States is number one when it comes to many things including making electricity. And no, not one of many. Looking at IEA data for 2007 for OECD countries, it takes all the generation from #2 t0 # 7 to match US generation.

Poor Mr Pickens is going to be surprised to find out that wind does not “will permit the United States to become less dependent on foreign oil” and “With wind, there's no decline curve” if you can erect wind turbines faster than they break.

At least T Bone did not make any ridiculous claims about reducing saving the planet. He wants PTC to increase his profits.

Looking at the IEA data for 2007 for OECD countries that provide 'leadership' for wind there is some interesting results:

The winner is Denmark where 83% of electricity is produced by burning fossil fuels. Very very green. The Netherlands in next at 79% fossil. Portugal – 69%, Germany 68%. Spain is not doing too bad at 62% but that may have more to do with 18% nuclear generation than wind and solar.

Excuse me but I will ignore these folks when they pitch their 'good' ideas for reducing ghg.

Next I took a different approach. I looked to see who was burning the least fossil fuel to make electricity. The winner is the Swiss at 3% fossil, 40% nuke, and the rest hydroelectric. Cheaters.

Sweden is not far behind at 9 % fossil, 40% nuke. France at 12% fossil, 85% nuke. Slovak Republic 27 % fossil, 51% nuke.

[David Walters]

The key of course is the the natural inverse proportion of nuclear to fossil. With wind and no nuclear, it means building into the system a set amount of fossil for spinning reserve. Thus the Germans plant to build 8 brand spanking new dirty coal plants to supplement wind energy. Well done. Of course they were going to build 23 (!!!!) plants but there was so much opposition they cut it down by 2/3s. Now they are projection a defecit in power, made up by...the always ready French nuclear grid. What can one conclude about this.

Well, Pickens knows the score...the profit margin he expects, to be pocketed by his company, equals the tax subsidies he'll get for buildng and running wind turbines. If the money is there, go for it.

David

[Bob Wallace]

'With wind and no nuclear, it means building into the system a set amount of fossil for spinning reserve."

Not necessarily, at all.

Spinning reserves or nuclear are not the only ways to solve the problem.

First there's linking geographically distributed wind farms. With HVDC transmission lines this is very effective (multiple major studies already completed).

Second, there's the ability to greatly decrease the amount of idling fossil with accurate and timely forecasting.

Third, there's non-spinning standby. In my area we're gearing up for a new wind farm. The natural gas peaker/standby plants are getting upgraded turbines that can go from a standstill to full speed in less than 15 minutes.

Fourth, there's storage, an area that needs attention IMO. Pumped-up hydro, compressed air, flow batteries, flywheels - there are solutions yet to be perfected, but some already in use.

Fifth, there are other non-fossil/nuclear sources that even if they happen to be periodic don't covary with wind. Tides don't always flow, the sun doesn't always shine, ..., but those sources have their own cycles.

Germany may be building coal plants now because that's the solution at hand.

That does not mean that stand by spinning coal is likely to be the solution a decade from now.

[Kit P]

David, Pickens is sooooo Texas. ERONisc!!! Buy up all of GE's industrial capacity to build wind turbines. No risk unless states and feds suddenly decide that cut incentives which would be bad policy. Building wind up is not a bad think just not a solution to AGW or a reliable supply of electricity.

If Pickens wanted to show leadership, he would ...... As a matter of disclosure, the company I work for has recently .....

Never mind, the least I can do for my employer is send some emails before posting business ideas on the Internet. Presenting ideas at work is like playing chess, you need a strategy.

[Kit P]

“That does not mean that stand by spinning coal is likely to be the solution a decade from now.”

Wrong Bob, if you pick ineffective solutions to solve a problem you will still have the problem decades from now.

“In my area we're gearing up for a new wind farm. The natural gas peaker/standby plants are getting upgraded turbines that can go from a standstill to full speed in less than 15 minutes.”

Somebody should tell Bob that 'natural gas peaker/standby plants' burn fossil fuel and are not very efficient. Again Bob is wrong. His area is gearing up to import huge amounts of natural gas. Read your state report and do the math. Wave a picture of a solar panel or wind mill in front of Bob and that is all he sees.
However, there is a huge increase in the amount of electricity produced by fossil fuel in Texas, California, and Spain at the same time there is a huge building boom in wind that is resulting in an insignificant increase in electricity produced by wind.

Bob, I did the math and showed you that your solution is ineffective. Please stop repeating the same solution unless you can provide an analysis to support your position.

[Bob Wallace]

Actually Kit, you are again driven to the state of wrongness by your extreme negativity.

We have fairly large amounts of natural gas here in the county and are in the process of developing more wells in order to replace what we do import. Importing worked when prices were down. Now it makes sense to punch in some more wells.

We are also discussing the fact that natural gas turbines are not a good long term solution, but they are what we have available at the moment.

We are a testing area for wave and tide. We have people working on pump up hydro in the area. And we are looking at all the other solutions that you chose to ignore.

You, in your twisted desire to "win the game" cherry pick any fault that you can find and blow that out of proportion, award yourself a big blue ribbon, and spend the following moments patting yourself on the back (or engaging in some other type of one handed pleasuring).

Quit being a jerk.

Use your background and experience to do something positive for a change.

Solve a problem. Don't settle for the lesser role of just being one.

[mds]

From the previous post:
“ ‘Don't get the idea that I've turned green. My business is making money, and I think this is going to make a lot of money.’ “
I would suggest Mr. Pickens would not risk good money to a possibly unprofitable venture if the PTC is not renewed. I think Mr. Pickens would like to have the PTC for additional profits. This is not a bad thing. The USA should extend the PTC if they want to be major players in the wind industry. Heeelllooo ...667 wind turbines ordered from GE! ...$2 billion spent in the USA! The source of our energy is shifting and if you don't want to be net importers...

Kit P,
Liked your data on countries with lowest CO2 output. Very Enlightening. Clearly nuclear should be part of the picture. Still you have a fault in your arguement:
"if you pick ineffective solutions to solve a problem you will still have the problem decades from now" Wind is obviously becoming more and more cost effective, in spite of Reagan's almost killing it off in this country. Solar is shaping up to blow it away. It is not really a question of whether it will be there. It is more of a question of how much the USA wants to be a producer of this technology. Nuclear, wind, and solar are going to be big. Clearly the market is already deciding this. (Nuclear waste storage and development is more subsidized than wind or solar.)

Bob,
I agree. Some additional points:
1. Wind can provide something like 20% of grid power without much problem in load leveling. That's a lot of displaced coal.
2. Smart grid technology can allow some devices to use power only when wind or solar are available. This together with HVDC connection across the USA sun belt is why solar is going to combine with electric transport technology (PHEVs, E-REVs, & BEVs) to grow both like weeds. ...no storage or base-load required there. It's not just electric transport. There are several air conditioning systems now coming to market that use ice, cold rocks, or batteries to run on off-peak electricity. Make off-peak price, wind power output, and solar power output information available via the www and you can have these devies pull their power when you want.
Smart grid will allow users to use more electricity when solar, wind, or wave power are availble.
Here is a link for you:
http://tyler.blogware.com/blog/_archives/2008/3/24/3600473.html “Sempa Power can swing both ways” Gas or Electric Heat - March 2008
“It has developed software that does an up-to-the-minute analysis of natural gas, propane, oil and electricity rates and can switch a customer between electricity and fossil fuels whenever the rate is lowest.”
“payback of just three years. This is because natural gas tends to be cheaper than electricity during the day but more expensive at night”

Is it just human nature or is it something about our culture in the USA specifically? Why do I always run across discussions aimed at monolithic solutions?

Our opinions of which technology to use for more electric power would seem to be of lesser consequence. The electrical market is a mix now and is obviously moving to a different mix. Reagan and the Bushs have not killed wind or solar. They're going to be part of the mix.

Nuclear AND solar AND wind.

[mds]

...or maybe it's just Kit P being monolithic here.

[Lad]

I believe the long term future of energy in our country will transition to solar power generation and electric drive transportation; simply because the sun is the largest and most stable form of energy we have available. All the other forms are essentially interim solutions to satisfy the political and economic interests of the various interim energy stakeholders. Pickens and his investment in government supported wind energy is just such an example.

Our need to continue using fossil fuels will someday peak as their cost continues to escalate and solar energy is developed and moved to mainstream energy production. Only a good government energy policy and solar energy development and production breakthroughs can accelerate this transition.

[Carl Hage]

Pickens claim that the project is dependent on Federal Production Tax Credits is disappointing.

It's worth stating what the PTC is: 1.5 cents/kWh for the first 10 years of operation. As a percentage of revenue, it's not huge, but enough to compensate for the indirect subsidies of dirty energy, and make wind profitable.

We also don't have a Pollution Tax Penalty. If there was a fee associated with CO2, NOx, mercury, particulate, etc. emissions, then a PTC wouldn't be necessary. If pollution were taxed and refunded to people, it would give an economic incentive to conservation as well.

[Kit P]

It looks like mds was being logical until he stated drinking Bob's kool aid.

“wind, and solar are going to be big”

Sorry, mds do have a concept of the difference between big and little?

If you look at impact on how we live, the air tight Franklin Stove was big and still is. Putting electricity in our homes was big and still is.

Many of the posters here have has no comprehension of the difference between 0.8% and 99.2%. For those who build power plants, renewable energy is fun as long as we get to pass the cost along to the customers.

“Why do I always run across discussions aimed at monolithic solutions?”

Sometimes that is just the way the numbers work out. If you live in a cabin in a remote location, that air tight Franklin Stove is big. Please do not forget that the stove was a product of the industrial revolution where child labor that was as repugnant as slavery.

If you live in a small town, I can put together a sweet 5 MWe biomass plant that is sustainable. The 5 or so employees will all be able to afford a local 1500 square foot home and a new Corolla every five years or even a bass boat if you make the car last longer. For that small town, renewable energy is big.

However, for society as a whole 'renewable energy other' is 0.8%. For every large city, you need a large nuke or fossil plant. Show me your plan to put 4000 windmills in San Francisco. And another 4000 windmills in Oakland, 4000 windmills in San Jose ans so forth. This is where large central generating facilities like Moss Landing and San Onfre. Or maybe a million roof solar systems to replace each large central plant.

I hope this illustrates the magnitude of the issue. If there was no power plants retiring, no immigration, and no increase in demand for big screens TVs, each 4000 windmills will increase winds share by 0.2% . Increasing our industrial capacity by a factor of 4 (per the DOE report) and assuming some offshore wind mills will be larger (it makes the math easier) would result in a 1% increase per year.

I suspect I am the only who took the time to read the DOE report. Wind will always be an insignificant source of electrician. Same with solar. It is not about choice, it is about physics and pouring concrete.

[Carl Hage]

Let me also compare the 1.5 cent/kWh Production Tax Credit for wind energy to the Cap-And-Trade price/kWh. The EU carbon trading price on May 16 is 24.85 EUR or $38.6494 USD/ton. Based on figures from eia.doe.gov, at this price average coal generators would pay 4.0c/kWh, gas 2.6c/kWh. Carbon Capture and Sequestration is estimated to be $100-300/ton, or
10.5-31.5 c/kWh-coal, 6.6-19.8 c/kWh-gas.

So the current subsidy is substantially less than EU carbon trading costs.

[Bob Wallace]

Kit, you probably aren't old enough to have seen the transition from horses to cars.

My grandfather was.

You probably aren't old enough to have seen the transition from ground travel to flight.

My father was.

I'm thinking you're older than me (at least in spirit, you are) and during my lifetime I've seen a transition from radio to TV, from mechanical calculators to electronic calculators, to computers.

I've seen the transition from prop planes to jets, from being ground bound to people in space, from vinyl to tape to CDs to blips stored stored on a hard drive.

None of those transitions happened over night. Changeover went from 0.01% to 0.1% to 1% to 10% and at somewhere a critical point was reached, the change acquired great momentum, and the old technology was swept away.

Wind has been lagging at well below 1% of total electricity used in the US for a few years. It's on track to hit 1% this year. It stands a good chance of hitting 2% in less than three years.

Look back to the top of the page and you'll see someone who's going to kick it up above 2% and on to the next level.

We're in the early stage of another great transition, a change from generating our energy from fossils fuels to harvesting it more directly from the sun.

The transition won't be without false starts, some wasted effort, or what might look from here enormous expense.

But whatever it takes, we'll do it. We have too many external pressures that will shove our sorry butts down that path and too many excited young minds who are jumping up and down with the excitement of playing this great game.

Grumpy old naysayers are just going to get passed by like the old farts who stood on the sidelines and howled-

"That thing will never replace horses!"

"Man will never fly!"

"No one will ever walk on the moon!"

Want to spend your time figuring why an idea wont' work and then do your best to p!ss on the parade?

Or want to spend your time identifying potential problems and the doing the more interesting work of creating potential solutions?

Up to you.

[Angus]

Here in eastern Canada there is progress with wind energy but for the most part disapointing. In the eastern most province there is some small scale projects and one servicing an isolated community encorporates wind generation, hydrogen storage from excess wind(still experimental) and back up diesal(i believe the total savings was some 33 000 litres per year since wind turbines were installed). But the mother of all renewables is still Hydro with a total of some 2800 MW for the island portion and 5000 MW for labrador with a potential of some extra 2800 MW if an agreement can be reached with Quebec. What is interesting is that the Churchill Falls Hydro Dam(sold mostly to NY via Quebec) created an artificial penisula with ideal conditions for wind generation(5000 MW) and it can be tied into the existing grid. Several companies have approached the provincial government for development of this unique situation but because of a dispute over the origional development, all is on hold. That would be a total potential of 7800MW of renewables at a relatively low cost because the hydo dams would be used as a backup to wind. As the wind generates electricity the water level in the dams would be maintained at a more constant height and would be readily availible as a reserve.

[Bob Wallace]

I think you also have tidal generation research occurring at the Bay of Fundy. That's a huge resource.

http://www.alternative-energy-news.info/press/tidal-power-project-bay-of-fundy/

I read an article recently about how Henry Ford came very close to building tidal generators there. Almost a hundred years ago. Bet it happens this time.

[Angus]

The problem with all this is the foot print on the environment. Hydro dams have a huge potential but the area flooded is enormous. One Russian scientist I spoke to sincerly believed that daming rivers in Canada, Norway and northern Russia is having an effect on the climate. Another point he makes is that the salinaty of the oceans could be affected. All valid points to be considered.

It's imperative that we put conservation and efficiency at the top of the agenda with energy and until we do, very little is going to change.

[George Bruce]

Wind "farms" harvest subsidies.

[Benjamin Cole]

Windfarms, solar, geothermal, nukes and PHEVs (the Volt is coming).
OPEC is dead, and happy will be the day. OPEC is a zombie now -- walking 'round, not knowing it is dead.
We need more posts here in the Energy Blog.
A fleet of EVs and a grid juiced by clean power plants -- the future is bright, maybe better than ever before,
Short oil now. I am worried oil will collapse so much it will crush alternative fuels and conservation measures. Just like the last time.

[Bob Wallace]

George - you don't have your facts straight.

Many energy generation methods are subsidized. It takes that to get new technology up and going sometimes.

Benjamin - OPEC, and the non-OPEC oil producing countries, are going to be eating our lunches during the transition period. You're a bit early, IMHO, to start the celebration. Ready your budget for some big hurts as all those oil places get what they can while the getting is good.

This time around, they can't produce enough refined fuel to flood the market like was done before. The market has grown too much.

And last time we didn't really have alternative technology like we now do. We didn't have the advanced batteries, we didn't have large scale wind underway, we didn't have cheap solar.

[Benjamin Cole]

The sniveling doomster naysayers, the TOD crowd, just doesn't get it. Either: 1) Oil prices come down, or 2) we switch to PHEVs and non-oil-burning power plants. There is no doomsday. I actually prefer option 2, as it will make for cleaner air, and a better balance of payments.

[Kit P]

George, they are called production tax credits (PTC). The electricity generating industry pays lots of taxes. When the industry invests in generation that has higher capital cost but reduces the amount of NG used and therefore ghg produced, a reduced federal tax rate is applied to so that the profit margin is sufficient to get projects built. Since all US citizens benefit form importing less LNG, I think this is a good policy.

The use of the word 'subsidy' generally is indicative of a shallow and baseless objection to something.

[Michael Cain]

Pickens envisions that large scale renewable energy projects like his Pampa Wind Project will permit the United States to become less dependent on foreign oil.

There's a hell of a jump between what is (generously) a renewable version of a 415 MW generating plant and becoming less dependent on foreign oil that is used almost exclusively for transportation applications. I would be more willing to believe that as Pickens' motivation if he were investing in something that made electrified transport more widely available -- building light rail, high-performance battery tech, etc.

[Cyril R.]

Wind "farms" harvest subsidies.

If wind is competitive with just 1-2 cents/kWh, then that can be taken as proof that wind power is almost competitive in a free market, and electric generation is NOT a completely free market anywhere on this planet, so what's your problem?

[DaveMart]

Using hydro-power as backup does not necessarily involve flooding huge areas:
'As far as power generation is concerned, a dam is nothing more than a way to get water from the reservoir inlet to the power turbine without losing head. A smooth-walled tunnel would serve just as well, as long as it was large enough to allow the water to move relatively slowly. So instead of building a giant dam and flooding hundreds of square miles of river valley,[2] one could have only two small reservoirs, connected by tunnel. A portion of the river's flow would continue in its natural course, but the larger portion would be diverted through the tunnel for power generation.'

http://www.energypulse.net/centers/article/
article_display.cfm?a_id=1404

Please copy and paste the above link, as it truncates if posted as a hyperlink.

The costs look reasonable too:
'The turbines and generators and other "balance of system" items would up that figure, but it's still in the ballpark for the cost of dispatchable gas-fired capacity, and well under the $1500 / kilowatt "rule of thumb" for new coal-fired plants.'

From the same link.
The comments about the costs being above NG plants may be out of date, given the recent sharp increases in gas prices.

Picken's comments on the costs of wind also need putting into context as those of someone who is keen to get as much subsidy as he can.

Wind power with the excellent resource in the States would seem to have an excellent future, as it is also fast to build.

[Kit P]

“If wind is competitive with just 1-2 cents/kWh”

That is an incorrect assumption Cyril. Wind in combination with NG is a resource of electric power that is considered reliable. But not cheap. It could be if we tapped into reserves of natural gas. When the price of natural gas comes down, wind will no longer be economical. As wind turbines age, they require more maintenance.

As I have shown, wind is the shinny thing waved in front of you so you do not notice the real problem which is the growth of natural gas.

For those of you in California who think building lots of NG in the central valley while putting up a few windmills in Washington State will make your air cleaner and electricity cheaper, you are wrong.

There is nothing wrong with the category of 'renewable energy other' except that it is too small of a solution. As a practical and practicing engineer, I am very good at solving real problems by finding real solutions.

"We can't drive our SUVs and eat as much as we want and keep our homes on 72 degrees at all times ... and then just expect that other countries are going to say OK," Obama said.

If you want to 'keep our homes on 72 degrees at all times' we can solve that problem. If South Korea can go from one of the poorest countries in the world to one of the richest without any energy resources, then it is just a matter of looking at how they did it.

[Kit P]

“as it is also fast to build”

This is a myth. What DaveMart is not seeing is the 8-10 years of development work for each site before construction starts. It takes several years to test for wind resources. Then there is the paper work to protect the environment. I have linked several EIS for California projects. What about the kangaroo mouse and the darter snail? Is there anyplace on the west coast that is not listed under the ESA? Does your project have sufficient reserves in case a borrowing owl is attracted to your site?

Could your project disturb the the brain waves of the local tin hat society? What if you find artifacts of a previous culture whose dignity must be maintained while they build casinos and coal plants without emission controls? What if your renewable energy is the wrong flavor? Then we also must consider how countless generations in the future will view our activities. On this one, there is a positive trend and every reason to believe that future generation will be more advanced. Bob Wallace may be evidence that I am wrong.
Davemart, their just too many unanswered questions for judges to ponder. Surely renewable energy must meet the same social justice standards. One person's good job may really be a case of environmental racism.

Then there are the practical issues of the actual construction. The one limiting factor is pouring concrete. It does take less time to pour the base mat for one wind turbine than one 1500 MWe steam turbine/generator. How about 4000? Transporting oversize load is another major issue. If you have ever shared the road during a major wind project, you would know what I mean.

[donb]

mds stated:

Wind is obviously becoming more and more cost effective, in spite of Reagan's almost killing it off in this country.

What really killed off wind power at that time was the state of the technology. There were a bunch of wind turbines built, quite a few of which became scrap metal after a few years as they could not hold up in the environment.

Carl Hage said:
We also don't have a Pollution Tax Penalty. If there was a fee associated with CO2, NOx, mercury, particulate, etc. emissions, then a PTC wouldn't be necessary. If pollution were taxed and refunded to people, it would give an economic incentive to conservation as well.

There are fees associated with NOx, particulates, SO2, and (soon) mercury. Those fees are the costs of pollution control equipment. I would much rather have the pollution control equipment doing its job than have those pollutants dumped into the air and a tax paid to the government that then may (or may not) be refunded to the people.

[Bob Wallace]

How about we admit that we're going to need additional/replacement energy sources in the world and drop the ridiculous red herring crap?

New nuclear, new wind, new whatever is going to take local permitting and pouring concrete. (Well, roof top solar won't take concrete.)

Part of the decision to use one type of generation type over another is a complex decision that involves economic analysis (both up front and long term costs), community acceptance, and environmental impact. And all those factors are inter-related.

Railing about 'eco warriors' or 'tin hat crazies' is not useful. It's just more tired old political ranting that the country is tired of.

Let's start acting like problem solvers and lay down the facts in an objective and helpful manner. Take the right wing talking points over to red state or some place where they're appreciated.

[Bob Wallace]

"The lifetime cost of new generating capacity in the United States was estimated in 2006 by the U.S. government: wind cost was estimated at $55.80 per MWh, coal (cheap in the U.S.) at $53.10, natural gas at $52.50 and nuclear at $59.30."

http://en.wikipedia.org/wiki/Economics_of_new_nuclear_power_plants#Cost_per_MWh_.28or_kWh.29

--

The cost of wind is, and is expected to continue to decrease over time.

"The cost of electricity from utility-scale wind systems has dropped by more than 80% over the last 20 years.

"In the early 1980's, when the first utility-scale wind turbines were installed, wind-generated electricity cost as much as 30 cents per kilowatt-hour. Now, state-of-the-art wind power plants at excellent sites are generating electricity at less than 5 cents/kWh. Costs are continuing to decline as more and larger plants are built and advanced technology is introduced.""

http://www.awea.org/faq/cost.html

Sungri is promising concentrated solar at $0.05 per kWr. Thin-film costs are dropping very fast. We have a distinct possibility of a 10x to 20x drop in thin film costs in the next 3-5 years.

The cost of coal and natural gas generation have been rising due to fuel prices. And those prices are expected to further increase as demand increases and supplies dwindle. And rise even more as CO2 emitters are required to control or offset their emissions.

If, as the analysis link by DaveMart above, we can create storage in the range of $0.07 - 0.08 per hWh (and realize that we don't need 100% storage, just fractional) then there's a point coming where wind + solar + storage will be cheaper than either coal or natural gas or nuclear.

In the meantime we can build new wind and solar at a furious pace if we choose and utilize existing coal/natural gas/nuclear/hydro as our smoothing/backup and then phase the least desirable, most expensive out later in the transition.

NIMBY type resistance will decrease as people get better acquainted with the benefits and designers get more skilled at fitting their ideas into the community.

[DaveMart]

Perhaps it is easiest if we make our assumptions clear.
It is my position that supplies of oil are relatively limited, and that it is likely to be in too short supply to provide for present transportation needs, and that includes unconventional resources such as oil shales, which in any case will require many years to ramp up.
The position regarding natural gas is not quite so clear, what is clear is that ever more difficult resources are having to be used which entails ever decreasing energy returns on investment.
Coal resources in the States are very substantial, but not infinite and entail considerable environmental costs.

The above preamble is to explain my preferences in power supply, which would involve altering the funding of power utilities to reward them for reducing energy consumption, and building nuclear and renewables as fast as possible.

I agree that time delays even for wind power are likely to be considerably delayed in the current climate, however the physical aspects of eh build are certainly faster than for nuclear, and it seems to me that at fuel and power shortages bite regulatory hurdles are likely to be tackled.
In my view cost reductions for solar PV power are likely to be high within the next few years (2012-15), especially if deployed on the ground in medium sized configurations of 2-10MW and outputting power at 20volts for local consumption requiring no steppers or long distance transmission, as suggested here by Nanosolar:
http://www.nanosolar.com/blog3/2008/04/16/
municipal-solar-power-plants/

This should enable peak power needs in many area of the US where peak occurs in high temperatures to be met most economically by solar rather than expensive gas.

This should not be taken to mean that solar will be the most economical solution for base-load, and nuclear would do that very nicely, as if a dual-reactor 1.6GW station was built on every site that currently is used you could generate US base-load power requirements, and air source CO2 heat pumps could effectively stretch the heating and cooling output from this:
http://www.jarn.co.jp/News/2003_Q2/30620
_Eco_Cute.htm
"Eco Cute" CO2 Heat Pump Water Heaters

EV cars are becoming available at reasonable cost and with performance which would just about do, although way behind combustion engines:
http://www.gizmag.com/ukp14000-thnk-city-
electric-car-ready-for-showrooms/9032/
UKP14,000 TH!NK city electric car ready for showrooms

Although the stresses of transition will be considerable, it is now possible to outline strategies and technologies which could runa technological civilisation with minimal fossil fuel input, at less than ruinous cost.

Getting there will not be easy.

[Ike Solem]

The stability of the goverment tax/subsidy program for wind is definitely important for any business, because they need to draw up ten-year business plans in the energy business, minimum. If one of the main components - the governmental tax and regulatory positions - fluctuates a lot, investors will be very leery of exposing themselves to that kind of risk.

Nascent industries in the United States have always benefited from government protection in their early stages, which makes perfect sense - you don't send Little Leaguers off to "compete" with professional baseball teams. From the government's point of view, having a large number of both large-scale and start-up renewable energy businesses should be viewed as a good thing.

This is because the government is charged with dealing with emergency situations, such as an interruption of fossil fuel imports into the U.S. The government also provides the level playing field, or should, but it has been heavily slanted towards fossil fuels for many decades.

So, on the government end of things, it would be best to have a policy that rewards and protects investors who move large sums into renewables, as that also punishes and increases risks for investors who stick with fossil fuel portfolios.

What the government can't do is innovate well - that's where the startups will come in. What we really need to do is take the model that created both the computer revolution and the large-scale growth in global oil production, and apply that to the renewable energy problem.

In that model, you had government-funded basic research at public universities that was more about generating top-notch industrial scientists and engineers than it was about cooking up patents for the university. You also had a wide variety of small startups that got support from local and national governments.

A similar revolution in energy would have happened decades ago, but renewable tech has been viewed by investors as a "disruptive" rather than an "emerging" technology, a view that is finally changing as the looming issues of resource scarcity and environmental degradation continue to make themselves felt.

[George Bruce]

"George - you don't have your facts straight."

Bob, I was under the impression that most or all wind power projects were subsidized. If that is wrong, please correct me and I will be grateful for the education.

"The sniveling doomster naysayers, the TOD crowd...."

Benjamin, I don't even know what the TOD crowd is, but do you really think that characterizing anyone you disagree with as "sniveling" advances a sober debate of the issues?

"George, they are called production tax credits (PTC)...."

Call them what you will, but a subsidy is still a subsidy, although in some cases there may be strong arguments in favor of it.

"Since all US citizens benefit form importing less LNG, I think this is a good policy."

Maybe, I guess it depends on the actual numbers. Some of the projections I've seen here and elsewhere would make a defense contractor pushing a new weapons system blush with shame.

"The use of the word 'subsidy' generally is indicative of a shallow and baseless objection to something."

No it's not. Often the term "subsidy" is used to describe a subsidy.

"If wind is competitive with just 1-2 cents/kWh, then that can be taken as proof that wind power is almost competitive in a free market, and electric generation is NOT a completely free market anywhere on this planet, so what's your problem?"

If wind is competitive with 1-2 cents/Kwh, then it needs no subsidy. At those costs, everyone in the world will be shoving each other aside to put up windmills. And they will be driven by pure greed. My "problem"? Wind power is not competitive with 1-2 cents per KWh anywhere in the known universe at this time. It doesn't make any difference how much you want it to be so, it isn't.

[Gari N. Corp]

This is only loosely connected to the main thrust of these comments, but the PTC has to be one of the most inefficient and badly-targeted renewable incentive regimes anywhere in the world. The PTC IS essentially a subsidy, but it's one that only very large corporations with very large tax exposures can use. This has led not only to banks and law firms gobbling up huge amounts in fees for structuring deals, fees that developers would probably rather were reinvest in new capacity, but to an extreme reluctance on the part of wind developers to discussing the economics of their business. Pickens probably has a tax bill large enough to benefit from the PTCs (though I should really check that individuals can use them), but he may have to bring in a finance company as a joint venture partner.

[green007]

Applied Materials has added a News Release to its Web site.

Title: Applied Materials Introduces Unique Environmental Card Game for Children

Date: 5/20/2008 4:00:00 PM

[Kit P]

Gari, PTC are very well targeted to achieve their goal for increasing production from alternative energy sources. The apply to many other things. There are also similar targeted incentives aimed at non profit generators like COOPs and PUDs.

Then there are grants and cost shares to promote new technologies and conservation programs.

"The use of the word 'subsidy' generally is indicative of a shallow and baseless objection to something."

I would like to thank Gari and George for so nicely illustrating my point. There is a consistent theme at this blog. Post a story about battery improvements for BEV and we hear what about algae. Post a story about algae and we hear what about battery improvements for BEV.

Very good analysis Ike. Would you now be willing to research how the electricity generating industry pays to various local, state, and federal taxes?

[Kit P]

Davemart, let me correct so misconceptions that you have about the US.

“Coal resources in the States are very substantial, but not infinite and entail considerable environmental costs.”

Twenty five years ago I would have agreed with you. Coal has cleaned up its act. The environmental impact of coal is no more significant than wind or solar which can not grow fast enough to keep with demand.

“faster than for nuclear”

Since Davemart is more logical, maybe he can explain why the cost of nuclear or the speed building nuclear plants has anything to do with wind or solar not grow fast enough to keep with demand.

What is clear is that the world demand for natural gas and coal is growing at unpredicted rate. Bob Wallace cited a 2003 MIT study that was wrong by 2005. For fun we can blame China for the price of coal and Bill Clinton for the price of natural gas. In 2003, Finland wanted a nuke. In 2008, there is a waiting line at JSW for nuke forging and every manufacturer or wind turbines.

The good news is that the US has excess capacity to export coal. Know we know why those EU slugs objected to the US burning coal. They wanted to burn it.

[DaveMart]

Coal emissions:
Perhaps you don't mind what happens to mountains and water in WV, most of the rest of us dislike it.
You also do not accept anthropogenic global warming.
That is your privilege, but most of us do, as does the US government, so future legislation is likely to be based on that premise.
I don't understand your question about build speed - oil is darned expensive and gas prices are rising fast, so other than coal something must be done to satisfy demand, and in the short term solar and wind is quicker to build - here in the UK at least wind turbine parks do not take anything like the 8 years you suggest.

[gaetano marano - ghostNASA]

.

it could be possible to build much ENERGY-DENSE wind plants, just using MY idea of "Wind Energy Skyscrapers" that take advantage of the fast 300+ m. altitude wind:

http://www.gaetanomarano.it/articles/028energy.html

gaetano marano
--------------------------
www.gaetanomarano.it
www.ghostNASA.com
www.NewSpaceAgency.com

[Bob Wallace]

Rising energy prices might damp down demand.

It's happened twice before, '73-'74 and '79-'83. And we are now much 'smarter' when it come to conservation. We have good technology in terms of CFLs, more efficient appliances, etc. that will become more attractive to consumers as prices rise. And we have a continuing string of more efficient commercial applications.

US population growth is about 1% (best number that I could find in a hurry) so it would take only 1% conservation to flatten energy use growth. And I suspect we can count on large organizations who tend to pay attention to the bottom line to recognize the value in conservation. I know some individuals are.

[averagejoe]

Well, if the U.S. is really serious about conservation then it should substantially reduce both legal and illegal immigration. CFL's and 18 SEER air conditioners are all well and good, but any per capita reductions in energy demand are being wiped out by the flood of new residents. Every new resident boosts the total demand for: energy, food, clean drinking water, health care, educational services, waste disposal capacity (sewage and landfills), etc, etc.
Please understand, I'm not a Nativist. I just would like to see some common sense applied to U.S. immigration policy: a temporary reduction in immigration levels until the infrastructure can catch up.

[Kit P]

“here in the UK”

DaveMart, that is great. Could you tell us how much electricity is produced in the UK by wind. It would be nice if provide some time lines from initial project concept to commercial operation.

“Perhaps you don't mind what happens to mountains and water in WV, most of the rest of us dislike it.”

Like I said, I am very happy with how my electric utility produces my electricity particularly in WV. I do get tired of people who are poor stewards of their environment lecturing those who have clean air and water. Please come and visit if you like spectacular views, clean air and water. DaveMart has misconceptions that are based on living here.

[amazingdrx]

Wow, hard to post here with the lunatic fringe wind and solar haters. Not much point really. That's why I quit.

It's dead, nuts like kitty killed it.

Pickens, Buffet, and other billionaires boosting wind are wrong. kitty is right? Meow. Hehehey. Ridiculous.

Sorry jim, your blog has been infected with trolls.

[David Walters]

For a moment...there is no electircal system/grid/network in the world that was built entirely by free enterprise aka "The Market". Most were state owned, nationalized industries or regulated natural monopolies. This "market" crap is just that, crap.

All and very grid and generator is subsidized. All we're doing here is arguing what should be subsidized more or less. Right?

Secondly, society has got to make choices. I don't by the "Coal is what is available now" arguement. It makes advocates of such *killers* becauce that is what coal does on a regular basis, it kills, but few look at this as an issue. It kills now, and by the thousands. I want it to end.

As it stands, every country that is building wind power is also building coal plants to back up the wind. Natural gas is growing as someone pointed out pecisely because it's on demand, IS considered spinning reserve, BTW, even if it's not running because it can come up to full load in 10 to 20 minutes. This also puts out particulate and C02.

I am for ending all fossil fuel burning for electrical generation. At the very least for all base load power. That means in California, where ther ISO base/minimum load is approx. 21,000 MWs, it can all be replaced with nuclear. The peak load can reach over 40,000 MWs and does often. Let hydro (16% of our power now in the state) and other renweables have the other 34% until load following nukes can be designed (like the French ones do).

21GWs would require us to build about 15 more nuclear power plants. That's it. Shutdown ALL imported coal generation, shutdown all old gas fired thermal units, begin shuting down combustion gas turbines. That's my plan.

David

[DaveMart]

The wind power resource in much of the States is far superior to anything Europe has save for expensive off-shore, at the Picken's site for instance averaging 34% capacity whereas in Europe 25% is a very good site.
The economics of wind power improve disproportionately as capacity rises.
The will not be discontinuing the use of coal anytime soon in either the States or Europe but there seem solid grounds for preferring other sources where practicable and economic.
The value of the waivers for emissions and wastes in the coal industry far exceed the subsidies for wind, and the nuclear industry too internalises more of it's costs.

[JohnBo]

I like David Walters plan for California. Simply build a few more nuclear plants is a good solution. It is by far the cleanest and safest way to go for large base load power. A lot of folks worry about spent fuel waste storage but it is rather easy to maintain. I hope my state builds more nuclear. I was sad to see our power company is choosing a new coal plant to meet future demand.

[Kit P]

The US electricity generating industry has a very good safety record. It is record of which we are very proud.

“It makes advocates of such *killers* becauce that is what coal does on a regular basis, it kills, but few look at this as an issue. It kills now, and by the thousands. I want it to end.”

David calling people killers is a very serious charge. My air quality is good, every day. So My society will keep using coal and ignore those who are 3000 miles away.

“Secondly, society has got to make choices.” “That's my plan.”

David you do know that your society has passed legislation to prevent building new nukes? When does David think they are going to start building nukes in California?

[Kit P]

An interesting tidbit in today's reading:

Energy Markets Report (May 12 - May 16, 2008)

“According to Platt’s Electric Power Daily (5/16/08), ERCOT has seen “its share of volatility in recent months” due to “an influx of new wind generation and not enough transmission… In 2006, there were 75 15-minute intervals in which real-time prices fell below $0/MWh. So far this year [2008], there have been already more than 2,250 occurrences” (see pages 1 and 3).”

[Clee]

I suppose by some definitions, Northern Ireland is not part of Europe. Wind plants in Northern Ireland also have an average capacity factor of 34%. http://www.cprw.org.uk/wind/winstat.htm#rolling%20capacity