Wind%20Energy%20Development

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Wind Energy Development

• Thomas Tanton
• Sr. Fellow and V.P.
• Institute for Energy Research

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Overview

• Background
• Foreign Oil Displacement?
• Job Creation?
• Competitive Costs?
• Reliability?
• Environmental Improvements?
• CO2?
• Why cant we do what Denmark has done? Or should
  we?

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Background

• IER is a non profit 501 c(3) organization
  dedicated to historical and forward looking
  analysis of the intersection of energy, economics
  and public policy
• We do not accept public funds
• I have 35 years in the field
• 28 years Principal Policy Advisor CEC
• 3 years General Manager at EPRI

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Foreign Oil Displacement?

• Very little oil is even used to generate
  electricity lt3 (source EIA)
• The little amount of oil that is used is not
  primarily for energy but for load balancing,
  start-up, ancillary services and other purposes
  not displaceable by wind
• Any oil that IS displaced, generally speaking,
  would most likely be more expensive domestic, not
  cheaper foreign oil

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Job Creation?

• Majority of jobs are temporary construction jobs
• Majority of wind turbines are imported
• Claims of job creation seldom are net

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Competitive Costs?

• Contrary to most claims, wind is NOT cost
  competitive once costs are corrected for high
  levels of subsidy
• 60-65 of the costs are born by taxpayers
• Costs have dropped for windbut also for
  everything else, while volatility has increased
• Costs may only be considered competitive if
  fossil prices are expected to continue to
  monotonically increase.
• Official forecasts do not expect forever higher
  prices
• History suggests not signing 30 year fixed
  contracts at the top of the market

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Renewables Are Expensiveeven with heavy subsidies
Sources geothermal and solar PV Western
Governors Association, June 2004 all others
EPRI, November 2005
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Reliability?

• Wind and Electrical Demand seldom correlate
• Turbine system are highly reliable
• Wind can be forecast, but not well

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Imposed costs vary by situation and requires
complex modeling
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Environmental Improvements?

• CO2
• Grid balancing and intermittency require
  off-design operation of thermal plants
• Life cycle considerations imply net increase in
  CO2 with large amounts of wind (e.g. concrete)
• Birds and Bats
• High mortality of endangered species and other
  wildlife
• Necessary transmission also may cause
  unacceptable impacts to habitat and continuity

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Denmark?

• Denmark doesnt really rely on the very high
  claims of wind usage
• Denmark relies on NORDPool for much of its
  capacity and balancing and energy is delivered
  from thermal and hydroelectric
• 4 of total not 30
• Denmark is NOT achieving CO2 reductions, in part
  because of its use of wind