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Corina|EV • 12 years ago

Really amazing how low the price got! And a 20-year contract?! That would be a great accomplishment!

rucio • 12 years ago

Subsidies aren't accounted for here, nor the sale of green tags in addition to actual energy. Since taxpayers foot two-thirds to three-fourths of the cost of building a wind facility, that "externality" takes the cost from 6 cents to 18-24 cents per kWh. Green tags, or renewable energy certificates sell at about $50/MWh, bringing the cost of wind to 23-29 cents/kWh.

Bob_Wallace • 12 years ago

Subsides are talked about in this article and will be handled more thoroughly in future releases of this ongoing series. Specificially, wind benefits from a 2.2 cent/kWh production tax credit (PTC). They pay a lower income tax rate on power produced, a benefit given to most new sources of clean energy.

Please provide substantiation that "taxpayers foot two-thirds to three-fourths of the cost of building a wind facility".

Dave • 12 years ago

I do a lot of contracting in rural Saskatchewan and have meet 4 people who have wind turbines... not one of them would do it again.
Setup cost was justified by almost perfect conditions which never occure. The best one person got was about 50% of what he expected. Worst was 25% when running at 100% capacity.
Bottom line is there are countries that tried going wind in a big way only to find it was a complete waste.
You still need the traditional infastructure to supply power when wind cannot... why spend money on a second unreliable source.
The key is an advancement in battery technology and a good source of energy like hydro and nuclear.
The planet is at 6B people we are not all going to eat organic tomatoes and use wind power..

Dave • 12 years ago

Also our city is looking at putting up a large turbine. They project a 10% return on investment. BS when the government says 10% return it will probably be more like -30% once done. I would bet anything it will cost more and produce less than the people pushing this say it will.
It is not going to fly though as there are enough reasonable people to see the folly in this stuff and there is a growing number of people outraged that the city is thinking of spending money on this.
I love the idea of wind but expectations are not relistic.

Bob_Wallace • 12 years ago

" BS when the government says 10% return it will probably be more like -30% once done."

You just make up facts to suit your bias, do you Dave?

Zachary Shahan • 12 years ago

Dave, a ton of communities and individuals have benefited immensely from new wind farms. Wind is now over 20% of Iowa's & South Dakota's energy supply, and climbing...

A Colorado utility had 55.6% of the electricity on its grid coming from wind at one point last year.

Wind is driving down the cost of electricity around the world.

You might want to look at its potential & benefits a bit more before trying to shoot down your local project.



Bob_Wallace • 12 years ago

"Bottom line is there are countries that tried going wind in a big way only to find it was a complete waste."

Some facts please. I've never heard of these countries.


Have you ever seen anyone suggest that we run the world on nothing but wind power?

Or eat nothing but organic tomatoes?

Zachary Shahan • 12 years ago

Dave, there are plenty of testimonials out there of farmers and
others leasing their land that show wind as a great option. Of course, everything isn't a win for everyone.

AndrewW • 12 years ago

DOE provide some real facts, which are better than AWEA-cheerleaders.

Wind will still be expensive in 2016, $.15-.19 kWh:

Intentional misinformation is killing the green movement.

Bob_Wallace • 12 years ago

The Department of Energy reports the 2009 average wholesale price of wind-electricity as approximately$0.045/kWh.

It was up about a penny higher than 2005 prices due to a now-resolved shortage of wind turbines. High demand for turbines allowed manufactures to hike turbine prices which forced production prices higher.

Page 32...


Four and a half cents. And a range of about 3.3 cents to 5.3 cents. Add in the 2.2 cent PTC and subtract out undisclosed wind farm profits to arrive at the production costs. Ballpark = a nickle.

AndrewW • 12 years ago

You keep missing the point: the price that utilities pay for wind is not the COST of that electricity. DOE has the costs correct - $.15 - $.19 per kWh. Subsidies make up the difference in price/cost. The suggestion that wind electricity COSTS less than NG or Coal is just silly ignorance.

The reality is that many of the wind farms built in the last few years will NEVER perform profitably without subsidies of 60-70% (current).

We need "clean, affordable and scalable electricity" to solve our energy needs - wind is not.

Bob_Wallace • 12 years ago

OK, Andrew, educate us.

1) Where is the roughly ten cents per kWh subsidy you claim? The ten cents in excess of the recognized 2.2 cent PTC.

2) Do you think coal should be charged for its "hidden costs" - the health and environmental damage which it causes and which we pay via tax and insurance premium dollars? The additional nine to twenty-seven cents per kWh.

3) Do you think we should recognize the roughly six cents per kWh subsidies which nuclear receives?

4) Do you understand that the current price of NG-electricity is artificially low due to market glut and the price of NG is likely to be as much as 50% higher next year? Furthermore, do you realize that the 'six cents' price for NG is for a plant that is on 24/365, and not a NG plant which has to spread its fixed costs over fewer than 24 hours a day?

Oh, and how about the subsidies NG receives. Include them or not?

And please read my comment to which your replied.

Production cost, if you want to figure out what it is then take the wholesale 3.3 cents to 5.3 cent range, add in the 2.2 cent PTC and subtract out undisclosed wind farm profits to arrive at the production costs.

Ballpark = a nickle."

Bullfrog • 11 years ago

@Bob "1) Where is the roughly ten cents per kWh subsidy you claim? The ten cents in excess of the recognized 2.2 cent PTC."

Its in an accelerated 200% depreciation benefit provided by the federal tax code to wind farms to help them recoup invested capital. It allows wind farm to deduct accelerated depreciation from their tax. The depreciation deductions range from 15% - 30% of capital investment each year for the first five years of operation. Basically allowing them to recoup 80% or more of capital costs. That adds up to about 5 cents/kWh of power generated plus the approx 2 cents/kWh PTC. Additionally wind farms (and solar) receive property tax reductions that usually come in at about 70% reduction depending on state which is a massive amount of tax savings considering the amount of property. It all adds up to about 12cents/kWh in tax benefits.

To be fair, oil and gas plants also get the depreciation of capitol tax benefit, but at a much lower rate and spread out over the lifetime of the facility rather than first five years.

Edit to add a link

Bob_Wallace • 11 years ago

That adds up to about 5 cents/kWh of power generated plus the approx 2 cents/kWh PTC."

Five plus two does not equal ten plus two.

And, is it not the case that wind farms have to choose between accelerated depreciation and the PTC?

"Allows PTC-qualified facilities installed in 2009-13 (2009-12 in the case of wind) to elect a
30% ITC in lieu of the PTC. If the ITC is chosen, the election is irrevocable and requires the
depreciable basis of the property to be reduced by one-half the amount of the ITC. If the ITC is chosen, the election is irrevocable and requires the
depreciable basis of the property to be reduced by one-half the amount of the ITC."

American Recovery and Reinvestment Act of 2009

Now I could spend some time verifying/disproving your "80% recoup of capital ex", but I'd rather you document it.

I suspect you are adding 30% ITC and 50% depreciation basis to get 80%. And that ain't right. It's a misunderstanding of depreciated value.

And, please, get your facts from laws in effect, not stuff from anti-wind sites.

juangault • 11 years ago

i wanted to share an update to an article I read in the local newspaper while on vacation. It would be good to see the "bottom line" numbers on these projects, but looked through the lenses of local values.


Bob_Wallace • 11 years ago

Thanks for that. If there is anywhere in the US that should be installing lots of renewables it's Hawaii with the price they pay to gen power from oil.

Zachary Shahan • 11 years ago

Thanks. Hawai'i has some tremendous resources. In a perfect world, I think it would be the 1st state to go 100% renewable.

Bob_Wallace • 11 years ago

Hawaii might be second, Idaho has a big lead.

84% hydro, 90% renewable total.

Or maybe third. Washington State is about 80% renewable.

Zachary Shahan • 11 years ago

Good call. :D

bob • 11 years ago

Your vastly overestimating the value of early depreciation. It's a basic time value of money equation * a modest percentage of the cost of building wind farms. (Actual benefit closer to 1/2 cent /kwh not 12 cents.)


Roscoe70 • 12 years ago

Interesting article and discussion.
The analysis needs to include further adjustments:
ADD costs for real cost of state and federal transportation programs (maintaining existing roads, planning for new/improved transportation infrastructure, regional public transportation subsidies, etc.).
SUBTRACT costs which subsidize current international security costs associated with imported petroleum.

Breath on the Wind • 12 years ago

Determining the equivilent cost of powering an electric vehicle in equivilent gas miles is not difficult.  What is needed is a common conversion factor.  The heat content of the fuel provides this and various charts on the web give the values. From this chart:  http://alternativefuels.abo...  33.56 KW-hrs of electricity equals 1 gallon of gasoline in its heat content.  At $ .70 equivilent gasoline is then using a cost of (.7/33.56 =) $.021 per KW-hr for the electricity.   This is consistant with the balance of the article. 

In keeping with the parameters of the article other considerations may apply.  Transmission cost is often considered to average around 95% with conventional power production located relatively near markets.  Transmission costs for wind may be higher.  Charging costs for an EV also average around 5% and this may not be considered in a battery to wheels efficiency of the EV.  However if the far superior EV efficiency is considered (and most will only store the equivilent of 1 to 2 gallons of gasoline) then the cost for a gasoline gallon equivelent in range should be 3 to 6 times lower.  http://answers.yahoo.com/qu...   

Bob_Wallace • 12 years ago

I do the math in a simpler (but not as elegant) fashion.

An EV like the Nissan Leaf uses about 0.35kWh per mile.

The US average price for electricity is (was a few months ago) $0.1275/kWh.

That means $0.045/mile, plus a little for charging losses.  Perhaps 10%.  Call it $0.05/mile for easy math. 

($0.1275 * 0.35 + 10% = $0.049)

The operation-efficient option to an EV would be a 50mpg hybrid.  To drive a mile with a 50mpg ICEV you would need to fuel it with $2.50/gallon gas.

(50 * $0.05 =$2.50)

It's not the physics way, but it's easier for the average person to follow.

(Of course we are likely to pay less for our charging power when we plug in off-peak.  Eight cent electricity equals $1.54/gallon gas in a Prius.)

Breath on the Wind • 12 years ago

Bob, thanks for the link.  I won't debate what is "easier" Ultimately discovering the cost of driving a car may be more useful but it requires numbers that can change from vehicle to vehicle and with grid mix electricity rates.  You can see some other calculations for the Leaf at my second link above. 

This EIA table (5/15/11) puts your estimate of present electricity prices a bit higher than the US residential rate of $ .112:  http://www.eia.gov/cneaf/el...  However, the article seemed to discuss a "wind rate" and not a grid mix rate. 

James • 12 years ago

You think farmer can make 1000 acres of wheat with electric tractors and combines? How about a 80,000 lb transport truck going cost to cost with frozen beef.
When I see this I will know electric transportation is here.

Tony • 12 years ago

The irony is electric transportation is here. Investigate how locomotives and large mining dump trucks work. They do use diesel fuel but they also use electric motors to move that much weight. Maybe a 150hp hybrid farm tractor or semi is an alternative that could work with today's technology.

Zachary Shahan • 12 years ago

Good point.

Bob_Wallace • 12 years ago

A tractor plowing a large field or a combine working grain doesn't travel very far during the day. Lots of movement in a restricted area.

Imagine a system in which a 'big electric wire' was located somewhere close. The tractor/combine ran on exchangeable battery packs. A truck brought charged battery packs into the field and took the discharged pack back to the charging station.

Tractors and combines would be great were they run by electricity. Bunches of torque at your fingertips.

The other option is biofuel. It's likely we might never figure out how to run everything on electricity. But if we can run 'almost everything' with electricity then we could afford to do the last few percent with fuel we grow.


Long distance trucks? Move to electrified rail.

Having big trucks rumbling down our highways is inefficient. Once we have high speed rail it will be a lot cheaper and faster to send things by rail.

Waywardson286 • 11 years ago

I have to disagree with ya Bob, and Not just because I'm a truck driver. I worked for a company in 04 that was contracted to fuel and service locomotives for the BNSF. There was one coal train that I serviced every other day on a regular schedule (everyday on a rush schedule during the holidays) that traveled approximately 500 miles on a round trip from the power plant in Fort Collins, CO to the coal mines in Gillette, WY. the fastest that train could make a round trip was about 27 hours, and that's if nothing got in the way, like the dozen trains leaving Denver headed north or a backup of coal trains trying to get loaded and rolling again. The problem with trains is track and crew availability. There are places in nearly all major cities where trains become bottle necked and have to wait on each other. I once sat for 10 hours waiting for a train to make it to the fueling spot that never made it that day, because of the bottleneck issue. You put a couple hundred million dollars worth of meat or produce on a train and let it get bottle necked outside a city or trying to get to fuel and you'll have rotten meat or produce, and meat packing companies going broke in a heart beat. Granted, trains haul more freight and because of that they use less fuel, but the time it takes to navigate through some major cities or into a rail yard to be unloaded is why trucks are better than trains, especially for time sensitive loads like meat and produce. A truck can run L.A. to New York in 3 days where it takes a train a week or more. As far as high speed rails are concerned, we're not going to have high speed freight rails. For passenger trains sure, but not for freight trains.

Bob_Wallace • 11 years ago

What your really saying is that our rail system needs improvement.

The CA HSR system was originally designed for freight on a separate set of tracks.

Don't know if it will happen, but there's no reason we can't work our way to a system that can move freight faster than trucks.

Perishable loads could travel on HSR at night when the lines are not getting used for passengers.

Zachary Shahan • 11 years ago

your view of what trains are capable of is very limited by your experiences.

check out the trains in Europe, China, and Japan -- a completely diff story.
unfort., such limited thinking is what keeps the US in the dark ages on this one.

Gth1087 • 12 years ago

Thank God for the progressives/liberals in Europe for leading the way on wind power. Independent reports have consistently revealed an industry plagued by high construction and maintenance costs, highly volatile reliability and a voracious appetite for taxpayer subsidies. Such is the economic strain on taxpayer funds being poured into wind power by Europe's early pioneers -- Denmark, Germany and Spain – all have been forced to scale back their investments. Middle class American’s always pay the lion’s share for this crap; our money can be invested in other ways. Wind is free however; the cost of transferring wind to power is very expensive.

Bob_Wallace • 12 years ago

I had to read this twice to get some idea of what you were trying to say.
Oh, the wasted time....

Wind is one of the two cheapest ways to make electricity and on the way to becoming the cheapest as natural gas prices rise and the price of wind turbines continues to fall.

exdent11 • 12 years ago

Could you find sources [articles] that explain how wind energy gets around intermittency issues? Can it be overcome with geographical distribution, electrical storage , or what? If storage, in what form and at what cost? Could it be used for uses for which intermittency is not relevant?
Thank You, J.O.

Zachary Shahan • 12 years ago

Hey there.

Is this useful for you: http://cleantechnica.com/wo...

Ldave • 11 years ago

Zach, what do you think of Gemasolar's accomplishment in Spain recently, operating a solar thermal power plant 24 hrs/ day using thermal storage vessels (molten salt), charged during the day, to provide continuous, on-demand 24 hr/day power? Of course, these are experimental projects, so they are off topic in a discussion of levelized costs and such. But it sure drops a flaming arrow into the throngs of naysayers that eqate renewables with 'intermittant' and 'unreliable', doesn't it?

Rosa Goldman • 11 years ago

All such storage solutions not only add cost and diminish usable power (there is always a loss of energy involved), but they also underscore a certain impracticality of scaling off-grid kludges to a large system.

Bob_Wallace • 11 years ago

Yes, but you miss a most important point.

There are times during which stored power is much more valuable than when that power might have been generated.

We built over 20GW of pump-up hydro storage in the US many years ago because nuclear plants were putting out power into low demand nighttimes, but that power had great value in the middle of the day when demand exceeded supply.

As we scale up renewable we will need storage to time shift power from when it's readily available (and cheap) to when supply is sketchy.  Sure, we will loose a bit, but that's just part of the cost of doing business.

Ldave • 11 years ago

Directly on point, Bob. I, personally, consider Gemasolar's accomplishment a milestone in solar sourced electricity generation that began years ago right here in the states with Solar One. Most people are aware that a better battery would be most useful. With solar thermal plus storage, there it is right in front of you... a low loss battery for offsetting thermal production from electricity production.
As far as 'adding cost' and 'diminishing useable energy', I can only refer you to their design. The plant started with a known daytime demand. They then built a standard power tower arrangement, using heliostats and a central tower receiver with molten salt as heat transfer fliud. Except that they built more heliostats than needed to meet daytime demand and used more molten salt than needed to drive a standard steam turbine for daytime demand. The excess mirrors create excess heat (which would otherwise be wasted, as this is heat in excess of demand), which is stored in the excess molten salt in a well insulated vessel, awaiting nighttime or passing clouds to be utilized for steam generation when temp gradient at central tower falls. The comment on the 'certain impracticality of scaling off-grid kludges to a large system' is rather ironic in that anyone with a basic understanding of thermodynamics knows that the larger the storage vessel for a thermal process, the more efficient it is; that is, the losses become less the larger the vessel is by an order of magnitude. So, in point of fact, to the above naysayer, in this case, scaling to large scale makes storage more efficient and, thus, more practical, not less. For the Gemasolar project, estimated losses relevent to storage as a function of instantaneously useful: 3%.
And thankyou, Rosa, for playing naysayer right on cue.

Bullfrog • 11 years ago

But its still 5x too expensive even with Mojave Desert insolation and California energy prices. Even with the molten salt technology the power company and their Google investor wanted to scrap the plan and go with a photovoltaic system instead due to the falling prices of panels. The company went out of business and their German parent company went bankrupt before it was even built despite having federal loan guarantees. The Ivanpah plant will go forward apparently with new fananciers.

Bob_Wallace • 11 years ago

What number are you using for your "5x too expensive"? And how does that compare with what utilities are now paying for peaking power?

Dave Long • 11 years ago

Regarding Gemasolar and similar plants planned:
'Energy from the plant does not come cheap: it is costly compared with burning fossil fuels. Yet experts expect future plants to be competitive. "The cost of electricity generated from a plant like Gemasolar, if it were built in southwest US, would probably be in the range of 13 to 16 cents per kilowatt-hour," says Glatzmaier. That's thanks to the sunnier weather in the region, and government tax incentives. Trailblazing technology Gemasolar has set a precedent that others are following. "We have a [similar] plant under construction right now inNevada, which will come online December 2013," says Bill Gould of SolarReserve. "That plant has a 120-megawatt capacity – the equivalent of 200,000, maybe 300,000 homes," he says. Electricity from that site would be close to competitive with fossil-fuel power, which costs between 6 and 10 cents per kilowatt-hour. Such prices would also bring it into line with other...'
5X more? Not. Cheap? Not yet. But remarkably competitive considering that coal and gas have been around a rather long time and are well established technologies.
Also, I'll reiterate this point once more: you've missed the point of the innovation. Photovoltaics are 'intermittant' sources. And as such can only augment what are known as 'baseload' sources, sources that can supply 24 hrs/ day, on demand. Solar thermal with storage represents a milestone transition to 'baseload' capability with solar source.

Bob_Wallace • 11 years ago

Let me suggest a rework of this paragraph...

" Also, I'll reiterate this point once more: you've missed the point of the innovation. Photovoltaics are 'intermittant' sources. And as such can only augment what are known as 'baseload' sources, sources that can supply 24 hrs/ day, on demand. Solar thermal with storage represents a milestone transition to 'baseload' capability with solar source. "

Photovoltaics are variable sources. As such they require 'fill-in' supply such as storage or dispatchable generation in order to totally replace old tech 'always-on' generation. Solar thermal with storage is possibly a very useful fill-in. It will have to compete with solar/wind production stored using other technologies.

Dave Long • 11 years ago

Certainly a valid reworking of that paragraph. But perhaps neither version, 'intermittant', 'variable, or 'fill-in', really says it like it is. While solar resource isn't intermittant in the same sense as wind, its major achilles heel is that it doesn't present at night. At some point these plants around us that produce power at night will reach their lifetime end point. We may have all the daytime generation in the world from clean sources, but what shall we do with night? Now, I've seen the nighttime photos from orbit that show our lighting demands (alone), and they are significant. 'Fill-in' is, IMHO a bit of weak characterization of this, as half of the solar day is night, on average. It's these both kinds of intermittancy that leads power generation operating companys to estimate that only up to about 15% of total load can come from these sources unless a gamechanger is found.

Bob_Wallace • 11 years ago

The Sun does shine during our peak demand hours. That's real handy.

We've got a couple/three options.

1) Continue to use fossil fuels and really screw ourselves.

2) Build a lot of nuclear and drive the price of electricity through the roof.

3) Convert our grid to renewables. That means that we have to find ways to work with more variable inputs than we now have. (All generation is variable, just some more-so than others. Notice how San Onofre recently became absent?)

The fill-ins for variable wind and solar will likely be dispatchable generation such as solar and biogas as well as storage. As someone who lives off the grid with solar I know that a combination of wind + solar + storage + dispatchable generation works. I've lived it for over 20 years (less the wind input).

BTW, it's 25% wind and solar for the Eastern grid, 35% wind and solar for the Western grid. 40% for the Hawaiian grid. EVs on the grid will take these allowable penetration levels higher.

That's for the grid as it now is, no additional storage or dispatchable generation. We're busy converting from coal to natural gas. All that NG will be dispatchable generation which will allow penetration levels to go even higher.

And I didn't mention dispatchable load, except indirectly via EVs....

Dave Long • 11 years ago

Clearly, we're on the same page here. I would dispute this statement however:
BTW, it's 25% wind and solar for the Eastern grid, 35% wind and solar for the Western grid. 40% for the Hawaiian grid. EVs on the grid will take these allowable penetration levels higher.
It is my understanding that these numbers are for 'renewables', which include hydropower, which currently accounts for about 60% of 'renewable' generation, and is, notably, baseload quality power... its not variable and is on-demand. My understanding of things is, however, a moving target, and I'm willing to entertain visionary ideas. I have trouble, though, getting past the management of such a large fraction of variable generation.
And kudos to you for operating a successful off-grid system. I'm not there yet. But I'm sure that you manage your daily usage based on generation. Can we really expect the average American to do that, given the disconnect the average person has from generation?

Bob_Wallace • 11 years ago

I'm pretty sure 35% = 30% wind and 5% solar. I'll try to look it up tomorrow, but I'm running out of steam at the moment.

I don't have any expectation that the average American would be willing to manage their own power system. I do so only because it would have cost me very major money to hook to the grid.

I think we will gradually move from a fossil and nuclear grid to a largely wind/solar grid with background inputs from geothermal, tidal and some biomass. Some more hydro than we have today. Hydro might go above 15%. But wind and solar are likely to be so cheap that they will store at prices hard for new hydro to match.

The big question for me is whether storage will be battery or pump-up hydro. I thought it might be hydro but new battery technologies are emerging that are very promising. The MIT liquid metal battery, for example, is made from dirt cheap materials and a prototype has already exceeded 7,000 charge/discharge cycles with about zero performance loss.
Another option is the Aquion sodium-ion battery that should be fairly cheap to manufacture and has undergone over 5,000 cycles by an independent lab with little or no performance drop. Aquion should be manufacturing in a few months, they're right now setting up the factory.

A year or so ago two or three California utilities (PG&E, SMUD and possibly one more) were talking about building new pump-up storage and
another utility (San Diego?) was talking about a CAES facility. That talk seems to have gone quite and that makes me wonder if they aren't seeing batteries as a more viable solution for storage.

Bob_Wallace • 11 years ago

I found the western grid part...
May 26, 2010NREL Study: Western Grid Can Handle Increased Wind and Solar Power

A new study shows that it would be possible for the Western power grid to draw 35% of its electricity from wind and solar energy sources by 2017. The Western Wind and Solar Integration Study (WWSIS), released by DOE's National Renewable Energy Laboratory (NREL) on May 20, examines the benefits and challenges of integrating wind power, solar photovoltaic systems, and concentrating solar power onto the grid. The study concludes that while additional infrastructure isn't needed, key operational changes are required to meet this target. The report focused on the power system operated by the WestConnect group of utilities in Arizona, Colorado, Nevada, New Mexico, and Wyoming.


I just noticed that this doesn't include Washington and Oregon with all their hydro....

Dave Long • 11 years ago

I stand happily corrected. I assume that the 'key operational changes' are very fast switching equipment, the availability of which has, no doubt, been driven by the accelerated development of variable renewables themselves. Arizona, Nevada, and Utah do have significant hydro on the Colorado: Glen Canyon and Hoover Dams.