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Editorial: Timing is wrong to take away subsidy for wind power

The national transition away from fossil fuels and toward an increasing reliance on power from the wind and sun has been becalmed by the expiration of the Production Tax Credit, a 2.3 cents per kilowatt hour subsidy granted wind power generators.

Some argue that the subsidy, first offered in the 1990s to stimulate the development of alternatives to coal and oil energy, has outlived its usefulness. It’s time, they say, for power from wind turbines to compete in the marketplace on an equal basis with other sources, including natural gas. We say, not yet. Instead, Congress should restore the wind power subsidy, and do so quickly before factories producing wind turbines are idled or closed and jobs lost.

The subsidy’s expiration three months ago oddly coincided with a drastic and costly increase in the price of the natural gas that fuels most New England power plants. New Englanders, according to the regional power grid’s operators, spent almost as much for electricity during December, January and February as they did for all of 2012.

The spike in electricity costs forced paper mills in New Hampshire and Maine to close temporarily. The region’s economy suffered because home heating costs sucked up the disposable income of many households. The price increase was not caused by a shortage of supply but by a lack of pipeline capacity to bring the gas to north. That problem should be rectified in time, but natural gas is not an environmentally benign fuel. Burning it produces greenhouse gases, though not nearly in the quantities that result from burning coal or oil, and the long-term impact of the hydraulic fracking used to gain access to the gas is uncertain.

Wind power, which is not without its own problems, pollutes far less, and its use reduces the region’s overreliance on natural gas.

The use of subsidies to foster the development of green energy sources like solar and wind power is still necessary. But both technologies have evolved to the point where they could compete head to head with power from almost any other source if the subsidies given those sources were also withdrawn. Most of those subsidies come in the form of “externalities,” primarily unaccounted for environmental and health care costs.

A Harvard Medical study recently pegged the full cost to the U. S. public of mining and burning coal, for example, at $500 billion annually, but the damage can’t be measured in money alone. Burning coal aggravates conditions like asthma and shortens the lives of those who breathe its unburned particles. Factoring in the true costs of burning coal, the study said, would triple the price of electricity produced by coal-burning power plants.

Oil, too, enjoys a host of subsidies. Most of them are unnecessary but fiercely defended by the industry and its lobbyists. Biggest of all may be the subsidies granted nuclear power plants, an industry that wouldn’t exist if taxpayers didn’t foot the insurance bill.

In a perfect energy world, all externalities would be accounted for and all producers would compete on an equal footing. The situation, however, is a long way from perfect.

The subsidies for green energy, including wind power, should be eliminated, but not until Congress imposes a tax on the carbon emissions that are driving global warming. Taxing carbon would instantly make wind power economically competitive without a subsidy. Congress should tax carbon and New Hampshire’s congressional delegation should back the effort. Until it does, however, subsidies like those granted wind power should remain in place.

Legacy Comments14

what is criminal is this rags refusal to cover the massive Keystone Pipeline news

Taxpayers have been waiting decades for promised technology advancements that would wean the industry off public handouts. I'm no longer convinced the wind industry can survive without the PTC. Big wind grew up on the tax credit, developed market plans and forecasts that relied on it, and now the tax credit appears to be a required component of the industry's economics. It's time taxpayers recognize this fact and pull the plug on this losing technology once and for all.

"In 1983, Congress was told by the Solar Energy Industries Assn. and the American Wind Energy Assn. that "improved solar and wind technologies ... will begin to become competitive and self-supporting on a national level by the end of the decade if assisted by tax credits and augmented by federally sponsored R&D." Thirty years later, with desired subsidies pocketed and more, the mirage continues."

All forms of energy receive federal support, and wind’s cumulative incentives are a fraction of those given to other energy sources. The Nuclear Energy Institute’s own tally of federal support finds $73 billion in federal support for nuclear and $225 billion in support for coal and natural gas over the last 60 years, far more than has gone to all renewable sources combined. Similarly, DBL Investors found $4.8 billion in annual federal spending for oil and gas between 1918 and 2009, $3.5 billion annually for nuclear between 1947 and 1999, and $370 million annually for renewable energy (non-biofuels) between 1994 and 2009. Because the duration of the nuclear and fossil incentives were three and six times longer than those for renewables, respectively, the cumulative amount of support is even more heavily tipped against wind energy. Wind’s primary federal incentive, the Production Tax Credit (PTC), provides tax relief for American wind energy investment and project development. The jobs and economic development driven by the PTC generate more than enough tax revenue to cover the value of the tax relief provided by the PTC. Taller towers, longer blades, improved gearboxes, the growth of domestic wind power manufacturing, and over 30 years of experience in siting wind turbines to maximize their power output have helped drive down wind's costs. According to the Department of Energy, wind power’s prices have dropped 43 percent over the last five years. Michael Goggin, American Wind Energy Association

Intermittent power resources like Wind do not reduce fossil fuel use or emissions as claimed. When the wind dies down, our lights would go out unless conventional, reliable, powerplants were running in the background, ready to supply power when the Wind quits unpredictably, as it always does. Cycling these 'balancing' powerplants up and down is inefficient, causing them to use more fossil fuel and emit more CO2 than if they ran evenly, like before the Wind projects were installed. Compare it to your gas mileage when driving your car in 'stop and go' traffic versus cruising steadily down the highway. We get 50% better gas mileage on the highway than in city traffic. Wind power is very expensive wishful thinking. And when installed on mountaintops it destroys one of NH's most precious assets, it's magnificent scenery. All cost for no benefit.

The fossil fuel industry myth that wind energy's emissions reductions are significantly less than expected has been thoroughly debunked. Last fall, a comprehensive analysis using real-world data for every power plant in the Western U.S. found that wind energy produces 99.8% of the expected emission reductions, as renewables' incremental impact on power plant cycling was found to be "negligible" even at 33% renewable energy. That result was recently confirmed by an in-depth renewable integration study by the Mid-Atlantic and Great Lakes independent grid operator, PJM. In 2013, U.S. wind energy reduced carbon dioxide pollution by more than 100 million tons, as well as greatly reducing emissions of other health-harming pollutants such as sulfur dioxide, nitrogen oxides, mercury, and other toxins. Michael Goggin, American Wind Energy Association

I concur that a carbon tax is a market based approach to promoting greener energy and addressing the problem with subsidies. It is a good idea that has been kicked around for decades; the time has come. The current system promotes exploitation of dirty fuels like tar sands crude, while greener technologies like wind struggle.

What makes you think IWT's are so clean? Manufacture uses lots of resources and installation is very disruptive of the environment. Wind turbines contain oil and leak Big drawback is can't be dispatched for demand and they wear out and need to be backed up with other power.

It is time to END the subsidies for wind energy. Wind energy will do nothing to reduce greenhouse gas emissions and will continue to increase the cost of electricity by displacing the more reliable and necessary generation sources. Wind energy is NOT a reliable generation source, it is a redundant energy source. In most cases, the wind blows at times of low demand (night) and not when it is most necessary. In addition, wind energy requires transmission lines in areas where there is insufficient transmission. Adding wind energy to the mix will require thousands of miles of transmission lines that do not currently exist, at a substantial cost to ratepayers. Wind energy receives enough subsidies, aside from the PTC, including investment credits, loan guarantees, state subsidies, etc. We should learn from Europe’s costly mistakes. In addition, the environmental and societal costs of wind energy are excessive (health issues, loss of property value, tourism impact not to mention the millions of birds and bats killed). In NH, wind projects are being built to satisfy the RPS goals of Massachusetts, destroying NH’s natural and scenic environment.

Cold this Winter and deregulation is what caused expensive electricity and the PTC didn't effect prices at all. The subsidy for wind made it harder for other power sources to compete. PTC is additional subsidy just for wind power, is not to be confused with tax deductions which all businesses receive for expenses. Industrial wind turbines use vast amounts of fossil fuel for manufacture, transportation and installation of equipment including infrastructure for transmission. Additionally environmental toll is high as the once pristine ridges are blasted and filled for these projects disrupting wildlife and neighbors living too close. Rural communities are becoming industrial sites with many impacts including property value loss. Electricity uses less fossil fuel than heating and transportation here in New England and many factors are the culprit in CO2 being released including, agriculture, lifestyle, and even breathing. Are you going to tax that too? We have too many taxes and subsidies as it is. Time for corporations to get off the public dole, and let wind spin on it's own. Tax funding for research is good, but the PTC gives multinational corporations money for nothing. It's time for people to be personally responsible for their energy and resource use and live sustainably. The problem is too many people living wastefully and that's what needs to change.

Electric costs this Winter largely due to cold temperatures, and heating and transportation use more fossil fuel than electricity here in New England. PTC was an additional tax incentive, not to be confused with tax deductions businesses get for expenses and didn't help to lower electricity prices one bit and made it harder other power sources to compete. Tax funding should be for investing in research and NOT give multinational corporations money for nothing. As far as the true cost of IWT's in New England, there is an high environmental cost as the once pristine ridges where installed are blasted and filled filled in and disturb wildlife and neighbors located too close to these projects. Also vast amounts of fossil fuel and carbon is released for the manufacture, transportation and installation of the turbines. Electricity is a smaller part of carbon released, and heating, transportation, agriculture, recreation, and lifestyle all play a larger part, including every breath you take results in more CO2 being released and are you intending to tax that? We have more than enough taxes and subsidies and it's time for corporations to be weaned off the public dole and for wind to spin on it's own. Time for people to take personal responsibility for energy and resource use and not live so wastefully.

NO, NO, NO - again ....the editors of this liberal rag completely skip over the debate on the Governments role. Thats what liberals do - they declare the debate won and move on to the taxing and spending. Government in our form of govt is for Govt to be REFEREES in life not PLAYERS. Our form of Govt is not in the business of picking winners and losers (Nobama's record is absolutely dismal in that regard) . Even the liberal progressive socialist democrats should not support this crony politics as it is the devils playground for lobbyists. liberal progressive socialist democrats always whine about money in politics so on this one issue they can prove they are not hypocrites by fighting crony politics.

You make lots of silly challenging statements BUT offer not one fact to support these statements !!!

"Wind power, which is not without its own problems, pollutes far less, and its use reduces the region’s overreliance on natural gas." does it do that btw...???

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