Wind blowing against Alexander’s energy arguments

Source: Paul C. Barton, Gannett Washington Bureau • Posted: Wednesday, March 27, 2013

Sen. Lamar Alexander has long opposed a tax credit for wind energy and thinks that modern windmills are a blight on the landscape, but the sector continues to grow in some areas of the country.

WASHINGTON — Few issues arouse as much passion for Tennessee Republican Sen. Lamar Alexander as federal subsidies for wind-generated electricity.

But utilities, including his home-state Tennessee Valley Authority, are finding they like wind power more and more.

Alexander, up for re-election in 2014, argues the country needs 100 new nuclear plants to ensure low cost and clean power for the 21st century.

At the same time, he has this year renewed efforts to strip the wind industry of a tax credit, in existence since 1992, for new power it brings on line. The credit provides companies 2.2 cents per kilowatt hour, costing the federal government about $1.5 billion annually.

But in fighting wind turbines, which he regards as a blight on the countryside and large-scale bird killers, Alexander is experiencing some of fictional character Don Quixote’s frustration with windmills.

In fact, the Tennessee senator had to stomach voting for a renewal of the tax credit himself when it was included Jan. 1 in a bill to keep income taxes from increasing on middle-class Americans and avoid the so-called fiscal cliff.

“A huge waste of money” is Alexander’s description of the tax credit.

“But it was more important to vote for a bill that permanently preserved lower tax rates for 99% of American taxpayers on their individual taxes, their estate and gift taxes, their dividends and capital gains,” he added in a statement.

“I will continue my efforts to get rid of the 20-year-old, multibillion-dollar subsidy for unreliable, expensive wind energy that stands no chance of powering our nation’s 21st-century economy.”

But some environmentalists and the wind industry’s trade group, the American Wind Energy Association, beg to differ about the importance of the power source to the nation’s economic future.

In 2012, more wind energy — 13,124 megawatts — was added to the U.S. electric grid than any other form of power. Of all U.S. power, 4% now comes from wind.

Further, the subsidies produce at least $18 in capital investment for every dollar they cost, the association says, and wind farms return far more in tax revenues to all levels of government than they receive in subsidies. And the group adds that doesn’t count lease money farmers receive for allowing the turbines on their land, even as they plant and harvest right along side of them.

More to the point, utilities, especially in the Midwest, are finding that wind power coming off the wind farms of the Great Plains is often cheaper than other power sources, especially at night. In fact, many are using wind to displace nuclear.

Utilities are also entering into long-term contracts with wind sources as a hedge against future volatility in natural gas and oil prices.

“Once a wind farm is installed, its costs are very low. Wind is free,” said Howard Learner of the Environmental Law and Policy Center in Chicago, an environmental advocacy group.

And the TVA has not missed its opportunity.

Since 2010, it has entered into six contracts that can provide it with a maximum of 1,515 megawatts of power. That compares with the 34,000 megawatts it has from other sources, primarily nuclear and fossil fuel plants.

But the agency is contemplating the purchase of an additional 500 megawatts before it re-evaluates its power mix, called its “integrated resource plan,” a spokesman said.

The wind power TVA is purchasing is coming primarily from the belt of states that run from North Dakota to Texas.

Texas, in fact, is No. 1 in wind capacity with 12,212 megawatts of capacity, followed by California with 5,549 and Iowa with 5,137.

Nine states now get 10% or more of their power from wind, with Iowa getting more than 20%. California is on course to get more than a third of its supply from wind by 2020, and a recent Department of Energy study predicted wind could supply 20% of the nation’s supply by 2030.

In contrast, Tennessee has only 29 megawatts maximum of wind power, barely enough to fuel 7,000 homes. And like the rest of the Southeast, it lacks significant wind potential. Its wind potential is rated at barely 1% of power needed.

Some parts of Tennessee, such as Chattanooga, are home to production of equipment for the industry, however.

Wind blows in the region only 20% of the time, Alexander reminds audiences when he speaks on the subject.

And even its most ardent supporters acknowledge that utilities could never depend entirely on wind because they can’t always count on the wind blowing.

“There is no way you can power major municipal areas with that kind of intermittent supply,” said Steve Kerekes of the Nuclear Energy Institute, a trade group for that industry.

And perhaps just as important, Alexander said, they would scar the mountaintops of Tennessee, the only place in the state where they can work.

Noting that oil billionaire T. Boone Pickens has said wind turbines and transmission lines are too ugly for his ranch, Alexander asks, “Why would we want them on the most beautiful mountaintops in America?”