Source: AWEA
On the heels of a recent Forbes blog post where I call out Texas’ Comptroller for playing favorites in her biased scrutiny of Texas’ wind industry, comes another Forbes piece by James Taylor from the Heartland Institute. Confusing correlation with causation, Taylor claims wind energy causes higher energy prices. However, an increase in electricity prices cannot automatically be accounted for by pointing the finger at wind energy. That’s simply playing fast and loose with the facts.
This is the same tired slant we have heard from Heartland Institute time and time again. Not surprising – when pundits want to cherry pick data to make their argument strong, it doesn’t always work.
First there are many, many factors that determine energy rates, not just one type of resource. In an analysis of utility rates, economists Ernst Berndt, Roy Epstein, and Michael Doane identified 13 reasons why an electric utility’s rates may be higher or lower than the average. They include things like the average use per customer, age of the electricity distribution system, generation resource mix, local taxes, and rate of increases prior to any implemented renewable portfolio standard (RPS). So faulting renewables for high energy prices is a bogus claim. Furthermore, there is no data showing a nationwide pattern of renewable energy standards leading to rate increases for consumers. The report states: “American consumers in the top wind energy-producing states have seen their electricity prices actually decrease by 0.37 percent over the last 5 years, while all other states have seen their electricity prices increase by 7.79 percent over that time period.” Further, 15 studies from various grid operators, state governments, and academic experts have examined the impact of wind energy on wholesale electricity prices and confirmed that wind energy reduces electricity prices.
Noticeably missing from Taylor’s lineup of “proof” is Texas, the number one wind producer in the nation. In 2009, the Public Utility Commission of Texas (PUCT) said, “renewable generation has reduced wholesale and retail energy prices during some periods and has been instrumental in moderating price increases during periods in which the cost of natural gas was increasing.” That same report also states that “for each additional 1,000 megawatts of wind produced, the clearing price in the energy market fell by $2.38,” or $67 million annually. ERCOT’s own Independent Market Monitor found that coal and natural gas set the marginal price of energy somewhere around 90 percent of the time, meaning that 90 percent of the prices influencing investment decisions are set by coal and natural gas, not wind. When fuels do affect prices, the Brattle Group also makes a pretty strong case that natural gas, not wind, is responsible for setting the bulk of market prices.
When it comes to jobs and economic growth, Texas, again leading the nation, reported an increase of 8,000 to 9,000 direct and indirect jobs in 2013 related to the wind industry. The economic benefits and jobs realized in West Texas represent the biggest economic revival in that area since the Great Depression. The cost of reliably integrating large, conventional power plants onto the power system in Texas is more than 17 times larger than the cost of reliably integrating wind energy.
Furthermore, operational wind energy projects and those under construction will avoid 115 million tons of carbon dioxide emissions annually, while avoiding the consumption of over 36 billion gallons of water each year, because wind turbines use virtually zero water in operation. Those savings do not exist in a vacuum.
Heartland Institute is the same organization that ran a billboard comparing those concerned about climate change to terrorists. When the planet experienced yet another month of recording-breaking temperatures, it’s mind-boggling to see the same overused rhetoric slamming climate-saving clean energy.
But, if Taylor wants to talk about high prices, let’s look at what it costs for Heartland to do your bidding. Heartland received $25,000 from the Koch Foundation in 2011 and a projected $200,000 for 2012! It also received $25,000 from the U.S. Chamber of Commerce (a notable climate change denier), and $2,500 from Marathon Petroleum. Listed “sponsors” for the Heartland Institute’s 2009 “International Conference on Climate Change” amounted to $47 million from fossil fuel energy companies and right-wing foundations, with 78 percent of that total coming from the Scaife family of foundations.
Heartland funders are determined to maintain the status quo, lie about climate change and renewable energy, and keep the playing field rigged for their own self-interests at the expense of everyone else’s. This Forbes article is no exception.
This post originally appeared on our Texas Clean Air Matters blog.