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Click to see a simulation of the proposed wind plant atop Backbone Mountain in Western Maryland
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Notable Quotes


"Renewable energy (hydropower, for example) can have horrendous impacts on fish and wildlife. But I can think of no proposed project more devastating to fish, wildlife, and the local economy than plunking a wind farm in the middle of Nantucket Sound."

—Ted Williams, Audubon Magazine (May 5, 2004).

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#1. Industrial wind developers are interested only in providing a public service.

All the false and misleading claims which this industry makes for itself work to disguise the fact that it is only a nominal producer of electricity in the eastern US. Its primary purpose is to increase profits by providing extraordinary tax and income sheltering opportunities for a few wealthy investors—such as Florida Power and Light, which owns the nation's largest stock of wind projects, AES, General Electric (which purchased Enron's windplants when the latter company went bankrupt), and BP—at the expense of average taxpayers and ratepayers. Taxpayers presently cover between 65-80% of the capital costs of all wind installations, allowing wind ownership to avoid paying their fair share of taxes to the federal treasury. On a per kilowatt hour basis, wind is the most heavily subsidized source of industrialized power in the nation, receiving 25 times more support than coal, natural gas and hydro, and 16 times more than nuclear generation.

In response to persistent lobbying from the wind industry and its allies, 29 states have passed renewable portfolio standards requiring each state to purchase a percentage of its electricity from renewable power sources. This obligates utility companies doing business in the state to purchase electricity from the wind industry without any meaningful competition.

Congress has provided wind developers with an accelerated double declining capital depreciation schedule and extraordinary investment and production tax credits. With laws ensuring a captive market and with tantalizing incentives for profit, investment in wind seems nearly risk free. The only remaining factor assuring success is access to land—and lots of it.

This is a major obstacle to the industry. A typical windplant is gigantic, consisting of dozens of 400 foot turbines arranged along many miles of access roads and communication/transmission line infrastructure. But the potential for profit is so great that wind investors work hard to bulldoze opposition in order to secure the land they so desperately need. Meanwhile, Congress has made wind initiatives so lucrative that it seems to have discouraged responsible citizenship. Consider what's at stake financially:

  • Federal production tax credits remain front and center for wind developers and their investors, giving the industry tax credits worth 2.1 cents for each kilowatt-hour it produces. As cited in Claim #4, a modest 40 MW windplant should produce about one hundred million kW hours annually (each 1.65 MW turbine would yield about four million kW hours a year), generating over $20 million in tax credits over the ten year period allowed by the production tax legislation. Since this windplant, if it produced steady energy, would power about 9000 homes a year, the total subsidy, underwritten by taxpayers, would be about $2,500 for each household powered! But this is just the beginning of the story. At a Maryland Public Service Commission heading, a spokesman for Clipper Windpower, a company proposing to erect a 100MW wind facility in Western Maryland, told the hearing examiner that his company expected $150,000,000 from production tax credits leveraged over a ten year period.

  • Moreover, federal tax benefits pay as much as two-thirds of the capital cost of each $4.5 million wind turbine, with many states creating incentives to cover on average an additional ten percent of these costs. Windplant owners can use these tax credits to reduce their corporate tax obligations by tens of millions each year, as the Marriott Corporation did a few years ago with a similar clean energy scheme, within a year reducing its corporate tax obligations from 36 to 6 percent—at a savings of nearly $100 million, with average ratepayers and taxpayers picking up the slack to the federal treasury (See "The Great Energy Scam: How a Plan to Cut Oil Imports Turned Into a Corporate Giveaway," Time Magazine, October 13, 2003. Read an excerpt here). And Florida Power and Light, using primarily its wind tax shelters, has not paid any income tax for years, despite having annual revenues in the billions.

  • State renewable portfolio standards laws make it probable that wind companies will likely charge utilities double the price paid for coal. For example, a 140MW wind facility as a consequence will likely reap 25 million dollars annually for the product it generates, and almost all of that energy product will be wasted in the electricity grid's spinning reserves. In addition to its lucrative production tax credits, the wind industry is a lusty cash cow.

One should be mindful that most of limited liability wind companies are merely "mom-and-pop" operations (US Windforce, Synergics, Critierian) formed to assemble the initial capital and grease the local officials. Once the wind project is approved, they either sell it to companies like Constellation Energy, Florida Power and Light, or AES, which have a lot of discretionary income to shelter, or enter into an "equity" partnership with them, which accomplishes the same purpose (but hides the situation from the public).

It is for these kinds of rewards that wind developers have placed private gain over the public interest. In the process, they have transformed the wind business into yet another extraction industry, relying upon false claims and the gullibility of those seeking easy solutions to complex problems.

There are now about 35,000 industrial wind turbines in operation across the United States, producing less than one percent of the nation's actual generation. No coal plants have closed anywhere. And no empirical evidence exits that there is less coal burned per unit of electricity produced as a specific consequence of wind. And no evidence whatsoever that the nation has reduced CO2 emissions in the production of electricity. Indeed, none of the industry's substantial subsidies are indexed to actual measured reductions of CO2 or the closing of any fossil-fired plants.

< Back to List   |   Claim #2 >

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