3 degrees Fahrenheit this morning
... and the wind is blowing hard. At least 15-20 mph average, I'd guess.
And I continue to obsess upon the impact of behemoth industrial wind turbines destroying massive amounts of our most visible and beautiful natural environment, while pondering the warmth that could be generated from the turbulence outside.
Here is a simple proposal from a 1500 person community on a plateau 2000 ft above a beautiful valley with a metro area of over 200,000. We propose that the amount of political energy, federal subsidies, and consumer price support in the interest of industrial scale wind turbine development, be redirected to support a massive implementation of the PACE program (Property Assessed Clean Energy).
Such an effort toward targeting energy generation closer to the point of use would have a far greater impact for dollar spent than any collective scheme that continues to distribute energy over a "physical" distribution grid. If a renewable electricity generation unit became an integral part of every building, we would gain 6 - 20% more efficient and cleaner use of all energy so generated. That is the same percentage of electricity energy we lose thru transmission and distribution over the “GRID” according to the Lawrence Livermore National Laboratory.
With increased investment in research and development into energy storage technology; coupled with a redirection of the power companies to a local maintenance industry role, we can redirect the responsibility of conservation directly back to the consumer, at a dramatically lower cost.
Green and clean? Of course, but don’t get me started.
Disclaimer this proposal has not been formally adopted by the Bent Mountain community.
where the northernmost tip of the Great Blue Ridge Plateau meets the southernmost reaches of the Storied Shenandoah Valley.
Tuesday, December 14, 2010
Sunday, December 12, 2010
How long will it be before we see that we must be responsible for Ourselves?
Until that happens, I for one believe, I can help my family, friends and neighbors understand that.
Indeed, we can experience the greatest joy when we each realize the power we have.
With the same public investment of capital we are currently making in industrial scale, grid dependent, wind turbine installations, we can realize five times the exaggerated benefits claimed by the current wind industry developers. its well-paid lobbyists, and co-opted environmental organizations. Not only that, we can repay the bill ourselves with financial savings, rather than passing on the cost to our kids.
It will require a dramatic shift in our current economic structure. Instead of our natural resources continuing to be burdened with the costs of distribution, refinement and re-distribution; we have the opportunity to take upon ourselves the production of our own energy consumed, be it electrical, bio-fuel, fossil fuel, or by absorbtion. The rejection of convenience is the cost we must be willing to pay to achieve our dreams.
HOW?
Use all federal subsidies, including tax incentives used to attract profit-seekers into the "renewable energy industry", to capitalize PACE (Property Assessed Clean Energy) programs for all institutional/government, commercial and residential Properties.
Extended Benefits
Through the PACE program, which has been endorsed by the Commonwealth of Virginia for adoption by Virginia localities, publically-financed energy conservation and clean energy improvements for all properties will be repaid as a direct property-based improvement in the short term and as an inherent property value in the long term.
The continuance of energy rate hikes that are an ingrained part of our system would be reduce dramatically as well.
We must, as a community, investigate and mathematically investigate these claims and commit ourselves to the implemetaion required.
Indeed, we can experience the greatest joy when we each realize the power we have.
With the same public investment of capital we are currently making in industrial scale, grid dependent, wind turbine installations, we can realize five times the exaggerated benefits claimed by the current wind industry developers. its well-paid lobbyists, and co-opted environmental organizations. Not only that, we can repay the bill ourselves with financial savings, rather than passing on the cost to our kids.
It will require a dramatic shift in our current economic structure. Instead of our natural resources continuing to be burdened with the costs of distribution, refinement and re-distribution; we have the opportunity to take upon ourselves the production of our own energy consumed, be it electrical, bio-fuel, fossil fuel, or by absorbtion. The rejection of convenience is the cost we must be willing to pay to achieve our dreams.
HOW?
Use all federal subsidies, including tax incentives used to attract profit-seekers into the "renewable energy industry", to capitalize PACE (Property Assessed Clean Energy) programs for all institutional/government, commercial and residential Properties.
Extended Benefits
Through the PACE program, which has been endorsed by the Commonwealth of Virginia for adoption by Virginia localities, publically-financed energy conservation and clean energy improvements for all properties will be repaid as a direct property-based improvement in the short term and as an inherent property value in the long term.
The continuance of energy rate hikes that are an ingrained part of our system would be reduce dramatically as well.
We must, as a community, investigate and mathematically investigate these claims and commit ourselves to the implemetaion required.
Tuesday, September 28, 2010
...or maybe not. Slide 13 ...now we start to follow the money.
Now, all we need is enough wind, or maybe not.[sic] Slide 12 ...now we get to the Don Quixote part
Monday, September 27, 2010
Now, all we need is enough wind, or maybe not.[sic] Slide 11 ...now we get to the Don Quixote part
Saturday, September 25, 2010
Now, all we need is enough wind, or maybe not.[sic] Slide 10 ...now we get to the Don Quixote part
Now, all we need is enough wind, or maybe not.[sic] Slide 9 ...now we get to the Don Quixote part
Now, all we need is enough wind, or maybe not.[sic] Slide 8 ...now we get to the Don Quixote part
Wednesday, September 22, 2010
Now, all we need is enough wind, or maybe not.[sic] Slide 7
Now, all we need is enough wind, or maybe not.[sic] Slide 6
Now, all we need is enough wind, or maybe not.[sic] Slide 5
Now, all we need is enough wind, or maybe not.[sic] Slide 4
Now, all we need is enough wind, or maybe not.[sic] Slide 3
Now, all we need is enough wind, or maybe not.[sic] Slide 2
Click on the picture to get a larger image on your screen.
Click on the picture to get a larger image on your screen.
Now, all we need is enough wind, or maybe not.[sic] Slide 1
Wednesday, September 1, 2010
What's so special about Poor Mountain?
Ed Kinser, a wildlife biologist, former staff biologist at Mountain Lake, alpaca farmer, and most importantly, a neighbor in our Bent Mountain Community is generously sharing his love of the Appalachian Mountain Environment. Ed, originally from Tazewell County, Virginia is developing a particular interest in the Bent Mountain environment and it's unique place on the northern most peninsula of the greater Blue Ridge Plateau. Ed very recently shared his account of his geological survey with Bruce Davidson:
Quartz veins in granite indicate a geological fault location on Poor Mountain Photo by Eldon Karr |
"Bruce Davidson, retired geologist, accompanied Bob Johnson and me up Poor Mt. on Wednesday. This allowed the addition of some geological information to our Poor Mt. Natural History, which, in turn, helps to verify that Poor Mt. is unique among the Blue Ridges. From the Parkway, and along 221, and up to the second entry onto Willet, the rock formations are granitic and are a part of the Blue Ridge Formation (Precambrian). Just before getting to the Karr’s driveway, there is a transition zone with a mixture of rocks and lots of fractures, along with intrusions, indicating a fault zone. From there on up to the top, there are sandstones and shales from the Unicoi Formation (younger and Cambrian). Most sources just say that the Blue Ridges are granitic in nature."
A shale concretion on Poor Mountain Photo by Ed Kinser |
"It was so much fun and so interesting-- I took Joanie back over to point out the features we saw. "
Earlier in the season, we also found an American chestnut that looks unusually healthy and has lots of fruiting bodies on it.
An American Chestnut on Poor Mountain Photo by Ed Kinser |
Ironweed and Jewelweed provide a late summer presentation of Poor Mountain colors. In the late spring, look for displays of Catawba Rhododendren & Flame Azaelea. Photo by Eldon Karr |
Tuesday, July 20, 2010
A Roanoke County Hidden Treasure
Poor Mountain
& its Steward Community, Bent Mountain
Click on this image to see larger size
An easy to understand element of our Environmental Impact Study
...the Stewards of Poor Mountain
Sunday, July 18, 2010
Federal Financial Interventions and Subsidies in Energy Markets 2007
Excerpts from Energy Information Administration / Executive Summary
Executive Summary
Background
In May 2007, Senator Lamar Alexander asked the Energy Information Administration (EIA) to
develop an analysis of Federal energy subsidies focusing on subsidies to electricity production.
Senator Alexander also specified that the analysis should be limited to subsidies provided by
the Federal government, those that are energy-specific, and those that provide a financial
benefit with an identifiable budget impact. Federal energy subsidies and interventions
discussed in the body of this report take four principal forms:
Direct Expenditures. These are Federal programs that directly affect the energy
industry and for which the Federal government provides funds that ultimately result in a
direct payment to producers or consumers of energy.
Tax Expenditures. Tax expenditures are provisions in the Federal tax code that reduce
the tax liability of firms or individuals who take specified actions that affect energy
production, consumption, or conservation in ways deemed to be in the public interest.
Research and Development (R&D). Federal R&D spending focuses on a variety of
goals, such as increasing U.S. energy supplies, or improving the efficiency of various
energy production, transformation, and end-use technologies. R&D expenditures do not
directly affect current energy production and prices, but, if successful, they could affect
future production and prices.
Electricity programs serving targeted categories of electricity consumers in
several regions of the country. Through the Tennessee Valley Authority (TVA) and
the Power Marketing Administrations (PMAs), which include the Bonneville Power
Administration (BPA) and three smaller PMAs, the Federal government brings to market
large amounts of electricity, stipulating that “preference in the sale of such power and
energy shall be given to public bodies and cooperatives.” The Federal government also
indirectly supports portions of the electricity industry through loans and loan guarantees
made by the U.S. Department of Agriculture’s Rural Utilities Service (RUS).
Wednesday, July 14, 2010
Federal and State Tax Breaks and Subsidies for Wind Energy
We are grateful to Mr. Glenn Schleede for providing us with a copy of his paper titled “Federal and State Wind Energy Tax Breaks and Subsidies,” which he sent Monday, to Governor McDonnell and Lt. Governor Bolling of Virginia.
July 12, 2010
MEMORANDUM FOR: The Honorable Robert McDonnell, Governor
The Honorable Bill Bolling, Lieutenant Governor
Commonwealth of Virginia
SUBJECT: Federal and State Tax Breaks and Subsidies for Wind Energy
Introduction:
Both of you have made statements indicating that you favor greater use of wind energy in Virginia and you have used our tax dollarsi to promote wind energy. However, if you consider objectively the true costs and benefits of electricity from wind, you will conclude that greater use of wind energy is NOT in the best interests of Virginia’s taxpayers or electric customers.
Recently, I have sent you several emails demonstrating that:
Electricity from wind is very high in true cost and very low in true value.
The wind industry and other wind energy advocates greatly overstate its benefits and understate its adverse environmental, economic, energy, scenic, and property value impacts.
Claims of job and economic benefits from “wind farms” are greatly exaggerated.
“Wind farms” are being built primarily for lucrative tax benefits and subsidies for their owners – not because of their environmental or energy benefits.
This email elaborates on the last point, above, because it is apparent that many in the public, media, and government do not yet understand:
The extent and cost of existing federal and state tax breaks and subsidies for wind energy.
The cost of tax breaks and subsidies are a part of the full, true cost of electricity from wind.
When all the true costs are counted, the cost of electricity from wind far exceeds the cost of electricity from existing generating plants powered by traditional energy sources.
Wind energy is unlikely to ever become a commercially viable way to generate electricity except for users who are beyond the reach of electric distribution lines or those few people who are willing to either (i) install expensive battery storage systems, or (ii) have electricity only when the wind blows.
Tax breaks and subsidies for wind energy are:
Transferring wealth – millions of dollars annually -- from ordinary taxpayers and electric customers to “wind farm” owners and their financiers.
Distorting capital investment decisions, with billions of dollars being spent on “wind farms” that produce very little electricity -- which electricity is low in value because it is intermittent, volatile, unreliable and most likely to be produced when least needed.ii
Adding to federal and state budget deficits.
2
Background
When initially proposed, the rationale for providing tax breaks and subsidies for wind energy was to help a relatively new technology for producing electricity compete with established electric generating technologies until advances in technology would permit wind to compete without subsidies.
However, the tax breaks and subsidies for wind energy have grown and grown. The massive tax breaks and subsidies now available and the wind industry’s well-financed lobbying efforts to preserve, expand, and extend them makes clear that there is no longer any serious expectation that electricity from wind will become commercially viable without massive subsidies or that significant advances in wind technology are likely to ever permit wind to become a competitive source of electricity.
Understanding who benefits from generous tax breaks and subsidies for wind energy
Political leaders who are serious about holding down energy costs and protecting the interests of taxpayers need to understand:
The high true cost and low true value of electricity from wind farms.
How extraordinarily generous the federal and state governments are to “wind farm” owners, developers, and financiers.
How ordinary taxpayers and electric customers end up bearing the tax burden and costs escaped by these firms.
“Wind farm” developers and owners that are benefiting from the tax breaks and subsidies include such US firms as Dominion Resources, FPL Group (parent of NextEra), Duke Energy, AES, Invenergy, and Noble Environmental (JPMorgan Partners), and foreign-owned firms such as Iberdrola (Spain), Horizon (Energias de Portugal, S.A. of Portugal), E.On (Germany), Shell (Netherlands), and BP (UK).
But they are not the only ones benefiting handsomely from the wind energy tax shelters. Financial firms with large profits they wish to shelter from taxation iii have also realized that they can take advantage of the massive federal and state tax breaks and subsidies for wind and other “renewable” energy sources that provide opportunities for them to receive large returns with little or no risk.iv
The lucrative tax breaks and subsidies for “wind farm” owners and financiers equip them to hire lobbyists, make generous with campaign contributions, and influence members of Congress and state legislatures, governors and regulators to extend and expand these huge benefits.
Existing Federal and Virginia Tax Breaks and Subsidies for “wind farms”
The share of the economic value of a “wind farm” to its owners that is accounted for by tax breaks and subsidies varies quite widely among “wind farms” depending on factors such as the total capital cost, financing, production, operating costs, useful life of the turbines, and income from sale of electricity and, in some cases, “green energy credits.” One wind industry executive reported at an American Bar Association conference that just two of the federal incentives (see A and B, below) accounted for 2/3 of the economic value of a “wind farm “ v
Tax breaks and subsidies now available include – but are not limited to -- the following:
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A. Accelerated Depreciation – Federal and State. Perhaps the least recognized and understood federal AND Virginia tax break available to “wind farm” owners is Five-Year Double Declining Balance Accelerated Depreciation (often referred to as “5-year 200% DB”). It is a generous “Modified Accelerated Cost Recovery System” (MACRS) method for calculating the share of “wind farm” capital cost that can be deducted each year from otherwise taxable corporate income.vi Five-year 200% DB Accelerated depreciation has two huge benefits for “wind farm” owners and their “tax partners” that are not enjoyed by owners of traditional generating facilities that have much longer and slower tax depreciation periods (generally 20 years):
Cash Flow: It provides large amounts of interest free cash that can be used for other purposes. In the first six tax years, the entire capital cost of the project, including equity and debt, can be deducted from otherwise taxable income.
Reduced corporate income tax: It immediately reduces the owners’ and their financial/tax partners’ income subject to Federal and Virginia corporate income tax.
The following example illustrates the benefits, if the project had capital costs of $100,000,000, which is the approximate cost of a 50 megawatt (MW) “wind farm”
The following table shows the depreciation deductions, by tax year, and the impact on a corporation’s tax liability for a relatively small $100,000,000 “wind farm.”
The following wiil take you to the original document which contains the referenced table:
http://alleghenytreasures.wordpress.com/2010/07/13/glenn-schleede-challenges-virginia-leaders-to-review-federal-and-state-wind-energy-tax-breaks-and-subsidies/
Note that the deductions from otherwise taxable income and from tax liability could be taken regardless of whether the $100 million “wind farm” investment is financed with debt or equity.vii
Virginia provides the accelerated depreciation tax break shown above because Virginia corporations begin their tax calculations using their federal taxable income shown on their federal return,viii a number that reflects the effects of 5-year 200% DB accelerated depreciation.
Note that the exceedingly generous accelerated depreciation permits a “wind farm” owner to “recover” cash equal to or exceeding its equity investments (perhaps 30% of total capital cost) in as little as 12 to 18 months from the time a “wind farm” goes into operation.
Clearly, an organization must have a large amount of taxable income to take advantage of this tax break, which explains much of the attraction of “wind farms” to such organizations as Dominion
4
Resources, FPL Group, Duke Energy, BP, Shell, Iberdrola and others that have large profits from electric utility or oil production operations.
“Wind farm” owners that do not have enough taxable income to take advantage of the tax breaks can and do find readily available “tax equity partners” among the financial firms on Wall Street that are eager to shelter their profits from federal corporate income tax (See Endnote iii for a list of the firms that lobby to preserve, extend and expand tax breaks for wind and other “renewables.”)
Unfortunately, tax breaks and subsidies created for special interests by politicians in Washington and State capitals offer such compelling opportunities for great returns with little or no risk that they divert both human talent and capital from innovative and productive activities in the private sector that could result in products and services that would be far more cost effective, beneficial, and capable of competing in the private competitive economy.
B. Federal Production Tax Credit (PTC). “Wind farm” owners are currently eligible to receive $0.021 per kilowatt-hour (kWh) of electricity produced during the 1st 10 years of operation. The PTC provided $0.015 per kWh when instituted in 1992 but has been increased with inflation to the current level of $0.021 per kWh. A 50 MW “wind farm,” such as that used above to illustrate the benefits of accelerated depreciation, operating at an average capacity factorix of 35% would generate 153,300,000 kWh per year. The owner would receive a PTC of $3,219,300 per year or $32,193,000 over 10 years. The lucrative Production Tax Credit (PTC) is a direct deduction, dollar for dollar, from the “wind farm” owner’s “bottom line” tax liability.
C. Investment Tax Credit (ITC) or Cash Grant in lieu of PTC. The American Recovery and Reinvestment Act of 2009, often referred to as the “stimulus” bill, was originally estimated as costing taxpayers $787 billion and is now estimated to cost in excess of $860 billion. The bill was justified on grounds that it would create jobs in the US and “stimulate” the US economy. That legislation, now widely regarded as hugely wasteful, among its many provisions, allowed taxpayers eligible for the federal wind production tax credit (PTC) to take either one of the following two generous alternatives in lieu of the PTC; either:
1. Investment Tax Credit (ITC). The “stimulus” legislation permits “wind farm” owners to choose an investment tax credit (i.e., a direct deduction from taxes otherwise due) equal to 30% of capital costs in lieu of the Production Tax Credit. If the “wind farm” owner does not have sufficient tax liability to use all of the ITC deduction, unused amounts can be carried forward and deducted in future years. This tax break is available for projects placed in service during 2009 and 2010 or where construction has started by 2010 and placed in service before the end of 2012. The newly authorized ITC has substantial benefits for “wind farm” owners compared to the PTC because (i) the benefit is available immediately rather than over a 10-year period and (ii) the benefit is based on capital cost and, therefore, is available regardless of the amount of electricity produced by the “wind farm.”x
2. Cash Grant in Lieu of ITC. The “stimulus” legislation also made “wind farm” developers eligible for the ITC to elect to receive a cash grant of equal value from the US Treasury in lieu
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of the ITC. The US Departments of Treasury and Energy awarded grants for “wind” projects totaling about $2.8 billion.xi Creating jobs was, allegedly, a key reason for the “stimulus” legislation but most of “wind farm” projects covered by grants awarded by Treasury and DOE were for (a) projects that were already completed, nearly completed or already fully committed to by the grant recipients, (b) were equipped with turbines manufactured primarily in other countries, and (c) were owned by foreign-based companies. xii In any case, “wind farms” result in very few new jobs.
D. Additional subsidies for electric utilities and costs for Virginia electric customers provided by 2007 legislation. Despite the huge federal and state tax breaks and subsidies already in place (Sections A and B, above), the General Assembly of Virginia, in April 2007, approved a bill that is highly favorable to Dominion Virginia Power and other electric utilities but costly for Virginia’s electric customers.
Among its many provisions were several promoting the use of wind and other “renewable” energy while enhancing Dominion and other utilities profitability, and assuring that all costs and a higher return for the utilities would be passed along to electric customers. Among these provisions were:
1. Establishing goals for sharply increased use of electricity generated from wind and other renewables. (Such goals create an artificial, high price market for electricity from wind and/or “green energy” certificates – all for the benefit of owners of wind farms.)
2. Mandating that customers be provided an opportunity, while paying a premium price, to have up to 100% of the electricity they use come (at least in theory) from wind or other renewable energy sources.
3. Assuring full cost recovery and a higher rate of return (up to 200 basis points) on investments by Dominion Power and other utilities in facilities to produce electricity from wind and other “renewable” sources.
4. Limit the authority of the State Corporation Commission to question costs and returns demanded from customers by electric utilities.
E. Additional US Department of Energy (DOE) Subsidies. The DOE provides several additional subsidies to the wind industry, all financed with tax dollars, including:
1. From $60 to $100 million per year for “wind energy R&D” contracts and grants.
2. Additional millions in taxpayer dollars for “studies,” “analyses,” “reports,” and other wind energy promotional information prepared by or for DOE’s Office of Energy Efficiency and Renewable Energy (DOE-EERE), DOE’s National Energy “Laboratories,”xiii state energy offices, and other DOE contractors and grantees. While the National “laboratories” undoubtedly perform some objective work that is based on scientific methods and engineering principles, much of the information issued by these organizations that deals with wind energy is demonstrably biased, misleading, and even false. These “laboratory” activities are more akin to those carried out by trade associations that typically provide one-sided information used to influence the public, media and government officials.xiv
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3. More taxpayer dollars flowing though DOE and NREL to support various state government wind promotional activities and to state “wind working groups,”xv consisting of wind industry representatives and other wind energy advocates (but seldom, if ever, include representatives from citizen groups opposed to “wind farms”) that work in support of wind industry objectives.
4. DOE, using authority provided in the now infamous $787 billion to $860+ billion “stimulus” legislation, has awarded $2.3 billion in tax credits for organizations that wish to engage in renewable energy manufacturing activities, with most of the credits relating to wind energy.
US Energy Information Administration (EIA) Comparison of Tax Breaks and Subsidies for Various Energy Sources
The wind industry often claims that other energy sources receive substantially more tax breaks and subsidies than wind energy. However, an April 2008 report by the US Energy Information Administration (EIA) “Federal Financial Interventions and Subsidies in Energy Markets 2007," demonstrates that, on a kilowatt-hour of production basis, wind and solar energy, receive higher tax breaks and subsidies than any of the traditional energy sources.xvi
It should be noted that this analysis from EIA:
Did not take into account the substantial tax break for wind energy provided by five-year double declining balance accelerated depreciation described earlier.
Did not include state tax breaks and subsidies.
Was prepared before the federal government provided billions in direct cash grants and other subsidies for “wind farm” owners from the $787 billion to $860+ billion “stimulus” legislation.
Harmful wealth transfers and misdirected capital investments.
Unfortunately, federal and state government elected and appointed officials seem either not to recognize what they have done or not to care that federal and state wind energy policies, tax breaks and subsidies for the wind industry are having significant adverse economic impacts by:
Transferring hundreds of millions of dollars annually from the pockets of ordinary taxpayers and electric customers to a few large corporations that own “wind farms” and their “tax equity partners.”
Misdirecting billions of capital investment dollars to energy projects (“wind farms”) that produce very little electricity – which electricity is low in quality and real value. Electricity from wind turbines is intermittent, volatile, and unreliable. The electricity is low in real value because it is most likely to be produced at night in colder months, not on hot weekday late afternoons in July and August when electricity demand is highest. Further, because wind turbines are so unreliable, they cannot substitute for reliable generating capacity required in areas experiencing growth in peak electricity demand or needing to replace old generating units.
Absent the huge tax breaks and subsidies for “wind farms,” billions in capital investment dollars could be available for more productive purposes including loans to businesses – large and small – that are finding it difficult to borrow money to finance expansion and job creation in the private, competitive economy.
7
The preceding points are focused on financial cost and value, not externalities.
The foregoing discussion has not dealt with external costs, commonly referred to as externalities; i.e., the costs not reflected in the price charged for the electricity.
A discussion of externalities associated with each source of energy used to produce electricity is beyond the scope of this paper. However, it should be noted that wind energy advocates generally assign high externality values to other sources of energy while assigning none for wind energy. In fact, producing electricity with wind energy does impose external costs, including adverse impacts on environmental, ecological, scenic, and property values.
Examples of adverse environmental and ecological impacts include noise, dead birds and bats, destruction of vegetation and disruption of ecosystems and wildlife habitat, and nuisance impacts such as shadow flicker. Claims that “wind farms” do not adversely affect neighbors’ property values simply are not true.
Conclusion
Because of the false and misleading claims that have been spread widely by the wind industry and other wind energy advocates, it is quite understandable that the public, media, and government officials have been misled. However, it is now time – especially for political leaders – to:
Learn the facts about wind energy,
Give far greater attention to the interests of taxpayers and electric customers.
Stop the unwarranted wealth transfers and misdirection of capital investments resulting from the massive federal and state tax breaks and subsidies for wind energy.
Resist the lobbyists who are advocating the continuation and expansion of these measures.
Glenn R. Schleede
18220 Turnberry Drive
Round Hill, VA 20141-2574
540-338-9958
Endnotes:
i Recently, $800,000 to James Madison University, where staff participate in wind industry lobbying activities.
ii Wind turbines are most likely to produce electricity at night in colder months, with little or none produced on hot weekday late afternoons in July and August when electricity demand reaches peak levels.
iii ACORE (American Council on Renewable Energy) is a Washington DC based lobbying group representing organizations seeking tax breaks and subsidies for “renewable” energy. A recent ACORE press release announced that some 20 high-powered, Washington-connected subsidy pursuing financial firms have created a new Washington-based lobbying organization, US Partnership for Renewable Energy Finance, US PREF, to push for the extension and expansion of “renewable” energy tax breaks and subsidies. Firms listed as members of US PREF include Bank of America, Merrill Lynch, Citi, Credit Suisse, Deutsche Bank, GE Energy Financial Services, Google, Green Order, Hudson Clean Energy Partners, Madison Dearborn Partners, Morgan Stanley, NRG Energy, Skadden Arps, SolarCity, Starwood Energy, Troutman Sanders LLP, US Renewables Group, and VantagePoint Venture Partners.
iv http://frontpagemag.com/2010/05/06/the-wind-farm-scam/
v http://www.abanet.org/environ/committees/renewableenergy/teleconarchives/121504/feoppt.pdf
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vi IRS Publication 946.
vii The Congress, in the Economic Stimulus Act of 2008, added a 50% 1st year “bonus” deduction for 2008 investments. The effect of this additional “bonus” would permit “wind farm” owners to deduct 60% in the 1st , 16% in the 2nd, 9.6% in the 3rd, 5.76% in the 4th and 5th and 2.88% in the 6th tax years. This “bonus” was extended to cover 2009.
viii See Virginia Corporation Income Tax Return, Form 500, page 2, line 1.
ix The annual “capacity factor” of a generating unit is calculated by dividing the number of kWh of electricity generated by the unit by the rated capacity of the unit times the hours in a year. If the illustrative 50 MW (50,000 kW) “wind farm” generated 153,300,000 kWh of electricity in a year, it would have a capacity factor of 35%; that is, 153,300,000 kWh divided by 50,000 kW rated capacity x 8760 hours in a year.
x Separating the tax break from actual electricity production, in effect, reduces the owner’s incentive to maintain turbines and other “wind farm” equipment so as to maximize production.
xi Choma, Russ, American University, Investigative Reporting workshop; May 26, 2010; http://investigativereportingworkshop.org/investigations/wind-energy-funds-going-overseas/story/renewable-energy-stimulus-grants/
xii Choma, Russ, American University, Investigative Reporting workshop; February 8, 2010; http://investigativereportingworkshop.org/investigations/wind-energy-funds-going-overseas/story/renewable-energy-money-still-going-abroad/
xiii Particularly the National Renewable Energy “Laboratory” (NREL) and the Lawrence Berkeley National “Laboratory” (LBNL)
xiv Examples include NREL’s “Jobs and Economic Development Impact” (JEDI) model that overstates local and state benefits from “wind farms”, and LBNL’s recent report that claims, falsely, that “wind farms” do not adversely affect the values of nearby properties.
xv http://www.windpoweringamerica.gov/state_activities.asp
xvi See: http://www.eia.doe.gov/oiaf/servicerpt/subsidy2/pdf/chap5.pdf, Table 35, page 106.
July 12, 2010
MEMORANDUM FOR: The Honorable Robert McDonnell, Governor
The Honorable Bill Bolling, Lieutenant Governor
Commonwealth of Virginia
SUBJECT: Federal and State Tax Breaks and Subsidies for Wind Energy
Introduction:
Both of you have made statements indicating that you favor greater use of wind energy in Virginia and you have used our tax dollarsi to promote wind energy. However, if you consider objectively the true costs and benefits of electricity from wind, you will conclude that greater use of wind energy is NOT in the best interests of Virginia’s taxpayers or electric customers.
Recently, I have sent you several emails demonstrating that:
Electricity from wind is very high in true cost and very low in true value.
The wind industry and other wind energy advocates greatly overstate its benefits and understate its adverse environmental, economic, energy, scenic, and property value impacts.
Claims of job and economic benefits from “wind farms” are greatly exaggerated.
“Wind farms” are being built primarily for lucrative tax benefits and subsidies for their owners – not because of their environmental or energy benefits.
This email elaborates on the last point, above, because it is apparent that many in the public, media, and government do not yet understand:
The extent and cost of existing federal and state tax breaks and subsidies for wind energy.
The cost of tax breaks and subsidies are a part of the full, true cost of electricity from wind.
When all the true costs are counted, the cost of electricity from wind far exceeds the cost of electricity from existing generating plants powered by traditional energy sources.
Wind energy is unlikely to ever become a commercially viable way to generate electricity except for users who are beyond the reach of electric distribution lines or those few people who are willing to either (i) install expensive battery storage systems, or (ii) have electricity only when the wind blows.
Tax breaks and subsidies for wind energy are:
Transferring wealth – millions of dollars annually -- from ordinary taxpayers and electric customers to “wind farm” owners and their financiers.
Distorting capital investment decisions, with billions of dollars being spent on “wind farms” that produce very little electricity -- which electricity is low in value because it is intermittent, volatile, unreliable and most likely to be produced when least needed.ii
Adding to federal and state budget deficits.
2
Background
When initially proposed, the rationale for providing tax breaks and subsidies for wind energy was to help a relatively new technology for producing electricity compete with established electric generating technologies until advances in technology would permit wind to compete without subsidies.
However, the tax breaks and subsidies for wind energy have grown and grown. The massive tax breaks and subsidies now available and the wind industry’s well-financed lobbying efforts to preserve, expand, and extend them makes clear that there is no longer any serious expectation that electricity from wind will become commercially viable without massive subsidies or that significant advances in wind technology are likely to ever permit wind to become a competitive source of electricity.
Understanding who benefits from generous tax breaks and subsidies for wind energy
Political leaders who are serious about holding down energy costs and protecting the interests of taxpayers need to understand:
The high true cost and low true value of electricity from wind farms.
How extraordinarily generous the federal and state governments are to “wind farm” owners, developers, and financiers.
How ordinary taxpayers and electric customers end up bearing the tax burden and costs escaped by these firms.
“Wind farm” developers and owners that are benefiting from the tax breaks and subsidies include such US firms as Dominion Resources, FPL Group (parent of NextEra), Duke Energy, AES, Invenergy, and Noble Environmental (JPMorgan Partners), and foreign-owned firms such as Iberdrola (Spain), Horizon (Energias de Portugal, S.A. of Portugal), E.On (Germany), Shell (Netherlands), and BP (UK).
But they are not the only ones benefiting handsomely from the wind energy tax shelters. Financial firms with large profits they wish to shelter from taxation iii have also realized that they can take advantage of the massive federal and state tax breaks and subsidies for wind and other “renewable” energy sources that provide opportunities for them to receive large returns with little or no risk.iv
The lucrative tax breaks and subsidies for “wind farm” owners and financiers equip them to hire lobbyists, make generous with campaign contributions, and influence members of Congress and state legislatures, governors and regulators to extend and expand these huge benefits.
Existing Federal and Virginia Tax Breaks and Subsidies for “wind farms”
The share of the economic value of a “wind farm” to its owners that is accounted for by tax breaks and subsidies varies quite widely among “wind farms” depending on factors such as the total capital cost, financing, production, operating costs, useful life of the turbines, and income from sale of electricity and, in some cases, “green energy credits.” One wind industry executive reported at an American Bar Association conference that just two of the federal incentives (see A and B, below) accounted for 2/3 of the economic value of a “wind farm “ v
Tax breaks and subsidies now available include – but are not limited to -- the following:
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A. Accelerated Depreciation – Federal and State. Perhaps the least recognized and understood federal AND Virginia tax break available to “wind farm” owners is Five-Year Double Declining Balance Accelerated Depreciation (often referred to as “5-year 200% DB”). It is a generous “Modified Accelerated Cost Recovery System” (MACRS) method for calculating the share of “wind farm” capital cost that can be deducted each year from otherwise taxable corporate income.vi Five-year 200% DB Accelerated depreciation has two huge benefits for “wind farm” owners and their “tax partners” that are not enjoyed by owners of traditional generating facilities that have much longer and slower tax depreciation periods (generally 20 years):
Cash Flow: It provides large amounts of interest free cash that can be used for other purposes. In the first six tax years, the entire capital cost of the project, including equity and debt, can be deducted from otherwise taxable income.
Reduced corporate income tax: It immediately reduces the owners’ and their financial/tax partners’ income subject to Federal and Virginia corporate income tax.
The following example illustrates the benefits, if the project had capital costs of $100,000,000, which is the approximate cost of a 50 megawatt (MW) “wind farm”
The following table shows the depreciation deductions, by tax year, and the impact on a corporation’s tax liability for a relatively small $100,000,000 “wind farm.”
The following wiil take you to the original document which contains the referenced table:
http://alleghenytreasures.wordpress.com/2010/07/13/glenn-schleede-challenges-virginia-leaders-to-review-federal-and-state-wind-energy-tax-breaks-and-subsidies/
Note that the deductions from otherwise taxable income and from tax liability could be taken regardless of whether the $100 million “wind farm” investment is financed with debt or equity.vii
Virginia provides the accelerated depreciation tax break shown above because Virginia corporations begin their tax calculations using their federal taxable income shown on their federal return,viii a number that reflects the effects of 5-year 200% DB accelerated depreciation.
Note that the exceedingly generous accelerated depreciation permits a “wind farm” owner to “recover” cash equal to or exceeding its equity investments (perhaps 30% of total capital cost) in as little as 12 to 18 months from the time a “wind farm” goes into operation.
Clearly, an organization must have a large amount of taxable income to take advantage of this tax break, which explains much of the attraction of “wind farms” to such organizations as Dominion
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Resources, FPL Group, Duke Energy, BP, Shell, Iberdrola and others that have large profits from electric utility or oil production operations.
“Wind farm” owners that do not have enough taxable income to take advantage of the tax breaks can and do find readily available “tax equity partners” among the financial firms on Wall Street that are eager to shelter their profits from federal corporate income tax (See Endnote iii for a list of the firms that lobby to preserve, extend and expand tax breaks for wind and other “renewables.”)
Unfortunately, tax breaks and subsidies created for special interests by politicians in Washington and State capitals offer such compelling opportunities for great returns with little or no risk that they divert both human talent and capital from innovative and productive activities in the private sector that could result in products and services that would be far more cost effective, beneficial, and capable of competing in the private competitive economy.
B. Federal Production Tax Credit (PTC). “Wind farm” owners are currently eligible to receive $0.021 per kilowatt-hour (kWh) of electricity produced during the 1st 10 years of operation. The PTC provided $0.015 per kWh when instituted in 1992 but has been increased with inflation to the current level of $0.021 per kWh. A 50 MW “wind farm,” such as that used above to illustrate the benefits of accelerated depreciation, operating at an average capacity factorix of 35% would generate 153,300,000 kWh per year. The owner would receive a PTC of $3,219,300 per year or $32,193,000 over 10 years. The lucrative Production Tax Credit (PTC) is a direct deduction, dollar for dollar, from the “wind farm” owner’s “bottom line” tax liability.
C. Investment Tax Credit (ITC) or Cash Grant in lieu of PTC. The American Recovery and Reinvestment Act of 2009, often referred to as the “stimulus” bill, was originally estimated as costing taxpayers $787 billion and is now estimated to cost in excess of $860 billion. The bill was justified on grounds that it would create jobs in the US and “stimulate” the US economy. That legislation, now widely regarded as hugely wasteful, among its many provisions, allowed taxpayers eligible for the federal wind production tax credit (PTC) to take either one of the following two generous alternatives in lieu of the PTC; either:
1. Investment Tax Credit (ITC). The “stimulus” legislation permits “wind farm” owners to choose an investment tax credit (i.e., a direct deduction from taxes otherwise due) equal to 30% of capital costs in lieu of the Production Tax Credit. If the “wind farm” owner does not have sufficient tax liability to use all of the ITC deduction, unused amounts can be carried forward and deducted in future years. This tax break is available for projects placed in service during 2009 and 2010 or where construction has started by 2010 and placed in service before the end of 2012. The newly authorized ITC has substantial benefits for “wind farm” owners compared to the PTC because (i) the benefit is available immediately rather than over a 10-year period and (ii) the benefit is based on capital cost and, therefore, is available regardless of the amount of electricity produced by the “wind farm.”x
2. Cash Grant in Lieu of ITC. The “stimulus” legislation also made “wind farm” developers eligible for the ITC to elect to receive a cash grant of equal value from the US Treasury in lieu
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of the ITC. The US Departments of Treasury and Energy awarded grants for “wind” projects totaling about $2.8 billion.xi Creating jobs was, allegedly, a key reason for the “stimulus” legislation but most of “wind farm” projects covered by grants awarded by Treasury and DOE were for (a) projects that were already completed, nearly completed or already fully committed to by the grant recipients, (b) were equipped with turbines manufactured primarily in other countries, and (c) were owned by foreign-based companies. xii In any case, “wind farms” result in very few new jobs.
D. Additional subsidies for electric utilities and costs for Virginia electric customers provided by 2007 legislation. Despite the huge federal and state tax breaks and subsidies already in place (Sections A and B, above), the General Assembly of Virginia, in April 2007, approved a bill that is highly favorable to Dominion Virginia Power and other electric utilities but costly for Virginia’s electric customers.
Among its many provisions were several promoting the use of wind and other “renewable” energy while enhancing Dominion and other utilities profitability, and assuring that all costs and a higher return for the utilities would be passed along to electric customers. Among these provisions were:
1. Establishing goals for sharply increased use of electricity generated from wind and other renewables. (Such goals create an artificial, high price market for electricity from wind and/or “green energy” certificates – all for the benefit of owners of wind farms.)
2. Mandating that customers be provided an opportunity, while paying a premium price, to have up to 100% of the electricity they use come (at least in theory) from wind or other renewable energy sources.
3. Assuring full cost recovery and a higher rate of return (up to 200 basis points) on investments by Dominion Power and other utilities in facilities to produce electricity from wind and other “renewable” sources.
4. Limit the authority of the State Corporation Commission to question costs and returns demanded from customers by electric utilities.
E. Additional US Department of Energy (DOE) Subsidies. The DOE provides several additional subsidies to the wind industry, all financed with tax dollars, including:
1. From $60 to $100 million per year for “wind energy R&D” contracts and grants.
2. Additional millions in taxpayer dollars for “studies,” “analyses,” “reports,” and other wind energy promotional information prepared by or for DOE’s Office of Energy Efficiency and Renewable Energy (DOE-EERE), DOE’s National Energy “Laboratories,”xiii state energy offices, and other DOE contractors and grantees. While the National “laboratories” undoubtedly perform some objective work that is based on scientific methods and engineering principles, much of the information issued by these organizations that deals with wind energy is demonstrably biased, misleading, and even false. These “laboratory” activities are more akin to those carried out by trade associations that typically provide one-sided information used to influence the public, media and government officials.xiv
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3. More taxpayer dollars flowing though DOE and NREL to support various state government wind promotional activities and to state “wind working groups,”xv consisting of wind industry representatives and other wind energy advocates (but seldom, if ever, include representatives from citizen groups opposed to “wind farms”) that work in support of wind industry objectives.
4. DOE, using authority provided in the now infamous $787 billion to $860+ billion “stimulus” legislation, has awarded $2.3 billion in tax credits for organizations that wish to engage in renewable energy manufacturing activities, with most of the credits relating to wind energy.
US Energy Information Administration (EIA) Comparison of Tax Breaks and Subsidies for Various Energy Sources
The wind industry often claims that other energy sources receive substantially more tax breaks and subsidies than wind energy. However, an April 2008 report by the US Energy Information Administration (EIA) “Federal Financial Interventions and Subsidies in Energy Markets 2007," demonstrates that, on a kilowatt-hour of production basis, wind and solar energy, receive higher tax breaks and subsidies than any of the traditional energy sources.xvi
It should be noted that this analysis from EIA:
Did not take into account the substantial tax break for wind energy provided by five-year double declining balance accelerated depreciation described earlier.
Did not include state tax breaks and subsidies.
Was prepared before the federal government provided billions in direct cash grants and other subsidies for “wind farm” owners from the $787 billion to $860+ billion “stimulus” legislation.
Harmful wealth transfers and misdirected capital investments.
Unfortunately, federal and state government elected and appointed officials seem either not to recognize what they have done or not to care that federal and state wind energy policies, tax breaks and subsidies for the wind industry are having significant adverse economic impacts by:
Transferring hundreds of millions of dollars annually from the pockets of ordinary taxpayers and electric customers to a few large corporations that own “wind farms” and their “tax equity partners.”
Misdirecting billions of capital investment dollars to energy projects (“wind farms”) that produce very little electricity – which electricity is low in quality and real value. Electricity from wind turbines is intermittent, volatile, and unreliable. The electricity is low in real value because it is most likely to be produced at night in colder months, not on hot weekday late afternoons in July and August when electricity demand is highest. Further, because wind turbines are so unreliable, they cannot substitute for reliable generating capacity required in areas experiencing growth in peak electricity demand or needing to replace old generating units.
Absent the huge tax breaks and subsidies for “wind farms,” billions in capital investment dollars could be available for more productive purposes including loans to businesses – large and small – that are finding it difficult to borrow money to finance expansion and job creation in the private, competitive economy.
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The preceding points are focused on financial cost and value, not externalities.
The foregoing discussion has not dealt with external costs, commonly referred to as externalities; i.e., the costs not reflected in the price charged for the electricity.
A discussion of externalities associated with each source of energy used to produce electricity is beyond the scope of this paper. However, it should be noted that wind energy advocates generally assign high externality values to other sources of energy while assigning none for wind energy. In fact, producing electricity with wind energy does impose external costs, including adverse impacts on environmental, ecological, scenic, and property values.
Examples of adverse environmental and ecological impacts include noise, dead birds and bats, destruction of vegetation and disruption of ecosystems and wildlife habitat, and nuisance impacts such as shadow flicker. Claims that “wind farms” do not adversely affect neighbors’ property values simply are not true.
Conclusion
Because of the false and misleading claims that have been spread widely by the wind industry and other wind energy advocates, it is quite understandable that the public, media, and government officials have been misled. However, it is now time – especially for political leaders – to:
Learn the facts about wind energy,
Give far greater attention to the interests of taxpayers and electric customers.
Stop the unwarranted wealth transfers and misdirection of capital investments resulting from the massive federal and state tax breaks and subsidies for wind energy.
Resist the lobbyists who are advocating the continuation and expansion of these measures.
Glenn R. Schleede
18220 Turnberry Drive
Round Hill, VA 20141-2574
540-338-9958
Endnotes:
i Recently, $800,000 to James Madison University, where staff participate in wind industry lobbying activities.
ii Wind turbines are most likely to produce electricity at night in colder months, with little or none produced on hot weekday late afternoons in July and August when electricity demand reaches peak levels.
iii ACORE (American Council on Renewable Energy) is a Washington DC based lobbying group representing organizations seeking tax breaks and subsidies for “renewable” energy. A recent ACORE press release announced that some 20 high-powered, Washington-connected subsidy pursuing financial firms have created a new Washington-based lobbying organization, US Partnership for Renewable Energy Finance, US PREF, to push for the extension and expansion of “renewable” energy tax breaks and subsidies. Firms listed as members of US PREF include Bank of America, Merrill Lynch, Citi, Credit Suisse, Deutsche Bank, GE Energy Financial Services, Google, Green Order, Hudson Clean Energy Partners, Madison Dearborn Partners, Morgan Stanley, NRG Energy, Skadden Arps, SolarCity, Starwood Energy, Troutman Sanders LLP, US Renewables Group, and VantagePoint Venture Partners.
iv http://frontpagemag.com/2010/05/06/the-wind-farm-scam/
v http://www.abanet.org/environ/committees/renewableenergy/teleconarchives/121504/feoppt.pdf
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vi IRS Publication 946.
vii The Congress, in the Economic Stimulus Act of 2008, added a 50% 1st year “bonus” deduction for 2008 investments. The effect of this additional “bonus” would permit “wind farm” owners to deduct 60% in the 1st , 16% in the 2nd, 9.6% in the 3rd, 5.76% in the 4th and 5th and 2.88% in the 6th tax years. This “bonus” was extended to cover 2009.
viii See Virginia Corporation Income Tax Return, Form 500, page 2, line 1.
ix The annual “capacity factor” of a generating unit is calculated by dividing the number of kWh of electricity generated by the unit by the rated capacity of the unit times the hours in a year. If the illustrative 50 MW (50,000 kW) “wind farm” generated 153,300,000 kWh of electricity in a year, it would have a capacity factor of 35%; that is, 153,300,000 kWh divided by 50,000 kW rated capacity x 8760 hours in a year.
x Separating the tax break from actual electricity production, in effect, reduces the owner’s incentive to maintain turbines and other “wind farm” equipment so as to maximize production.
xi Choma, Russ, American University, Investigative Reporting workshop; May 26, 2010; http://investigativereportingworkshop.org/investigations/wind-energy-funds-going-overseas/story/renewable-energy-stimulus-grants/
xii Choma, Russ, American University, Investigative Reporting workshop; February 8, 2010; http://investigativereportingworkshop.org/investigations/wind-energy-funds-going-overseas/story/renewable-energy-money-still-going-abroad/
xiii Particularly the National Renewable Energy “Laboratory” (NREL) and the Lawrence Berkeley National “Laboratory” (LBNL)
xiv Examples include NREL’s “Jobs and Economic Development Impact” (JEDI) model that overstates local and state benefits from “wind farms”, and LBNL’s recent report that claims, falsely, that “wind farms” do not adversely affect the values of nearby properties.
xv http://www.windpoweringamerica.gov/state_activities.asp
xvi See: http://www.eia.doe.gov/oiaf/servicerpt/subsidy2/pdf/chap5.pdf, Table 35, page 106.
Monday, July 12, 2010
Virginia Pilot’s Organization Registers Concerns over Poor Mountain Wind Farm
ROANOKE, Va. (July 12, 2010)--The largest pilots’ organization in Western Virginia, the IFR Pilots' Club, has registered concerns with the FAA over the proposal to place windmills on Poor Mountain.
“As a result of our review, we believe the proposed windmills present a potentially deadly hazard for pilots and passengers trying to land in the Roanoke Valley,” says Matthew Broughton, airline transport rated pilot and IFR president. Broughton also is a Roanoke aviation lawyer who holds a commercial transport pilot’s license.
Broughton says that the primary approach corridor to the Roanoke Regional Airport extends a few miles north and west of Poor Mountain. The placement of 15 or more windmills on the mountain would likely force the FAA to raise the minimum vectoring altitude of all aircraft, commercial or private, trying to land in Roanoke through this approach corridor.
“We believe that the windmills would create additional delays of aircraft trying to get into the Roanoke Valley during adverse weather,” says Broughton. “This is both a safety issue and travel inconvenience for those flying in and out of the Roanoke airport.”
According to Broughton, the Poor Mountain approach corridor leads to runway 6. It is the longest runway in Roanoke and it also has the lowest minimums, making it is the runway controllers and pilots use most often in poor weather conditions.
“Unfortunately, Roanoke already has much higher minimums than our competing airports, such as Lynchburg and Greensboro,” says Gordon Ewald, a master flight instructor and member of the IFR Pilots’ Club. “The potential adverse affects of raising these minimums would hurt both pilots and passengers alike because it would reduce the days when aircraft could successfully and safely get below the clouds to land in Roanoke and force more deviations to other locations, such as Lynchburg and Greensboro.”
Broughton says that the IFR Pilots' Club is strongly opposed to any additional interference with the flyable airspace in or near the approach corridors, since the placement of these extremely tall structures could lead to aircraft accidents and endanger the lives of pilots, passengers and individuals on the ground.
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The IFR Pilots’ Club was founded 1990 as a non-profit voluntary organization of both instrument rated and visual rated pilots. Its purpose is to promote safety in aviation through pilot education and review of accidents and safety violations in western Virginia.
Monday, June 28, 2010
Who Decides the Future of Bent Mountain?
At first 18 wind turbines and later 54 wind turbines
Directors of the Roanoke Valley Cool Cities Coalition, Diana Christopulos, Board Chair, red rain parka, daypack and hiking staff, Stan Breakell, Director, navy rain parka and umbrella, Sean McGinnis, Director, gray rain parka, broad-brimmed rain hat, Jeremy Holmes, Director, forest green rain parka, Chad Braby, Director, red and gray rain parka, Renee Goddard, Director, day-glo yellow rain parka, (Mark McClain, Director, was the photographer and not pictured) participate in a Poor Mountain outing led by Don Giecek, Business Development Manager (salesman) for Invenergy LLC, orange rain parka and aussie bush hat and Maryellen Goodlatte, Invenergy’s local legal representative and wife of Congressman Bob Goodlatte (R-Va), ivory mid-length rain parka.
Two separate groups recently went to the ridges of Bent and Poor Mountains to talk and look and ponder if it should be developed for industrial use. Comparing our experiences, it is easier to see why we left with very different impressions.
May 19, 2010 was a wet, foggy day on Poor Mountain. The self-assigned assessment team of the Roanoke Valley Cool Cities Coalition (RVCCC) wasn’t able to see the extraordinary long range vistas from the highest peak in the region, nor the lady slippers at their feet. They saw transmission towers, radio towers, TV towers, and their related construction debris dumps. So while considering the “scale” of benefits promised by Mr. Giecek, they concluded that Mr. Giecek was right and Poor Mountain’s natural environment indeed had already been “trashed”. So, with the promises of “gr-r-reat” benefits including the salvation of the planet (and the human race), they decided that rainy day that Poor Mountain and the resident Bent Mountain community was a small sacrifice they, the board members, could make for humanity. Sad, though, it was.
Nearly a month later, June 18, 2010, members of the Bent Mountain community enjoyed conducting a tour of the mountain including special and protected habitat on a gentle warm, sunny day. We traveled the abandoned Laurel Creek fire trail, originally built by the Civilian Conservation Corps (CCC) in the 1930’s. Closed to access over 20 years, it was covered with lush green grasses and Lady Ferns. Our guest remarked at the seldom witnessed clarity of the water as he leaned his head outside the truck, looking down at the silt-free stones in the creek gorge below. We stirred up two rafters of turkey, saw several young bucks with their fuzzy antlers, and came upon a strutting Ruffed Grouse on Honeysuckle Lane that sent us both quickly struggling to identify it.
We were unable to reach the site of the old microwave tower, the summit of Poor Mountain (El. 3928’) at the “jumping off point” for the first 18 “green credit producers” for the Chicago Climate Exchange. The access road is gated and locked and the secondary access way was blocked off with huge boulders. We did, however, become intimately familiar with the site by traversing its boundaries, exploring tax maps, topographic maps, and Google Earth, the next best thing to a helicopter tour.
Eighteen Wind Turbines surrounding a Remote Hollow w/Cove Hardwoods on Poor Mountain
We recognized that Invenergy’s proposed initial installation will impact an extraordinary area of remote wilderness far beyond the 2000 acre site.
While this particular area is only marred by access trails to the 138Kv transmission line right-of- way, the remote hollow on the site is one of two major contributors as the headwaters of Laurel Creek. It is for this reason we chose to approach our tour from the Laurel Creek fire trail.
Geologically, Bent Mountain is a unique plateau in the Blue Ridge Mountains. It is similar to its sister area, Burke’s Garden in Tazewell County. Poor Mountain’ eastern slopes provide soft “sweet” water to the Bent Mountain plateau. The western slopes are much rougher and drier with craggy rock outcroppings. The result of the difference in water supply has been that the Bent Mountain plateau has provided a rich habitat for wildlife as well as human beings for many generations. (Currently, 1500 people call Bent Mountain their home.) Our home, located high on Poor Mountain and about a mile from the old Indian camp farm, is supplied with sweet spring water that our family has enjoyed for 35 years. In the driest of years, our spring has never gone dry.
The site proposed for the first 18 wind turbines also is nestled between a number of protected environment areas. To the Northeast is the Poor Mountain Preserve (Nature Conservancy) where a unique stand of the endangered Pirate Bush flourishes. On an adjacent tract to the Northeast, the Nature Conservancy holds an easement to protect the headwaters of Bottom Creek. Another nearly 1000 acre tract of land to the southeast has been placed with the Western Virginia Land Trust. And the Nature Conservancy also holds a large acreage of land protecting the Bottom Creek Gorge, the highest waterfall in Virginia and the Tier 3 designated Bottom Creek.
Proponents of the Wind Turbine project, (Invenergy, its paid Professional advocate, Mary Ellen Goodlatte, Atty., and the Cool Cities Coalition) have stated that Poor Mountain has already been “trashed” with communications transmission towers and it has been logged; therefore, the environmental value this 2000 acre section, and adjacent hollows, of Poor Mountain and its resident human community is a small sacrifice to make.
Some of the Poor Mountain area has been recently logged. This was instigated by the devastating Gypsy Moth infestation of 2008. Indeed, that has had a dramatic impact on natural habitat on Poor Mountain. However, 2010 has been a banner year for our wilderness up here on the mountain. This past winter of constant snow served as a magic elixir for a strong recovery. I have spotted my friends, the native “Brookies”, I think Char is their formal name. Nevertheless, this high up in elevation, they were never stocked.
The natural environment on Poor Mountain is still in a fragile state. The Invenergy Wind Plant Turbines will all be placed on narrow ridges with very wide ridge roads. Clearing, excavation and construction, over 200 acres on all of the ridges (narrower ridges than shown in the adjacent Mountaineer Wind Farm in WV) of a recovering environment below and on both sides of the ridge will serve as a death blow to immediate woodland environments including Cove hardwoods and miles of streams, including Bottom Creek, a state designated Tier 3 stream that runs through the Nature Conservancy’s Bottom Creek Gorge.
Trees and plants are nature’s form of erosion control techniques. When forests in the mountains are logged and clear cut, they are extremely susceptible to massive erosion. As an architect, I have never seen a construction project of any kind where erosion and sediment control measures, subject to human control, were not breached, either by accident or negligence. Note the breached erosion control measures in the above photo on the Mountaineer Wind Farm, WV.
There is nothing inherently wrong with trying to capture the energy of the wind. The issues arise over answers to two fundamental questions:
Do you support Industrial Scale Wind Turbine Projects for the money?
Or
Do you support Industrial Scale Wind turbine Projects for humanity and our environment?
Both questions require every individual, who chooses to answer either, to dedicate themselves to “critical thinking”. Merely “choosing a side” is an insult to the future of humanity.
Proponents have stated:
“The proposed Invenergy project has the potential to reduce carbon emissions by approximately 98,000 tons a year.”
On existing Wind Turbine installations 15% to 25% of rated capacity is all that can be expected on an annual basis in the Appalachian highlands due to the intermittent and turbulent (thermals and eddies) nature of wind. This initial proposed installation’s maximum rated capacity is 45MW if it were running at 100% efficiency at 100% of the time. In reality, this project would have a maximum output of 11.25MW. The RVCCC calculation does not include the electricity drawn from the grid to maintain the turbines. If the electricity from the turbines cannot be sent into the grid, it is drained off into the ground. The turbine system has no capacity to store electricity. A calculation that only addresses the rated output of the turbines, is very misleading, and is not the net gain of power drawn from wind.
By RVCCC’s undocumented calculation factors, this brings the carbon emission reduction down to about 42,000 tons a year, more than 57% less.
Proponents have also stated:
Average Households Powered:
“The equivalent of approximately 8,500 to 10,000 households in the Roanoke Valley.”
Based upon an industry recommended residential wind turbine installation of 10Kw rated capacity, the claim is inflated by over 880%. The actual homes served in would be 1,125 and there is no way to determine that they would be in the Roanoke Valley.
Invenergy, LLC has a strong financial interest in resuming Federal “energy credits” included in the current “cap & trade” legislation. Congressman Bob Goodlatte (R-Va) has repeatedly and eagerly opposed “cap & trade” legislation, policies and abuses. The very concept of “cap & trade” created a financial trading market in 2003. The Chicago Climate Exchange (CCX) on which Invenergy’s founder & CEO, Michael Polsky is a charter board member along with Richard M. Daley, of the Chicago Daley family and 16 others.
Coal companies and coal-fired power plants are actually permitted to increase their carbon emissions into the atmosphere when they PURCHASE Energy Credits on the Chicago Climate Exchange. This exchange of “credits” is good for business for coal companies and a nationwide host of other carbon emitting industries. They are willing to pay massive amounts of money for these “credits.” As a result a small group of people in Chicago are raking in big dollars under the guise of renewable energy. Does this sound like another Wall Street derivatives market scandal that plunged us into the most severe recession since the Great Depression? It is.
And who is the source of such great riches? All of us will pay, through our taxes and our electric bills. And the actual reduction of carbon emissions is relatively miniscule.
In addition, are we so naïve to think that there won’t be 54 wind turbines, as identified in a 2005 joint study by Invenergy and PJM, a company that operates the electrical grid distribution system?
Here’s a poignant quote from:
Chris Bolgiano of Highland County, Virginia, a “humorous” nature writer of five books, innumerable articles, and one short history of a small place -- her own community.
“What drives this high-cost/low-benefit gold rush is the federal production tax credit. More tax breaks beckon in national forests, where no local property taxes are levied so local communities wouldn’t share in revenues produced by turbines, plus the Forest Service helps pay for building roads. In the three years that the federal tax credit hasn’t been reauthorized since first enacted in 1992, the skyrocketing wind industry plateaued like a mountaintop-removal coalmine.
The coal mining that has ravaged the land and people in part of Appalachia for a century is our major source of electricity, and is obscenely destructive to forests. But destroying more forests in order to stop destroying forests doesn’t make sense. And building industrial wind plants in Appalachia isn’t change. It’s a 21st century version of the same old pattern of taking value out and leaving costs behind.
These ancient mountains are well-documented as the biologically richest temperate woodlands in the world, one of North America’s greatest natural treasures, rich in globally rare species and communities, including human ones. So you can’t dismiss my aging hippie protest merely as NIMBY, which in any case is simply love of place. It breaks my heart to see these murdered old mountains assaulted again.”
On the evening of June 23, 2010, the Bent Mountain Civic League voted unanimously to endorse the Planning Committee’s commitment to oppose the proposed installation of wind turbines on Poor Mountain.
Tuesday, June 8, 2010
Facing a Disturbing Reality
Here's a link for everyone to study closely.
Beyond consideration for our rural families, their values, and their environmental compatibility; what are we willing to sacrifice for our continuing lust for energy? Will we sacrifice our ability to grow food?
Friday, June 4, 2010
Virginia SCC Denies Appalachian Power Bid for Wind Power
Yesterday, Appalachian Power Company was denied approval of a request to enter into a contract to purchase wind power from 3 Wind Turbine Production Facilities, two (2) in Illinois and one in Greenbrier, Co., West Virginia, for resale in Virginia. The board stated that APCO was already meeting the state's voluntary targets for renewable energy and Virginia consumers have already weathered a 50% increase in rates over the past 3 years. You'll find more @ http://www.roanoke.com/news/roanoke/wb/249145
Although APCO, a subsidiary of American Electric Power, may have and pursue a right of appeal of the decision, they will likely honor their contracts with Invenergy, PLC and seek additional revenues in other states. The deeper story is in the continuing struggle/collaboration between ineffective goverment regulation and big profit-motivated industry.
Is American Electric Power Co. too big to fail as well?
As a good old friend reminds me,"track the money."
Friday, May 28, 2010
...breaking news!
Where there's Money....
The proposed industrial wind turbine installation in Highland County, Virginia has encountered intense opposition by residents and stewards of the environment. Although the project is moving ahead, under the banner of a smaller development organization, only 2-3 wind turbine sites have been cleared and some new roadwork is in place.
Recently, it is my understanding that attorney, Mary Ellen Goodlatte, has invited the Roanoke County planning staff, Planning Commission members and County supervisor, Ed Elswick, on a trip (expense paid?) to the site of the Beech Ridge Wind Farm. The project is a $300 million, 119-wind turbine installation under construction in Greenbrier County, West Virginia, on behalf of her client, Invenergy, PLC. This project consists of 1.5 Mw turbines. (the project proposed in Roanoke County will have 2.5 Mw turbines; 167% larger with greater environmental impact area). The purpose of this visit is to "educate" Roanoke County staff and planning commission members about the benefits of the installation of this technology in the Appalachian Mountains.
Currently, the Roanoke County Zoning Ordinance has no provisions for such an installation in Roanoke County. The county is expected to amend their ordinance this year and the invitees are only those who will be primarily responsible for preparing and recommending ordinance changes to the Roanoke County Board of Supervisors.
Unfortunately, we seem to all be blinded by the promise of big money and a silver bullet to conceal our ever growing consumption of energy.
The following link was published by Virginia Wind which is maintained by:
Dan Boone and Rick Webb of Highland County, VA:
http://www.vawind.org/Assets/Docs/Wishful-Thinking.pdf
Note: This post was edited on 06-01-10 to correct earlier misinformation regarding the site to be visited and deletion of references to Ms. Goodlatte's family.
The proposed industrial wind turbine installation in Highland County, Virginia has encountered intense opposition by residents and stewards of the environment. Although the project is moving ahead, under the banner of a smaller development organization, only 2-3 wind turbine sites have been cleared and some new roadwork is in place.
Recently, it is my understanding that attorney, Mary Ellen Goodlatte, has invited the Roanoke County planning staff, Planning Commission members and County supervisor, Ed Elswick, on a trip (expense paid?) to the site of the Beech Ridge Wind Farm. The project is a $300 million, 119-wind turbine installation under construction in Greenbrier County, West Virginia, on behalf of her client, Invenergy, PLC. This project consists of 1.5 Mw turbines. (the project proposed in Roanoke County will have 2.5 Mw turbines; 167% larger with greater environmental impact area). The purpose of this visit is to "educate" Roanoke County staff and planning commission members about the benefits of the installation of this technology in the Appalachian Mountains.
Currently, the Roanoke County Zoning Ordinance has no provisions for such an installation in Roanoke County. The county is expected to amend their ordinance this year and the invitees are only those who will be primarily responsible for preparing and recommending ordinance changes to the Roanoke County Board of Supervisors.
Unfortunately, we seem to all be blinded by the promise of big money and a silver bullet to conceal our ever growing consumption of energy.
The following link was published by Virginia Wind which is maintained by:
Dan Boone and Rick Webb of Highland County, VA:
http://www.vawind.org/Assets/Docs/Wishful-Thinking.pdf
Note: This post was edited on 06-01-10 to correct earlier misinformation regarding the site to be visited and deletion of references to Ms. Goodlatte's family.
Wind farm illness: Waubra Disease
An ominous video from New Zealand. Remember Invenergy's reference to "Truescape". They were the New Zealand consultants who prepared simulations of the proposed Poor Mountain Project.
Thursday, May 20, 2010
Let me explain where I’m coming from.
(PLEASE NOTE THAT THE GENERATOR, AT THE HUB OF THE PROPELLER, IS NEARLY AS BIG AS MY HOUSE, LIKE A GIANT OVERSIZED AIRSTREAM TRAILER.)
To begin with, here are definitions from Wikipedia:
NIMBY (an acronym of Not In My BackYard or, much less frequently, Not In My Blue Yonder) describes the opposition of residents to the nearby location of something they consider undesirable, even if it is generally considered a benefit for many. Examples include: an incinerator, an ethanol plant, a nuclear-power plant, or a prison.
BANANA (an acronym of Build Absolutely Nothing Anywhere Near Anything or possibly Build Absolutely Nothing Anywhere Near Anyone) is a term most often used to criticize the ongoing opposition of certain interest groups to land development.
CAVE People (an initialism for Citizens Against Virtually Everything) is a pejorative acronym for citizen activists who regularly oppose any changes within a community. The phenomenon is linked to the so-called NIMBY (Not In My Back Yard) phenomenon in which residents oppose a development as being inappropriate for their local area.
Recently, ...yesterday, a friend and neighbor remarked, regarding the proposed Wind turbine project on Bent Mountain:
“Its clean, not a fossil fuel and not dependent on anyone.
If the windmills would work on my land I'd gladly give it for the betterment of the next generation.”
I was compelled to respond:
Clean energy? Images of pristine, sparkling white pinwheels on the distant horizon can be misleading. For those of us who have grown up enjoying the wonders of the natural environment, we have witnessed decades of intrusion on the natural environment on Poor Mountain by communications corporations along Honeysuckle Lane. No honeysuckle up there, probably never has been, just dump piles of old concrete and steel and tower parts and more and more towers, all providing greater access to more people, more construction, clear cutting, wildlife habitat removal. Clean, NO!!!
not a fossil fuel ? True. These behemoth super-industrial scale wind turbines rely on heavy metals in the form of massive batteries to keep the blades moving during periods of no wind. Physically, the energy consumption to provide the torque required to start these giants from stop negates too much of the energy they generate in optimal conditions.
and not dependent on anyone. Except the taxpayer. Federal grants, subsidies and incentives are in the trough for consumption by big corporations including manufacturers, installation developers, power companies, construction companies and a never ending string of monetary beneficiaries.
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