It boils down to this. If the U.S. Production Tax Credit (PTC) is renewed by the U.S. Congress this fall, then wind power is set to boom for the next five years.
If it isn’t renewed, we can expect a few more years like 2013 where due to the uncertainty surrounding the annual PTC expiry/renewal many projects in the U.S. were shelved, resulting in a dismal 1GW of wind installations across the U.S.A. that year.
Without the PTC renewal, 2015-2020 are likely to post similar results in the U.S. for new wind installations — at a time the rest of the world is setting yearly wind power generation and installation records.
European and Chinese wind turbine manufacturers are anticipating the decision as much of their future business could flow from the United States which has huge, untapped wind reserves, both onshore and offshore.
Fossil Fuel economic subsidies
Unlike the massive subsidies and tax breaks for the fossil fuel industries, which literally go up in smoke requiring constant subsidy dollars to continue along their present business model, wind production tax credits are not spent to lower rising fuel costs. Rather, the tax favour allows more wind turbines to be built and installed, resulting in fewer fossil fuel subsidy dollars going up in smoke.
Worldwide, the fossil fuel industry receives over $550 billion dollars of subsidy and tax breaks — and the U.S. alone gives $80 billion to their domestic oil, gas, and coal industries to lower fuel costs for consumers. That’s 1/7th of the world’s total fossil fuel subsidies, right there.
Fossil Fuel externality subsidies
That doesn’t include the implied subsidy of externalities, those costs to society from fossil fuel use that are not factored into the fuel cost and are not paid for by the oil and gas, or coal industries. Everything from the acid rain that eats concrete structures like bridges, skyscrapers, some roadways and concrete sculptures, to polluted water that must be treated before it can be used, to building filtration systems to remove airborne pollutants caused by fossil fuel burning, to medical costs borne by individuals, organizations and governments, and more. The final fossil fuel externality is, of course, the millions of premature deaths worldwide caused by the ever-increasing concentrations of fossil emissions in our atmosphere.
Fossil Fuel externality cost estimated at between $40-80 per ton of CO2
The cost of fossil fuel use is estimated to be on the order of $40-80 per ton of CO2 emitted and those costs are paid, just not at the gas pump. Governments and individuals pay that price — which varies widely depending upon where you live (city, country, downwind of coal power plants, or on the coastline with its usually fresh air).
If we included the externality cost of all fossil fuels, every type of fuel would double in cost. Our coal-fired electricity would double in cost, and removing the direct subsidies would double it again. The same would occur with gasoline and diesel for our cars.
Yes, it’s a lot of money. And one way or another, we’re paying it. Don’t deceive yourself, it is being paid, just not at the gas pump nor on your electricity bill. But we are paying those subsidies and externality costs in our taxes, and in other ways such as higher health costs and lowered life expectancy resulting from our fossil fuel addiction.
Wind PTC subsidy amounts to a paltry 2.3 cents/kWh (if renewed)
None of those externalities exist for wind power. Wind has no $40-80 per ton of CO2 externality. Wind is not asking for worldwide subsidies of $550 billion, nor is it asking for American subsidies of $80 billion dollars.
Wind power in the U.S.A. is asking for a paltry 2.3 cents/kWh over a 10 year period.
The current amount of the PTC is an inflation-adjusted 2.3 cents/kWh for ten years. For use in our levelized cost analysis, we levelized its value over twenty years, the average duration of a wind energy contract. — Visualizing the Production Tax Credit for Wind Energy, Syracuse University / University of California, Irvine / University of California, Berkeley
Here is an infographic that shows some of the ways that wind power assists the U.S. economy, which was provided to us by the American Wind Energy Association (AWEA).
Wind Power jobs
As the graphic demonstrates there are many tangible benefits of wind power in the United States, not the least of which is providing jobs for Americans, attracting billions of dollars of investment, and adding new, clean electrical generation capacity to the utility grid.
Wind turbines, an additional income source for farmers
Many farmers augment their annual income by inviting utility companies to install wind turbines on their farms. While most crops produce between $150-600 per acre of land after costs are deducted, a utility company wind turbine pad rental with 24/7 access, pays approximately $4000 per acre of land, although this varies in different parts of the country. The extreme range for wind turbine installation payments appears to be $2200-6500 per acre, depending on regional wind flows and size and height of the turbine. Unfortunately for farmers, wind turbines and their towers are quite large, limiting installations to a maximum of one turbine per every few acres, depending on the size of the unit.
GE Space Frame Tower
General Electric too, is awaiting the decision and has an entirely new product line ready to deploy, both in turbines with their Brilliant wind turbine technology and their truck-transportable and easily-assembled Space Frame Towers.
Be sure to check out another graphic AWEA made earlier this month highlighting some of wind’s many other benefits by clicking here: http://bit.ly/1qtwHBc.
Help us spread the good news about wind power’s good deal by sharing this graphic with friends and colleagues.
Here are a few suggested tweets:
- “New graphic highlights wind’s benefits and contribution to U.S. energy independence. bit.ly/1C6ta3D #windpower“
- “Wind power benefits communities in all 50 states, farmers call it their most “drought-resilient crop” bit.ly/1C6ta3D #windpower“
- “Energy from wind farms strengthens America’s energy independence bit.ly/1C6ta3D #windpower“