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A More Realistic Cost of Wind Energy

Willem Post's picture
President Willem Post Energy Consuling

Willem Post, BSME'63 New Jersey Institute of Technology, MSME'66 Rensselaer Polytechnic Institute, MBA'75, University of Connecticut. P.E. Connecticut. Consulting Engineer and Project Manager....

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  • Nov 29, 2013

Wind Energy Costs

Like the corn-to-ethanol and solar industries, the Big Wind industry basks in political correctness and political favoritism. Big Wind has grown comfortable in its dependence on federal and state governments that decide which energy industries will be winners or losers — discrimination enforced by squeezing taxpayers, rigging the tax code and regulations, such as state-mandated “must-take” provisions and renewable portfolio standards, RPS. 


Various Big Wind promoters maintain the cost of wind energy is competitive with other sources of energy. As shown below, this is hardly the case. They often point to power purchase agreements, PPAs, between wind turbine owners and utilities to sell at 5 to 6 c/kWh as proof of market price parity.


However, costs are not the same as prices. Energy costs have to do with the unsubsidized cost of producing energy. Pricing that energy is greatly influenced by the level of subsidies. If that were not the case, wind turbine owners would not be fighting so hard for various subsidies, such as extending the 2.3 c/kWh production tax credit; its pre-tax value is about 3.4 c/kWh, depending on tax rates. This credit is not trivial, as the US average grid price is about 5 c/kWh.


The EIA calculates the levelized cost of NEW onshore wind turbine plants placed in service in 2018, capacity factor 0.34, 30-yr life, at $86.6/MWh, including transmission costs of $3.2/MWh.

These costs include various subsidies not available, or partially available, to other sources of energy, and exclude various hidden and not-so-hidden costs. Also, the assumed 30-yr life is grossly excessive, based on European experience; and the transmission cost is understated, based on examples in this article; and the costs of generation sufficiency (balancing, standby, etc.) and grid sufficiency (extending and augmenting the grid, energy storage, etc.) are not included. As a result, comparison with other energy sources, based on the EIA data, becomes invalid.


NOTE: To illustrate the EIA understatement of transmission cost: The components of the US levelized cost of energy are 58% generation, 31% distribution, 11% transmission. As wind and solar plants are added, the T&D percentages are likely to increase; the EIA assumed a transmission impact on levelized cost of 3.2/(86.6-3.2) = 3.8%, about 1/3 of 11%; the EIA gives no explanation for its low estimate.


NOTE: To illustrate the EIA understatement of transmission cost:  If the US investment in transmission were $7,000 million in 2007 without having to integrate wind and solar energy, then $8,902 – $7,000 = $1,902 was invested to integrate wind and solar energy, almost all for wind energy. US installed wind turbine capacity was 11,575 MW at end 2006 and 16,907 MW at end 2007, for an increase of 5,332 MW, at a capital cost of about $9,598 million, i.e., the transmission cost adder is about 1,902/9,598 = 19.8%. Similar calculations for 2008 through 2012 show percentages of 16.3; 19.7; 38.8; 40.8; 33.0; the EIA assumed a transmission impact on levelized cost of 3.2/(86.6-3.2) = 3.8%; the EIA gives no explanation for its low estimate. 


NOTE: US installed wind turbine capacity was 60,007 MW at the end of 2012, which can produce 60,007 x 8,760 x 0.32 = 168 TWh/yr, or 4.4% of US energy generation. On a global basis, wind energy’s contribution is about 3.2%. 


Regional Variations in Capacity Factor: Based on a sub-sample of wind turbine projects built from 2007 through 2011, the regional average CFs in 2012 were:


– Central States……….0.36

– Great Lakes…………..0.28

– Northeast……………..0.24

– Southeast……………..0.23  


These CFs reflect the quality of the wind resource. See page VII of URL.


2012 CFs for NEW projects commissioned in 2010 and 2011 were: 


– Central States………..0.370

– Great Lakes……………0.280

– West Coast…………….0.260 

– Northeast………………0.252 

– Southeast………………0.247 


See page 48 of URL.


Project capital costs are about $2,000/kW in the Central States; about $2,600/kW on 2,500-ft-high ridgelines in New England; and about $4,500/kW offshore. If O&M/MWh in the Central States is set at 1, ridge line New England is about 2, and offshore about 3.


As a result of a realistic 20-year life, instead of 30 years assumed by the EIA; a realistic CF of 0.25, instead of 0.33, or better, claimed to get permits; the higher O&M/MWh; the higher capital cost/MW, New England wind energy costs are at least 2 times Central States. Similar reasoning applies to offshore energy costs being at least 3 – 4 times Central States.




The below data are based on extracts from a report titled “The Hidden Costs of Wind Electricity”, December 2012, authored by Dr. Taylor and Tom Tanton. 


Assuming a realistic 20-year life of a wind turbine increases the levelized cost to $93/MWh; the EIA uses 30 years, the NREL uses 20 years. No wind turbine manufacturer claims 30 years. Some claim 25 years, others 20 years, but European experience indicates 20 years or less.


After backing out the effect of accelerated depreciation for wind turbine plants, the levelized cost increases to $101/MWh. Accelerated depreciation rules, just for wind turbines, allow the entire investment to be written off in 5 years, to make tax-shelter spreadsheets look good. The 5-yr write-off period is unheard of in the rest of the utility industry.


Adding the costs of:


– increased frequency of start/stop operation

– keeping gas and coal plants available in cold standby mode

– keeping some gas plants in synchronous (3,600 rpm) standby mode

– operating more hours in part-load-ramping mode (extra Btu/kWh, extra CO2/kWh)


to balance the variable wind energy, adds $17/MWh for natural gas, and $55/MWh for coal, and reduces the CO2 emission reduction effectiveness of wind energy, as more and more wind energy is added to the grid.

NOTE: In synchronous (3,600 rpm) standby mode (high-speed idling, 24/7/365, no or minimal energy sent to the grid), the fuel consumption is 6 to 8 percent of rated fuel consumption.


Extra balancing NG fuel adds $6.00/MWh, extra balancing coal fuel adds $9.00/MWh 


Transmission system investments to gather energy from the wind turbines and transmit it from less populated areas, via HVDC and HVAC lines, to population centers adds $27/MWh.  


Thus, the total levelized cost of wind energy averages $151/MWh with NG back-up/balancing and $192/MWh with coal back-up/balancing.


Absent economically-viable, utility-scale, energy storage, variable/intermittent, non-dispatchable wind energy cannot exist on the grid, unless balanced by dispatchable coal, gas and hydro plants. For that reason, any levelized costs should be stated as a combination of:


– wind energy balanced by coal energy 

– wind energy balanced by gas energy 

– wind energy balanced by hydro energy


System costs can be determined by the weighted average cost of the combinations, as proposed in the Taylor/Tanton report. 


NOTE: Levelized costs are the net present value of the total cost of new construction (including finance charges during and after construction), maintenance, and operation of a generating plant over its lifetime, expressed in dollars per unit of output, i.e. dollars/MWh. They are used to compare various generating sources to see which sources are the most cost-effective when constructing new plants.




The Taylor/Tanton report may or may not overstate, but it certainly performs a useful purpose to attract attention to the heavily-subsidized, wind energy boondoggle, and the inane crowing about wind energy being at grid parity, and the inane crowing about it lowering grid electric rates (BTW, not the rates of rate payers), whereas, in fact, that is merely so, because of the various subsidies, such as: 


– accelerated depreciation to write off the entire project in 5 years, 50% in the first year, just for wind turbines, plus 

– the 2.3 c/kWh production tax credit, PTC, for 10 years, or 

– in lieu of the PTC, receive a 30% investment tax credit, ITC, or 

– in lieu of the ITC, receive a 30% CASH GRANT at commissioning of the project, in case the wind turbine owner claims he has no taxes due against which to apply the ITC; “1603c clause of ARRA”, plus other 

– government grants, low-cost loans, and loan guarantees, plus 

– the socializing, via rate schedules, of various other costs that are mostly hidden/not-easily-identified, as explained in detail in the ATI report by George Taylor, Ph.D. and Thomas Tanton, each with decades of experience analyzing the economics of energy systems.


With enough money, even pigs can be made to fly, and even wind energy can be made to appear at grid parity, with much of the costs foisted off onto the public via the rate schedules, the tax code and government hand-outs..




The historic cost data of wind turbine plants in various geographical areas are well known. This is not the case with grid level costs, except in countries that produce 10 to 20 percent of their annual energy with wind turbines.


In Europe, several countries, such as Denmark, Spain, Ireland, Portugal, etc., produced 10 to 20 percent of their energy with wind turbines at least 10 years ago. As their build-outs took place, more became known regarding grid level costs. It appears these grid level costs are significantly greater than claimed by various wind energy promoters.


The below Organisation of Economic Co-operation and Development, OECD, study quantified the levelized costs of the grid level effects of variable energy, such as wind and solar, on the grid. It includes three categories of costs:


1) Balancing: 


Wind energy balancing by cycling generating units requiring: 


– increased cold starts and stops. 

– increased warm starts and stops. 

– increased synchronous operation (3,600 rpm) in regulating mode

– increased ramping up and down while operating at part-load. 


All four cause increased fuel consumption and increased wear and tear of equipment, just as would be the case with a car. 


2) Grid Level:


– the costs of connecting wind turbines to grid. 

– grid reinforcement and extension. 

– the cost of energy losses to transmit the energy from wind turbines in remote locations to end users in population centers; such losses will be significant if transmitting from west of Chicago to the East Coast, as envisioned by the NREL.


3) System Level:


– the costs of back-up (adequacy), i.e., keeping almost all EXISTING generators fueled, staffed, and in good working order to provide energy when wind energy is minimal, about 30% of the hours of the year in NE, about 10 – 15% of the hours of the year west of Chicago. 

– the costs of capacity payments, to offset the hit to the economics of existing generators, as these units will be producing less kWh/yr, but still are needed when wind energy is minimal. With less kwh/yr produced, the cost of each kwh must increase to cover fixed costs, but that cost will often exceed the grid spot price!


NOTE: Here is an article regarding the intermittency of wind energy in the UK, which concludes, absent economically-viable, utility-scale energy storage (not yet invented), nearly all existing generators are needed to provide continuous electric service, as required by a modern society, no matter how many wind turbines are built in the UK.


In the US, the costs of the above three items for onshore IWTs are minimal, about $5/MWh, or less, when the annual wind energy on the grid is only a few percent, because most grids have some spare balancing and transmission capacity to absorb variable wind energy. As the wind energy percentage nears 3 – 5% (the current US condition), the spare capacity of most grids is used up.


Because the costs are minimal, and because there is so much “noise” in the data, and because adequate, real-time, 1/4-hour performance data is usually lacking, various claims regarding wind energy operational and cost impacts on the grid, and CO2 emission reduction effectiveness, are made that cannot be verified; an ideal situation for IWT promoters to spin their deceptive yarns.


The costs of the above three items are about $7.5/MWh at 5%, about $16.30/MWh at 10%, and about 19.84/MWh at 30%, according to the OECD study. 


This is significantly greater than the about $5/MWh usually claimed by IWT promoters, but those claims are for when the wind energy percent is only a few percent, as is the case in most of the US. See page 8 of below URL. Corresponding costs for offshore wind turbine plants would be significantly greater.


These costs are a significant part of the US annual average grid price of about $50/MWh. Mostly, they are “socialized”, i.e., charged to rate payers, not to wind turbine owners. As a result, wind turbine owners, with help of other subsidies, such as the $23/MWh production tax credit, and accelerated depreciation schedules just for wind turbines, can underbid other low-cost producers, causing them to sell less energy and become less viable over time, i.e., future investors would be less willing to invest in such producers, unless compensated with “capacity payments”, that also will be charged to rate payers, not wind turbine owners; a free ride all-around.




The OECD report states higher estimated costs for Europe than the US, even though Norway and Sweden are doing wind energy balancing with hydro plants at low cost for Denmark, the Netherlands, Germany and the UK; all these countries have robust HVDC and HVAC interconnections. Spain, largely an island grid, is using pumped hydro and gas turbines for balancing (more costly than hydro) and Ireland, largely an island grid, is using gas turbines for balancing (more costly than hydro).


The OECD estimated costs for Europe are higher than US costs, because Europe has decades of real-time, grid operations data, and decades of energy systems investment data to get to high levels of annual wind energy, such as 10 to 20 percent, i.e., the OECD study had no need for “modeling with supercomputers” or engage in estimating future costs, a la NREL studies. 




The NREL study titled “The Western Wind and Solar Integration Study Phase 2”, issued in 2012, analyzes the effects of having a total of 33% wind and solar annual energy on the grid by simulating grid operations on a sub-hourly basis using computerized modeling. 


The Western Electricity Coordinating Council, WECC, a.k.a. Western Interconnection, including the western states of the United States, the two western provinces of Canada and a small part of Mexico, had 885,000 GWh of energy on its grid in 2012, of which wind energy was about 38,055 GWh, or about 4.3%, and hydro energy was about 170,000 GWh, or about 20%. 


At that low annual wind energy percentage most grids have enough spare part-load-ramping capacity to balance wind energy with only minor impacts on the efficiency of fossil-fueled generators and on their CO2 emissions, especially if much of the wind energy balancing is performed by hydro plants.


The NREL extrapolating from the grid conditions at 4.3% annual wind energy to hypothetical grid conditions at 33% annual wind energy, 0.33 x 885,000 = 292,050 GWh/yr, with computerized modeling, and then make pronouncements regarding capital costs, operating costs, CO2 emission reductions, and rate payer cost savings, is beyond credible. This may serve the PR purposes of the AWEA, et al., to sway the public and legislatures, and to keep subsidies flowing, but will be of little use to grid operators. The NREL makes the claim capital costs for transmission system build-outs to go from 4.3% to 33% wind energy would be minor. This appears to be wholly unrealistic. See next section.


Here is a “Fast Facts” memo from the California ISO, CAISO, which indicates its grid’s flexible generator capacity is nowhere near where it needs to be to accommodate increasing wind and solar energy on the grid. Any capital investment costs for increased flexible generator capacity, transmission system build-outs, and associated O&M cost increases, will be charged to rate payers via rate schedules and fees on electric bills, not to wind turbine owners.


A much better approach would have been using the many years of existing grid operations data, emissions data, and cost data of the European countries that already have 15 to 20 percent of annual wind energy on their grids, and learn about their costs and CO2 emissions.


The tendency in the US has been to underestimate wind energy costs to increase its political/economic attractiveness. As a result, the OECD report indicates lesser costs for wind energy than appears to be the case, based on the Taylor/Tanton report.


NOTE: Due to water supply conditions and reservoir storage capacities, the output of hydro plants cannot be augmented to increase energy production, as with a thermal plants. To maximize the capacity of wind energy balancing, the hydro plants would need to be centrally controlled.


NOTE: Denmark generated about 28% of its total energy with onshore and offshore wind turbines in 2012, but it uses the hydro plants of Norway and Sweden to balance almost all of it, because its domestic balancing capacity has been for some years, and still is, insufficient. Denmark usually generates wind energy at night when demand is low, i.e., it is exported (at low cost) to Norway and Sweden, according to energy flows over international connections. BTW, Denmark has the highest household electric rates in Europe, about 30.0 eurocent/kWh, including all fees and taxes; Germany is a close second, about 29.2 eurocent/kWh.

Computerized Modeling is Subjective: Computerized modeling usually is highly subjective, as are cost estimates, especially if performed by pro-RE people in government trying to “prove” the positive aspects of their RE programs.


The IPCC used its methods to “prove” global warming, but its computerized modeling was found to be flawed.




Below are some examples of the estimated capital costs of transmission system build-outs to accommodate wind turbines. The costs are much greater than claimed by the NREL in its various studies, so as to make wind energy look more competitive, and not to arouse the public, as any costs of the transmission system build-outs will be “socialized”, i.e., charged to rate payers, not to wind turbine owners. 


New England Example No.1: The ISO-NE performed a study of having 23% of energy delivered to the NE grid from wind by 2030. 


– Wind turbine plants, roads, tie-ins to transmission systems 7,500 MW, onshore x $2,600,000/MW + 4,500 MW offshore x $3,600,000/MW = $36 billion; 61.9% of costs.


– HVDC onshore overlay + HVDC offshore transmission systems + modifications to existing HVAC systems, per ISO-NE, $19 to $25 billion, say $22 billion, or 22000/12000 = $1.83 million/MW of wind turbines; 38.1% of costs.


Production: (7,500 MW x CF 0.30* + 4,500 MW x CF 0.40) x 8,760 hr/yr = 35,478 GWh/yr^, less losses.


* The current ACTUAL Northeast CF is 0.24. See URL. The ISO-NE study ASSUMES the CF will increase to 0.30; no basis is given. A starry-eyed “assumption”? Will NE wind conditions be sufficient for this assumption? I think not.


^ The current NE wind energy production is about 1,200 MWh/yr, i.e., almost ALL capital costs are yet to be spent.


New England Example No. 2: Northern Pass, an HVDC, north-south transmission system is planned from Franklin, NH, to Deerfield, NH; 187 miles; capacity 1,200 MW; capital cost $1.4 billion; 1400/187 = $7.49 million/mile, or 1400/1200 = $1.17 million/MW.


HVDC energy from hydro plants in sparsely-populated Quebec, New Brunswick and Labrador is fed into the system at the Canada-NH border and transmitted to southern NH, where it is fed, after conversion, into existing HVAC systems; any modifications required to the HVAC systems are not included in the cost estimate.


Mid East Coast Example: Trans-Elect and Atlantic Grid Development are the project developers of the Atlantic Wind Connection, AWC. The AWC will be designed to transmit energy from 7,000 MW of offshore wind turbines to consumers in New Jersey, Delaware, Maryland and Virginia.


Construction period 2016 – 2026; the offshore HVDC transmission backbone will be built in five phases; total estimated cost $6.311 billion; this estimate likely excludes connecting the wind turbines to the HVDC backbone, as the locations of the wind turbines, spread out over an area of about 600 km x 40 km = 24,000 km2, or 9,266 sq miles, are not yet known. 


A series of offshore stations will convert the AC energy from the IWTs to DC and step up the voltage to 320 kV for transmission via HVDC lines to the onshore grids, where onshore stations will convert it to AC; 6311/7000 = $0.90 million/MW, comparable to the Northern Pass and Netherlands-Norway examples, which are 1.17 and 1.15 $million/MW, respectively.


The capital cost of the IWTs would be 7,000 MW x $3.6 million/MW = $25.2 billion, for a total project cost of $31.5 billion; transmission 6.311/31.5 = 20% of project costs. This does not include:


– any onshore grid modifications and 

– the extra OCGT and CCGT capacity required for balancing the wind energy, and 

– the above-mentioned wind turbine to HVDC backbone connection.


Energy production would be 7,000 MW x 8,760 hr/yr x CF 0.40 = 24.53 TWh/yr, less losses

Ireland Example: Element Power plans to build 3,000 MW of wind turbines, 10 clusters of 300 MW each, in the Midlands of Ireland and transmit the energy, via the Irish Sea, to Wales. Element claims an estimated total project cost of 8 billion euro and a completion date by the end of 2018. This estimate appears low compared to similar projects in the US. See URL.


– Wind turbine plants, roads, tie-ins to transmission systems = 3,000 MW x 1,800,000 euro/MW = 5.4 billion euro; 67.5% of costs.

– Wind turbine clusters feeding into new HVAC systems to a common point, conversion to HVDC, then, via the Irish Sea, to Wales; about 150 miles; capital cost 2.6 billion euro; 32.5% of costs.


Element Power does not mention the levelized (owning + O&M) cost of:


– reinforcing the Wales onshore grid to take the additional energy and, 

– the increased UK OCGT/CCGT wind energy balancing operations, etc. 


Likely, they will be “by others”, i.e., UK rate payers.


NOTE: For the above two examples, the percentages for transmission system capital costs are similar.


US Example: Investor-owned utilities and transmission companies invested a record $34.9 billion in transmission ($14.8 billion) and distribution ($20.1 billion) infrastructure in 2012, according to the Edison Electric Institute. The spending on transmission was about 24% greater than 2011, the greatest year-over-year percentage increase since 2000.


The spending is driven by many factors, including large transmission projects and interconnection of renewables, such as utility-scale solar and wind projects. EEI found in another report that about 75% of transmission spending through 2023 will be to integrate solar and wind projects. All these costs will be socialized, i.e., charged to rate payers, not to wind turbine owners.


The NREL has proposed the US get 20% of its energy from wind by 2050, or about 1,000 TWh/yr. During the past 15 years, the US has invested at least $25 billion in transmission systems to support 60,000 MW of wind turbines that can produce 170 TWh in 2014. 


The $25 billion would have been much greater, but for the use of existing spare transmission capacity. That spare capacity has been used up and the heavy lifting in terms of investment in augmented onshore and entirely-new offshore transmission systems is about to happen. 


As it took about $25 billion for transmission investments for the first 170 TWh/yr production level, future wind energy increments of 170 TWh will require at least $50 billion of transmission investments each. The above New England and Ireland examples show about 33% of total capital costs (wind turbines + transmission systems) is for transmission systems.


An ADDITIONAL energy production of 1,000 – 170 = 830 TWh/yr will require at least 830/170 x $50 billion =  $244 billion to be invested by 2050 just for the HVDC and HVAC transmission system build-outs, for example, to transmit wind energy from west of Chicago and the Atlantic Ocean to population centers.


Netherlands-Norway Example: There exists a 580 km-long (363 miles), underwater, HVDC line from the northern tip of Holland to the southern tip of Norway; capacity, 700 MW; voltage, 900,000 V; cable resistance at 50 degrees C, 29 ohm; cable losses at rated load, 2.5%; capital cost, 600 million euro ($780 million); in service 6 May 2008; 780/363 = $2.15 million/mile, or 780/700 = $1.11 million/MW; a second line is planned.


NOTE: Comparing the above New England Example No. 2 and the Netherlands-Norway Example, the onshore HVDC cost/mile is about 3.4 times the offshore cost/mile.


Sweden Example: HVDC underground cable, plus VSC systems; 1,440 MW (2 x 720 MW) 300kV; ordered by Svenska Kraftnät, the national grid operator; completion in 2014.


– ABB HVDC cable, 1440 MW (2 x 720 MW) 300kV, 125 miles; turnkey cost $160 million ($1.28 million/mile)

– Alstom Grid’s MaxSineTM Voltage Source Converters (VSC); turnkey cost $320 million


For 125 miles total cost $160 + $320 = $480 million, or $3.7 million/mile

For 200 miles total cost $568 million, or $2.84 million/mile

For 250 miles total cost $632 million, or $2.5 million/mile

For 400 miles total cost $824 million, or $2.1 million/mile


Western Interconnection Example: The NREL studied a wind energy increase from 38,055 GWh (4.3%, CF 0.26) in 2012 to 292,050 GWh (33%, CF 0.26) on the Western Interconnection by 2050.


The capital cost for just the HVDC and HVAC transmission system build-outs will be

(292,050 – 38,055)/170,000 x $50 billion = $75 billion; see above New England examples. 


Based on the above examples, for the NREL study titled “The Western Wind and Solar Integration Study Phase 2”, issued in 2012, to claim transmission system capital costs to go from 4.3% to 33% wind energy will be “minor” is a high order of obfuscation and deception of the public and legislators.




The MISO grid has more than 11,000 MW of wind CAPACITY on its grid, but that capacity produces about 8% of annual energy on MISO’s grid. For that level, OECD calculates about $12/MWh for the below cost items:


1) Balancing: 


Wind energy balancing by cycling generating units requiring: 


– increased cold starts and stops. 

– increased warm starts and stops. 

– increased synchronous operation (3,600 rpm) in regulating mode 

– increased ramping up and down while operating at part-load. 


All four cause increased fuel consumption and increased wear and tear of equipment, just as would be the case with a car. 


2) Grid Level:


– the costs of connecting wind turbines to grid. 

– grid reinforcement and extension. 

– the cost of energy losses to transmit the energy from wind turbines in remote locations to end users in population centers; such losses will be significant if transmitting from west of Chicago to the East Coast, as envisioned by the NREL.


3) System Level:


– the costs of back-up (adequacy), i.e., keeping almost all EXISTING generators fueled, staffed, and in good working order to provide energy when wind energy is minimal, about 30% of the hours of the year in NE, about 10 – 15% of the hours of the year west of Chicago. 

– the costs of capacity payments, to offset the hit to the economics of existing generators, as these units will be producing less kWh/yr, but still are needed when wind energy is minimal. With less kWh/yr produced, the cost of each kWh must increase to cover fixed costs, but that cost will often exceed the grid spot price!


According to the OECD report, the cost is about $5/MWh for item 1 and $7/MWh for items 2 and 3, for a total of about $12/MWh at 8% annual wind energy.

Note: None of these costs are charged to wind turbine owners.


Because of the low annual wind energy percent on the US grid, and the noise in the data, and almost nothing being measured, unverifiable claims can be made in impressive-looking NREL, et al, studies regarding fuel consumption, CO2 emissions reduction and cost impacts of wind energy.


At 10 – 20% annual wind energy on the grid, i.e., when MISO and ERCOT would each have about 20,000 MW on their grids, the above three items would be much greater in magnitude, and would have much greater costs, and the CO2 emissions reduction effectiveness would be much less, as was determined from the 1/4-hour real-time operating data of the Irish grid at 17% annual wind energy. See below Wheatley paper. The US, and many other countries, just have not yet gotten to that cost and ineffectiveness stage.


ERCOT has spent about $7 billion on several thousand miles of transmission lines to extend the grid from the about 10,000 MW of wind turbines (capital cost about $20 billion) in West Texas (Panhandle) to the population centers in Mid Texas, i.e., about 25% of the total capital cost of wind turbines + transmission. This percentage is within the typical range of 20 – 35 percent, as shown by several examples in this article.


Those costs were socialized via rate schedules, i.e., charged to rate payers (a surcharge of about $5/month for households), not to wind turbine owners. See above item 2.


Also, ERCOT encouraged private investments in OCGTs and CCGTs to augment the quicker-ramping capacity on the grid (ERCOT’s older coal plants were not quick enough), plus investments to implement other grid operation changes; the levelized costs are mostly socialized via rate schedules. See above item 3.

Wind energy promoters use the red-herring claim, “the US grid is aging, and these investments needed to be made anyway, so why charge them to wind turbine owners”, but to build-out wind turbines in remote areas with few people and transmit the energy 500 – 1,000 miles to population centers clearly is mainly for the benefit of wind turbine owners.


The Pickens Plan: T. Boone Pickens planned to build 4,000 MW of wind turbines in West Texas (The Panhandle), and wanted the state to provide about 500 miles of transmission to population centers in Mid Texas; the Pickens Plan.


He may not have had enough friends in state government, because the state did not agree. Pickens got out of the wind business and lost about a billion dollars. He knew without the free transmission, his project was dead in the water.


Subsequently, the federal government increased the wind energy subsidies, the pressure of lobbyists representing multi-millionaires with tax shelters became much stronger, and the state government did build the transmission systems, too late for Pickens, but in time to benefit other wind turbine owners, and make their tax shelters pay handsomely; the costs were charged to rate payers, not to wind turbine owners.



MISO’s energy sources are: Coal 48%, Gas/Oil 32%, Nuclear 6%, Wind 8%, Other renewables 6%.


On November 29, 2013, at 6 PM, wind energy was 6,000 MW; at 11 PM  8,312 MW; at 1 PM  1,602 MW, and remained at that level until 5:30 PM, while normal daily demand was increasing to its daily late-afternoon/early-evening peak, a clear example of wind energy being out of step with demand. As wind energy decreased, OTHER generators (coal and gas/oil) made up for the partially-predictable lack of wind energy, PLUS provided energy for the highly-predictable daily peak demand. 


There likely were some impacts on fuel consumption and CO2 emissions due to changes in part-load-ramping operation, start/stop operation, synchronous and stationary standby operation, to accommodate wind energy to the grid, but as little, or nothing, is measured in real-time, every 1/4 hour, any statements regarding fuel consumption and CO2 emission impacts are not verifiable.




The MISO grid will be used as an example to demonstrate the need for capacity payments. The NREL claims 33% wind and solar energy is feasible in its Phase 2 of the Western Wind and Solar Integration Study (WWSIS-2). As the MISO grid area has an abundance of good winds, but somewhat meager insolation, this exercise assumes 33% wind energy for the MISO grid.


MISO wo/wind energy: Coal 52%, Gas/Oil 36%, Nuclear 6%, Wind 0%, Other renewables 6%

MISO w/8% wind energy: Coal 48%, Gas/Oil 32%, Nuclear 6%, Wind 8%, Other renewables 6%*

MISO w/33% wind energy: Coal 35%, Gas/Oil 20%, Nuclear 6%, Wind 33%, Other renewables 6%

* The current condition.


Big Production Decrease: 

Assume capacity factor of coal plants wo/wind energy = 0.85, then w/32% wind energy the CF = 35/52 x 0.85 = 0.572, an energy production decrease of (0.85 – 0.572)/0.85 = 32.7% due to wind energy.


Small Cost Decrease:

Assume cost fractions of coal plants wo/wind energy: O&M fixed 0.65 + O&M variable 0.30 + Capital 0.5 = 1.00

Assume cost fractions of coal plants w/32% wind energy: O&M fixed 0.65 + O&M variable 35/52 x 0.30 = 0.202 + Capital 0.5 = 0.902, a cost decrease of 9.8% due to wind energy.


A big production decrease and just a small cost decrease spells financial disaster for the coal plants, as would be the case for the gas plants. Wind energy cannot function on the grid without the balancing and backup performed by coal and gas plants. A conundrum!!


Almost all EXISTING coal and gas plants need to be fueled, staffed, and kept in good working order to provide energy when wind energy is minimal, about 30% of the hours of the year in New England, about 10 – 15% of the hours of the year west of Chicago. i.e., absent economically-viable, utility-scale energy storage (not yet invented), nearly all existing coal and gas plants are needed to ensure continuous electric service, as required by a modern society.


The remedy is capacity payments to make ”whole” the owners of the coal and gas plants; these payments likely will be socialized via the rate schedules, not charged to wind turbine owners.




Note that the effect of the PTC is not included in the above ATI calculations. 


The PTC has been extended for one year by Congress and the President, but that one year extension means 10 years of PTC subsidies going to wind turbine plant owners who have begun construction of their turbines in calendar year 2013. 


The PTC provides owners with 2.3 c/kWh that the wind turbines generate over the next ten years, which is worth about 3.4 c/kWh in pre-tax income, as the PTC serves to reduce taxes dollar for dollar. The US Congress Joint Committee on Taxation estimates that the innocent-sounding, “one year” extension will cost American taxpayers over $12 billion over 10 years, for wind turbines with a construction start (not a service start) during 2013.




Various wind energy promoters, such as the AWEA, NREL, et al, maintain integrating variable wind energy to the grid is similar to the minute-by-minute demand variations grid operators have had to deal with for decades. It is clear from the below report, this is not the case.


The report, dd November 2013, was jointly prepared by the North American Electric Reliability Corporation and the California Independent System Operator Corporation.



According to the EIA, the levelized cost of energy from an:


– advanced NG combined cycle plant is $65.6/MWh

– advanced coal plant is $123/MWh

– nuclear plant is $108.4/MWh 


The assertion made by the AWEA, et al, wind energy is becoming cost competitive with energy from other sources, the holy grail of grid parity, is not the case, based on the more-inclusive levelized cost estimates in the Taylor/Tanton report.




Wind turbine plant energy densities are less than 2 W/m2, as measured at the wind turbine, less due to energy losses to transmit the energy to the user. Here is an offshore example.


Offshore Example: The Anholt offshore wind power plant has 111 Siemens wind turbines, 3.6 MW each, for a total of about 400 MW, on 88 km2, 14 meter deep water, capital cost $1.65 billion; inaugurated on September 3, 2013; energy density = 400 MW x CF 0.40/88 km2 = about 1.82 W/m2; the CF of 0.40 as measured at the wind turbine is assumed, less due to energy losses to transmit energy to the user.


Onshore Example West of Chicago: Wind turbine plants west of Chicago have an average CF of about 0.36, as measured at the wind turbine i.e., the energy density is about 0.36/0.40 x 1.82 = 1.64 W/m2.




According to Forbes, a power company in South Carolina is investing about $11 billion to construct two 1,100 MW nuclear reactors on about 1,000 acres, or 1.56 sq miles. Production = 2 x 1,100 MW x 8,760 hr/yr x CF 0.9 = 17,344,800 MWh/yr.


Wind turbine capacity west of Chicago required to produce the same quantity of energy: 17,344,800 MWh/yr/(8,760 hr/yr x CF 0.36) = 5,500 MW.


About 1,850 wind turbines, 3 MW each, 459-ft tall, 373-ft diameter rotors, CF 0.36, properly spaced to minimize airflow interference, would be required to produce the same quantity of energy, but it would be VARIABLE energy requiring OTHER generators to be more hours in inefficient part-load-ramping mode for back-up/balancing the wind energy, using more fuel/kWh and emitting more CO2/kWh, thereby partially offsetting what wind energy was meant to reduce. 


Land area required = 5,500,000,000 W/(1.64 W/m2) x 1 acre/4,047 m2 = 828,678 acres, or 1,295 square miles. The land can be used for agriculture, but any people living within 1.25 miles, or 2 km, from such wind turbines will find their quality of life, health and property values adversely impacted. Animals, especially birds and bats, will also be adversely impacted. See URLs.



Duke Energy Renewables, Inc. will pay $1 million in fines and restitution for unlawfully killing golden eagles and other threatened birds with its wind turbines, the Department of Justice announced Friday in its first criminal enforcement of the Migratory Bird Treaty Act.


Duke Energy Renewables Inc., a subsidiary of North Carolina-based Duke Energy Corp., pled guilty to violating the federal law that protects hundreds of bird species.


The company admitted killing 14 golden eagles and 149 other protected birds, including hawks, blackbirds, larks, wrens and sparrows, at two sites in Converse County, Wyo., from 2009 to 2013.


The remedy is operational curtailments, which will reduce capacity factors and increase wind energy costs, or lobby the government to get “lawful” bird-kill permits. Some companies will do anything to “fight global warming”.


Breaking News: Their lobbying was successful. Killing birds is now legal!! Who would have thought.




The EIA periodically publishes a table of levelized costs of various sources of energy. The EIA is comparing NEW plants, but the cost comparisons are flawed, because applying federal tax rates, depreciation schedules, and not counting various hidden and not-so-hidden cost impacts of variable wind energy, affects the values in the table. This is an irrational approach regarding comparing the costs of NEW plants.


There should be no problem for the EIA to use only capital cost estimates and only O+M cost estimates for NEW plants, and then compare levelized costs of new plant against new plant, without applying tax rates, etc.; it would simplify the EIA efforts and present a more realistic economic picture.


But there are various hidden and not-so-hidden costs, due to wind energy being on the grid, and due to gas and coal-fired generators being “paired” with wind energy, that the EIA does not identify nor quantify. These costs are being socialized via rate schedules, because it would be “unfair” to burden wind turbine owners with these costs, as they had made no provision for them in their tax-shelter spreadsheets.


The Taylor/Tanton report examined the EIA levelized cost methodology and quantified these costs. The AWEA does not want these costs known to the general public and legislators, as they would be casting a bad light on wind energy.


For example: The US has widely varying CFs for solar systems, because of insolation differences. Why not have a graph showing levelized cost vs CF? The same for wind turbine plants.


Here in New England, the CF for single-axis, properly-oriented PV solar systems is about 0.147, but because roofs are not facing due south, and are not at the correct angle, and the panels are aging (Chinese panels were found to age faster), covered with shadows, dust, snow and ice, the REAL WORLD CF is about 0.125, 18% less. The corresponding German numbers are 0.12 and 0.10. 


Yet, the CF numbers in the EIA table imply much greater PV solar energy production, as if New England conditions do not exist; an “official” method of fooling, befuddling the public, including legislators, etc.


Here in New England, ridge line construction costs of wind turbine plants are about $2,600/kW, (excluding transmission system build-out costs, etc.) and up, and O+M costs are about 2 times those in Kansas, while winds are just average, even on ridge lines. As a result, CFs are about 0.25 in the Northeast, but not anywhere near the 0.32 or better promised during permit hearings. 


Here is an article showing wind turbine CFs not being anywhere near promised values to get permits. Please read it.




According to the Taylor/Tanton report, there are numerous hidden costs to wind power, including the cost of back-up power, the cost of extra transmission, and the cost of favorable tax benefits. And, the assumption of a 30-year life used in government calculations for wind power is optimistic, based on reports from European countries regarding the useful service lives of their wind turbines.


Including these hidden costs in calculating the cost of wind energy increases its cost by a factor of 1.5 or 2, depending on the power system that is used as back-up. Taylor/Tanton calculates

ratepayers are paying an extra $8.5 to $10 billion a year for wind energy compared to natural gas-fired generation, and this will only increase as more capacity is added.


Add to this the more than $12 billion that the American taxpayer is paying for the ‘one-year’ extension for the PTC, and one can see that the wind industry is a boondoggle at the expense of taxpayers and ratepayers, that is, slowly but surely, making the US economy less competitive.


The US economy is beset with a vast array of such wasteful, marginally effective programs, which, collectively, act as a wet blanket on the economy, preventing it from growing more rapidly and raising living standards, except of the few million well-connected, catered-to, households at the top. 


As a result, the Federal Reserve has to provide $85 billion/MONTH of credit to the federal government and banks to keep the present economy afloat, a.k.a. quantitative easing, or QE. The credit is created out of thin air, totaling about $3 trillion since 2008, and counting.


Europe and Japan are stagnating, largely because they also are afflicted by the same maladies and their central banks are similarly “pro-active”. 




Wall Street Journal, Renewable-Energy Tax Breaks Pass Despite Headwind, January 1, 2013,


American Tradition Institute, The Hidden Costs of Wind Electricity, December 2012,


Energy Information Administration, Levelized Cost of New Generation Resources in the Annual Energy Outlook 2012, July 12, 2012,


The Hill, Issa takes aim at revised wind credit, January 2, 2013,


Forbes, Why It’s the End of the Line for Wind Power, December 21, 2012,


Energy Tribune, Wind Turbines ‘Only Lasting For Half As Long As Previously Thought’, January 2, 2013,


OECD Report on Wind Energy Costs


Energy From Wind Turbines Actually Less Than Estimated?


Wind Energy CO2 Emission Reduction Less than Claimed

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Roger Faulkner's picture
Roger Faulkner on Dec 27, 2013

You are comparing dissimilar things. Transmission lines cost $millions per mile, at least.

Bas Gresnigt's picture
Bas Gresnigt on Dec 27, 2013


Europeans are paying double to put their solar generation in their own cloudy towns, instead of across the border in the desert
There is a desert project here. But it doesn’t start because of the political instability in the desert. I estimate that it will take ~30 years before it is stable enough to do that investment there.

Since the new NPP that UK government wants, nuclear is off here. The figures are so bad (~75% of all costs during the life time of the NPP have to be subsidized), that everybody looses all appetite.
Even offshore wind + (pumped) storage is much cheaper!

We in NL don’t like it either, as we are in the fire line if something like Fukushima happens at Hinckley. The prevailing winds go into our direction. And history shows chance is considerable.

Schalk Cloete's picture
Schalk Cloete on Dec 27, 2013

A few points:

Firstly, any article by Mark Jacobson is guaranteed to contain a renewables-friendly message and needs to be critically reviewed. Put “critique mark jacobson” into Google to understand this point. 

I could not spend much time on this paper, but three things immediately jumped out. Firstly, the study is based on the Central US (a.k.a the Saudi Arabia of Wind). If one extrapolated energy production statistics from Saudi Arabia to guage the potential of fossil fuels, it would obviously give a very skewed representation of reality. Same thing with this paper. 

Secondly, very high capacity factors were used, even for the Saudi Arabia of wind. The paper uses 45% in its calculations, but real-world statistics in the US interior show an average capacity factor of about 38% (which is still very good). I actually like wind in the central US, but you can be sure that, if the authors considered the global average wind capacity factor (about 23%), the conclusions would be very different.

Thirdly, the 33% of power at a reliability of a coal plant is based on the entire downtime (both planned and unplanned). Since long-term planning for wind downtime is impossible, wind reliability should be compared to fossil plant reliability measured by the percentage of unplanned downtime. Generally, a fossil plant only experiences about 5% unplanned downtime that requires shutdown within 12 hours. Based on the generation-duration curve in the paper, this criterion would justify about 15% of the yearly wind power at the same reliability as a coal plant. 

An important implication for the supergrid idea from this paper is the rapid deceleration in the benefit of increasing the number of interconnected wind farms. This strong trend of diminishing returns will cause the costs of increasing interconnection to start outweighing the benefits much sooner than advocates would want. And, as Willem often points out, the costs (and NIMBY concerns) facing the supergrid idea are very large. 

So, in conclusion, the paper seems to have found that, for one of the best locations for wind power on earth (further enhanced by over-optimistic capacity factors), wind can close down one coal plant for every seven coal-plant equivalents of power it produces. In addition, the other side of the coin – power peaks – must also be considered. The generation-duration curve in the paper shows that the wind farms will produce 10-15 times the amount of power that can be considered as baseload for about 25% of the time. Thus, for every baseload plant that can be closed by wind (in the most ideal case), 10-15 load following plants are needed to balance the intermittent spikes. 

Roger Faulkner's picture
Roger Faulkner on Dec 27, 2013

I have great frustration over the fact that burial of transmission ios what the public wants, yet we (DOE, EPRI, EuropeanEnergy Commission) are doing nothing to move that forward. Underground cables are nice, and very expensive, but not at all up to the task of burying a supergrid.

There is a cost crossover at high capacity, in which replacing two parallel overhead lines with one underground line is less expensive, but one needs much higher capacity than cables can deliver. Elpipes are my creative solution to that, but the response from utilities is not very welcoming. 

Gary Tulie's picture
Gary Tulie on Dec 27, 2013

A lot of the cost assumptions re balancing costs vary quite dramatically according to the mix of electricity sources in the region. 

In areas with high levels of dam based hydro capacity, substantial wind capacity can also be installed with minimal adverse balancing costs.


When you have hydro-dams it is rarely possible to run the hydro plant constantly at full capacity as this would quickly run down the dam levels. This being the case, intermittent renewables paired with hydro actually act synergistically to have a much higher combined reliable capacity than either technology operating alone.

Even with fossil fuel backup, factors such as the capacity of intermittant power sources installed, the mix of such sources, and the quality / reliability of forecasting of wind / solar capacity are all very important as is the availability of demand response.

– for example, the degree of spinning reserve required can vary according to factors such as how much demand variation has to be accommodated, how large a variation from forecast wind / solar power output might occur at a particular time, and how much demand response is available to the grid operator ( a water utility might need to distribute water between supply reservoirs at some time within a 7 day period rather than at a particular time, and so is able to time their pumping operations to take advantage of windy or sunny hours, and throttle their pumps as if they were spinning reserve.

Taking all of this into account, along with local wholesale prices, the best sites for wind power may not be the windiest sites, but rather could be slightly less windy areas near large hydro facilities, or places with large dispachable loads.

Bas Gresnigt's picture
Bas Gresnigt on Dec 27, 2013


Those lines were not really urgent yet.
But they become really urgent in a few years.
So this summer Merkel installed a new law that should solve long delays due to NIMBY.

I doubt that there is a budget problem.
They assume grid expansion will cost thousand billion euro. 

Bas Gresnigt's picture
Bas Gresnigt on Dec 27, 2013


Mankind has to develop itself further in order to survive. And that is only possible with enough intelligence. So we can develop space ships much bigger than huge ocean cruise ships (so they become comfortable “villages”)  and travel with near light speed to other planets, etc.

Clayton Handleman's picture
Clayton Handleman on Dec 28, 2013

Willem, you posted the following:

“The EIA, NREL and grid operators consider wind energy having ZERO dispatch value.”

I asked you for the link, your reply was:

“It does not matter what the EIA or NREL think.”

If it doesn’t matter what they think then why did you bring it up? 

If it does matter what they think then please support your comment that would seem to be at odds with the recent work that I have seen NREL produce.

Finally, if you are in error then please retract the attribution to NREL if it is not factually representing their position.


Clayton Handleman's picture
Clayton Handleman on Dec 28, 2013

I find it fascinating that you have the ability on one hand to contemplate the feasibility of reducing the worlds population by a factor of 8 but the idea of renewable energy is inconceivable to you even when all of the technology exists to do it.  And added to that solar, wind and storage are all on rapidly declining learning curves and we are learning at an ever accelerating rate, how to interconnect out world with intelligent systems. 

I will stick with the renewables problem as it seems orders of magnitude easier to solve.

Clayton Handleman's picture
Clayton Handleman on Dec 28, 2013

Thanks for the reference.  We could both mine it pretty extensively to support our points.  It is easy to mix up the what if case with the what is case.  In 2012 you are right about the capacity weighted capacity factor being closer to 38%.  However there were a significant number of projects that fell in the range of 40% – 50% during 2012 offering a likely preview of coming attractions. 

The article pointed out that technology is continuing to improve and that non-ideal siting is at cause for the stagnation of CF not the technology.  I think it is reasonable to assume that siting issues are related to transmission access.  If we can get the high capacity lines out to the areas with the best wind there appears to be substantial headroom to improve the fleet average capacity factor.  Increases in CF reduce all of the costs that you and Willem are talking about.  Transmission line utilization and efficiency improves, requirements for backup and peaking are reduced. 

Regarding the study I referenced.  The area of study was relatively small and the meteorological conditions are likely correlated.  The idea of the Supergrid is to connect decorrelated areas to futher bring up the baseload “floor” and further smooth intermittency.  And while you suggest that their values are too high, I think yours are on the low side.  So split the difference and at the end of the day their point about aggretating sources is still valid and valuable.  This has been looked at further here and data from across the country is combined here.  Page 196 of this study provides a sense of the scale required to decorrelate sources.  It is pretty clear that as the scale is expanded and you move into decorrelated regions that you get a better and better behaved aggregate wind resource. 

I think it looks promising and yes the economics are debatable all day.  However unless one factors in the externalities, just waiving hands, saying CCS is going to be cheap – when it isn’t even out of the lab, or pay no attention to the 400 mountains and counting that have been obliterated along with their water shed services while mining coal – I don’t feel very convinced that that alternative is really monetizing the costs in such a way that a pure market analysis is solving the societal problem in the way that best serves society.


Gary Tulie's picture
Gary Tulie on Dec 28, 2013

As far as I know, hydro plant is generally designed with more generation capacity than can be continuously used – i.e. constrained by the amount of water available, so that it is usually possible to adjust the capacity used in counterpoint wind / solar resource without losing out on hydro generation. This being the case, hydro designed in this way is ideal for balancing intermittent power sources.  

Clayton Handleman's picture
Clayton Handleman on Dec 28, 2013

Willem, I had not heard of this.  Could you provide a resource to support your contention that Norway is curtailing hydropower and that it is related to backing up windpower? 

Could you provide some sense of what percentage of the hydro resource is being curtailed?  And in absolute terms, what is the trade-off.  In other words, how much additional wind energy does this enable?

For example, if they curtail 50 MWhr but it enables the addition of 500 MWhr of wind and the cost is relatively low and it avoids the addition of a fossil fuel plant then that could be good.  If it is the other way around then not so good.  I would be very interested in a source that provided some clarification.  Thanks


Gary Tulie's picture
Gary Tulie on Dec 28, 2013

To clarify my background, I hold an MSc in Renewable Energy Systems. 

Regarding your assertions above, if annual hydro output were to be curtailed to make room for wind, or solar power this would make no sence at all as the effective cost of running all the generators is the same at that time as not running any of them – so that the marginal cost of the electricity is effectively zero. I would be very surprised therefore if the hydro plants were curtailed when water is overflowing the dams.

In 2009, Norway had 30.46GW of hydro power capacity which generated 141TWh of electricity. This works out at a capacity factor of 54%. 

Larger hydro plants generally have several generators so that it is nearly always possible to adjust the number of generators in use in such a way as to achieve near optimal generation efficiency from the units which are running, so it is entirely possible to run generation intermittently either without affecting generator efficiency, or with only a very modest change in efficiency. 

In situations where hydro plant is run with low water levels, the effective head of the hydro plant is reduced cutting its effective capacity. By using wind power when available, there will be times when water levels which would otherwise be low can be allowed to build behind the hydro dam increasing the total annual generation even whilst some generators may be operating for fewer hours. 

May I ask William, what is your background?

Do you have any commercial interests which might be relevant to your post and to the strong anti-wind views which you are expressing?

Clayton Handleman's picture
Clayton Handleman on Dec 29, 2013

Willem, I think you missed my point.  In response to your statement:


“Reservoirs remain too full, water is spilled over dams that could be producing low-cost, zero-CO2 emitting energy.

Low-cost hydro plants are curtailed to have variable/troublesome, intermittent, grid-destabilizing, high-cost wind energy on the grid.”


I did some research to find out more because it surprised me and left me curious.  Not finding anything to support your claim I requested that you point me to a reference.  I also provided a HYPOTHETICAL example to illustrate why your contention seemed surprising and as an attempt to clarify sufficiently that you could address my specific question.

In the same thread you responded to Gary – “that does not mean they should be misused for balancing wind energy, even though they are the cleanest, lowest-cost way to integrate wind energy to the grid, i.e., it is a negative economically and environmentally, if wind energy causes less production by hydro plants.” 

This is a very strange contention and again I wonder if you would post a credible reference that backs up your contention.  I do not see how wind energy causes less production by hydro and in fact, Gary suggests reasoning that wind energy combined with hydro may offer higher energy from the hydro source with wind than without it.  This is due to the ability to keep the water at a higher level increasing head pressure and therefore increasing kwhr / gallon. 

You then go on to state the following:

“When Denmark sees strong winds, mostly at night when prices are low, almost all its wind energy is exported to Norway and Sweden.

When Denmark sees little wind, as on warm summer days when prices are high, it usually imports energy from Norway and Sweden.”

And then suggest that this is a bad thing because it brings the price of electricity down.  How is that a bad thing?  Is there an approach that produces comparable electricity with the same or less carbon production. 

You then make the following comment:  “Because Denmark, Norway, Sweden, Finland are part of NorPool, it is not likely fossil plants will be reducing their outputs due to wind energy, as Denmark never developed adequate flexibiltity for balancing, because the nearby hydro plants were soooooo convenient for much lower-cost balancing than adding CCGTs, etc.”

Isn’t that the whole point, that Denmark has demonstrated high penetration of wind without resorting to fossil fuels.  In other words, the hydro / wind symbiosis is enabling Norway and Denmark to avoid even getting into the fossil fuel business.  And then, if Denmark has further excess you say they will have to export to other European countries and displace fossil fuel power.  Isn’t that a good thing? 

You have commented on the expense of wind, but referring back to a resource you provided me in an earlier comment, wind is less expensive than all sources other than natural CCGT in the US.  However natural gas is more expensive in Europe so wind and CCGT are probably pretty close.  And, of course, if wind is displacing gas then it is saving carbon.  Most fossil fuel zeolots do everything they can to avoid monetizing carbon, playing the game that since it is not clearly priced, we will just leave it out of the discussion. 

You go on to suggest that wind is problematic environmentally.

“A more-costly, less- effective CO2 reduction source replacing a much less-costly, much more-effective CO2 reduction source is NOT ideal for economic, and environmental, and visually/noise reasons.”

I am unclear how wind combined with hydro is not a highly effective carbon reduction approach.  First, wind energy is very environmentally friendly.  It allows intermittency to be addressed without natural gas turbines.  What you are saying is nonsensical and I can only think you must be confusing the carbon emissions that can result when combining wind with fossil fuel backup.  The use of hydro avoids carbon emissions.

“Wind energy should be use to reduce FOSSIL FUEL plant production.” 

You are implying that wind is replacing hydro.  I keep hoping you will post a source that validates that but at this point I am pretty skeptical.  The hydro is used to enable higher penetration of wind, not as a replacement but as a sybiotic partner.  As you know the real question is MWhrs produced by non carbon sources.  It looks like the Norway / Denmark partnership is a great case study showing how grid expansion can offer a carbon reducing path. 



Schalk Cloete's picture
Schalk Cloete on Dec 29, 2013

Even though the US has great wind resources, there are a similar number of projects showing capacity factors below the global average of 23% than in the 40-50% range that you see as a projection to the future. Using positive exceptions as a basis for future projection is a rather misleading habit of RE activists. 

Most recent wind turbine innovation has been targeted at increasing reliability (CF) in regions with poorer wind resources. These are the areas where wind PPAs are set at double the wholesale price even when the PTC is included and intermittency costs are externalized to the grid. It should also be mentioned that this innovation can perhaps be better described as a trade-off optimization exercise because it has mostly been done by oversizing turbines relative to the generator. 

Regarding the supergrid idea, aside from the technical aspects already discussed, I see many additional problems with pursuing such a major and costly undertaking purely to facilitate the expansion of mature technology that will remain subsidy-dependent for the foreseeable future. Resistance will come from many groups who oppose the subsidized expansion of intermittent renewables and just as many NIMBY groups opposing both the turbines and the transmission lines. This will add a lot of additional complexity on top of this already highly technically complex endeavor, thereby translating to very slow and inefficient execution.

Which brings us back to my central point: subsidized deployment of intermittent renewables is the slowest and least cost-effective climate change mitigation mechanism. It is the polar opposite of the lowest-hanging fruit principle we should be employing in the delicate balance between climate targets and economic development. 

Gary Tulie's picture
Gary Tulie on Dec 29, 2013

The following paper from the Risoe Institute in Denmark may fit the bill

Forecasting as described in the paper is used by the markets to determine how much ramping capacity is required at any given time to back up wind generation on the Norpool markets. The quantity of ramping capacity made available is then adjusted according to the degree of confidence available regarding wind power output. i.e. When winds are steady and predictable with a high degree of confidence and low error bars, allocated ramping capacity is low. If a front is coming throug, and wind is subject to rapid change with poor predictive certainty, ramping capacity is increased in proportion to the error bars.

An alternative approach which I presented in my MSc paper is to schedule the lower bounds of the predicted wind power to be used normally on the grid, with remaining power scheduled to heat pumps on Denmark’s many district heating networks – storing heat in large hot water stores for dispatchable use to heating loads. This way, wind power effectively provides some or all of its own ramping capacity i.e. wind less than expected, turn off the heat pumps, more than expected, turn on more. This also allows for unexpectedly high or low power demand to be balanced by appropriate switching of heat pumps on the district heating networks. 

As a further advantage of this method, fuel use is also displaced on the district heating systems.

Bas Gresnigt's picture
Bas Gresnigt on Dec 29, 2013


Note that your NREL study under-estimated the role of PV (especially rooftop) with a factor 3-10.

Just compare with the situation in Germany: Now ~36GW PV versus ~31GW wind installed.
A few year ago wind capacity was twice that of PV!

PV expanding much faster than wind, because of the continued priced decrease.
And all predictions are that the price decrease will continue with ~8%/a as it did the last 35year, with fluctuations. Now also caused by (hopefully temporary) EU import restrictions / taxes on Chinese panels.

The nice thing is that PV-solar and wind compensate nice, as wind blows more through the night.
Further that solar production is fairly accurate predictable.

This should be included in your super grid estimations.

Gary Tulie's picture
Gary Tulie on Dec 29, 2013

Here is an article on the interaction of Danish wind and Norwegian hydro – primarily looking at the economic interactions and effects on spot market prices.

Bas Gresnigt's picture
Bas Gresnigt on Dec 30, 2013

And still ~90% of all Germans support the Energiewende  (opinion polls, supported by the election results of last September).
So it is not such a burden.

Clayton Handleman's picture
Clayton Handleman on Jan 1, 2014

“Note that your NREL study under-estimated the role of PV (especially rooftop) with a factor 3-10.”

Yup, I know it.  NREL also left V2G out of the study entirely.  Already with the current increase in EV, PEV and Hybrid sales and the resulting battery price reductions that is looking like a rather preposterous omission.  And that in just 5 years (they froze the data collection in 2009 if I recall). 

Yet some prolific commenters and posters on this board choose to attempt to discredit NREL as stary eyed promoters of renewable energy, rather than respectfully disagree.  I find it really undermines the discussion.  I think NREL has shown sufficient tendency to err on the side of conservative assumptions that it is hard for me to understand how one would paint them as a source intentionally overstating the case for renewables.  If one is going to suggest that something they publish is off target or exaggerated I would like to see them post backup to support their allegation of NREL’s error.  That would keep the quality of discussion much higher on the board.

Here is a post with a number of major studies of implimentation of high penetration renewables in the US fyi.  Most folks are still reluctant to build V2G into the discussion.  The naysayers look 2 – 5 years into the future and then stop there.  They seem to think, almost wish, that the technology will stall in 5 years and not improve in terms of cycle endurance, capacity and $/kWhr.  The learning curves for EV batteries are pretty immature but they look very positive and there is a building consensus that they are correct.  I think it is time to make reasonable assumptions about EV penetration and the impact of distributed storage.  That dramatically changes the discussion about the impact of intermittent renewables particularly when they are aggregated throughout the country.

Roger Faulkner's picture
Roger Faulkner on Jan 1, 2014

Great discussion!

My proposed supergrid will be based on underground transmission in elpipes. Overhead lines max out at ~5000 amps (5kA), cables at ~2kA, and elpipes can realistically go to 20kA. There’s nothing magic in that; it comes from using massive conductors. Everything faces some NIMBY in the US, but gas pipelines face a lot less than overhead transmission lines simply because they are not visible. This post explains the difference pretty well:

I make the argument linking the supergrid to renewables because it is convenient, and it is true that WITHOUT a supergrid, most renewables will never reach true cost parity…but a supergrid is economical even in the absence of renewable energy, based on cutting reserve margins, spinning reserve, and the total amount of generation needed to keep the lights on over an entire continent.

Clayton Handleman's picture
Clayton Handleman on Jan 1, 2014

Schalk, I guess you misunderstood my post.  I agree, if we don’t upgrade the grid then we will continue to flounder in the lower capacity factor area.  My premise was that IF we build the grid, we will be rewarded with the higher capacity factors that go a long way toward negating your arguements in opposition to grid upgrades.  I understand that your other arguement is that we cannot expand the grid due to NIMBY etc.  If coal companies can reduce 400 mountains and counting to rubble without being stopped by NIMBYs then surely we can run power lines through mostly rural areas.  It is worth pointing out that a lot of the transmission would be DC which takes FAR less real estate than even the 765 Vac.

You are right, to charactorize me as an optimist.  But I am not naive.  I watched naysayers that said we would NEVER see modules at $1.00 / Watt, much less nearly half that.  I have watched us go from 50kW turbines that needed an onsite repair crew to the massive 3, 4 5 even 7.5 MW machines whose down time is dramatically reduced and whose output is equivalent to about 150 of those early 50kW machines.  15 years ago smart grid was such a foreign concept that I rarely could find someone to intelligently converse with about it.  Now we are seeing the pieces coming together and it is being taken seriously.  At the end of the day, the most poorly monetized portion of the economics of electricity is the externalities having to do with climate change.  Fossil fuel activists won’t include in their discussions a reasonable $/kwhr figure for carbon.  They won’t even do strawman calcs with biased low-ball numbers.  Until they start including those numbers, I do not see how there can be a productive discussion.  We also should start doing LCOE of solar on the more realistic 30 – 50 year lifetime of the solar arrays. 

I favor a mechanism to let it get the details sorted out in an efficient marketplace and generate the extensive blossoming of technology to address the environmental tragedy that is unfolding.  We need to attack the problem on both the supply side and the demand side.  I think that the solution is a SuperSmart Grid with high frequency bidding.  On top of that there needs to be a market based monetization of carbon.  Cap and trade is my favored approach but the politicians seem unable to do their part with that one.  And finally, generators need to be required to offer fixed price contracts up to 20 years with no free pass on fuel variability.  They can set the price, but have to offer it.  As you know that would force monetization of the unpredictability of fossil fuel costs.  Fossil fuel activists conveniently leave predictability out of their calculations because they have forced that risk onto the ratepayer rather than providing the ratepayer an apples to apples product. 

Until there is an efficient market I feel that subsidies renewabes are recieving are far below the free ride that fossil fuel activists try to justify for themselves.  Fossil fuel proponents generally portray the primary justification for renewables subsidies as being to adjust the cost of renewables to create a skewed market in perpetuity.  As a rule they conveniently leave out what most renewables experts view as their most important function.  That is to ramp renewables down the learning curve until they are a mature industry (about $1.25 / Watt installed for PV).  It is worth pointing out that the subsidies have done much of what they were designed to do. The impact has been nothing short of staggering, exceeding even the most optimistic forcasts  from as recently as a decade ago. 

Many that support the outdated extraction based paradigm are content with the distorted market as long as it favors coal, nuclear and gas by exteralizing environmental damage, by forcing customers to eat the variable fuel cost rather than offering them pricing that monetizes its variability, by passing the cost of the catastrophic damages rider for nuclear onto the tax payer to name a few.  When drawn out to discuss externalities the extraction advocates deflect the discussion into the realm of the subjective or just change the subject to odd topics such as extreme population reduction.  Fossil fuel activists tend to get into elaborate quantitative discussions about how uncompetitive renewables are and leave out any quantative accounting of carbon or any pricing to monetize the eternal destruction of 100’s of square miles of high quality water sheds and biodiversity habitat.  As such the claims of dramatic differences in the costs of mature renewables vs extraction and combustion based generation are usually rather hollow.

Nobody really knows what a more efficient market such as that promised by the smart grid will bring.  So I will offer my admittedly subjective opinion.  I am confident that a supersmart grid that allows much more efficient monetization of all of the sources and sinks of electricity will more than pay for itself by making possible and nourishing, an ecosystem for innovation that will lead to solutions, some of which, may not yet have been thought of.   

I recall the Soviet state with their centrally planned economy.  They would look at our many stores and endless middlemen in our distribution systems and our advertising and they could not imagine how it could lead to lower prices and more choice.  Surely common sense dictated that it had to be more expensive.  They just could not understand that the investment in distribution infrastructure and freeing up the market to innovate and compete, led to an extraordinary level of motivation, activity and productivity and most important, to efficient markets.  I say build the market making infrastructure, monetize the externalities, stop subsidizing solar when it hits $1.25 / Watt and let the market work its magic.   

I do not agree with taking a snap shot of today and pretending that this is an efficient market, or that innovation is going to bring the grid to its knees, that intermittency cannot be solved.  And why should a residential customer pay for a grid that is of sufficient reliability to run a semiconductor fab.  Why not let the fab owner add that additional robustness at the site.  The advocates of minor tweaks to our century old grid spread reliability fears to homeowners.  But if those homeowners could save $500/year on their electric bill by accepting less reliability, mighten they just purchase a generator, or plan on powering the house with their Pluggable hybrid.  Why should we deny the market that diversity?  With a market driven approach these factors will resolve much more cost effectively.  I think many ignor power of learning curves, and may not have looked at the case of Germany to see the degree to which soft costs can be wrung out of the system. 

I am not going to pretend that I know what it is ultimately going to look like.  Your vision may be correct but lets create the ecosystem that generates an efficient market and then let it decide. 


Paul O's picture
Paul O on Jan 1, 2014

Quote…...” Wind energy should be use to reduce FOSSIL FUEL plant production.”

…….I Totally agree

Bas Gresnigt's picture
Bas Gresnigt on Jan 1, 2014

It seems you do not understand the wind-hydro situation in NW-Europe well.

You wrote: “<i>In the near future, Norway and Sweden will run out of hydro balancing capacity, and the regional balancing will need to be enhanced..</i>”.
Norway hast at least 10times unused mountain lake capacities that are suitable for pumped storage.
Those can be activated once connection and wind capactiy is enhanced.  

Statkraft, Norway’s utility, is seeking more connection capacity, so they can earn more money with their pumped storage capacity. The Netherlands, Germany and Denmark are planning new undersea cables to Norway. 
So there is no real limit.

That also explains why Denmark targets 50% wind energy in 2020.


Clayton Handleman's picture
Clayton Handleman on Jan 5, 2014

Much of this post appears to be motivated by a piece that you reference called the “Hidden Costs of Wind Electricity” which was sponsored by the conspicuously named American Tradition Institute.  They have since changed their name to The Energy and Environment Legal Institute.  Source Watch has an interesting piece on this group which includes a link to this memo developed by one of its fellows.  One quote from the memo is

"D) Cause subversion in message of industry so that it effectively becomes so bad no one wants to admit in public they are for it"

Where the “it” they refer to is the wind industry.  The memo is a PR roadmap written by a fellow from ATI.  That is not to say that their white paper doesn’t offer food for thought.  However, I think procede with caution. 

Conspicuously lacking from their analysis is any treatment of externalities.  Same with your analysis.  To be meaningful you need to include externalities or explain your reasoning for their omission.

Gary Tulie's picture
Gary Tulie on Jan 6, 2014

Pumped storage may be desirable, but is not essential to supply balancing services, just a standard hydro plant that can be throttled appropriately to match demand, and which has a power capacity great enough so that it always or nearly always operates with a slightly less than full dam. 

Bas Gresnigt's picture
Bas Gresnigt on Jan 6, 2014

Val Martin,
You wrote:”industrial wind farms are net comsumers of electricity”
So in Danmark wind turbines deliver ~35% of all electricity consumed. 
So Germany installed ~31GW of wind turbines (max. consumption in Germany is ~80GW).
So the scientists and grid operators and utilities in these countries are crazy…

There are huge detailed calculations and formulations regarding the yield of wind turbines, and combined wind turbine parks in the grid.

Clayton Handleman's picture
Clayton Handleman on Jan 6, 2014


I believe that the thrust of your article is that there are large market irregularities being caused by subsidies.  Of course the point of subsidies for renewables is to correct for the market that has long been tilted in favor of fossil fuel generators.  You say above that “I used the ATI article to illustrate the concept of hidden and not-so-hidden costs, and the effect of excessive subsidies regarding reducing costs so wind energy can be priced to market.”  So it would appear that you are cherry picking the “socialized” costs.  I am having difficulty understanding how my comment could be interpreted as an “ad hominem insinuation”.  The purpose was to point out that you left out many costs that people find to be pretty important.  In a post that is looking at “socialized costs” I think that it is a pretty odd omission to leave out the societal cost of BAU and to fail to consider at how we should address the inefficient market for electricity which does not monetize many of the costs, some of which may turn out to be extraordinarily large

You assert that the subsidized costs are “excessive” as if it is a forgone conclusion.  My position and that of many other professionals is that monetization of externalities is very unsettled and that they currently are under represented in the cost of fossil fuel generated electricity.  The reason for my comment was to point out that framing the discussion in a way that dismisses the inefficiency of the electricity market in integrating societal costs, is consistent with the biased perspective of organizations such as ATI. 

I actually found their report interesting and thought provoking.  However they, like AWEA have a constituency to represent and they need to be looked at through that lens.  The difference between ATI and AWEA is that AWEA does not try to pass themselves off as anything other than an industry trade group.  They make no secret of the fact that their agenda is to promote the wind industry.  ATI is clearly coming from a position that is biased toward fossil fuels but they try to pass themselves off as an objective think tank.  So yes, I called into question your source. 

I am quite comfortable with my comment.  I believe one of the major sources in your post is biased, I called you on it and provided references.  You have certainly called some of my sources into question, NREL for example, but without providing references to back your assertions of bias even when asked.  Those who live in glass houses . . .

Bas Gresnigt's picture
Bas Gresnigt on Jan 6, 2014


Your comparison regarding land use of nuclear versus wind is clearly wrong.

The land between the wind turbines is used for the usual (mostly agricultural) economic activities.
So you should count only the footprint of the wind turbines.

Using your figures then: 
Nuclear produces 4MWh/m2 per year.
Each 3MW turbine has a footprint of ~64m2. That delivers a production of 140MWh/m2.
So the wind turbine has ~30 times higher power density measured in land used.

Furthermore you used 3MW wind turbines which are out of date now (also here in NL).
The standard is now 6MW.
That enhances the power densitiy of the wind turbine further. 

Bas Gresnigt's picture
Bas Gresnigt on Jan 6, 2014

That is also the method they are used. E.g. in Denmark and Germany.

Bas Gresnigt's picture
Bas Gresnigt on Jan 6, 2014


Then you also should have been in the north of Norway.
Total empty, with lots of unused mountain lakes.

Regarding the pumped storage capacity, Statkraft rather simple converted existing hydro.
It is simply a matter of installing another turbine/electric (generator/motor) combination.
The story goes around that they simply could adapt existing hydro installation in such a way it can also be used for pumped storage.
Anyway they can handle all demand and are eager to do more.
Check their WEB-site and you see that they actually are demanding more pumped storage, as they can earn money with it (they hope).

It is dubious whether they will really earn money with it. The pumped storage facilities in Germany make a loss as the wholesale electricity price seldom passes $60/MWh! Prices are so low.
When the wind fails during the day, solar takes over now.

The important point is that all utilities see that the wind will become less one or two days ahead, so all power plants (nuclear, etc) arrange to be ready to generate more the moment the wind flaws. Because then whole sale price goes up, so they then can earn money.

The wholesale price is now very low when the wind blows and/or the sun shines. Mainly because old power plants and nuclear mis the flexibility to shut down temporary (nuclear only down to ~50%, old plants down to only ~25%).

All indications are that Germany will continue installing at least ~5GW/a solar+wind. That rate may even become ~10GW/a again the moment the grid problems are solved in 2018.
Then utilities will be glad they can close their nuclear plants as they will then generate losses.

Bas Gresnigt's picture
Bas Gresnigt on Jan 6, 2014


What Denmark is doing in its area is making the hydro plants of Sweden and Norway operate at less of a part-load, and at lesser efficiencies, i.e., more water per kWh. “
Denmark does nothing in Norway.
It has no utility or so in Norway.

Norway trade electricitiy to its own benefit.
Buying cheap (the moment the wind blows) and selling expensive (the moment the wind flaws).
And they want more interconnection capacity so they can earn more!

It has nothing to do with higher cost/KWh for their hydro plants.
Statkraft, the Norwegian utility, simply can earn far more money using the flexibility of their hydro (and pumped storage).

Bas Gresnigt's picture
Bas Gresnigt on Jan 6, 2014

“Reservoirs remain too full, water is spilled over dams that could be producing low-cost, zero-CO2 emitting energy. Low-cost hydro plants are curtailed to have variable/troublesome, intermittent, grid-destabilizing, high-cost wind energy on the grid.”

You can be assured that Statkraft is not so stupid that they buy electricity for ~$20/MWh and then have to throw it away (by spilling over the dam), so they make a big loss.
If a manager at Statkraft does that (more than once), I think he will be taken off his post or fired.

Joe Schiewe's picture
Joe Schiewe on Jul 16, 2015

Absolutely – I am a major advocate of stopping any new oversized power line and gas pipeline corridors.  They look horrible, limit the use of the land, lower adjacent property values, affect wildlife, change hydrology, disrupt fauna, and tend to uproot a lot of people.  I promote keeping our energy sources local. 


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