https://www.bloomberg.com/news/articles/2018-07-26/largest-u-s-wind-project-dealt-potentially-fatal-blow-in-texas

“Texas dealt a potential death blow to what would be the largest-ever U.S. wind farm: American Electric Power Co.’s $4.5 billion Wind Catcher project.”

Not really. If Warren Buffett and his big-money pals really think this is a boon, they can continue. They only have to accept all the risk, or at least a lot more of it. The hypocritical investors want to pay as they go with ratepayer money, years before any power is produced. If they are willing to pony up the funds themselves, the building approvals will mostly be clear sailing. (The powerline is still a problem. Significant oversight on the part of the investors, and obvious hubris.)

“American Electric’s proposal tapped a financial model that utilities have long used to build nuclear, coal- and natural gas-fired plants: by tacking costs — plus a profit — onto customers’ bills. The company asked regulators in four states for permission to use the strategy for a sprawling project…”

This isn’t quite true. Oklahoma utilities don’t earn a profit. It is a cost-basis monopoly. I’m not familiar with Texas, but it must be about the same. Sure, overall, our utilities make money, but it is tightly controlled and transparent. OG&E was going to build a second coal plant next to an existing one. It was in the plans a long time, and there was a significant amount of work to be done before OG&E would be passing costs to ratepayers. When the state-approved planned time came, cold-hearted Scott Meacham overstepped his office and launched a smear campaign against coal. Millions were instantly flushed down the drain, and Oklahoma is paying for it all in higher costs and more pain on the least among us. Our bats and birds are being slaughtered for it too. It is the fear that we will never be able to build more reliable coal plants that is causing us to engage in these risky and unreliable wind schemes.

These investors aren’t playing fair. They won’t take the risk. I mean, can’t Warren Buffett write a check for the full $4.5 billion today? It isn’t like they don’t have the money if they have the confidence they are advertising.

There is another tell. Why is Wind Catcher advertising with all these feel-good PR spots on radio and TV?

“American Electric’s Southwestern Electric Power has proposed owning 70 percent of the 2-gigawatt project. Arkansas and Louisiana already approved the plans. Oklahoma has yet to issue a final decision. The project includes a transmission line to take the power to Tulsa and into Texas, Arkansas, and Louisiana.”

Oklahoma is balking, and Texas refused. Note the share of risk. Texas has a full 70% and Oklahoma has most of the rest. Is it any wonder Arkansas and Louisiana approved? They share almost no risk regardless.

Note the blatant falsehood of 2GW. We can ignore the conflation of power with energy because the point remains. The hand-wavers point to 800 towers with 2.5-megawatt capacity turbines on them. 800 x 2.5 = 2,000, right? Sure, but how much does one typically get from a given wind turbine? Here is the fact: The transmission line is only being built for 600 megawatts!

https://newsok.com/article/5587106/oklahomas-corporation-commission-asks-public-service-co.-of-oklahoma-to-seek-settlement-on-its-wind-catcher-plan

If the 800 towers ever actually exist, and if 100% are running at peak capacity, then over two-thirds of the power will be dissipated and wasted because it cannot be carried on the transmission line. Of course, 100% capacity is practically impossible. An average efficiency of 30% is probably a little optimistic. It is probably optimistic to suppose all 800 towers will ever stand at the same time, for that matter.

If Wind Catcher is a good deal, the investors should stop trying to pass costs on to the public until power is feeding into the grid. If Wind Catcher is good, prove it. Prove me wrong. The saddest fact hasn’t even come up yet: Taxes.

The whole investment doesn’t work without Federal money and Federal and State capital gains tax credits. Most of Warren Buffett’s profit is associated with manipulating taxes and receiving tax money straight out of our pockets. Buffett has done this many times. He invests, he rakes in the taxes, and he bails before the maintenance costs start showing everyone there is no free lunch, not even free breezes.

At best, in 20 to 25 years, all 800 of the bird/bat-choppers will be decrepit and hazardous. Who is going to clean up the mess? Will the investors do it? Will they come back with all their profits and make right for the landowners and land users?

Over and over for over 3,000 years we have abandoned windmills. We will this time, too, and someone has to clean up the mess.

This is one history lesson I wish we could learn. A windmill is a very limited tool, and industrial scale electricity production is not a use for which it is suited.

Oklahoma, did Texas just push us off the tracks in front of the oncoming train? I think so. Are we going to rush right back in front of the locomotive?

Advertisements