Wind Farms Costly for Kansans
by: James M. Taylor
Managing Editor of Environment & Climate News
The Heartland Institute
Published: May 1, 2005
 
Wind farms proposed for the state of Kansas would take money out of citizens' pockets, harm the Kansas economy, and provide few if any environmental benefits, a new study finds.

The study, conducted by former New England Electric System Vice President Glenn Schleede and released on March 1, 2005, documents that Kansas consumers will pay higher taxes and higher electric bills if the state chooses to adopt wind power recommendations made by the Kansas Energy Council (KEC).

The KEC, in its Kansas Energy Report 2005, recommends Kansas bestow special privileges on the wind power industry, such as tax exemptions, direct cash subsidies, and a mandate that all Kansas citizens purchase a certain percentage of their power from large wind farms.

Flaws in KEC Report Noted
The Schleede study, Misplaced State Government Faith in "Wind Energy," begins with harsh criticism of the KEC, which was created by Executive Order in June 2004, for a lack of objectivity in its 2005 energy report.

According to Schleede, the KEC is not objective in its analysis because the group consists in large part of representatives of organizations that would benefit from an expansion of wind power in the state. "The KEC may be somewhat unique since representatives of various special interests that would benefit from adoption of the KEC's recommendations apparently were permitted to be members of the Council" (emphasis in original).

By comparison, the Schleede study is self-funded, and Schleede has no financial stake in the outcome of the wind power debate.

Schleede writes, "the KEC has been misled by false and misleading information about wind energy" provided by the wind industry and pro-wind advocacy groups. "These organizations have consistently overstated the environmental and energy benefits of wind energy and understated the environmental, energy reliability, and economic costs."

Wind Energy Potential Overstated
For example, the KEC asserts in its report, "Kansas' wind-energy potential ranks somewhere between first and third in the nation and is at least 10 times greater than the state's current electrical demand. ... Should Kansas or any of the Plains states choose, electricity from wind power could become another exportable resource."

"These oft-cited claims are simply not true," responds Schleede. "They incorrectly assume that a potential resource ... is an actual, practicable, marketable resource" (emphasis in original). "Wind blowing over Kansas and the Great Plains is not a practicable, marketable resource for producing electricity," Schleede observes.

Schleede's study notes wind turbines can harness only a small portion of the wind; wind that is too light or too strong cannot be harnessed at all. Expensive transmission lines would despoil the landscape to bring wind from ideal locations to population centers. Finally, wind power is intermittent, unpredictable, and less frequent during times when electricity demand is strongest, such as during hot, humid summer days.

According to Schleede, approximately 21,000 giant wind turbines would have to be constructed and placed in the state to supply Kansas's energy needs under ideal conditions--which are, he points out, rare. More frequently, conventional power plants would still have to be running in backup mode to provide energy when wind conditions were not ideal.

Wind Power Prohibitively Expensive
Wind farms cannot displace conventional power plants; they merely supplement them, the Schleede study noted. Kansas consumers would be saddled with the costs of new wind farms and still pay for the conventional power plants needed to protect against blackouts when the wind doesn't blow.

"Wind turbines cannot be counted on to provide reliable generating capacity whenever customers need electricity," reports Schleede. "In fact, electricity consumers will, in effect, end up paying twice; first for the electricity from wind and then for the reliable generating capacity needed to meet peak electricity demand."

Tax Breaks Motivate Builders
Tax avoidance and subsidy rather than meaningful power generation are frequently the primary motivation for building wind farms, notes Schleede. Tax breaks and subsidies are ultimately paid for by taxpayers and electricity consumers.

The wind industry receives a 1.8 cent federal subsidy for each kilowatt hour (kwh) of electricity it produces. The industry also is granted accelerated depreciation for federal tax purposes. Generous federal tax breaks for wind energy producers translate into substantial additional state tax breaks, because Kansas bases its state income determinations on federal calculations. Moreover, all wind power equipment has been granted full exemption from Kansas property taxes.

"On December 15, 2004," notes Schleede, "an official from the firm of Milbank, Tweed, Hadley & McCloy, LLP, pointed out to the American Bar Association's Renewable Energy Committee that 2/3 of the value of a wind energy project comes from two federal tax breaks."

Also, Schleede observes, "A September 22, 2004, report by Citizens for Tax Justice claims that the FPL Group [a wind energy firm] paid no federal income tax in 2002 or 2003 despite having profit of $2.2 billion during those years."

Even with generous subsidies and tax breaks, wind power remains more expensive to produce than coal, natural gas, and hydroelectric power. As a result, wind power currently constitutes less than 1 percent of U.S. power generation.

Money Blowing Away
The wind power industry often counters these facts by asserting that expanding the state's use of wind power will create new jobs and economic benefits. Those claims, the Schleede study demonstrates, are misleading.

During construction of wind power facilities, a limited number of temporary jobs are created. Most such jobs last no more than six months, and they are typically given to workers with special skills, often imported from other states. Far fewer permanent jobs are created, and many of these, too, go to workers imported from other states.

Weighing against these relatively few jobs is the income forfeited by Kansans to pay for the substantially higher-priced electricity. Such forfeited income lowers living standards and silently eliminates a great number of jobs that a higher living standard would create. Worse yet, Schleede's report notes, most of the income paid for the higher-priced electricity would go to companies based in other states, further exacerbating the flight of dollars from Kansas.

Wind Turbines Harm Wildlife
Against all this economic cost, wind power might still be desirable if it provided substantial environmental benefits. Although touted as a "green" alternative to conventional power plants, wind power merely supplements them, displacing very little conventional power plant pollution.

But wind power imposes its own unique price on the environment. Wind turbines already in place across the U.S. directly kill hundreds of thousands of bats and birds (including endangered species) each year. The turbines disrupt aviary migration patterns and despoil landscapes.

Worldwide, Schleede notes, citizen environmental groups have risen up in opposition to wind power wherever turbines have been constructed or proposed.

"Other actions, such as using more energy efficient light bulbs, are much more cost-effective and environmentally meaningful," he concludes.

 
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