The green echo chamber is reverberating with reports about a new study claiming that the 468 megawatt Cape Wind project, a planned wind farm off the Cape Cod coast, would save New England ratepayers $7.2 billion through 2036.
When I first encountered news of the study, I was surprised, because 75% of Cape Wind’s expected output is already under contract, at rates that are more than twice the average price of electricity in the region. How could it be that adding expensive power to a regional grid reduces electricity rates?
This mystery was solved by Randy Hunt, a Massachusetts state representative and part time myth-buster. In an excellent blog post, Mr. Hunt explains that the new Cape Wind rate impact study suffers from a significant flaw. Namely, it fails to account for the cost of wind power, which seems like a pretty big oversight for an analysis that purports to estimate the cost of wind power.
Then again, the study was commissioned by the developers who stand to make a mint with the Cape Wind project, so it’s not shocking that the analysis would be of such dubious quality. What is somewhat surprising, however, is the alacrity with which environmentalist media has trumpeted this bogus report.