When all of the costs are included, wind energy costs were found to be nearly double government estimates while raising energy costs for consumers. Yet U.S. taxpayers are subsidizing wind energy at a cost of $12 billion a year.
A study (available here) by Dr. Michael Giberson, PhD., with Texas Tech University’s Center for Energy Commerce, found that the most frequently cited estimates of wind energy costs fail to include all of the costs, including wind power capacity and integrating wind power into transmission grids. The complexity of the power grid and the technical nature of most studies make it hard for policy makers and the general public to understand them, he wrote.
The federal government devotes substantially more financial resources to subsidize the production of wind power than it does to study wind power. The GAO counted over 80 separate federal programs offering economic support to wind power producers, though the largest program by a wide margin is the Production Tax Credit. State and local governments offer additional support. Government subsidies for wind power naturally raise questions concerning costs and benefits associated with the policy. Indeed, a complete policy analysis would assess both costs and benefits in a complete and consistent manner. Perhaps surprisingly given the extent of federal policy support for wind power, no systematic effort has been made to calculate the overall net benefit (or cost) of public policies supporting wind power.
The money quote: “So long as wind power remains more expensive than the alternatives, adding wind power cannot reduce the overall cost of power to the economy….”
The study was also reported in the news:
According to a new study conducted by Texas Tech University Professor Dr. Michael Giberson for the Institute for Energy Research, the government and wind lobby aren’t telling taxpayers the whole truth about how much wind energy really costs. The study comes as the wind lobby is set to receive another extension on massive subsidies with little results to show for it….
According to the study, wind energy costs taxpayers $12 billion per year and shows wind power costs $109 per megawatt hour, nearly double government estimates of just $72 per megawatt hour. The study also shows wind power doesn’t decrease the cost of electricity as environmental groups and government advocates claim, but instead shifts costs onto taxpayers. In addition, wind energy subsidies allow those who start wind projects to easily game the system.
“Wind power projects often obtain additional production subsidies, and these subsidies allow the wind project owner to profit even when power prices go negative,” the study states.