Just a couple months ago, wind energy had huge momentum.
T. Boone Pickens, who made his billions in the oil sector, touted the technology in a $58 million ad campaign and promised to build the world’s largest wind farm.
Fellow billionaires Phil Anschutz and Warren Buffett planned to build their own wind farms.
And wind power regularly appeared in stump speeches by presidential contenders Barack Obama and John McCain.
Then came the credit crunch. If the momentum for wind power was measured by the Beaufort scale, which measures wind speed, it has dropped from a strong gale to a gentle breeze.
After 45 percent growth in the market and $50.2 billion invested in the technology last year, the wind energy industry may come to a grinding halt as developers seek financing and big investors such as Lehman Bros. shut down.
“You can’t get funding,” said David Morris, a wind energy expert and vice president of the Institute for Local Self-Reliance in Minneapolis. “The credit crunch is hurting everyone, including the renewables.”
Congress recently renewed the wind production tax credit, which was set to expire this year. The tax credit, part of the $700 billion bailout bill passed earlier this month, supplies 2.1 cents per kilowatt hour for wind energy and will extend through 2009. But so far, it hasn’t appeared to have helped.
A number of big banks invested in wind projects to take advantage of those wind tax credits. But now many of those bank investors are disappearing, and others are far less profitable, which makes the tax credit far less inviting.
“There’s been a real pullback on banks investing because of the concern of profitability,” says Ethan Zindler, head of North American Research for New Energy Finance, a global industry research firm. “Tax equity funding is clearly the lifeblood of getting a project done.”
Still, alternative energy has been pitched as a top priority by both presidential campaigns on the theory that wind and solar energy can help the United States become energy independent and reduce greenhouse gas emissions.
The wind industry had set a goal for wind to provide 20 percent of the nation’s energy by 2030, up from just 1 percent today. So in light of the economic downturn, is that goal still feasible?
Yes, said Randy Swisher, executive director of the American Wind Energy Association. While 2009 and 2010 may see slower growth than the 45 percent rates of this year and last year, wind “will be an enormous growth industry,” he said.
“This is just a blip in the longer-term picture,” said Neeloo Bhatti-McAndrew, assistant director of the Energy Institute at the University of Delaware in Newark. “We’re being blindsided by the immediate consequences.”
If the nation hits the 20 percent wind mark, it could create 500,000 new jobs and $1.5 billion in tax revenue, according to a Department of Energy report issued this year. Greenhouse gases could be cut by 25 percent and water consumption cut by 17 percent, the report states.
Getting to that point, however, will require the construction of a 19,000-mile transmission network that could cost $60 billion and require extensive regional planning, according to a report by American Electric Power.
The high-voltage power lines would cross through neighborhoods across the United States, inevitably drawing ire from homeowners and drawn-out eminent domain battles with state, county and local communities. “People won’t want to live under high-voltage transmission lines,” said Morris.
Building the transmission lines will also necessitate changes to public utility laws and changes in the permit process managed by the Bureau of Land Management — obstacles that have not been addressed by either presidential candidate.
Wyoming Gov. Dave Freudenthal has been working closely with federal agencies to get permitting for transmission lines to bring wind energy from Wyoming to neighboring states. Tax credits are needed to encourage wind production, Freudenthal said, but most vital will be the transmission lines to bring the energy where it’s needed, he said.
The capital costs of building a wind farm should drop due to the economic downturn, which has led to a 30 percent drop in steel prices in the past few months. The majority of a wind turbine’s weight is steel, said Swisher of the American Wind Energy Association.
While the credit markets forced some wind projects to cut back plans — Renewable Energy Systems Americas, for instance, will whittle in half its 2009 plans for a Colorado wind farm — business moguls Anschutz, Buffett and Pickens still plan to continue forward on their respective wind projects.
Railroad and telecom tycoon Anschutz is building a 2,000-megawatt wind farm in Wyoming and has rights to build a $3 billion, 900-mile transmission line to bring wind from Wyoming to California, Las Vegas and Phoenix.
Buffett’s MidAmerican Energy is moving ahead with construction of four Iowa wind farms, totaling 483.8 megawatts.
Picken’s company, Mesa Power, planned to invest $10 billion to build the world’s largest wind farm — equaling 4,000 megawatts — in the Texas panhandle, but the economy may cause the company to “scale back a bit,” said Pickens spokesman Jay Rosser.
Interestingly enough, on the picture above, if you look carefully you will see "acciona" written on those wind mills.
They have been built by a European company which finances its projects essentially also outside the US.
What the author of this article fails to notice is that there is a difference between the fact of building wind-parks and the question who builds it. It is correct that US alternative energy companies will find it difficult to receive credit in the short term. But actually, the aeolian industry works at 100% production capacity utilisation and the order backlog is so huge that either somebody else will build these windmills in the US using non-US financing or the same installations will be exported to eg China but still generate the same amount of alternative energy, just elsewhere, and still maintain US jobs in the industry and provide for more if the US wants to expand windmill production capacity.
It is ludicrous to consider building more transmission towers and lines that are so vulnerable to terrorist's attacks. Wind energy will always be a very expensive method to generate electricity. Initial costs are astronomical and maintenance is prohibitive.
The smart thing to do is to build nuclear power generating plants adjacent to each major city thus eliminating the lengthy and vulnerable transmission lines. Shorter lines could service surrounding areas like they do today. Building nuclear plants will insure the job benefits remain in the US. The plants are more easily protected than long, exposed transmission lines passing through vacant rural areas. Our life style depends on uninterrupted electric power and don't think for a moment this is not apparent to terrorist organizations. Nuclear is safe today as demonstrated by its use in other nations. It is out transmission system that is undefendable. Modular nuclear power plants are less costly and more amenable to various requirements by different cites. It is a great "make work" program keeping jobs and profits in the US. The final benefit will be the electric automobile which then will have a cost and convenience advantage. We can develop and sell them to the world at large! That makes this a win,win, win situation and take the wind out of the sails of Billionaires who have conspired to buy properties and rights to make their fortunes on "green" technologies. It reminds me of the Railroad barons of yesteryear! Now the public needs to benefit.
The next administration should start work programs funded by congress similar to TVA in which the unemployed can work building wind, solar and hydro-powered farms to kick-start the growth in that area.
I am very interested in wind power, I wouldn't mind having a personal wind tower for my own energy consumption, but the only incentives/credits/grants I have found are geared toward towns and non-profits. If the government wants to increase interest in wind power, I think they need to make it more personal to the average consumer.
What happened to, "We can do it..." Already I'm hearing a "defeatest" attitude in the article. If the USA can spend $10 Billion a month on war, surely we can find the where-withal to fund this wind power, don't you think. It's a matter of "Willingness to do..."
Exxon spends less than 1% of revenue on renewables. Big oil COULD get behind this without the need for financing.
Just because Exxon or any other oil company has money in the bank does not mean they should invest it outside their expertise. Apple Computer has a strong balance sheet - - does that mean they should invest in either wind power or solar energy??
There will be pleanty of money available when the economics of wind, solar and other alternative energy sources make sense. Oil and natural gas need to cost more for that to happen. Simple economics.
Any company, including Exxon, should invest to make money for their shareholders and not worry about pleasing the Tree Hugger lobby.
So Peter..........
You are for big business...... Exxon....is just like AIG....They make billions of dollars off of us and return nothing except insider trading, posh junkets and outrageous executive salaries and bonuses.
Apple Computer and Microsoft should be investing in wind or solar power. The point being the cheaper the power cost to the individual the more sales they generate for themselves.
Let's see how your tune changes when there is no more polar ice cap, artic animals go extinct, our oceans rise and flood the coasts and the air is so poluted that you have to wear a mask to breath.
What big company do you work for???????? AIG maybe?????
Peter Uh last I checked Exxon was the largest energy producer in the world. That is exactly the point energy producers that understand production and distribution should be part of the solution. Not just wringing out every last nickle out of a 19th century business model.
And the bs about making money for and answering to share holders is pathetic. If corporations want to be treated like citizens they also need to have a moral center.
And the bs about making money for and answering to share holders is pathetic
Actually purple, publicly held corporations are legally bound to answer to, and to make money for their shareholders first, so it's not pathetic, it's not bs, it's the law.
If you want to change the law, then go ahead and try, until then you are wrong.
Danwill the law doesn't preclude morality. The law doesn't impose greed. There are plenty of businesses that do the right thing every day. I don't see them being prosecuted. So get over your self.
Danwill the law doesn't preclude morality
Did I say it did? No. My point was that the company has to make decisions that will profit it's investors. Exxon is very conservative in this fashion, and is not going to jump in an area they know nothing about without researching it carefully. They are investing quite a bit in battery research, which is crucial if you want to store that wind and solar power for night, or windless days.
They will choose what they know, not whatever the next "big hit" thing everybody is calmoring for when it may not make money for them. And if that leads to their eventual demise, then that will be on the heads of whoever made the decision to not pursue that course.
Exxon is not stupid, and they are quite aware that there oil income is limited, there total proven oil reseves have already declined 4% or so just in the last year. That is not sustainable for any company, and they know it.
Exxon fought a share holder attempt to force the company into renewables. Quite famously as I recall. Their CEO isn't interested.
it would depend on what kind of renewable, if it was corn-based ethanol, then good for him
Peter is right - that's why a viable government energy policy is a must. We can drill baby drill or we can invest in wind and solar. You get to choose next Tuesday.
I find it interesting that this article (and others) always comes back to the idea of huge farms with central distribution of power....so that we have to build huge transmission lines across vast spaces.
This is absolutely the time to size the wind farms for the area that they are located in and MINIMIZE the transmission losses by minimizing the distances that the electricity is transported.
My understanding is that 1/2 to 2/3 the energy generated is lost in transmission losses. Placing wind (or other electricity generation facililities) RIGHT NEXT to the area where they are needed.....and then using the grid as a buffer.....seems a much better way to get the energy we need and minimize the resources required to get it.
Theresa
The article adds that people balk because they dont want to live under high power lines, while my comment may seem a little too logical for some, why dont we bury the lines (electric, cable, phone, etc) and not only add to keeping the mess of wires from polluting the view but saving resources on poles and steel for supports? This also helps with insulating the lighting and wind caused "knock outs".
Most of europe buries their lines, why cant we? I can not fathom why a country who used to pride itself on innovation, continues to do things just because "thats the way its always been done". People were nay sayers with the car and email too, saying they didnt trust the horseless carriage, or that Email was "scary" (we all see what happened there), why should advances in power be any different?
That's something I don't get either. My lines used to be buried. When they were, my electricity was solid. I even had a tornado go through nearby and had electric back up in < 12 hours. 2 years ago they put everything on poles which i'm sure costed a fortune. I've had more outages in the last couple of years than I had in 20 with the buried lines. Frustrating and ugly!
There's a simple reason that high-voltage power lines aren't buried: they can't be. The distribution lines that feed individual neighborhood operate at far lower voltages than the lines the cross between cities. At these higher voltages there is no dielectic strong enough (i.e. the insulator around the wires) to actually bury them in the ground. All electricity wants to get to the ground -- you have to prevent that, or else you'll have none left at the end of the line. The high voltage lines have to be higher off the ground for the same reason -- the dielectric strength of air is not infinite, either, so the high the voltage, the high up the wires must be.
This is why it would be good to have politicians who actually know something about technology rather than a bunch of lawyers who know nothing about it.
And Europe doesn't bury their high-voltage lines? Have you not been there? There's tons of power lines everywhere!?!?! I remember being in England remarking at all of the power lines.
Thanks for the info. Wire insulation...maybe that's some more technology we should be working on. The model T was just the beginning. If we had quit because it got stuck in the snow and mud easier than a horse we wouldn't be where we're at now. The problem is we have fledgling industries trying to emerge competing against big oil/coal that will die if they do. We all know that it's best if we don't burn stuff for our energy, but we'll see what wins, greed or common sense.
We continue to give huge breaks to oil companies who have created the biggest transfer of wealth in the hisotry of mankind to other nations, while US held oil companies stuff away billions in profit.
Oil has ruled our life and infa structure for a very long time. It has effected how we interact with the rest of the world as a whole. Oil has given us the life of "fear factor living"--every twitch in oil price sends us reeling for one reason or the other.
It's about time we look to and support alternative energy sources of all kinds and give them the same support we do oil men. In fact we are about 35 years behind minimum. Did we not learn a thing in the 70's ?
Let us look to other countries, some large and some small, who have made huge inroads with energy programs. They do not tought themselves as the greatest nation in the world but they have instituted some pretty dramatic changes in enerergy.
Hey if General Motors can build cars for South American countries that run on alternatives to oil, then it should be no major hill to step up and supply Americans with the same vehicles.
We all know that it is the consumer who dictates the product.
The ONLY way alternative energy will emerge in vehicles is if the price of gasoline stays high, otherwise the populace will go back to it's old habits-----pain in the "pocket nerve" is the ONLY way to achieve change.
We all know that it is the consumer who dictates the product.
The ONLY way alternative energy will emerge in vehicles is if the price of gasoline stays high, otherwise the populace will go back to it's old habits-----pain in the "pocket nerve" is the ONLY way to achieve change.
Everyone is touting the "green energy" benefits of wind energy. But what isn't getting enough press is the dramatic and degrading effect wind farms have on ground-based radar systems. Huge turbines being built around radars continue to negate the detection and processing capabilities of radars. These radars are an integral component of the FAA's air traffic control capability, potentially jeopardizing safety of flight. Just as important, these same radars are a primary resource for America's Homeland Defense mission. As radar capabilities continue to be mitigated by wind turbines, it increases the opportunities for "non-cooperative" threat aircraft to penetrate our national defenses and reach lucrative targets of opportunity. The threat is real. The greedy corporations anxious to populate our homeland with wind farms, needs to realize there is a potentially tragic trade-off. Slow the over-saturation of wind farm growth and divert the money and engineering into fielding a radar system compatible with the impeding wind turbines - before its too late.
Everyone is touting the "green energy" benefits of wind energy. But what isn't getting enough press is the dramatic and degrading effect wind farms have on ground-based radar systems. Huge turbines being built around radars continue to negate the detection and processing capabilities of radars. These radars are an integral component of the FAA's air traffic control capability, potentially jeopardizing safety of flight. Just as important, these same radars are a primary resource for America's Homeland Defense mission. As radar capabilities continue to be mitigated by wind turbines, it increases the opportunities for "non-cooperative" threat aircraft to penetrate our national defenses and reach lucrative targets of opportunity. The threat is real. The greedy corporations anxious to populate our homeland with wind farms, needs to realize there is a potentially tragic trade-off. Slow the over-saturation of wind farm growth and divert the money and engineering into fielding a radar system compatible with the impeding wind turbines - before its too late.
Ok ...here's an idea..wind power may not be economical but the cost of land for the farms is astronomical.. so while the credit crunch is on...and it looks like Obama will win how about petitioning Ms Pelosi and Mr Ried to free up federal land in the Rockies for turbines in top of the front range and adjacent to Vail, Aspen, Teluride, Steamboat ski areas to top the ridges with those beautiful turbines made famous by the" Teletubies" to provide tons of power.. And can we ask them to make land available in the plains, and on Fed land all over the west for these farms... for free
Imagine how much cheaper the projects would be if the Feds and environmentalist would allow us to build there... It seems to me that the ones who are so in favor of this won't let the country use land that is free and empty... Or would we mar the lovely view..
We cannot have it both ways... We have the knowledge to do this and if the enviro-left wants it done...then go kick butt in Congress...We all "own that land"...
As a die hard moderate...I am incensed that the very people who are pushing alternative energy are stopping us from access to free and empty space to develop... Above San FRan the Mt's should be scattered even more with the pretty windmills...
Don't we ever learn? Isn't this what Americans have been asking for? Relief from everyone else, to be back on the cutting edge, come on!!!
It is ludicrous to consider building more transmission towers and lines that are so vulnerable to terrorist's attacks. Wind energy will always be a very expensive method to generate electricity. Initial costs are astronomical and maintenance is prohibitively expensive.
The smart thing to do is build nuclear generating plants adjacent to major cities thus eliminating the lengthy and vulnerable transmission lines. Shorter lines could service surrounding areas as they do today. Building Nuclear power plants will insure the job benefits remain in the US. The plant are more easily protected than long, exposed transmission lines passing through vacant rural areas. Our life style depends on uninterrupted electric power and don't think for a moment this is not apparent to terrorist organizations. Nuclear power is safe today as demonstrated by its use in other nations. It is our transmission system that is in-defensible. Modular nuclear power plants are less costly, smaller and more amenable to various requirements by different cities. It is a great "make work" program keeping jobs and profits in the US. The ultimate benefit will be the electric automobile which will have a cost and convenience advantage that will finally deliver us from the oil cartel manipulation of our lives at their whim. That makes this a win,win,win situation and takes the wind out of the sails of the billionaires who have conspired to buy properties and right-of-ways to make their fortunes on the popular "green" technology craze. It reminds me of the Railroad Barons of yesteryear. Nuclear will let John Q. Public get on board if it is managed properly.
If the initial cost of wind power installations are "astronomical", what do you call the initial costs of a nuclear power plant? Nuclear operating costs are also very high, with all the monitoring and backup systems required to prevent a disaster. Then add in the costs for fuel, and disposal of waste when the fuel is exhausted.
Your comparison of terrorist threats also doesn't make much sense. Sure, power transmission lines can be brought down by blowing up a tower, but then what? That line is out of service for a few days, and meanwhile power is re-routed through other parts of the grid. A successful terrorist attack on a nuclear plant could force the abandonment of an entire city for hundreds of years.
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A diverse supply of energy will help us as we depleat the oil reserves. Use every thing, wind,solar,geo thermal, bio mass, wave action, nuclear, natural gas, coal. This will also create millions of new USA jobs and improve national security.
utilizing wind,heat,high tides,dams etc. I believe is the right direction for dwelling energy needs. I'm sure everything is placed at most viable geo sectors for utmost deliverence output. my concern is, the same as medicene.It's not the doctors fees. Its the investors; hospitals,insurance industries that get awful greedy for financial gain.this is what is killing america. I believe,these industries should operated on a non-profit basis.with controls on upper management salaries.for a better american way of life.
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