Wednesday, 26 February 2014

Americans should celebrate the fact the Congress allowed the tax credit for wind energy to expire

Americans should celebrate the fact that Congress allowed a tax credit for wind energy to expire, even if the wind turbine industry is whining:

Justin Williams, a wind turbine technician for Vestas Wind Systems, says the failure to renew the Production Tax Credit was a major blow to the wind industry because developers relied heavily on this tax credit to help offset the expensive start-up costs of wind turbines.
“With the [tax credit] not getting extended for another year, it really hurt the wind industry,” Williams said. “A lot of projects got put on hold.  It was a big tax break for these guys. It’s kind of what helped them get the financing to build these sites.”
Williams says it takes at least four years to build a turbine from start to finish. “It’s a big investment, with all the money up front. You don’t start making money off a wind turbine until at least ten years later,” he adds.  "That’s why a lot of people relied on the [tax credit].”

What the Vestas representative "forgot" to mention is that the owners of wind turbines will not after those "at least ten years" be able to enjoy their profits for very long:

The analysis of almost 3,000 onshore wind turbines — the biggest study of its kind —warns that they will continue to generate electricity effectively for just 12 to 15 years. --
The report concludes that a wind turbine will typically generate more than twice as much electricity in its first year than when it is 15 years old.
The report’s author, Prof Gordon Hughes, an economist at Edinburgh University and a former energy adviser to the World Bank, discovered that the “load factor” — the efficiency rating of a turbine based on the percentage of electricity it actually produces compared with its theoretical maximum — is reduced from 24 per cent in the first 12 months of operation to just 11 per cent after 15 years.
The decline in the output of offshore wind farms, based on a study of Danish wind farms, appears even more dramatic. The load factor for turbines built on platforms in the sea is reduced from 39 per cent to 15 per cent after 10 years. 

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