Glenn R. Schleede: False claims that “wind farms” provide large economic and job benefits

We thank Mr. Schleede for granting permission to post his recent commentary:

January 3, 2011

False claims that “wind farms” provide large economic and job benefits

One would think that by now Obama Administration officials would admit that “wind farms” do not provide large economic and job benefits. However, recent Administration statements suggest the delusion continues and, perhaps, that officials do not understand why their expectations are unrealistic.

False expectations may be due to the infamous “JEDI” model (Jobs and Economic Development Impact model) developed for DOE’s National Renewable Energy “Laboratory” (NREL) by a wind industry consultant-lobbyist. Unfortunately, this “model” (paid for with our tax dollars) has been widely promoted by NREL and DOE and outputs from the model are used by “wind farm” developers to mislead the public, media, and government officials.

Economic models often produce false or misleading outputs because (a) the model itself is faulty, and/or (b) unrealistic assumptions are “fed into” to model, with the result that the models overstate national, state, and/or local job and other economic benefits. In the case of wind energy models, basic flaws and faulty assumptions often include one or more of the following:

1. Ignoring the fact that much of the capital cost of “wind farms” is for equipment purchased elsewhere, often imported from other countries. Some wind energy advocates claim that wind turbines are “manufactured” in the US when, in fact, they are merely assembled in the US using imported parts and components. About 75% of the capital cost of “wind farms” is for turbines, turbine parts and components, towers and blades – so a large share of the “wind farm” cost is for imports. These add to the outflow of wealth from the US and provide no economic or job benefits in the US.

2. Assuming that employment during project construction results in new jobs for local workers — when most “wind farm” construction jobs are short term (6 months or less) and the overwhelming share of them are filled by specialized workers who are brought in temporarily.

3. Assuming that the very few permanent “wind farm” jobs are new jobs filled by local workers – when, in fact, these few permanent jobs are often filled by people brought in for short periods. Some “wind farm” owners contracts with suppliers of wind turbines and other equipment for maintenance work with the result that no “new” jobs for local workers are added.

4. Assuming that temporary workers who are brought in for short periods live and spend their pay checks — and pay taxes — locally when, in fact, these workers spend most of their wages where they and their families have permanent residences — where the workers spend most of their weekends and where they pay nearly all of their taxes.

5. Assuming that the full purchase price of the goods and services purchased locally (often minimal in any case) has a local economic benefit. In fact, only the local value added may have a local economic benefit. This truth is illustrated by the purchase of a gallon of gasoline — let’s say for $3.00. Only the wages of the service station employees, the dealer’s margin, and the taxes paid locally or to the state mayl have a local or state economic benefit. Economic benefits associated with the share of the $3.00 that pays for the crude oil (much of it imported), refining, wholesaling, and transportation generally flows elsewhere.

6. Assuming that land rental payments to land owners for allowing wind turbines all have local economic benefit. In fact, these payments will have little or no local economic benefit when the payments are to

absentee landowners OR if the money is spent or invested elsewhere or is used to pay income taxes that flow to Washington DC or state capitals.

7. Using “input-output” models that spit out “indirect” job and other economic benefits that, in effect, magnify (a) all of the overestimates identified above, and (b) use unproven formula and data to calculate alleged “multiplier” effects.

8. Ignoring the environmental and economic COSTS imposed by “wind farm” development, which include (a) environmental, ecological, and economic costs associated with the production of the equipment, and constructing and operating the “wind farm” (e.g., site and road clearing, (b) wildlife habitat destruction, noise, bird and bat kills and interference with migration and refuges, (c) scenic impairment, (d) neighboring property value impairment, and (e) infrastructure costs.

9. Ignoring the fact that electricity produced from wind turbines, has less real value than electricity from reliable generating units — because that output is intermittent, volatile and unreliable. Also, the electricity is most likely to be produced at night in colder months, not on hot weekday late afternoons in July and August when demand is high and the economic value of electricity is high.

10. Ignoring the “backup power” costs; i.e., the added cost resulting from having to keep reliable generating units immediately available (often running at less than peak efficiency) to keep electric grids in balance when those grids have to accept intermittent, volatile and unreliable output from “wind farms.”

11. Ignoring the fact that electricity from “wind farms” in remote areas generally results in high unit costs of transmission due to (a) the need to add transmission capacity, (b) the environmental, scenic and property value costs associated with transmission lines, (c) the electric transmission “line losses” (i.e., electricity produced by generating units but lost during transmission and never reaches customers or serves a useful purpose), and (d) inefficient use of transmission capacity because “wind farms” output is intermittent and unpredictable and seldom at the capacity of the transmission line that must be built to serve the “wind farm.”

12. Ignoring the fact that the higher true cost of the electricity from wind is passed along to ordinary electric customers and taxpayers via electric bills and tax bills which means that people who bear the costs have less money to spend on other needs (food, clothing, shelter, education, medical care — or hundreds of other things normally purchased in local stores), thus reducing the jobs associated with that spending and undermining local economies that would benefit from supplying these needs.

13. Perhaps most important, ignoring the fact that the investment dollars going to “renewable” energy sources would otherwise be available for investment for other purposes that would produce greater economic benefits. “Wind farms” have very high capital costs and relatively low operating costs compared to generating units using traditional energy sources. They also create far fewer jobs, particularly long-term jobs, and far fewer local economic benefits. “Wind farms” are simply a poor choice if the goals are to create jobs, add local economic benefits, or hold down electric bills.

Glenn R. Schleede

Round Hill, VA 20141-2574

Allegheny Treasures Note:  “Mr. Schleede is the author of many papers and reports on energy matters.  He is now retired but continues to analyze and write about federal and state energy policies, particularly those affecting wind energy.”

“Until retiring, Schleede maintained a consulting practice, Energy Market and Policy Analysis, Inc. (EMPA)  Prior to forming EMPA, Schleede was Vice President of New England Electric System (NEES), Westborough, MA, and President of its fuels subsidiary, New England Energy Incorporated. Previously, Schleede was Executive Associate Director of the U.S. Office of Management and Budget (1981), Senior VP of the National Coal Association in Washington (1977) and Associate Director (Energy and Science) of the White House Domestic Council (1973).  He also held career service positions in the U.S. OMB and the U.S. Atomic Energy Commission.”

“He has a BA degree from Gustavus Adolphus College and an MA from the University of Minnesota.  He is also a graduate of Harvard Business School’s Advanced Management Program.

 

Sponsored Writing

Funny Bones Schools provide customers with the best in Defensive Driving Texas has to offer. It makes it easy and convenient for everyone to attend an online course and complete their certificate to assist them with their ticket. It provides the best Defensive Driving Course Texas has out there and is quick and easy to complete. Our course is also State Approved, this is the best option out there. Don’t look any further for the top El Paso Defensive Driving course. Make sure you take our course today. For the best Dallas Defensive Driving class look no further than our programs. Accredited and designed to make your day more efficient. If you want a San Antonio Defensive Driving school that you don’t need to drive to then sign up with us and take the class online! If you’re looking the best Houston Defensive Driving service then come on to the Funny Bones site and sign up for a class today.

Have you been looking for a cleaning company that can deliver results? Well if so you’re in luck because Karma Kleaners is known as the best House Cleaning Services Austin Texas has to offer. Just look at their reviews and you’ll see how great they are. They have done so well that the business has expanded and now they offer Maid Service Round Rock residents truly enjoy. It’s a great feeling to have the peace of mind that you’re leaving your house in trustworthy hard-working hands. No need to worry about your valuables with Karma Kleaners. You get discreet trustworthy professionals that can take care of the clean to the most granular of levels. So, reach out to our Cedar Park Maids and see why we have the great reviews we do. See why our clients rave about us. It’s because our Maid Service Pflugerville is truly top notch. Don’t wait to call us, you’ll wonder later why you didn’t reach out sooner. Think of all the things you could be doing with the time we’re taking care of your house. Let the best Maid Service Georgetown TX has clean every crevice of your house or apartment. We now service different neighborhoods in the Austin Metro so our Hutto Maid Service is available and if you want a great House Cleaning Leander TX can rave out then reach out to Karma Kleaners today.

Do you want to build your dream home? If so, look no further than Verde Builders. We are the #1 Custom Home Builders in Austin TX. Over the years, we have worked with thousands of home buyers and realtors to design impeccable homes.

At Verde Builders, we are devoted to providing our clients with their dream home. We can even build smart homes as we are some of the best Green Builders Austin TX has. So, you can get that energy efficient home from one of the best custom home builders out there.

If you’re looking the for the best in Horseshoe Bay Custom Homes then you’ve come to the best place for home constructions. So, get that custom home build today.

If you’re looking for the best Modern Farmhouse Austin has then Verde Builders Custom Homes can help you achieve the best construction for this.

When you choose to work with us, we will set up a direct line of communication with you to learn more about the home you want. Once you fill us in, we will develop a design and build your home according to schedule. Our Custom Home Builders in Bee Cave Texas have the expertise of transforming any premature design into a masterpiece. No matter what your initial design looks like, Verde Builders, the top Round Rock Home Builders, will provide with a state-of-the-art home just the way you want it.

Also If you want to Build on Your Austin TX then Verde Builders can help you create your dream house on your property.

If you require your Paving Austin contractors to have more than 10 years of industry experience and multiple generations of providing top-notch asphalt services, then TexAsphalt is the perfect choice for you. Our company specializes in meeting the demands of both commercial and residential properties that require premium services. Highly-experienced in seal coating, asphalt repairs, and a variety of other asphalt services, you can’t go wrong with choosing TexAsphalt. Highly reputed as the best Parking Lot Striping Austin Texas provider, we have serviced hundreds of clients in the Austin area. Give us a call today to learn more about how we can embellish your parking lot.