Brits To Withdraw All Windmill Subsidies By 2020; Rhody Does Not Need To Take That Long
From today’s Telegraph (U.K.).
Despite opposition from the Liberal Democrats, who strongly support more renewable energy, the subsidy regime for onshore wind and solar panels is now firmly expected to be phased out by the end of the decade.
A senior Conservative source said: “This is now very much the direction of travel.”
At present, householders pay for subsidies to renewable energy producers through an extra charge on household electricity bills.
“Extra charge on household electricity bills” to pay for a clumsy, inefficient but politically correct (in more ways than one) source of electricity. Where have Rhode Islanders heard that before? Oh,yes.
Terry Stewart, president of the Dorset branch of the Campaign for the Protection of Rural England gives the perfectly cogent reason, involving a splendid vocabulary word that I had never heard before.
The subsidy for wind turbines is iniquitous. It is a stealth tax.
A mandate to purchase electricity at an artificially high price is, indeed, a stealth tax, and an unjustified one at that. The only weakness in this phaseout plan is that the Cameron government is taking eight years to implement it.
Rhode Island does not have to make that mistake. The current phase of Deepwater Wind is essentially an experimental one. As the full-blown project will require rateholders across the board to pay two and a half times the market rate for electricity, it is time to conclude that this experiment is a failure (p.r. pros, give us a softer word!) and pull the plug on it.
Why a softer word? Fiasco or trainwreck work for me.
The Brits are not the only ones withdrawing subsidies in hard times.
I am not sure where the R.I. turbines were to come from, but most are supplied by Spain. They are (I think now “were”)produced in Spain under a heavy subsidy from the government. That has now been withdrawn. The “industry” will probably disappear.
Oil costs $2.20 per gallon of crude right out of the ground and refined it sells for $3.00 plus $0.60 tax. Uisng the wind turbine subsidy as a guideline would be like forcing us to pay $7.50 plus that $0.60 tax. For forty years we’ve subsidized turbines in the hope that there would be manufacturing cost, efficiency and reliability breakthroughs. Hasn’t happened. I’m ready to continue paying my share for R&D incentives but subsidizing production is absolute folly.
How is withdrawing a subsidy a tax? The extra charge is because the cost of generating energy per kilowatt is higher based on the inefficiency of windmill technology. Not so with oil and gas turbines. However, their pricing is based on 40% operational costs and 60% fuel prices. Wind farms? After capital expenditure and amortization over 20 years and lowering operational costs, the prices will decrease. Here is where things will get bad in the future.
You pay more for an inefficient and costly source of renewable energy but bear in mind that oil and gas prices will continue to grow.
In 20 years time, they may even surpass the cost of your wind farms. Oil and gas require payment. Wind, solar, marine and hydro-electricity (what the Canadians get at night when the Niagara falls are turned off) don’t require fuel.
Think about the future. At least someone is trying to do something about this.
Oh, and if anyone asks, I’m an energy expert and businessman who is actively working on the realities of the energy sector. Bear in mind that America uses three times as much oil as any other nation. Just like not asking for extra fries with our meals, try thinking about cutting down on what you use.