Cape Wind cost projections updated 1/08/10
'Cape Wind's big secret'
"Power will cost millions extra"
By Jay Fitzgerald
Thursday, January 7, 2010
"National Grid customers will experience sticker shock after the giant utility negotiates a long-term electric contract with Cape Wind developers, energy experts warn.
Business groups worry that a National Grid contract with Cape Wind, which needs a long-term deal to secure funds to build a giant wind farm off Cape Cod, could add tens of millions of dollars per year to electric bills..."
"It's still double the price - and the ratepayers will be picking up the tab for it for 20 years," said Robert Rio, a senior vice president at Associated Industries of Massachusetts."
Cape Wind cost projections updated 11/30/09
Offshore wind comparable: The National Grid identified Deepwater Wind off the coast of Block Island "will more than triple the current rate for traditional electricity."
Providence Business Journal
October 16, 2009
N. Grid rejects Deepwater Wind proposal
"...But in a letter to the PUC, Grid called Deepwater's proposal "not commercially reasonable" and said "in pure financial terms, [it] is uneconomic by a significant margin for Rhode Island customers for the entire term."
"National Grid estimated the cost of electricity generated by Deepwater's wind farms at 30.7 cents per kilowatt-hour, more than triple the current rate for traditional electricity, which in Rhode Island is mostly generated using natural gas. Deepwater put the cost closer to 20 cents per kilowatt-hour."
Cape Wind cost factors updated: May 4, 2009:
The proposed offshore wind project, Cape Wind, would consist of 130, 440' wind turbines in Nantucket Sound.
The following news, reports, and studies demonstrate that onshore windfarms fail to deliver value for our money.
Onshore wind is said to be twice as costly as energy from conventional sources. But, offshore energy is reported by World's largest wind turbine manufacturer, Vestas CEO and President, to be twice as costly as onshore wind.
What do the federal regulators reviewing Cape Wind have to say about the cost of Cape Wind's energy?
U.S. EPA response (CEQ #20090006) to the MMS Cape Wind MMS Final Environmental Impact Statement of February 17, 2009 states that Cape Wind is "not economically viable".
U.S. EPA Region 1. Response to the Cape Wind FEIS to MMS James Bennett:
"EPA's comments on the DEIS noted that the DEIS was not clear on how the scale of the smaller project alternative was established and whether it was based on economic consideration (for example where up front project capital costs were expected to equal project revenues) or other factors. We asked MMS to address this issue and whether this or another intermediate size alternative would perform substantially better economically or environmentally. We also noted that discussion about economic viability of the smaller scale project are complex given statements in the DEIS that the proposed project and other sites are not economically viable. The discussion of economic viability provided in the FEIS in Section 126.96.36.199. is the same as the DEIS, Section 188.8.131.52. of the FEIS states that the site of the proposed action in Nantucket Sound "has the greatest potential". In addition, the information contained in the Economic Model in Appendix F remains unchanged."
"Given the estimated COST OF ENERGY IS $122/MWh, TWICE THAT OF THE CURRENT MARKET AND THIS IS AFTER THE FULL BENEFIT OF TAX AND RPS INCENTIVES, the prospects of entering a long-term purchase power contract would seem low."
Minerals Management Service confirms in the Cape Wind DEIS and FEIS; and the U.S. EPA cites in their Cape Wind MMS FEIS comments that Cape Wind is "not economically viable";
Cape Wind Associates has petitioned the Energy Facilities Siting Board for a Certificate of Environmental Impact and Public Interest, pursuant to G.L. c. 164, § 69K, with respect to jurisdictional facilities approved by the Siting Board in EFSB 02-2. EFSB07-8.
Massachusetts Energy Facilities Siting Board is charged with ensuring a reliable energy supply for the Commonwealth, with a minimum impact on the environment at the lowest possible cost, M.G.L. c. 164, §69H. Confirmation by MMS and the U.S. EPA that Cape Wind is "not economically viable" conflicts with EFSB mandate to ensure a reliable energy supply for the Commonwealth at the "lowest possible cost".
David G. Tuerck, executive director of the Beacon Hill Institute of Suffolk University in 2006 addressed Cape Wind public subsidies:
"What we found was quite remarkable. Cape Wind stands to receive subsidies worth $731 million, or 77 percent of the cost of installing the project and 48 percent of the revenues it would generate."
Cost considerations unidentified, (beyond the identified "twice the price" of current energy), as produced by Cape Wind, include these ratepayers and taxpayers funded extras, positioned against economic losses that would be caused by Cape Wind:
>the cost of bonding for the project and performance of the project?
>upgrades to existing infrastructure cost?
> the cost of the very expensive operation and maintenance contract O&M?
Revenues lost by Cape Wind Beacon Hill Institute calculated as:
>reduction in employment of 1173-2533 jobs
>reduction in tourist spending of $57 million to $123 million
>loss in property values of $1.35 billion
"Massachusetts Fishermen's Partnership and the University of Rhode Island estimates that the negative impact to commercial mobile gear fishermen alone would be between $8 million and $13 million depending on access to the site over the life of the project."
>negative impact on marine trades by Cape Wind
"The Massachusetts Marine Trades Association has shown that the Massachusetts recreational marine economy is one of the most vibrant marine economies in the country. It's not difficult to see why. With nearly 1500 miles of coastline, 27,000 miles of inland waters and roughly 1260 marine trade businesses and individuals, Massachusetts recreational boaters account for almost 15% of the spending on recreational boating in the U.S. and generate nearly $1.5 billion dollars."
What Does Wind Cost?
"The Energy Information Administration assumes the total overnight capital cost of an onshore wind turbine to be $1,497 per kilowatt (in 2008 dollars) and that of an offshore wind unit to be $2,998 per kilowatt.  These costs are below the estimated cost made by the National Association of Manufacturers (NAM) and the American Council for Capital Formation (ACCF) of $2000 per kilowatt for onshore units and $3800 per kilowatt for offshore units (also in 2008 dollars).. "
September 21, 2008
"Vestas Wind Power is the largest global supplier of wind turbines, with 35,500 installed worldwide and more than 15,000 employees."
"Tell readers a little bit about this vision Vestas has for bringing wind power to the masses."
(said Globe reporter Erin Ailworth to Vestas' CEO and President), and,
Vestas chief responds:
"We've got more than 100 wind projects in the works currently, many of them only one or two small turbines. The largest is Cape Wind, a 130-turbine offshore project. I think if you look at wind resources on-shore in the US, they are fantastic. And, therefore, I am really wondering why anybody wants to put them up offshore because it's twice the price. So just as an outsider, I am just scratching my head saying, "Why?"
'Vestas calls for greater focus on onshore wind'
30 May 2008
"Vestas, the world's largest manufacturer of wind turbines, has today urged political leaders to focus more on increasing capacity from onshore wind farms, amid warnings that the cost of installing offshore wind turbines will continue to rise."
Cambridge Energy Research Associates CERA:
'Offshore Wind Power Capital Costs Will Continue To Rise, Creating New Challenges for European Renewable Energy Targets'
UK Country Guardian
October 23, 2008
'The great green electricity con'
"In his first of his weekly Greenwash columns, Fred Pearce finds that "green" electricity tariffs are often far from what they seem"
Offshore Wind: At a Crossroads
A report prepared for BWEA and Renewables East by
BVG Associates and Douglas Westwood
"Under the UK's existing Renewables Obligation and the capital grants programme for Round One, offshore projects have been built at a rate of only one per year. The near-term future remains uncertain and in the absence of a capital grant or similar support payment programme for Round Two, there are no clear signs of the stable pipeline of projects that the supply chain requires to drive forward investment. In short, the economic gap between capital costs, expected operational costs and revenue for most projects remains too large for substantial industry commitment."
National Center for Policy Analysis:
'Why Renewable Energy Is Not Cheap and Not Green'
"Wind power has proven itself to be a perpetual "infant industry," with its competitive viability always somewhere on the horizon."
'By Patrick Sawyer
14 Sep 2008
'Wind farms fail to deliver value for money, report claims'
"Wind farms are failing to deliver value for money and distorting the development of other renewable energy sources, a report claims."
"Excessive subsidies make them an expensive and inefficient way of reducing greenhouse gas emissions, a study by the Renewable Energy Foundation (REF) think-tank says."
UK Academy Report Voices Wind Power Doubts
by Jesse Broehl, Editor, SolarAccess.com News
"The UK has embarked on some of the most ambitious plans in the world for renewable energy - with wind power providing the lion's share of this clean energy. And like every major government plan, not everyone is smitten by it. In a report published this month, England's Royal Academy of Engineering (RAE) says that electricity from offshore wind farms, currently the most viable renewable source, will cost at least twice as much as that from conventional sources..."
November 7, 2008
'California study shows high cost of renewable power'
"While renewable power one day may compete with baseload power sources such as natural gas, coal and nuclear, it currently is more costly, and much less dependable."
'Gone With The Wind'
INVESTOR'S BUSINESS DAILY
"From California to Missouri, four of five environmental initiatives lost at the ballot box. Voters are clearly still not ready for exorbitant costs and excessive regulation without clear benefits."
May 14, 2008
'Shell, E.ON Stall Offshore Wind Projects EU Needs (Update1)'
Texas Public Policy Foundation
'The True Cost of Wind Energy '
Texas Wind Energy Past, Present and Future
"Earlier this year, with the oil price at record heights, T. Boone Pickens, a celebrated Texas oilman, seemed to confirm the unstoppable growth of the clean-technology industry when he announced plans not only to build the world's biggest wind farm, but also to spend $58 million of his personal fortune promoting the cause of wind power.
On Oct. 30, with oil prices having fallen by more than half, he told a television reporter that the boom he had foreseen in wind would be "put off" because of the unexpected fall in the price of fossil fuels and the sudden difficulty of borrowing money."
Overblown: The Real Cost of Wind Power
"A "load factor" of just over 30 percent is recommended for a wind farm to be economically viable. However, many of Britain's onshore farms have been running at around 20 percent, with some in urban areas dropping as low as 9 percent. Oswald believes that overly relying on wind power will result in major power failures across the U.K. and an increase of up to 50 percent in electricity bills. While nothing comes close to the capricious aspect of nature itself, the industry also still suffers from some severe technical difficulties."
The Renewable Energy Foundation publishes its report on the UK Government's support system for renewables.
"It seems to the authors of this paper that the answer to these questions is that the Renewables Obligation is, as Ofgem and the National Audit Office have observed, both counterproductive and very poor value for money"
5 September 2008
Read the Report at: http://www.ref.org.uk/Files/rb.jc.ref.roc.05.09.08.pdf
U.S. News and World Report
October 26, 2007
"Pricey power. Although offshore wind power is big in Europe, it's not moving so quickly in the United States. Local opposition is often cited, but just as important is that offshore developments cost twice as much as onshore wind."
Investors Business Daily May 7, 2007:
"The fact is that after more than 30 years and billions of dollars of government subsidies, neither wind nor solar power is economically competitive."
"Marlo Lewis, senior fellow in environmental policy at the Competitive Enterprise Institute, has pointed out that after three decades and over $14 billion in taxpayer subsidies, so-called renewable energy — wind, solar and biomass fuels — together supply only 3% of America's electricity, with wind and solar providing less than 0.2 of 1 percent."
"Touted as a means of protecting the environment from pollution, giant wind farms threaten birds and endangered species. The Center for Biological Diversity has sued wind farm operators in California's Altamont Pass where it is estimated that as many as 44,000 birds have been killed over the past 20 years. The casualties include an average of 50 golden eagles annually, by what the Sierra Club has called "the Cuisinarts of the air."
Jerry Taylor, a senior fellow focusing on energy policy and environmental protection at the Cato Institute:
"Renewable power mandates merely accentuate the inefficiency and cost premiums attached to so-called renewable power sources. If renewable power saved consumers money, created jobs, or carried any of the other economic benefits so frequently claimed by environmental activists, then government would not have to pass a law to force power companies to purchase it or consumers to buy it."
Thomas Tanton, a fellow at the Institute for Energy Research:
"Wind power is at least twice as expensive as power from conventional sources," Tanton says, "and it's less than half as valuable because it's not always available when you need it."
"In other words, in spite of wind turbines producing a quantity of power equivalent to more than 20 per cent of its domestic consumption, very little of this power is actually consumed in west Denmark. I have calculated that in 2003, more than 80 per cent of wind output was exported, leaving west Denmark to consume about 4 per cent of its power from its enormous capacity of wind turbines.
There is an added irony here. The Danish consumer pays the highest tariffs for electricity in Europe. Much of these are hypothecated for the support of windmill owners. However, the wind power is sold on the spot market at rates that are much lower.
Thus there is a direct transfer of wealth from Danish consumers to consumers in Sweden, Norway and Germany, every time 1kWh of electricity is sold in this way. During 2003, this net transfer of wealth amounted to more than £100m – or £40 per inhabitant."
Professor David Bellamy:
"Huge amounts of tax payers money for scant environmental and electrical benefit make them a scam. Wind-farms are inefficient, destroy the landscape and far more could be achieved through energy efficiency. If you lagged the roofs of 500 homes it would have the effect of putting up one turbine. They can only work 30% of the time at very best, in Denmark it is only 17%. We have to keep other stations running, spinning in reserve, inefficiently pouring out carbon dioxide and sulphur dioxide. These turbines are 22 storeys high put on hills where everyone can see them. They kill bats and birds and need 1,000 tonnes of concrete as well as a road infrastructure. It beggars belief that some environmental groups can say they are 'green'."
Henning Rasmussen, Danish engineer:
"When the wind arrives on or two hours later than forecast, we get nothing and we have to ask our neighbors to rescue us."
Gundolf Dany, chief engineer at Aachen:
"Until we invent a way of storing huge amounts of electricity, wind energy can never be relevant to our future."
Sir Martin Holdgate, former chairman of the British Renewable Energy Advisory Group:
"The trouble with wind farms is that they have a huge spatial footprint for a piddling little bit of electricity..."
Reviewer for the UN Intergovernmental Panel on Climate Change
"Wind farms are "environmentally damaging money wasters whose large scale use increases power demand. The New Age dream of a world operated by wind farms will remain a dream because the laws of physics do not allow it in an industrialized world. If wind power were economic then oil tankers would be sailing ships."
Neils Gram of the Danish Federation of Industries:
"In green terms windmills are a mistake and economically they make no sense…"
Jytte Kaad Jensen, chief economist for Eltra, Denmark's biggest electricity distributor:
"In just a few years we've gone from some to the cheapest electricity in Europe to some of the most costly."
Aase Madsen, an MP who chairs energy policy in the Danish Parliament, is emphatic:
"For our industry it has been a terribly expensive disaster."
Germany's Wind Farms Challenged
by Jim Bowler BBC World Service business reporter, Alsleben, Germany
"The country's great hope for is for a future of green energy, and in particular wind power."
"Critics say this underlines one essential drawback: you can't depend on wind for energy. Even if you build wind farms you still need conventional power plants in case the wind fails."
"However, some observers are now questioning whether all the investment in wind power makes economic sense."
"More of the costs will be pushed to the domestic sector."
Professor Wolfgang Pfaffenberger, Bremen International University
A Problem with Wind Power by Eric Rosenbloom
"A German Energy Agency study released in February 2005 after some delay stated that increasing the amount of wind power would increase consumer costs 3.7 times and that the theoretical reduction of greenhouse gas emissions could be achieved much more cheaply by simply installing filters on existing fossil-fuel plants. A similar conclusion was made by the Irish grid manager in a study released in February 2004 the cost of CO2 abatement arising from using large levels of wind energy penetration appears high relative to other alternatives."
U.S. Wind Subsidies
"The Energy Information Administration estimates that total Federal subsidies for electric production for fiscal year 2007 from wind power are $23.37 per megawatt hour, compared to 44 cents for traditional coal, 25 cents for natural gas and petroleum liquids, 67 cents for hydroelectric power, and $1.59 for nuclear. For wind power, these subsidies include a production tax credit of 2.0 cents per kilowatt-hour. However, they do not include accelerated depreciation, (a five-year write-off), a favorable accounting treatment that wind developers receive. (Figures are in 2007 dollars.)
According to the General Accounting Office, in fiscal year 2007, wind received 2.8 percent of all federal research subsidies to power generation but produced only 0.4 percent of U.S. electricity. Per kilowatt-hour, this was 14.7 times higher than the amount allocated to coal, most of which was spent to develop cleaner technologies. Coal produced 51.4 percent of all U.S. electricity in fiscal year 2007.
Approximately nine percent of electricity generated is lost in its transmission and distribution from power plants to end-use consumers (also called "line losses"). Given that the production tax credit for wind is based on electricity generated, not sold, the PTC is actually costing taxpayers and consumers more than its current value of 2 cents per kilowatt-hour since one-tenth of that electricity is not reaching consumers. Also, wind is an inefficient user of transmission because capacity must be available to handle the full rated output of turbines but wind turbines run at full capacity only a small portion of time."
Cape Wind has been undergoing federal and state reviews involving 17 agencies for approximately eight years.
Cape Wind spec'd GE 3.6 MW wind turbines are "discontinued" as the focus of these federal and state reviews.
Taxpayers continue to fund hardware specific studies of Cape Wind as a phantom offshore wind energy project that has no Power Purchase Agreement, no source for offshore wind turbines, and no project financing after 8 years.
Reporter Patrick Cassidy broke the turbine-less Cape Wind story:
Cape Cod Times, September 25, 2008: 'GE may change Cape Wind direction'
This article states:
"General Electric — identified earlier as the prospective supplier of wind turbines — appears to have dropped the 3.6-megawatt model Cape Wind had hoped to use, said Rodney Cluck, Cape Wind project manager for U.S. Minerals Management Service."
"In documents filed with the U.S. Army Corps of Engineers and Massachusetts environmental officials before 2005, Cape Wind officials listed the GE model as the turbine they had planned to use for the project, Cluck said."
"Although no manufacturer has been chosen by Cape Wind, a 3.6-megawatt turbine made by Germany-based Siemens or a 3.0-megawatt turbine made by Denmark's Vestas are being considered, Rodgers said."
"Vestas hasn't sold a sea-based turbine since December 2006. The company suspended sales of its 3-megawatt V90 offshore model after it had to replace faulty gearboxes at three wind parks. It began offering the model again this month."
"The 3.6-MW turbine, like the 2.3-MW, has been trialled for marine use. According to the plans of Siemens Wind Power about a fifth of future capacity is to be installed at sea. Which means the much greater proportion flows into the substantially larger and less risky onshore market. "We will keep delivering a big proportion of our 2.3-MW machines to the American onshore market," says a spokesperson. The lion's share of the offshore machines is also firmly booked for British projects. In 2008 these are Lynn and Inner Dousing off the east coast of England with 54 turbines; in 2009 25 turbines are going to the projects Gunfleet Sands and Rhyl Flats; 140 turbines have been ordered for Greater Gabbard by 2010. Anyone ordering now will have to be patient, with some deliveries taking longer than two years."
General Electric GE:
"GE Wind Energy Europe Managing Director Rainer Broring states the 3.6 MW GE 3.6l has been shelved for the moment, "GE's initial plan to install a prototype this year will therefore not materialise yet..."
"GE Wind, the subsidiary of the American energy giant General Electric, has left the risky business at sea altogether. Although seven 3.6-MW turbines have operated since 2003 ten kilometres off the Irish port of Arklow, the more secure business is on shore, says a spokesman of the company."
GE 3.6 MW wind turbine is "discontinued": (page 4):
GE 3.6 MW wind turbines "discontinued" status page 15 under "Offshore Wind Turbine Suppliers":
GE 3.6 MW offshore wind turbine status:
"General Electric 3.6sl (discontinued). Capacity 3.6 MW, rotor diameter 111 m. Hub height 75 m (from Cape Wind design specs). Seven 3.6s units producing power offshore at Arklow Bank since June 2004. See product brochure for GE 3.6sl. Based on experience at Arklow, GE had a set of engineering modifications to make for serial production of an offshore machine, but the company has to date decided not to compete in this market."
New York Times
March 27, 2009
'Cape Wind Navigates Shifts in Market'
By Kate Galbraith March 27, 2009
"But G.E. no longer makes any offshore turbines, according to Steve Fludder, the head of G.E.'s green business unit http://ge.ecomagination.com/ who sat down for a wide-ranging interview http://greeninc.blogs.nytimes.com/2009/03/26/ges-green-chief-bullish-on-clean-tech-future/ with The Times on Wednesday.
"G.E. has instead focused its turbine business where it sees the vast majority of demand: on land. Offshore wind, said Mr. Fludder, is "just a vastly costlier proposition — not for us but for the world."