Contributors
Richard Asinof: Focus should be on small-scale wind power
08:17 AM EDT on Friday, August 10, 2007
IN ALL THE ARGUMENTS back and forth regarding large-scale utility wind projects, a very simple truth seems to get lost: Smaller-scale, behind-the-meter community wind turbines are a prudent, cost-effective investment for Rhode Island towns and institutions to reduce high electricity costs and save money for taxpayers.
These wind turbines — between 600 and 1,500 kilowatts — provide electricity directly to the meter at a facility such as a high school, usually one of the largest electricity users in any town. By replacing the electricity at the retail rate — about 14 cents per kilowatt-hour today and certain to cost more in the future — a community wind turbine can achieve large savings for a town.
And, thanks to the new net metering law in Rhode Island, which the legislature enacted this year, these community wind turbines can reap even further cost savings by being given full credit, at retail rates, for any excess power the turbine generates.
These smaller-scale community wind turbines can operate extremely efficiently at wind speeds that may be termed “marginal” for utility-sized wind farms.
That’s why numerous Rhode Island communities in the East Bay are exploring the feasibility of constructing community wind turbines — including Bristol, Portsmouth, Warren, Barrington, Jamestown and Middletown. They are following the lead of the Portsmouth Abbey School, which has built and operated its own behind-the-meter wind turbine and is now reaping the benefits.
The savings are quantifiable. A detailed — and conservative — financial analysis by the Barrington Exploratory Wind Power Committee found that a 600-kilowatt community wind turbine built at Barrington High School would produce as much as $600,000 in savings over a projected 30-year life span (with refurbishing at 20 years).
In addition, these savings may be increased by about $500,000 if Barrington is successful in its application for $2.1 million in zero-interest federal Clean Renewable Energy Bonds. (Portsmouth was awarded $2.6 million in Clean Renewable Energy Bonds in 2006.)
In addition to the direct economic savings, community wind turbines can also achieve numerous important qualitative benefits.
They can provide towns with the ability to act at the local level to reduce harmful climate-changing carbon emissions (from coal, oil and gas-fired electric-power-generating plants, such as the coal-burning plant in Somerset).
They would also provide local school systems with excellent opportunities for students to learn about the science, technology, engineering and mathematical applications of renewable-energy technologies.
They would create an enhanced image of a community willing to invest in making itself a better place to live, increasing property values.
They would also create an enormous opportunity to educate Rhode Islanders about the value of wind power, and debunk many of the insidious myths and half-truths claimed by opponents.
The Rhode Island Office of Energy Resources and its Renewable Energy Fund, which receives money paid by ratepayers to support the development of renewable energy, is in an excellent position to support the development of community wind programs.
In the past, through an incentive policy, money targeted expressly for these kinds of projects by the state’s Renewable Energy Fund was used to “buy down” 30 percent of the total capital cost of community wind turbines. This “buy-down” incentive, which was provided to Portsmouth Abbey to help construct its wind turbine, is used by a number of other states, including Massachusetts, New Jersey and California. By reducing a wind turbine’s total capital cost — and payback period — by one-third, it can serve as one of the most effective policies to make community wind turbines even more economic to Rhode Island cities and towns.
Unfortunately, Governor Carcieri’s commissioner of energy resources, Andrew Dzykewicz, who has been vocal in his opposition to community wind projects, eliminated the “buy-down” incentive in a policy decision. He would prefer to have all energies directed toward his efforts to create a massive, utility-sized wind farm or wind farms for Rhode Island, which so far has proven to be a quixotic quest.
In April 2007, Governor Carcieri’s administration announced plans to create large-scale, utility-sized wind farms, identifying 11 potential sites (10 off-shore, one on-shore in Little Compton) to meet the planned goal of 20 percent of the state’s energy generated by renewable resources.
The state’s plan called for a quasi-public state agency to be created to “manage” the wind project. However, the legislature, which found some problematic wording in the proposed legislation to create the agency, did not bring the plan up for a vote.
Under the plan, the new quasi-public authority would have been able to bond energy developments up to $1 billion — whether or not they were renewable. In other words, the new authority would have been able to finance coal-burning plants, if it wanted. As a result, many environmental groups refused to support the legislation.
In a blatant “power” grab, the new authority, under the proposed legislation, would be given control over all wind projects in Rhode Island, past, present and future, forcing community wind projects to sell electricity to the new authority at less than the market price. The authority, as the newly created middle man, could then re-sell the electricity at market rates. As a result, potential cost savings realized by communities would be “taken” by the state — an action that may not be constitutional.
In a July 15 editorial, “Legislative power failure,” The Journal criticized the legislature for not moving more quickly to establish the new power authority. In its zeal to promote renewable energy, the editorial board apparently did not read the legislation’s fine print — language that would have turned the proposed power authority into a classic Rhode Island boondoggle that hurts, rather than helps, the development of renewable energy in the state.
At a conference on wind energy at the University of Rhode Island in April, Commissioner Dzykewicz argued for his proposal, showing a slide from Independent System Operator-New England, responsible for managing the electric grid in the region. The slide shows the actual peak electric demand for 2000-2005 and the forecasted peak electric demand for 2006-2012, rising from its current 28,000 megawatts to 31,000 megawatts.
Mr. Dzykewicz told the gathering he had nightmares about how the region was going to produce the additional megawatts.
However, in attempting to sell his plan, he told only half the story. He failed to display an equally important slide from ISO-New England, detailing how peak demand in summertime drives the need for new capacity.
A more cost-effective solution, according to Gordon van Welie, ISO-New England president and chief executive, is to cut the peak demand. For every 1,000 megawatts shaved from peak demand, the region will realize $600 million in electricity savings a year, van Welie told a gathering at MIT in February.
This argues forcefully for a system of community wind projects throughout the region, removing demand from the grid, as well as complementary investments in energy efficiency (the most cost-effective way to reduce energy costs) and distributed generation, behind-the-meter applications of solar- and wind-energy systems.
Mr. Dzykewicz’s dislike of community wind projects seems to mirror the position of the other major player — National Grid. The gargantuan foreign-owned corporation has created a veritable monopoly for electricity and natural-gas services in Rhode Island, providing electricity to 477,000 customers in 38 of the state’s 39 communities and delivering natural gas to about 245,000 customers in 33 communities.
National Grid makes its money when it sends electricity over power lines to the customer. Community wind projects, which benefit Rhode Island residents and towns, do not increase National Grid’s profit margin.
The choice Rhode Island faces is how it will control its energy future. At the earliest, it will take years — perhaps even more than a decade — for any proposed wind-energy project on the scale proposed by Commissioner. Dzykewicz to become a reality. While such a project, if done correctly, can have enormous value to Rhode Island and the region, it shouldn’t preclude making prudent investments today in community wind projects that can be up and running in the next two years, realizing immediate cost savings for Rhode Island towns and tax payers.
Rhode Island, if it so chooses, can become a national leader in creating community wind projects. While towns and cities can make these investment in community wind projects by themselves, it behooves the legislature to support these efforts — and for Governor Carcieri and Mr. Dzykewicz to be more flexible and change their policies and priorities.
Richard Asinof served as the chairman of the Barrington Exploratory Wind Power Committee. The opinions expressed in this op-ed are his own, and do not necessarily reflect those of any group.
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