All that is green is not necessarily good. Before the Town of Ipswich builds a second of a series of wind turbines, the residents should ask themselves whether green is good or if green is just plain greedy.
The current wind turbine and the proposed second wind turbine for the Town Farm Road site are a bad deal for the residents of Ipswich who buy their electricity from the Ipswich Municipal Light Department (IMLD).
First, let’s dispel the assumption that wind power is free and the Ipswich schools benefit from free electricity.
Today, the IMLD can purchase energy at about $50 per megawatt hour (mwh). Wind turbine No. 1, the one currently operating on Town Farm Road, cost the Ipswich schools and the IMLD, $4.36 million to build. The IMLD estimates that the cost per mwh is about $65. However, this is just an estimate because it is dependent on the sale of Renewable Energy Certificates (RECs) at $21/mwh to offset the $4.36 million the schools and IMLD spent to build it.
Unfortunately for the schools, IMLD and ultimately, Ipswich residents, RECs today sell for between $5 and $14/mwh and so the $65/mwh appears to be, at best, optimistic. So, the Ipswich schools effectively are paying at least $15/mwh, or 30 percent more, for electricity because it comes from the turbine. These are dollars being used to pay a higher rate for electricity that could be used for other things like paying for busing so residents don’t have to, or funding other programs.
You may ask yourself, what are RECs?
RECs are derivative securities created by Enron, the energy company that went bankrupt under a cloud of fraud. Further, these RECs are not unlike the mortgage-backed securities that nearly bankrupted the world’s largest banks and required nearly a trillion dollars of taxpayer money to resuscitate. So not only are the Ipswich schools paying more for electricity, they are also now in the business of trying to sell complex derivative securities.
Despite all of this, IMLD is ready to double down on wind. There is a second wind turbine being proposed next to the one already built. This is a $5.4 million project that the IMLD is building in partnership with a private developer.
While the town does not have to pay $5.4 million to build the second turbine, IMLD is obligated to buy electricity from it for the next 13 years at a cost of about $125/mwh or 2.5 times the amount it buys electricity for today! This cost will be borne by the residents of Ipswich.
Why does wind cost so much more? In part it is because Ipswich is in a marginal location when it comes to siting a wind turbine. The fact is that there are far better locations to place wind turbines in Massachusetts than Ipswich based on studies performed by the U.S. Department of Energy.
Because Wind Turbine No. 2 will be built and owned by a private developer, it is estimated to bring in additional taxes of approximately $78,000 per year. However, does this benefit offset the diminution of property values? Does this benefit offset the years of expense and effort to preserve the salt marsh?
The IMLD is industrializing the southern end of the Great Marsh by putting up 40-story electrical power plants. This is not just about preservation of views. This is not just about conservation of the Great Marsh. Everyone supports renewable energy. However, the fact is that going green is expensive, especially the way IMLD is going about it.
I don’t think we want to buy into a boondoggle. By choosing to build the wind turbine, IMLD is taking money from each resident’s household budget and directly transferring it for the benefit of a private developer.
There are other sources of renewable energy that are better, abundantly available and cheaper.
The Ipswich Board of Selectmen voted this past Monday, Sept. 19, to include an open-ended, blank check warrant to move forward on Wind Turbine No. 2. Town meeting is the only opportunity the residents of Ipswich will have to voice their concerns.
By voting yes, Ipswich residents will give IMLD authorization to commit to a $5.4 million project, the cost of which will be borne entirely by its residential customers.
Vote NO for Article 12 at the October special town meeting.