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The 'green' energy credits that aren't 

In the 16th- century church, those who were long on cash but short on righteous living could balance the equation by buying indulgences, representing a sort of absolution for sinful behavior.

Indulgences may have disappeared about the time of Martin Luther, but they seem to be alive and thriving in a more contemporary religion – the Church of the Green.

Wells Fargo & Co. announced this week that it is buying renewable energy certificates for 550 million kilowatt-hours of wind energy a year for three years.

The bank said the acquisition makes it the “largest corporate purchaser of renewable energy in the United States,” but it’s hardly the first. Everyone from the National Farmers Union to Audubon New York to Whole Foods to Starbucks to FedEx Kinko’s has done similar deals.

And how much of this “clean” wind-generated electricity will Wells Fargo be taking for its own branches, offices and facilities, to supplant supposedly “dirty” power it’s getting from other sources?

Not a single watt.

Instead, Wells Fargo and others are buying credits or certificates representing wind-farm electricity already generated and sold to other utilities and customers. The amount of wind generation is tallied by various organizations that act as clearinghouses, and they in turn sell the credits.

But the buyers of those credits aren’t actually reducing their electrical consumption from the local utilities who serve their offices, power that could come from coal, nuclear, natural gas, hydro, or even wind – not through these transactions, anyway.

So what exactly do these transactions contribute – beyond burnishing a company’s environmental reputation?

The answer, not surprisingly, is that they provide a nice subsidy.

“What renewable energy credits do is provide a second revenue stream for wind developers,” a Wells Fargo spokeswoman says. “It encourages development of more wind power” since it “becomes more profitable for them to do so. It pushes the market.”

It’s not as though companies – and consumers, for that matter – lack for opportunities to save energy if they’re so inclined (and given what electrical prices in particular have done in recent years, they have plenty of financial incentive to do so). Wells Fargo’s own announcement cites its record in reducing power consumption at its own buildings, through such measures as installing more-efficient cooling equipment at a facility in Phoenix.

Furthermore, many utilities offer customers the opportunity to pay a little more on their bill so they can go out and buy “green” power, which is typically more expensive than conventional generating sources. That has the added benefit of eliminating the cut the middlemen clearinghouses are taking.

And it’s not as though wind power has lacked for development incentives without resorting to the gimmickry of renewable energy credits. What with tax credits, technology advances that have driven down the cost of wind power, the cost of other generating fuels going up, and the interest of utilities in diversifying their energy portfolios, wind power is the preferred flavor of the moment.

Puget Sound Energy already has one wind project up and running in Columbia County, and another soon to begin operating in Kittitas County. Wells Fargo’s announcement also cites a direct investment the bank has made in a Texas wind farm.

But what about the supposed environmental benefits to the energy-credit program? Wells Fargo says its purchase of wind credits will offset 40 percent of its electrical consumption and prevent the emission of 380,000 tons of carbon dioxide a year.

But if Wells Fargo isn’t actually cutting its consumption of power, and the credits represent power that someone else has already bought (and would have whether or not someone acquired the credits), it’s an incredible stretch to argue that the purchase of credits represents a reduction in emissions. Not one less lump of coal or cubic foot of gas will be burned because of this. The only heat generated is the warm-and-fuzzy feeling the buyer of credits hopes everyone gets from the publicity.

For all its attributes, wind as a means of generating electricity has drawbacks. There are a limited number of places wind will work. In the places it will work, the wind is not steady, and it sometimes doesn’t show up at peak periods of electrical demand when the additional juice is most needed. Utilities and regional transmission grid operators are wrestling with the issue of how to build a system that can handle the peaks of wind generation, but may sit idle when there’s no wind.

Wind has even generated its own criticisms on environmental grounds, with charges that the spinning blades mar the landscape and will slice and dice birds. While it’s a matter of personal taste, as industrial sites and sights go, windmill farms tend to be intriguing and dramatic additions rather than detriments. And while the bird-mulching scenario makes wind turbines out to be aerial Cuisinarts, in actuality the blades turn so slowly you can easily count the revolutions per minute.

Wind power is a complicated enough topic in assessing its benefits and costs, without having empty-gesture programs such as purchasable credits muddying the waters – or in this case, more properly, clouding the air.

P-I reporter Bill Virgin can be reached at 206-448-8319 or billvirgin@seattlepi.com. His column appears Tuesdays and Thursdays.


This article is the work of the source indicated. Any opinions expressed in it are not necessarily those of National Wind Watch.

The copyright of this article resides with the author or publisher indicated. As part of its noncommercial educational effort to present the environmental, social, scientific, and economic issues of large-scale wind power development to a global audience seeking such information, National Wind Watch endeavors to observe “fair use” as provided for in section 107 of U.S. Copyright Law and similar “fair dealing” provisions of the copyright laws of other nations. Send requests to excerpt, general inquiries, and comments via e-mail.

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