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Why is Duke buying costly wind power?

Sometimes, because of lack of information, Americans don’t always have a clear understanding of circumstances. For instance, I had always assumed that Indiana power companies, namely Duke Energy, had to purchase any and all electric power generated by solar or wind.

According to an article written by Ryan Tracy in the Friday, March 29, 2013, edition of The Wall Street Journal, that is not so in all states. Indiana is not one of those states that have a mandatory purchase provision for solar and wind. The purchase of solar or wind generated energy in Indiana is voluntary on the part of Duke Energy.

Maybe the Tipton County Citizens for Responsible Development should be asking Duke Energy why Duke is purchasing energy from the wind farms when there is no state mandate. The purchase of wind generated power produced in Tipton County carries a tremendous subsidy that is paid by every American tax payer.

In comparison, the subsidy for oil and gas is $0.64 per megawatt hour versus $56.29 per megawatt hour for wind, a $55.65 per megawatt hour difference. The difference is being paid by the citizens of Tipton County, the state of Indiana, and the rest of the United States. The total wind subsidy for 2010 was $5 billion.

Additionally, in 2010, coal oil and gas paid $10 billion in federal taxes to the United States Treasury, while wind was draining billions from the Treasury’s current account.

The Wall Street article continues, “There is no federal rule requiring utilities to purchase renewable energy, but mandates require it in 29 states. This year, legislators in at least 14 of those states have introduced bills that would water down or repeal renewable energy mandates, according to Database of State Incentives for Renewables and Efficiency at North Carolina State University.”

If I was a member of the CRD, I would be asking Duke Power why, when much cheaper energy is available and there is no state of Indiana mandated purchase requirement, Duke Power is purchasing extremely expensive energy from the wind farms. If the CRD could stop the purchase by Duke Power of the excessively expensive power generated by wind farms, they could cut the head off this snake.

The mandates for supporting wind and solar are nothing but tax increases in sheep’s clothing. If Duke Energy has signed long term contracts for energy coming from wind farms somebody should lose their job.

Rob Gramlich, interim chief executive of the American Wind Energy Association said, “States with mandates have seen in some cases over a billion dollars of investment in construction and manufacturing. The benefits are no longer hypothetical.” I will agree with that statement with one caveat. As far as Tipton County is concerned, employment levels for maintaining the wind farm is pitiful. Once the giant wind turbines are in place, benefits are few to anyone except the land owners who have sold their soul for a few pennies. The Wall Street article stated that utility companies are generally steering clear of the state frays.

North Carolina based Duke Energy Inc., for one, hasn’t taken a position on the repeal effort. Why would one of the largest energy companies and obviously experts in the United States, not give an educated opinion on something so important to the American consumer? Is Duke Energy so afraid of the environmentalists that they won’t comment, right or wrong? If not concerned with environmentalists, then who or what is keeping a company in the forefront of energy production in the United States from stating an opinion? It’s a lack of intestinal fortitude.

The issue of state mandated energy purchases, or lack thereof, is worthy of examination by the Tipton County Citizens for Responsible Development. States that presently have mandates requiring energy companies to purchase power from renewables will, sooner or later, repeal those requirements. The reason is simple, it increases costs for customers.

Eventually, the American consumer of power in the United States will determine the preferred energy source and will eliminate marginal suppliers. The long term competitiveness and viability of wind generated energy is questionable.