June 5, 2014
Texas

Stop wind subsidies and make them pay their share for power lines, Nelson says

Nicholas Sakelaris, Staff Writer- Dallas Business Journal | Jun 4, 2014 | www.bizjournals.com

The federal government should stop giving out subsidies to solar and wind energy, and wind producers should shoulder the cost to build transmission lines that bring that power from remote locations to populated areas.

Donna Nelson, chairman of the Public Utility Commission of Texas, argues that and other points in a memorandum she sent out to fellow commissioners recently.

After 22 years of subsidies, wind and solar should be considered mature industries, she said. The credit expired in December, but Congress is debating it again. It’s become a hot issue with conservatives who say it props up an industry that no longer needs it.

With more than 11,000 megawatts of wind capacity, Texas produces more wind than any other state and many countries.

The federal wind production tax credit “destroys the underpinnings of the wholesale competitive electric market” and could lead to the loss of base-load generation because it undercuts the price, Nelson said.

In Texas’ electric grid, base-load generation means coal, nuclear and natural gas. Nelson was among those calling for a change in Texas’ electricity market to a capacity market where developers are paid for the capacity they have available in addition to the energy they actually create. The controversial push for a capacity market lost steam in recent months after new projections show the state having adequate power well into the future.

Nelson argues that the Panhandle region of Texas is experiencing so much interest from wind developers that it’s overwhelming the transmission infrastructure, even after Oncor and other utilities paid millions to build the CREZ(Competitive Renewable Energy Zone) project.

The influx of wind power is already causing stability concerns in the Panhandle and West Texas, even though the $7 billion CREZ project just finished last year. The cost for this infrastructure is passed on to Texans’ electric bills. But Nelson suggests the cost should be shared with the wind developers.

“I would like to explore the cost of system upgrades, the costs to maintain and operate the current system and the allocation of those costs specifically related to renewable sources,” Nelson said.

She calls on fellow commissioners to start an “ERCOT Planning and System Costs Associated with Renewable Resources” project to further explore the topic.

Of course, coal plants will face more scrutiny under this week’s Environmental Protection Agency regulations that require carbon emission reductions of 30 percent by 2030. The EPA regulations, part of President Barack Obama’s plan to reverse climate change, are seen as a victory for renewable energy.

URL to article:  https://www.wind-watch.org/news/2014/06/05/stop-wind-subsidies-and-make-them-pay-their-share-for-power-lines-nelson-says/