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Let’s talk about money and wind farms  

Credit:  OPINION: Let's talk about money and wind farms | By Dr Jamin Hubner | The Daily Republic | Aug. 14, 2015 | www.mitchellrepublic.com ~~

On April 29, The Daily Republic published my column, “Wind Farms: The Worst Idea Since Cash for Clunkers.” Since then, there have been several local responses to both my article and to criticism of wind energy in general. Allow me to briefly focus on two items.

I reminded readers that (all things considered) government programs cost greater than what such programs “produce.” Subsidies equal (inherently inefficient) income redistribution. The government cannot “pull a rabbit out of a hat.” In a May 14 column for The Daily Republic, Anthony Rezac essentially reached into a hat and proclaimed, “oh yes it can.” I will leave him to that imaginary world.

By June 8, the CEO of American Wind Association finished crafting a remarkably misleading piece of political prose for the Sioux Falls Argus Leader. Like Rezac and others, the majority of anti-wind concerns were casually dismissed while strings of dollar bills were lowered into readers’ faces and swung repeatedly (perhaps this would silence the critics). But, no—no fires were put out, and I might suggest that waving a dismissive hand at South Dakotans as if they were too gullible to care is not a particularly good strategy.

So, since all that pro-wind advocates seem capable of consistently conversing about is money, let’s talk about money and wind farms.

First, to repeat, wind farms have to be subsidized because they generate such a huge financial loss, and no one in the free market is silly enough to build them from their own resources. In Buffett’s words, “they don’t make sense without the tax credit.” It is precisely because of this monetary loss that pro-wind advocates have to resign to exaggerated estimates, numerical figures, and macro-level statistics (absent of micro-level realities) in the first place. They are on the defensive for good reasons.

Second, by comparison, wind energy is the most financially wasteful government-sponsored energy program in existence. This was ably demonstrated in a 2010 study conducted by Simmons et. al. for Utah State University. One key finding was, “In 2010 the wind energy sector received 42 percent of total federal subsidies while producing only 2 percent of the nation’s total electricity. By comparison, coal receives 10 percent of all subsidies and generates 45 percent and nuclear is about even at about 20 percent.”

These figures have not significantly improved today.

And yet we are supposed to believe Tom Kiernan’s claim that wind energy will soon “compete” with other sources of energy? Like a tricycle in Nascar.

Third, claiming American wind energy helps the American economy by being distinctively “local” is absurd. Between 75-90 percent of wind farms are owned by foreign corporations/investors, and more than 60 percent of wind turbines are manufactured by foreign companies, according to Choma. American wind energy is as American as a pair of shoes labeled “Made in China.”

Fourth, property owners who have sold their wind rights may never earn their royalties fast enough to cover the loss in property values from owning them. In other words, those who are supposed to be making millions, don’t. (You can find this out yourself simply by asking around.) None of the financial figures produced by the AWA or – to my knowledge, by any pro-wind advocate – takes into full account this central negative factor: depreciation of land. This is significant not only because of the amount of depreciation for land near and under wind farms (which is high), but because of the ever-increasing value of land (amplifying the losses).

More than a half-dozen independent studies conducted by appraisers and university-sponsored groups in the last decade found a 15-59 percent decrease in property values on or near wind farms (see McCann Appraisal LLC, summaries). (Predictably, pro-wind studies creatively generate data with lower estimates).

Combined with 30-40 percent income tax on earnings from wind royalties, shoddy contracts often not inflation-adjusted and dependent on Washington’s empty wallet (and irrational politics), certain land-owners with wind farms ultimately earn pennies instead of millions over the long haul. (This is what you won’t hear when signing a 30- or 60-year contract.) Even for the lucky few in better situations, the profits still don’t add up to the glorious estimates because of these losses.

Fifth, because of this liability, investors will go elsewhere to invest their money (as will families in local communities). Few want to live on or near a wind farm, and no investor wants to invest in land that has any potential for significant depreciation. (And this is true whether land actually depreciates or not; ambiguity is enough to stop investors).

Sixth, as mentioned above, wind-farm developers’ numbers (whether royalty estimates, long term sales, “bringing money to the community,” etc.) are so out of touch with reality that it’s hard to even keep a straight face. Speaking of, Kiernan in his article even claims wind energy will contribute to the prevention of “a total of 22,000 premature deaths by mid-century” via cleaner air. What’s next? The vibration from turbines will cure constipation? Happy day, Farmer Joe.

Space does not allow for seventh, eighth, etc. But, wind energy advocates should at least pause before mindlessly regurgitating monetary figures in public and proclaiming everyone a financial winner with wind farms. Nothing is free, and the monstrous costs of wind energy are coming to the light year after year.

[rest of article available at source]

Source:  OPINION: Let's talk about money and wind farms | By Dr Jamin Hubner | The Daily Republic | Aug. 14, 2015 | www.mitchellrepublic.com

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

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