The Deceptive and Destructive Power of BigWind
Remember the environment? Like the actual environment we set out to protect?
The government doesn’t. It has reduced our environmental concerns to an equation.
The equation looks something like this: Government subsidies plus incentives plus mandated use of renewables plus changes in standards and regulations plus “hope” equals the possibility of an eventual reduction in carbon emissions that will presumably be better for the environment. Minus the cost of creating profitable industries and the environmental impacts of these renewables. We just have to hang in there and pay more for electricity as the industry evolves and works out some glitches.
I’m sure Bill Gates is working on robot whales to replace the ones that are washing up on our shores.
Gaslight in hindsight
In 2019, Forbes writer Brian Murray was already trying to employ our patience as energy costs rose:
The investment firm Lazard produces a periodic report on the average cost of generation from different electric power sources – the “levelized cost of electricity” in energy geek parlance. Their latest report shows that over the last decade the levelized cost per unit of electricity from new utility-scale onshore wind and photovoltaic (PV) solar power plants has dropped about 70 and 90 percent, respectively. In many places, the cost of new renewable generation is at or below that of existing conventional sources like natural gas, coal and nuclear.
This would seem to be good news for those interested in making energy clean and cheap. Yet, a recent study suggests that policies that mandate renewable use have driven up the retail price of electricity and have been an expensive way to achieve greenhouse gas reductions – often an implicit reason for those mandates. While it seems paradoxical that electricity prices could be rising while generation costs are falling, this possibility is an artifact of how electricity markets work and how these workings have grown more complex as the industry evolves from a more centralized fossil fuel-based generation base to a more distributed and renewable base.
It only seems paradoxical. It’s complex.
A Numbers Game
According to the Corporate Finance Institute, ”the LCOE (levelized cost of energy) of an energy-generating asset can be thought of as the average total cost of building and operating the asset per unit of total electricity generated over an assumed lifetime.”
We’re going to come back to levelized costs, assumed lifetime and other magical thinking. Back to Forbes circa 2019…
There are several reasons for the steep reduction in renewable costs. One is the improvement in basic product design. Wind turbines are now much larger and have much higher capacity factors than a decade ago. Although the new designs are more expensive up front, increased capacity and capacity utilization have outpaced those higher costs to lower the cost of energy produced. A typical base-to-blade tip height for onshore turbines is now often over 500 feet – as tall as the Washington Monument…
We’re going to come back to this, too…
Murray also credited declining renewable costs to “improvement in manufacturing efficiency” and “policies such as tax credits, preferential feed-in tariffs, and renewable portfolio standards (RPS).”
Even then, the apparent effects of renewable portfolio standards programs (which required that a certain percentage of electricity supply in a state were generated by sources that are designated as renewable) were that retail prices rose considerably while carbon emissions were only moderately reduced.
Our estimates suggest that RPS passage has imposed substantial costs on consumers of electricity to date.
You can read the Forbes article here, and the EPIC report it cited here.
In 2022, we were asked to be patient again.
But the good news for the wind and solar industries is that their resources remain among the least expensive, largely because every major source of electricity is also experiencing a spike in costs. And the Inflation Reduction Act, passed in August, contains incentives for renewable energy manufacturers to build their products in the United States, which could set the stage for a new era of growth in the domestic supply of wind and solar components, and could help to reduce prices.
(more on the Inflation Reduction Act here, here and here)
And the excuses continued in 2023…
Offshore projects can require a decade to progress from planning stages to generating power. That means agreements on issues like the power price may be years old before the turbines are in place and generating electricity.
That system worked when inflation was negligible and demand for turbines and other equipment was relatively subdued. Now, as a growing number of developers look to secure everything necessary to undertake the projects — from wind turbines, which cost millions of dollars, to the services of specialized construction ships, to bank financing — they discover that the price tags have suddenly soared. Mr. Dyrholm estimates that prices of wind turbines alone have increased 30 percent in the past year.
… And 2024
Many companies--including BP and Equinor, and global wind power leader Orsted--rushed to close deals for offshore wind farms with various U.S. state and federal authorities to take advantage of the transition enthusiasm and generosity that the Biden administration ushered in when it took office in 2020.
Wind power was marketed as cheaper than alternatives--except solar--and, as such, the best bet possible for the future of energy as a replacement for gas and coal. Deals were struck for long-term electricity supply at fixed prices agreed between the developers and the local authorities. These prices were based on the assumption of basically static raw material and equipment prices.
When central banks started fighting post-pandemic inflation, however, costs changed. Costs rose. And wind, especially offshore wind, stopped being so cheap. In fact, offshore wind has never really been cheap but it was in the past couple of years that this became obvious and impossible to ignore.
Faced with these higher costs, offshore wind developers had to either scrap the projects that had become unprofitable and not worth building or ask for higher prices. BP and Equinor did the latter, but the state of New York refused to pay more--for a time. The reason it refused was that it realized this would saddle its citizens with higher electricity bills--when wind and solar were being advertised as cheaper than cheap.
Oops! Someone miscalculated the levelized costs.
And this is how that impacts us here at home…
Revisiting the Equation
In 2022, just a few years after Forbes sang the praises of improved turbine design…
…the World Economic Forum suggested we go back to the drawing board.
The wind industry is being buffeted on all sides by shrinking subsidies, surging supply chain costs, and cumbersome approvals processes, compounded by what is often a lack of synchronized and optimized project design. Wind turbines' ballooning size, bulky weight, and inefficient designs create an unsustainable demand for raw materials and increase costs…. A new, efficient design strategy with a considerable reduction in weight will enable the offshore wind industry to sustain exponential growth profitably. (emphasis mine)
How did the experts manage to screw up such a simple equation?
It’s complex.
Titanic Miscalculations
First off, we’re seeing serious flaws in “assumed lifetime” projections. It appears experts grossly overestimated the life of the system.
On July 13, a blade the length of a football field broke off one of Vineyard Wind’s turbines dumping chunks of fiberglass and foam insulation into the ocean before the project even finished construction.
Per the Vineyard Gazette:
Two weeks ago, Vineyard Wind was touting how it had grown to be the largest offshore wind farm in the country when it brought its 10th turbine online. It’s all come crashing down since.
Officials with Vineyard Wind and the turbine’s manufacturer GE Vernova are investigating how the 107-meter blade folded over, but the project’s been shut down indefinitely until federal regulators can figure out what went wrong.
Each Vineyard Wind turbine – there were about 22 either entirely constructed or underway before the broken blade – is more than 800 feet tall, on par with the Eiffel Tower. The company previously said once assembled, the turbines would be “the largest turbine in the western world.”
On day 49, locals are still picking up debris ranging from pieces more than four feet in length to needle-like shards of fiberglass that are washing up along Nantucket beaches.
The fiasco is being blamed on a manufacturing flaw. “Insufficient bonding” says producer GE Vernova. This is concerning given that the company has produced 150 blades and has already installed 24 of the project's expected 62 turbines.
Just last week, another blade failure in the UK was linked to GE Vervnova.
The UK project's failed GE Vernova-manufactured blade is the same model deployed on the Haliade X 13-megawatt turbines under construction in Vineyard Wind's lease area south of Martha's Vineyard.
SSE Renewables has not provided details of the incident other than calling it a "blade failure." It happened less than four months after the company reported that an installed blade on another of its turbines had sustained "damage."
Apparently, no one was anticipating manufacturing flaws and installation failures. Or the laws of physics. Or inflation. Or even the impact of strong wind. And there’s also no plan for what to do with these enormous towers once they outlive their usefulness (which, based on current evidence, will likely be much sooner than industry experts anticipated).
Meanwhile, in the environment…
But the government assures us that everything’s fine.
The federal government issued a new "biological opinion" on the offshore wind power project off Martha's Vineyard and Nantucket, finding that pile-driving noise associated with Vineyard Wind 1 is likely to adversely affect, but not likely to jeopardize, the continued existence of whales, fish or sea turtles listed under the Endangered Species Act (ESA). (emphasis mine)
"It will have no effect on any designated critical habitat," National Oceanic and Atmospheric Administration Fisheries said in a statement. "NOAA Fisheries does not anticipate serious injuries to or mortalities of any ESA-listed whale including the North Atlantic right whale." The agency said that with mitigation measures, "all effects to North Atlantic right whales will be limited to temporary behavioral disturbance."
This must just be a sad coincidence…
Let’s go back to the beginning…
And nourish our roots.
Powerful & informative article - thank you much ATR - God's blessings to you - in GOD we Trust ...
The greenies were actually likable, back when they were all about saving the whales and cleaning up the waterways.
Did those guys all die? Or did they get bought out by the people selling wind turbines and disposable masks?