Hydroelectricity: Are Water and Wind Transparent?

Bills making their way through the Minnesota legislature would bring a degree of honesty to "renewable energy" counting. Legislators and citizens clamored last year to count all the hydroelectricity that the state's utilities already buy and consumers already use. Minnesota's Next Generation Energy Act recognized hydroelectricity as a renewable energy source, but simultaneously forbids counting electricity from generators of over 100 MW capacity.

Minnesota's Renewable Energy Standard (RES) mandates that 25% of electricity must come from "renewable" sources by 2025. This eliminates the State's primary hydroelectricity sources - Manitoba and Missouri River basin. House File 2190 and companion Senate File 1906 would address this.

Illuminating the connection to industrial wind, Center of the American Experiment's Peter Nelson provided testimony to the Senate Committee on Energy and the Environment last week. 

"While it is likely that utilities are underreporting the rate impact, it is possible that recent additions of wind energy sources posed little to no impact on electricity rates.  But that’s not because wind energy is a cost competitive energy alternative.  Rather, it’s because the federal government heavily subsidized wind energy development.  Indeed, federal taxpayers have been footing the bill for Minnesota’s RES."

"Looking to the future, Minnesota cannot depend on federal subsidies to cover the cost of the state’s RES.  These subsidies are set to expire at the end of 2012 and they are unlikely to be renewed in the current economic and political environment.  Navigant Consulting compared the levelized cost for a 100 MW wind plant depending on certain policy scenarios.  The cost was around $40/MWhr in 2011 with all of the federal subsidies in place.  After the federal subsidies expire, the cost rises to around $100/MWhr in 2013.  In its December 2011 Resource Plan update, Xcel reports that “post-2012 wind projects may be significantly more expensive if they are unable to rely upon the availability of the [federal Production Tax Credit.]”

Bill Grant, Director of Commerce's Office of Energy Resources, stated that Minnesota's 2007 Renewable Energy Standard was designed for "speed".  The goal was to install as many wind turbines as possible, as fast as possible, in order to get as much federal subsidy money as possible. 

Water is transparent: Counting water generated electricity fulfills the State's mandate. 

Wind is transparent: Citizen tax and rate money taken by force of law for a contrived "need".

Honest counting of hydroelectrical usage removes the artificially contrived "need" for industrial wind. The Coalition for Sensible Siting encourages honesty and transparency in energy policy.  Minnesota legislators are encouraged to support HF 2190/ SF 1906.

Peter Nelson's 2011 report, "Recommendations for Promoting Affordable and Competitive Energy Rates in Minnesota", provides a comprehensive RES analysis.