Wind Energy vs. Fossil Fuels: Hurdles and Hopes for a Renewable Future
ENERGY, 8 Jun 2015
The fossil fuel industry receives billions in taxpayer subsidies as the wind industry fights to take flight.
5 Jun 2015 – The colossal oil spill in Southern California last month spurred many to wonder why we have not abandoned fossil fuels for wind and other sources of renewable energy.
A busted pipeline spewed an estimated 101,000 gallons of crude oil onto a pristine stretch of the Santa Barbara coastline on May 19, creating a nine-mile-wide oil slick in the Pacific.
“We don’t have an estimate for [the duration of] this cleanup response, as we are still assessing the extent of the contamination,” U.S. Environmental Protection Agency spokesman Rusty Harris-Bishop told Yahoo News this week.
Last year, roughly 67 percent of the nation’s electricity came from fossil fuels — such as coal, natural gas and petroleum — which release pollutants into the air.
Meanwhile, wind power, essentially a pollution-free, sustainable energy resource that the United States can harness domestically, supplied only 4.4 percent of the country’s electricity.
But Franklin (Lynn) Orr, the under secretary for science and energy at the Department of Energy (DOE), said the transition to clean energy is already underway — and expected to continue.
“Four and a half percent of America’s total electricity. That is triple the share what it had six years ago. And it’s on track to double again in the next five years,” Orr said in an interview with Yahoo News.
Given the proper financial investment and political backing, wind could account for a much larger percentage of the nation’s electricity production than it currently does.
But, critics say, many corporations and politicians stand to profit from our continued reliance upon fossil fuels.
“There are still a lot of politicians that are really in the pocket of the fossil fuel industry and some that are ideologically committed to it,” Nathanael Greene, renewable energy policy director for the Natural Resources Defense Council (NRDC), said to Yahoo News.
Widespread support for wind energy
The United States is a world leader in wind power, having invested an average of $13 billion per year in wind plants from 2008 to 2013.
Kit Kennedy, director of the NRDC’s energy and transportation program, says the United States underwent a “quiet revolution” in renewable electricity in recent years.
Polls have consistently shown that Americans strongly support wind energy.
Conservative Texas has the most installed wind power capacity of any state, and the runner-up is liberal California.
“It’s not a red state-blue state distinction. Wind is a powerhouse in states across the country. That means we are seeing bipartisan support for wind power, and that’s growing,” Kennedy said in an interview with Yahoo News.
Iowa and South Dakota power more than 25 percent of the electricity in their respective states using wind, she said.
And the United States is not alone. Global investment in wind power soared from $14 billion in 2004 to $80 billion in 2013, a 21 percent annual rate of growth. In 2014, Denmark set a world record by generating about 40 percent of its electricity from wind.
The DOE estimates that wind energy could supply the nation with 10 percent of its electricity by 2020, 20 percent by 2030 and 35 percent by 2050.
This would require cooperation and strategic planning: expanded development areas, increased economic value and reduced costs.
Federal policy: A stable environment for investors
The cost of wind power has dropped dramatically over the past decade.
Still, the initial investment needed to install wind turbines is greater than it is for traditional energy generators. Furthermore, the development of wind farms is not always the most financially lucrative use of land.
The American Wind Energy Association (AWEA), the national trade association for the wind industry, argues that investors need a “predictable, stable pro-growth tax policy” — the kind currently enjoyed by the fossil fuel industry.
The U.S. government provides the Production Tax Credit (PTC) for investors who financially support one of 12 renewable electricity sources.
But potential investors are scared away because Congress does not always extend the PTC, AWEA says.
In 2012, uncertainty over whether the incentives would be renewed resulted in a 92 percent drop in wind installations the following year, according to AWEA; as a result, the wind industry’s economy reportedly lost $23 billion and 30,000 jobs.
“Despite the fact that we have been growing rapidly, there has been a boom-and-bust cycle due to unstable federal policy,” David Ward, director of strategic communications for AWEA, said in an interview with Yahoo News.
Investment in new wind industry projects rebounded after Congress extended the PTC with the American Taxpayer Relief Act, which became law in early 2013, but the damage for that year was already done.
The 2013 drop-off was the most drastic since the PTC was introduced in 1992, but it was not unusual. There had been similar drop-offs in 2000, 2002 and 2004.
“Other industries have permanent incentives in place that do not come and go,” Ward said. “This happens despite poll after poll showing that the overwhelming number of voters support policies supporting wind’s growth.”
State policy: Commitment to clean energy
Twenty-nine states have adopted policies to incentivize renewable energy called Renewable Portfolio Standards. These require state utilities to purchase a certain amount of renewable energy.
For instance, Hawaii recently adopted a policy pledging to use 100 percent renewable energy by 2045. Right now, Hawaii’s electricity is extremely expensive because it is primarily powered by diesel fuel, which is imported to the islands.
“Whenever you are importing oil, there is a possibility of spills,” Kennedy said. “Simply as a matter of economics, Hawaii has gotten religious on renewable energy.”
John Moore, executive director of the Hawaiian Sustainability Foundation, says that the state’s salt saturation can break wind turbines — especially if they are close to the water — but that is no reason to abandon clean energy.
“The majority of people that live in Hawaii see no reason why we can’t have all solar and some wind,” Moore told Yahoo News. “The solar is the real no-brainer because the sun’s always shining here.”
The costs of solar panels for consumers have dropped rapidly, as well.
By 2014, a typical rooftop solar panel cost about 1 percent of what it cost 35 years earlier, Orr explained; as a result, solar PV module installations last year were 25 times what they were in 2008.
“All these efforts are not a coincidence,” he said. “They are the result of public and private investments in research and development.”
California, another state with ambitious goals, is working toward using 50 percent renewable electricity by 2030.
“What you’re seeing is a large number of states — red and blue — adopting these renewable energy policies and a couple of states redoubling their efforts from one set of targets to a new set of targets. That’s incredibly exciting, too,” he said.
Subsidies for the fossil fuel industry
Scientists know that fossil fuels harm the environment, exacerbate climate change and cause respiratory ailments in humans.
So why does the U.S. government shell out billions of dollars to prop up fossil fuels while providing relatively sparse support for wind?
Oil Change International, an organization advocating against subsidies for fossil fuels, says the industry’s fingerprints can be seen on every barrier to a transition toward clean energy.
“We see the influence of the fossil fuel industry as hugely problematic and something that needs to change. We need to separate the influence of the oil, gas and coal industries from our politics,” David Turnbull, campaign director for the nonprofit, said in an interview with Yahoo News. “They spend millions upon millions of dollars to influence our democracy.”
Estimates for how much the U.S. government gives to the fossil fuel industry — not even including indirect costs — can vary from $10 million to more than $50 billion per year, according to Turnbull.
According to a Guardian investigation, the U.S. government awarded Shell, ExxonMobil and Marathon Petroleum significant taxpayer subsidies — worth $1.6 billion, $119 million and $78 million, respectively — thanks to politicians they helped elect by donating to their campaigns.
Greene says it is understandable that the subsidies were implemented long ago to bolster the American economy, but it is time to cut back — especially now that we have viable alternatives.
“The irony is that we are now subsidizing renewables as a way to overcome the subsidies we are paying to the fossil fuels industries,” Greene said. “It’s like subsidizing both sides of a war.”
In the coming decade, taxpayers are projected to give more than $135 billion to these corporations.
Vermont Sen. Bernie Sanders, who recently launched his campaign for the Democratic presidential nomination, and Minnesota Rep. Keith Ellison have introduced legislation that would end subsidies to the oil, gas and coal industries.
“At a time when scientists tell us we need to reduce carbon pollution to prevent catastrophic climate change, it is absurd to provide massive taxpayer subsidies that pad fossil-fuel companies’ already enormous profits,” Sanders said in a release. “At a time when fossil-fuel companies are racking up record profits, it is absurd to provide massive taxpayer subsidies to pad their already enormous earnings.”
ExxonMobil, Shell, Chevron, BP and ConocoPhilips — the five most profitable oil companies — raked in more than $1 trillion in profits over the past 10 years, according to the release.
In a report, the International Monetary Fund (IMF) says that post-tax global subsidies are significantly higher than previously thought and are expected to reach $5.4 trillion by the end of the year.
“The sustained interest in energy subsidy reform also reflects increasing recognition of the perverse environmental, fiscal, macroeconomic, and social consequences of energy subsidies,” the report reads.
In April, World Bank President Jim Yong Kim called for eliminating all subsidies for fossil fuels and implementing a carbon tax.
Similarly, Fatih Birol, the chief economist at the International Energy Agency, has said that fossil fuel subsidies are basically an incentive to pollute.
Fossil fuel industry’s perspective
The American Petroleum Institute, the nation’s largest trade organization for the oil and natural gas industry, argues that fossil fuels are central to the country’s economic growth, energy security and overall security as the foundation for its “all-of-the-above energy approach.”
“We need to make sure that the small but vocal view of those who peddle the false choice between energy production and safe environmental stewardship do not prevail in their narrow view which is contradicted by the facts,” API president and CEO Jack Gerard said during his “State of American Energy” speech in January.
The API and similar organizations argue that not only should we persist in using fossil fuels to maintain our current lifestyles, but also we will have to use more of it in upcoming decades.
Wind power has occasionally been met with resistance — perhaps most famously in Massachusetts.
In 2010, the federal government approved the construction of a wind farm, called Cape Wind, off the coast of Cape Cod.
The proposed 130 wind turbines on Horseshoe Shoal in Nantucket Sound would generate 75 percent of the electricity for Cape Cod, Martha’s Vineyard and Nantucket, according to project organizers.
But there has been fierce opposition from some groups, most notably the Alliance to Protect Nantucket Sound, who say the wind turbines would ruin the ocean views of wealthy homeowners and decrease property values.
Although the Alliance presents itself as an “environmentalist” group, billionaire industrialist William I. Koch, who made a fortune in fossil fuels, is its chairman and a main financier.
The anti-wind campaign has succeeded in slowing construction of the wind farm. Ironically, the Cape and nearby islands would be among the top beneficiaries of wind power, since they are particularly vulnerable to the hazards of climate change.
In March 2015, President Obama committed the U.S. to fighting climate change by setting a challenging, even unprecedented, goal: to reduce the nation’s greenhouse gas emissions 26 to 28 percent below 2005 levels by 2025.
Orr, who was sworn in as the DOE’s under secretary for science and energy three months earlier, said, “We need all of the tools that are in our toolkit now to do this, plus some more that we need to invent.”
Whereas Congress and state governments set the rules for Renewable Portfolio Standards and direct subsidies, the DOE focuses on advancing clean technologies and ensuring that fossil fuels are as clean as they can be.
“What we really need for the country is a well-diversified portfolio of energy,” Orr said. “Fossil energy has a big part in the system now. As we think about transitions, we have to do that in an orderly way that makes the whole system continue to operate.”
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