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Is wind worth it?

Chris Woodward   ( Monday, December 03, 2012

The battle over extending the wind production tax credit (PTC) continues.

With the production tax credit for wind set to expire at the end of this year, a bipartisan group of senators and congressmen -- Senators Chuck Grassley (R-IA), Mark Udall (D-CO) and Representatives Jerry McNearney (D-CA) and Steve King (R-IA) -- held a press conference last month to call for another extension. Forty veterans who now work in the wind industry also came to promote wind as a cost-competitive option for lowering energy costs for Americans.

Lesser, Dr. JonathanBut is wind production worth government subsidies? Dr. Jonathan Lesser, president of Continental Economics, Inc., recently examined four years of data from three regional transmission organizations -- including the one in Texas that has over 10,000 megawatts of installed wind generation -- to find out when wind provided the most electricity and how that impacts the value.

Lesser spoke on the results last week at The Heritage Foundation, which wants the tax credit to end and for wind to compete on the free market.

"The least amount of wind power is generated when the demand for electricity is greatest," he explained. "Conversely, you get the most amount of wind generated typically in the spring, when the demand for power is the lowest. Hence the market prices are lowest."

According to the U.S. Energy Information Administration, wind provided 19 percent of Iowa's total electricity generation in 2011, but it was second to coal.

This is the 20th year for the wind production tax credit.

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