Lesser misstates facts at Heritage-Exelon anti-wind energy briefing

Economist Jonathan Lesser, who authored a recent report on wind power for Exelon Corp. as part of its campaign against the federal wind energy Production Tax Credit (PTC), made a number of misstatements about wind at a Capitol Hill briefing sponsored by Exelon and the Heritage Foundation.

As the late Senator Daniel Patrick Moynihan once said, “Everyone is entitled to his own opinion, but not his own facts.”  Here are some facts of which Mr. Lesser seems unaware:

Variable electric generation from wind farms can be integrated readily into utility systems with virtually zero increase in the need for fast-acting reserves or “backup” generators. Utility system operators already deal regularly with massive swings in electricity demand and in the output of conventional generators. Also, the amount of electricity generated by wind farms changes slowly and predictably; failures at conventional (nuclear and fossil-fueled) power plants occur instantaneously without warning. The fast-acting reserves utility system operators must have on standby 24/7/365 for conventional outages typically cost dozens of times more than the slower-acting reserves needed for wind’s variability. It is more appropriate to talk about the need to back up large conventional power plants than about backing up wind power.  Tellingly, Mr. Lesser had no response to our main point that the grid integration costs for large coal and nuclear power plants, such as those operated by Exelon, are far larger than the integration costs for wind.

Wind power saves consumers money because it costs very little to operate a wind farm, and wind turbines need no fuel. When the wind is blowing, utility system operators turn down, or turn off, the output from the most expensive power plants on the system to save on fuel costs. For example, here is what Joe Gardner, Executive Director of Real-Time Operations for the Midwest Independent System Operator (MISO), said recently about wind generation after it reached a peak of more than 10,000 MW on the MISO system:

“Wind represents one of the fuel choices that helps us manage congestion on the system and ultimately helps keep prices low for our customers and the end-use consumer. When we have significant quantities of wind being generated, we use less of other, more expensive, generation types to keep the system in balance.”

Adding wind power to a utility system actually improves average fossil power plant efficiency while also reducing pollution.  The reason for this is the same as the reason wind power saves money: when the wind is blowing, wind generation displaces the output of the most expensive, and therefore least efficient, fossil-fired power plants first.  Typically these are the older plants that also pollute most, which means that wind power is very effective in reducing pollution. All government, utility, and grid operator data and studies confirm that adding wind energy to the grid significantly reduces fossil fuel use and pollution.

Large quantities of wind energy can be reliably integrated onto the power system through the use of wind energy forecasting and other grid operating tools. I wrote here recently about new wind generation records being set by the ERCOT (Electric Reliability Council of Texas)(8,521 MW, or 28 percent of total electric generation) and SPP (Southwest Power Pool)(5,215 MW, or 21 percent) systems. As other examples, Xcel Energy’s utility system in Colorado frequently obtains more than 55% of its electricity from wind energy, and Portugal’s utility system has regularly exceeded 90% wind energy, all without any reliability problems. For all of 2011, wind energy provided about 20% of the electricity produced in Iowa and South Dakota.  (See p. 9 of linked report.)

As I have stated previously, Mr. Lesser is overstating current wind integration costs by a factor of five–they are roughly $100 million, rather than the $500 million he claims. My source for this data is a summary of more than a dozen wind integration studies (see p. 64 of linked document) presented in the annual wind market status report prepared for the U.S. Department of Energy by Lawrence Berkeley National Laboratory (LBNL).  Mr. Lesser is referencing a National Renewable Energy Laboratory (NREL) study, but that study is examining a projection in which wind supplies 30 percent of the electricity on a utility system.  In fact, today wind provides 3 percent of our electricity supply.  While integration costs do rise as the share of wind generation on a system increases, we are still a long way from 30 percent today.

Geographic dispersal of wind farms makes their aggregate electricity production less variable and more predictable. (See pp. 21-28, http://www.vtt.fi/inf/pdf/tiedotteet/2009/T2493.pdf). This is something that seems intuitively obvious–the wind is usually blowing someplace, and the larger the geographical area being considered, the more likely that will be the case–and has been documented by a host of studies.

By Michael Goggin, AWEA Manager-Transmission Policy, http://www.awea.org/blog