Transcript Slide 1

Taking Advantage of
America’s Wind Resources
Providing Infrastructure and Implementing
Predictable, Long-Term Incentives
Ross Beppler
Wise Presentation 7/25/12
What’s the Challenge?
•Any way you look at it
(yearly gross, per capita,
historical) the United
States emits large
quantities of carbon
dioxide
• 315,000 million metric
tons of carbon dioxide
have been emitted since
1900
The Impact of the Power Sector
• The Power Sector has a huge impact on the
carbon dioxide emissions in this country
• Nearly 70% of power generation comes from
fossil fuels
• 92% of coal is used for electricity
• Wind can be used as a means of power
generation
Why Wind?
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Part of a diverse portfolio
Abundant
Low Levelized Cost of Energy (LCOE)
Minimal land impact
Domestically produced: over 500 US
manufacturers produce parts for turbines
• Demonstrated Success: 90% reduction in cost
since 1980, 35% of new generation the last 5
years
How Does Wind Work?
• Not a New Concept:
5000 B.C. first harnessing of wind energy
200 B.C. first windmill
1890 first electricity production
WWII first U.S. use
• Capacity Factor- Ratio of Maximum Potential
Output to Actual Power Generation
• Wind Classes
Energy Policy in the United States
• 1970 oil embargos begins federal investment in
wind energy
• 1978 Energy Tax Act establishes first federal tax
incentive
• 1992 Original Production Tax Credit set at 1.5
cents per kilowatt-hour
• The Production Tax Credit has been the primary
government incentive
• PTC will expire in 2013
Does Wind Receive an Unfair
Advantage from the Government?
• Not so fast!
• Long History of Government Subsidies for
Energy Production
• Federal Subsidies for Fossil Fuels are part of
the permanent Tax Code
• Research and Development funding is skewed
in favor of fossil fuels
What Other Obstacles Does Wind
Face?
• Variability
• Lower Capacity Factors than other forms of
generation needs back up generation
• Leveling of costs
• Kills birds and bats
• Results in Shadowing and Noise
• Transmission Infrastructure
What do we do?
Policy Alternatives
• Something
Production Tax Credit Extension
• Extend the Production Tax Credit
Pros
Cons
Demonstrated Success
Not Technology Neutral
Political Support
Costs the Gov’t Money
Industry Backing
Long-term Sustainability?
Impact
Renewable Portfolio Standards
• Requires electricity producers to provide a
certain percentage of their generation from
renewable sources
• Primarily a state incentive thus far
• Success of state programs has garnered
attention for a national model
• Bingaman, Markey, and Waxman sponsored
bills with different priorities
Cap & Trade
• Sets a limit to the emissions allowed before a
penalty is imposed
• Creates a market for Renewable Energy
Credits which can be traded allowing market
forces to set the price
• Potential complications with offsets
Recommendation: Carbon Tax
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Technology Neutral Solution
Existing infrastructure to put in place
Not as prone to corruption
Continuing incentive to reduce emissions
Applicable to all power generation
Could be applied to gasoline consumption
Allow states to continue setting RPS
Revenue Generation could pay for necessary grid
Improvements
Acknowledgements
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For help with the paper the author would like to recognize:
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Erica Wissolik, IEEE-USA, and everyone involved in the WISE
program who made this opportunity possible
Bill Behn, Factuly Member in Residence
The IEEE Energy Policy Committee for allowing access to
their meetings and correspondence
Charlton Clark at the Department of Energy for providing an
inside look at the DOE’s Wind Program, and giving valuable
information and contacts
Former WISE interns for their advice, specifically Levi Lyons
for his guidance on transmission issues
John Buydos at the Library of Congress for providing
assistance navigating the vast resources of the library, and
selecting some initial resources
To the many others in D.C. and beyond who were consulted
as a part of this process and aided in the completion of this
report
To the author’s parents for their moral support and editing
help
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