Many people don’t realize that wind energy is costly and that building wind turbines has led to increasing electricity prices in Minnesota. In fact, data from the federal Energy Information Administration (EIA) show Minnesota’s electricity prices have increased 26 percent more than the national average since 2007, when then-governor Tim Pawlenty signed the Next Generation Energy Act (NGEA) into law.
But why are prices increasing if the cost of generating electricity from wind—$15 to $25 per megawatt hour (MWh) with federal subsidies— is lower than that of coal at $25 to $35 per MWh?
We’re glad the article brought this up. Before I jump into this further, it’s important to ask this question: “Would you be willing to only have electricity when the wind is blowing?”
The answer is probably not, and I’m not trying to make a flippant statement about everyone sitting alone, cold, and in the dark. However, the fact that people want electricity at all times means the general public need to understand that adding wind power to our electricity mix isn’t like trading in your Hummer for a Tesla at the car dealership.
Wind turbines can only produce electricity when the wind is blowing. When the wind isn’t blowing we need other power plants to ramp up their production of electricity to fill the gaps. EIA data show wind turbines in Minnesota generated electricity about 33.67 percent of the time in 2016. In Minnesota, coal plants generally supply power when the wind isn’t blowing.
As you can see, adding wind does not remove the need to have coal-fired power plants running on standby to generate electricity in case the wind isn’t blowing. Therefore, instead of saving money consumers money by installing cheaper generating units and retiring older, more expensive assets, the part-time nature of wind requires consumers to pay for both wind and coal. This brings the total cost per megawatt hour up to $40 to $60 per megawatt hour.
Paying twice for electricity is why electricity prices continue to increase.
The previous article suggests that “Folks complaining about wind should look at how much we’ve spent on coal and nuclear plants.” So that’s exactly what I did.
I added up the costs of retrofitting and upgrading the Monticello and Prairie Island nuclear plants, and various upgrades and conversions at Big Stone, Sherco Becker (2 plants), Allen S. King, Riverside, Black Dog, and all MN Power Facilities—which includes the Clay Boswell power plant— and our results were:
About $4.5 billion to upgrade all of these facilities, or $10.5 billion less than the cost of building wind turbines and the transmission lines needed to transport the electricity generated from them.
Another thing to keep in mind is that EIA data show these power plants were very productive, generating 41.5 million MWh of electricity, about 70 percent of all the electricity generated in the state in 2016. In contrast, all of the wind farms in the state generated 9.93 million MWh, about 17 percent of electricity generation.
If you do the math, the cost of upgrading all of these facilities comes out to about $107.60 per MWh, whereas the cost of installing wind turbines and transmission lines amounts to about $1,510 per MWh. This strongly suggests Minnesotans get a much better value for upgrading existing nuclear, coal, and natural gas plants than building new wind facilities and transmission lines.
The part-time nature of wind means it is not a substitute for dispatchable sources of energy like coal, natural gas, hydroelectric power, or nuclear power because these sources of energy must be ready to provide electricity when the wind doesn’t blow. Therefore, we will still need some combination of these technologies (or expensive battery storage) to ensure we always have electricity. Nuclear energy, on the other hand, could actually replace coal as a form of electricity with no CO2 emissions.
If we want cleaner and cheaper electricity, then wind energy is NOT the answer, which is why we put up our awesome billboards.
Isaac Orr is a Policy Fellow at Center of the American Experiment.