Making matters worse, because wind farms are an unreliable source for electricity, users still need complete backup power generation, whether it runs on coal, natural gas or nuclear power. And these plants are never really offline; as Robert Bryce pointed out in Gusher of Lies, his exceptional book on America’s energy needs, these other plants are sitting in what is known as spinning reserve. Kept ready to take over from the fickle wind patterns around the world, they use energy themselves: The real net savings of using this alternative electricity source just keep shrinking.

Bryce also noted that in 2004, England’s Royal Academy of Engineering released a report concluding that when one factors in all of the costs for wind power — including keeping the more traditional generation sources online — the cost of electricity from wind is more than twice the cost of electricity from coal, natural gas or nuclear power.

Closer to home, last year the Electric Reliability Council of Texas reported that wind power could be counted on as being reliable just 8.7 percent of the time during periods of peak demand. Say that again: 8.7 percent reliability for a trillion-dollar investment? Yes. And we would still to have to build more conventional generation plants to cover our future electrical needs — to cover that 91.3 percent of the time when there isn’t enough wind to generate electricity.

Congress: We Won’t Get Fooled Again

I haven’t even mentioned that the cost of installing a land-based wind generator has risen 74 percent over the past three years; it’s now pushing $2.6 million per megawatt hour. And there’s no reason to believe that these associated costs won’t continue to rise if some Congressional Mandate forces wind-powered electricity on us.

This brings up the next point: That’s exactly what promoters of this type of electricity are pushing for, a mandate from the government to move forward.

Here’s where Pickens shows this hand. In an op-ed piece in the Wall Street Journal he says this miracle can be accomplished without any further government regulation — but then immediately adds that Congress should mandate wind power and its subsidies. For what it’s worth, there is a 1.9 cent per kilowatt tax credit for wind farm owners now, but that was not renewed in the 2007 Energy Bill. Or, just using my electric bill from last month: If any of that energy had come from wind farms, their owners would have gotten a $5.54 direct tax credit. Now multiple that figure times millions.

Mandated structures don’t work. Over the past 35 years Washington has given away untold billions in taxpayer monies or lost federal revenues for pie-in-the-sky ideas that were supposed to wean us off of foreign oil. But when Pickens says we imported 24 percent of our oil in 1970 and it’s 70 percent today, he’s absolutely correct: Congress gave those billions away and got us nothing in return.

Speaking of Silly Things

In a meeting last week with Rick Wagoner, CEO of General Motors and just a prince of a guy, he mentioned that GM is still bullish on ethanol. Then he gave me a wry smile and said, "Ed might have another opinion." Well, yes. I do. Thanks, Rick.

Before the last ethanol mandate from Congress, the price of corn was around $2.50 a bushel and today is almost three times that amount. Ethanol has given consumers higher prices for all grain-fed meat — and the price of oil has almost tripled and the price of gasoline almost doubled. So where is the positive impact from adding ethanol to the nation’s fuel supplies? Obviously, if the original theory was that ethanol was going to reduce our need for foreign oil or bring its price down, then its mission is an abject failure.

Oil is up, gasoline is up, corn is up, eggs, milk and meat are up — but in fact, our oil demand is down. Not because of ethanol, but because the individual’s experience with recent gasoline prices has weakened demand.

After factoring in items such as higher prices for natural-gas-powered automobiles, the poor reliability from wind power and the creation of a national infrastructure for delivering natural gas for automobiles, maybe nuclear power is the right answer. Alternatively, we could commit to some basic acts of conservation, like driving slower to maximize our fuel efficiency, or making our homes slightly more energy efficient. Or, currently Option C, a $1 trillion wind farm experiment that will give us 100 percent reliable electricity — less than 10 percent of the time.

The key thing to remember is, they need Congress to mandate this into reality. "Mandate" is code for "a government handout to private industry to do something that makes zero financial sense from a business viewpoint, except to those who stand to make a killing."

© 2008 Ed Wallace

Ed Wallace is a recipient of the Gerald R. Loeb Award for business journalism, given by the Anderson School of Business at UCLA, and is a member of the American Historical Society. He reviews new cars every Friday morning at 7:15 on Fox Four’s Good Day, contributes articles to BusinessWeek Online and hosts the talk show, Wheels, 8:00 to 1:00 Saturdays on 570 KLIF. E-mail: wheels570@sbcglobal.net

8.7 percent reliability for a trillion-dollar investment? Yes. And we would still to have to build more conventional generation plants to cover our future electrical needs — to cover that 91.3 percent of the time when there isn’t enough wind to generate electricity.

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