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Wind energy, natural gas complementary

by John Kintree

(Wednesday, Jan. 14, 2004 -- CropChoice guest commentary) -- About 90% of the new generating capacity installed by electric utilities in the United States in the last five years is natural gas-fired. The additional demand for natural gas from this sector of our economy is contributing to the upward pressure on the price of that fossil fuel today.

Building new generating capacity with natural gas-fired plants made sense five years ago. In early 1999, the price that electric utilities paid for natural gas was about $2.00 per thousand cubic feet. That compared favorably with the high cost of reducing air emissions from coal-fired plants, which account for half of the generating capacity in the United States.

However, at a price of $5.00 per thousand cubic feet (it's higher than that today), the total production cost of natural gas-fired electricity is about 4.2 cents/kWh. The single biggest part of that cost, by far, is for the natural gas.

It would be less expensive to generate electricity for about 4.0 cents/kWh with utility-scale wind turbines.

The wind is a renewable form of energy. Using wind turbines to generate electricity will not reduce the amount of wind energy that will be available next year or 20 years from now. The wind is going to blow regardless of whether we use it to generate electricity, or not.

However, burning natural gas to generate electricity today will affect the price of natural gas next year and 20 years from now. The faster we burn it, the less of it there will be, and the less of it there is, the more expensive it will become.

The bright side is that wind energy and natural gas are complementary to each other. The wind frequently blows best during the winter, which is when natural gas supplies are tightest, and when natural gas prices tend to increase. Natural gas-fired power plants make good backup units to meet the demand when the wind is not blowing.

In terms of a national energy policy, instead of spending $20 billion on a pipeline to bring natural gas from the northern slope of Alaska to the lower 48 states, it might be a better investment to use that $20 billion to create a low-interest loan fund for wind energy.

With wind energy, the largest single expense is the up-front cost of purchasing and installing the wind turbines. If wind energy developers could finance their projects at a 2% rate of interest, the total cost of wind-generated electricity would drop to about 3.0 cents/kWh.

By the end of 2003, there was close to 6,000 MW of wind generating capacity in the United States, which accounts for less than 1% of U.S. electrical production. Investing $20 billion in utility-scale wind turbines would result in another 20,000 MW of wind generating capacity.

The other problem with natural gas, aside from its limited supply and rising price, is that burning it releases carbon dioxide into the air. The more natural gas and other fossil fuels that we burn, the more we increase the risk of further global warming.

The bottom line is that the United States needs to generate more of its electricity with utility-scale wind turbines. That would help stabilize the price of natural gas, and it would do this in a way that does not pollute the air we breath, the water we drink, or the food we eat.

John Kintree
4043 Delor Street
St. Louis, MO 63116