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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 | |
