Subsidies eliminate incentives for lower-cost technology
“Stimulus success at Windy Point” [Opinion, May 15] paints a favorable picture for Goldendale, but only tells part of the story.
According to the American Wind Energy Association, Cannon Power Group developed two “Windy Point II” projects and one “Windy Flats IIa” project in 2009. The smallest was 29.9 megawatts and received $19.4 million, probably representing 30 percent of the project cost. It is unclear how much of the remaining 232 MW developed received or would receive funding.
Federal subsidies are apparently necessary because these machines are too expensive relative to their electrical output to compete in the electricity market without them.
However, subsidizing existing technology eliminates incentives to develop and bring lower-cost technology into the market. Paradoxically, taxpayers would be the largest beneficiary of new technology if it eliminated the need for subsidies.
The turbines in the picture were made by Siemens, almost certainly in Europe, though maybe the towers or the blades were made in the United States.
A few months ago, Sen. Chuck Schumer went through the roof when a big project proposed for West Texas was to result in a check for $450 million to a Chinese turbine manufacturer. Only in the United States would this happen.
— Larry Miles, Bellevue