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Carolina Journal News Reports

Expert: Renewables Add Billions to N.C. Energy Costs

Consumers would have saved $4.2 billion since 2007 without mandates

Apr. 21st, 2014
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RALEIGH — North Carolina consumers would have saved $4.2 billion since 2007 if mandates on electric power utilities to purchase expensive renewable energy had not driven costs well above the U.S. average, said a nationally recognized energy and environmental policy analyst.

James Taylor, senior fellow at The Heartland Institute and managing editor of the monthly publication Environment & Climate News, added that the limited potential for a North Carolina commercial wind and solar industry does not justify the exorbitant costs of renewable subsidies.

The U.S. Energy Information Administration reports that electricity prices have risen 10.8 percent nationally since 2007, but 17.8 percent in North Carolina over the same time period, or 65 percent faster, Taylor said. Taylor made his presentation March 29 presentation in Raleigh at the Civitas Institute’s Conservative Leadership Conference.

“North Carolinians are paying the price. We can measure this in our pocketbooks,” Taylor said.

Even with the higher costs, there seems to be little appetite in the General Assembly to roll back the 2007 law, known commonly as Senate Bill 3, which set the mandates in place.

State Rep. Marilyn Avila, R-Wake, who was on the panel with Taylor, noted that in 2007, “my first year in the House, I voted against the renewable bill, and in the last session I was one of the co-sponsors for repeal” of the mandates under House Bill 298.

When H.B. 298 came up last year, co-sponsor Rep. Mike Hager, R-Rutherford, said the GOP leadership was less conservative than the caucus, and the leaders did not allow the bill to reach a floor vote before the long session adjourned.

House Speaker Thom Tillis, R-Mecklenburg, has been a steadfast supporter of the mandates. Asked by an audience member at the forum if Tillis has changed his mind, Avila said, “I haven’t checked with him lately. It’s not something that’s going to be coming up … in the short session” of the General Assembly which opens May 7.

“Had North Carolina electricity prices risen at merely the national average since 2007, North Carolina electricity consumers would now be $4.2 billion richer,” Taylor said. “The average household pays $190 every year in extra electricity costs than would be the case if prices rose at merely the national average.”

North Carolina and 29 other states with renewable mandates are feeling the “real world consequences” of granting lucrative and preferential subsidies to renewable energy projects with requirements the volume of renewable power purchases escalate over time, he said.

“It’s not that North Carolina is particularly well-suited for solar power or wind power [to justify] these mandates,” despite claims to the contrary from those reaping the subsidies, Taylor said.

“Anything that we produce here is going to be more expensive” than the energy mix that is available without renewables.

The potential for wind power across the vast majority of North Carolina is nonexistent, he said. It would require 300 to 600 square miles of wind turbines to generate the same amount of power as a conventional, coal-fired power plant, he said.

“Offshore, [the potential is] OK. It’s marginal to fair, and high cost for very little wind power production,” Taylor said. “So if you’re going to the shore you have sight blight and you have the beaches ruined,” he said.

Showing a slide of the beach surrounding the Cape Hatteras lighthouse, Taylor said: “Just imagine what it would look like if we had giant wind turbines bigger than the Statue of Liberty littered offshore, which is what some renewable power groups want to see. I don’t think most people in North Carolina want that.”

The potential for productive wind farms is “a little better if we wanted to spoil the Smoky Mountains, if we wanted to spoil our wonderful ridge lines,” Taylor said.

To replace the electricity output of a coal-fired plant with solar power would require a solar farm of 30 to 40 square miles in size, Taylor said.

So-called net metering mandates in North Carolina and elsewhere require utilities to buy excess electricity generated by small solar facilities and home rooftop panels, but at retail prices. Taylor compared that to telling Walmart it must pay wholesalers $1.00 for socks that the store must sell for $1.00. That would put a store out of business.

“People like you and I who don’t have these facilities, who don’t have the money to have solar panels on our house, end up subsidizing those people who do,” Taylor said.

While President Obama has railed against fossil fuel subsidies, Taylor said, coal production receives “less than a buck, less than 50 cents” per megawatt hour of electricity. Nuclear receives $2.44 per mwh. Solar gets nearly $24, and wind $23.

Solar power facilities also receive a 30 percent cash-back federal tax credit, and 35 percent cash-back tax credit from North Carolina, not available to fossil fuels.

Then there is environmental damage aside from sight blight and sprawling land use caused by wind and solar facilities in the name of environmentalism, Taylor said.

“We don’t have people that are looking out for the environment, we have people who are looking out for their pet power projects,” Taylor said.

In the “once in-a-generation oil production catastrophe” of the 2010 BP spill in the Gulf of Mexico only 6,000 marine birds, mammals, and reptiles were killed, according to U.S. Fish and Wildlife Service, Taylor said. New technology that allows oil rig blowouts to be capped within 24 to 48 hours should prevent such future disasters.

“Each and every year wind power kills 1.5 million birds and bats, including bald eagles and California condors,” he said. The loss of these predators has been accompanied by a growth in insect swarms and vermin infestations, which can be a nuisance to humans and damage agricultural crops.

Solar thermal power requires twice as much water as coal, and four times as much water as natural gas, he said, yet it is most effective in sunny, arid climates with the least water.

“People who fight for affordable energy hope in states like North Carolina, the states like Kansas, states like Ohio will take the next step and roll back the renewable mandates,” Taylor said.

Dan Way is an associate editor of Carolina Journal.