The Cautionary Tale of Wind Energy in ERCOT

TPPF, by Charles McConnell, Aug 14, 2018

Recently, there has been a wave of cities (and companies) making pledges that they are “powered by 100% renewable energy.” Some states are getting in the game, too. Two years ago Hawaii pledged that its electricity would be entirely renewable by 2045. The California Senate recently passed a bill setting the same goal, while moving up the state’s timeline to get half its electricity from renewables from 2030 to 2025. All of Colorado’s Democratic gubernatorial candidates have made a pledge for that state to be “100% renewable” by 2030.

Many renewable energy advocates point to the Texas electricity market as a shining example of how these lofty renewable energy goals can become reality. Those same advocates fail to disclose (or maybe even recognize) two fundamental and cautionary truths of the Texas wind energy experiment. First, when Texans’ demand for energy is the greatest, in the heat of the summer days, wind energy nearly disappears from the grid. The result is that the grid depends on the continued reliability of the fuels that have powered the Texas success story—natural gas and coal. The second reality of the Texas grid is that state and federal subsidies for wind energy have eroded the Texas generation fleet of valuable baseload generation assets and the market structure for generation capacity discourages baseload investment.

Only after all of the facts are examined can anyone fully understand how the story of wind energy in Texas proves that the “100% renewable” claim is not achievable. Sobering lessons have been learned in Texas about how the distorting effects of renewable subsidies can lay waste to the competitive marketplace and expose ratepayers to high cost and low reliability.

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