Economic Impact of Windpower

[Ross]

Realism is another thing, isn't it?

[Ross]

Here is some reality about renewable --- green energy"

And the administration refuses to answer for the lack of job creation and growth resulting from almost $16 billion spent on ''stimulus'' grants------almost a quarter of them to European and Asian renewable-energy companies.

From the:
House Energy and Commerce Committee, ''American Taxpayer Investment, Foreign Corporation Benefit,'' 17 Jan. 2013

[Anmar]

Just a few comments...

Too bad none of that great energy those wind towers are making actually stays in the state of Kansas. 

First, the energy does stay in Kansas.  When you transmit energy across the grid, you lose energy.  Its much more efficient to use energy close to the generation source.  Probably this wind energy is going to Wichita or Tulsa and is getting traded or sold.

Second, Who cares?  If Apple came and opened an ipod factory in Howard, would you complain that nobody in elk county got a discount on ipods?  You don't bring businesses into your community to get a break on products, you do it for job opportunities, taxes, etc.  If people from Elk County can't get jobs from a company in their own county, its because they aren't qualified.  Not the Wind Farm's fault.  They don't care what county their employees live in.

Even though wind farms are only 25 to 35% efficient they still mAke a lot of money called profits for their owners.
Our wind farm is owned by an Italian company and that company is 1/3 owned by Italy.

Thus the wind farm acts as a giant money funnel siphoning money right out of the US.
Which is in no way healthy for the US economy. The economic impact of our wind farm is Pisa Poor for our country as a whole. If you give it just a little thought it is an economic negative for the US. And could be considered unpatriotic in my opinion.

So a small amount of there profit (maybe 1%) stays in Elk County that leaves 99% for Italy.
I`d links to know how that is good for the US as a whole?

If the Italian company owns 1/3 of the company, they get 1/3 of the profits, not 99%.  The other 2/3 of the profits goes to whomever owns the rest of the company.  Furthermore, where is your outrage about all the other companies that take profits overseas?  Every major american corporation has some percentage of foreign ownership.  Thats just how our economy works.

Finally...
Was this wind farm built on private land?  Aren't many of you against taxation and government handouts etc?  If its built on private land, what right does the local government or the people of Elk County have to the profits generated from the windfarm?

[Ross]

Just a few comments...

And just a few answers in hopes of clarifying?

Too bad none of that great energy those wind towers are making actually stays in the state of Kansas.  Now that might be of great benefit not only to Elk County but to our neighboring counties as well.  Just good business.  As for the boost in employment, I fail to see that.  But I do not know exactly how many people they employ and if they are from Elk County. I know of one for sure but not of any others.  I can however see that the PILOT money is being spent wisely fixing our roads and helping lower our taxes.

First, the energy does stay in Kansas.  When you transmit energy across the grid, you lose energy.  Its much more efficient to use energy close to the generation source.  Probably this wind energy is going to Wichita or Tulsa and is getting traded or sold.

You are right Anmar the generated energy is used here in Kansas, But electron for electron and watt for watt is traded through the Tennessee Valley Authority for sale there! Hence the energy is used there. Nothing from the energy generated is beneficial to Kansas. So, nykkylsdymes remains 100%  correct!

Second, Who cares?  If Apple came and opened an ipod factory in Howard, would you complain that nobody in elk county got a discount on ipods?  You don't bring businesses into your community to get a break on products, you do it for job opportunities, taxes, etc.  If people from Elk County can't get jobs from a company in their own county, its because they aren't qualified.  Not the Wind Farm's fault.  They don't care what county their employees live in.

I have no idea where they got all of the three or four or maybe even 5 employees from. But we were informed, I believe by Elk Konnected that the wind farm would bring jobs to Elk County. That is not necessarily good economic development for Elk County, now is it? 

The wind farm, I do believe said they would be training the people to operate and maintain the wind farm. So I guess you are implying that nobody in Elk County was trainable. I don't know! I sure hope not.

If the Italian company owns 1/3 of the company, they get 1/3 of the profits, not 99%.  The other 2/3 of the profits goes to whomever owns the rest of the company.  Furthermore, where is your outrage about all the other companies that take profits overseas?  Every major American corporation has some percentage of foreign ownership.  That's just how our economy works.

Even though wind farms are only 25 to 35% efficient they still mAke a lot of money called profits for their owners.
Our wind farm is owned by an Italian company and that company is 1/3 owned by Italy.

Thus the wind farm acts as a giant money funnel siphoning money right out of the US.
Which is in no way healthy for the US economy. The economic impact of our wind farm is Pisa Poor for our country as a whole. If you give it just a little thought it is an economic negative for the US. And could be considered unpatriotic in my opinion.

So a small amount of there profit (maybe 1%) stays in Elk County that leaves 99% for Italy.
I`d links to know how that is good for the US as a whole?

No, Anmar I said, "Our wind farm is owned by an Italian company and that company is 1/3 owned by Italy." To clarify let me put it this way, Enel an Italian Company owns 2/3 of the company and the country of italy owns 1/3. So all profits go to Italy. !00% of the profits are funneled out of the USA.

Finally...
Was this wind farm built on private land?  Aren't many of you against taxation and government handouts etc?  If its built on private land, what right does the local government or the people of Elk County have to the profits generated from the windfarm?

As individuals following the laws as State and Federal taxpayers and as land owners paying county property taxes to support our country, state and county functions, following the letter of the law, I am sure everyone believes Companies and Corporations are required to do the same thing. This company is probably getting off with lower taxes per dollar by paying in lieu of taxes.

I am personally, against excessive taxing and taxing for un-needed expenses. (waste)

During the negotiations with the wind farm Mr. Ritz, the only non-Elk Konnected County Commissioner at the time, wanted to negotiate free electricity for all Elk County residents. That I believe, would have been far more beneficial to the Elk County economy by allowing each and every citizen to have more money to spend with the merchants of Elk County, improving the economy. But, I personally believe the Konnected Kounty Kommissioners interests were more in line, with their property and negotiation of funds for the use of their land, and lacked the necessary thought, about the needs of Elk County Citizens and Merchants. Which is also know as Economic Development!

You see, also at the same time period, our Economic Development Employee was also Konnected as in Elk Konnected. So we might ask what happened to any real Economic Development?

The same wind farm company, with an identical size wind farm in Oklahoma is paying 3 million dollars to that community.

I feel compelled, to ask, where has it been beneficial to all of the citizens of Elk County to be Konnected (whatever that means)?

I hope this helps, Anmar.

[Anmar]

Why does a private corporation operating on private land have to be beneficial to the community?

[Ross]

Why does a private corporation operating on private land have to be beneficial to the community?

Why do I, who lives on private property, have to be beneficial to the community?

We are not the social idiots that the editor of the newspaper was referring to!

I think perhaps he was referring to some of the so called elite!
He was not very specific. But we do know, he was referring to someone in Elk County!
But, I have no problem with that, because, I don't personally have any friends that fall in either category.

I do have a problem with the attitude. Yes, the attitude is bothersome.

My friends are all good, down to earth people, and I find that true of just about everyone I have met in Elk County.

However, for an editor to make such a statement is very un-becoming, in my opinion.
I think he woud be better served by keeping ugly remarks locked up.

But now that the cat is out of the  bag, it should remain out, until a complete explanation and apology are tendered on the front page of his newspaper.

My guess is he won't offer either.

Just my opinion.

[Anmar]

Ross,

With all due respect, you didn't answer the question.  Here's a scenario.  I want to open a business.  Anmar's Kansas hay emporium.  I grow special Kansas prairie grass and ship it to California where people can't get enough of the stuff.  I buy 40 acres in Elk County and set up shop.  What obligation do I have to benefit the community?  Where did this standard come from?

[crosstimber]

I am very hesitant to post anything on this Forum anymore, but I must respond to something that Ross continues to post in an attempt to disparage the Payment In Lieu of Taxes (PILOT) that a previous board of county commissioners (none of whom are now on the board) negotiated with the developer of the Caney River Wind Project.

The same wind farm company, with an identical size wind farm in Oklahoma is paying 3 million dollars to that community.

TradeWind Energy was under no legal obligation to pay one penny in taxes to any entity with taxing authority over the land involved in the wind farm constructed in Elk County.  The current owner of the windfarm, Enel Green Power North America, has no legal obligation to pay one penny in taxes to any entity in Elk County either.  This is because wind farm development is exempted from ad valorem taxes in the state of Kansas.

At the Chisholm View Wind Project in north-central Oklahoma, also developed by Trade Wind Energy and owned by Enel, the project is subject to ad valorem taxation, as the state of Oklahoma has not exempted wind power development from property taxes.  I do not know the valuation method applied to the project, or the mill levies that have been assessed by the myriad of taxing authorities across the two-county area, but multiple newspaper accounts have placed the total amount of property taxes to be generated by the project in the $3,000,000 range.

So, it is a clear apples to oranges comparison.

When you compare apples to apples - the PILOT negotiated by commissioners Jontra, Hendricks, and McDonald versus the PILOT terms that apply to all of the other wind farm developments across Kansas - Elk County is receiving the highest amount per MW.  And the taxpayers and citizens of Elk County are receiving the benefits of this superior PILOT through the mill-levy reduction and spending flexibility the current board of commissioners enjoy.

Now some may say (I'm sure Ross would) that the project in Oklahoma is still benefiting the local taxing authorities more than the Caney River project is.  That is true, but there is one other thing to take into account.  The property taxes being paid by the Chisholm View project are underwritten by all of the taxpayers of the state of Oklahoma

Let me repeat that.  The property taxes being paid by the Chisholm View project are underwritten by all of the taxpayers of the state of Oklahoma.

How?  Through a state level Zero-Emission Facilities Production Tax Credit (PTC), not to be confused with the federal level production tax credit which some (but not all) wind farms in the United States receive.

The amount of the state of Oklahoma PTC will cover most if not all of the $3,000,000 figure that is so often printed as the amount of ad valorem tax generated by the Chisholm View project.

So, just how much might this state level PTC (which can be carried forward, is freely transferable, and 85% of which is refundable at the tax-payers discretion) be worth to Enel and/or Trade Wind for the Chisholm View project?

Let's do the math.  The project has an installed face-plate capacity of 235 MW.  The PTC is earned at the rate of $0.0050/kWh, that's half a penny per kWh.

Half a penny?!  That's not very much, right?  Depends on how many half-pennies you generate in a years time!  235 MW capacity is 235,000 kW/hr.  235,000 times 24 hours times 365 days equals 2,058,600,000 kWh per year.

But wait!  The blades don't turn 24 hours a day, 365 days a year.  Right!  Need to factor in a parameter called capacity factor, which is the actual output over a period of time as a proportion of a wind turbine or facility's maximum capacity.  I have not seen a published capacity factor for the Chisholm View project, but based on the project's location, would expect it to be at or above the national average which varies from year to year within a range of 25-27 percent.  For the sake of argument and easy math, let's use the low end and cut our production figure in fourths. 

So, that's 514,650,000 kwh times the PTC of $.005 per kWh for a total PTC of $2,573,250.

If the capacity factor of the project proves to be say 30%, then the PTC will be $3,087,900.

Either way, the PTC will cover most if not all of the local ad valorem taxes due from the project.

[Ross]

Ross,

With all due respect, you didn't answer the question.  Here's a scenario.  I want to open a business.  Anmar's Kansas hay emporium.  I grow special Kansas prairie grass and ship it to California where people can't get enough of the stuff.  I buy 40 acres in Elk County and set up shop.  What obligation do I have to benefit the community?  Where did this standard come from?

Well Anmar, I apologize for my message not coming across.
Each and every one of us is considered an asset to our community.
That is why the concern for the decline in population.
We each contribute at least financially through property taxes and through
our purchasing power, my purchasing power is retirement money brought in from out of state, even the person on food stamps purchasing food at the local market is contributing to the local economy. These actions benefit the Community.

If you were to buy a farm, you would pay property taxes. Property taxes benefits the community by providing for the fire department, the road department and the ambulance and the Sheriffs Department and other services. To have these services people are required to be hired and paid furthering circulation of money.

If your business requires you to hire a couple of employees, that benefits the community by providing employment for some one that might otherwise be unemployed and further circulation of money.

Perhaps if your business grew to an extremely large size a trucking firm might set up business in the community providing more jobs, attracting more people to the community. These new people would perhaps buy the vacant homes in the area. Creating even more opportunities for growth.

It is not that you have to be beneficial to the community, it just happens. And the more your business grows the more the community benefits. Therefore in my opinion the community should cheer you on. I try to do as much shopping locally as I can. If I buy in other counties the sales tax does not benefit the county I live in. And the local merchant loses business and may be forced to close down.

When I first moved here, I was told prices at the co-op in Severy were cheaper than at the Moline Feed Store. Sure, they are a little cheaper, but after figuring in the cost of gas and wear and tear on my vehicles and time involved, I figured I broke about even by shopping locally. By shopping in Moline I am supporting a local business and my community sales tax is paid here.

I sure hope this answers your question Anmar.

[Anmar]

It is not that you have to be beneficial to the community, it just happens.

Ok.  So from what I understand, you're saying that the company that owns and operates the wind farm has NO obligation to provide ANY benefit to the community.  If that's the case, why are you complaining that what they are doing isn't enough?