Owen Sheers: Why are utility companies uninterested in helping rebuild wind turbines?

Steve Kean Paine was my first client at Advantage Strategy, my company for which I work now. He was part of an energy project for Rice Energy that employed an installed option. This form of energy is an alternative for power plants to coal that uses waste heat from oil.

The concept was pretty unusual because the biomass from burning the carbonate sand which is involved in the energy production is environmentally undesirable. The sand is actually broken apart to make humus and by-products of that process form lakes and creeks. Rice Energy had found that using the by-products of the production to produce this type of energy was practical, if you add all the processes that had to be included to prove that this was economically viable and environmentally preferable to coal.

It’s not something that typically comes to mind when thinking about energy and wind power. Often the wind is unreliable. It just doesn’t always blow when you want it to. Sometimes a nearby transformer is broken or windy weather causes a billowing of smoke that obscures the wind. Sometimes the wind does blow but you have nothing to pick up the energy.

Steve Kean Paine was my first client at Advantage Strategy, my company for which I work now. He was part of an energy project for Rice Energy that employed an installed option.

And then there’s the problem of operating an energy plant without a power source. It can be a new technology, like a wind farm, or it can be older infrastructure that needs to be repaired.

Steve believed that with our energy options he would be able to guarantee that his company would have reliable electricity every night. He would continue to use an energy option that was the most economical, but still be able to take advantage of renewables and newer technologies.

He was correct. During this period, he was successful in having power at night and at times even was partially on during the day.

He had no problems. But now look at what has happened.

Paine discovered, as many experienced project managers in energy, that in the old days if you work out of your shop you can get utilities out and close it down.

But utilities have been telling me that in the so-called Energize America Act, passed by Congress in 2007, that production tax credits have been scaled back and are designed to not give incentives to energy companies that do not have an investment for wind, solar or natural gas to prove that they are viable.

The goal is to cut energy use by using renewable energy and/or substituting new technologies like gas or coal for oil.

As a result of this change in the tax credit, and after losing money one year on his work, Paine has stopped on the boiler system and found it impossible to fix.

It’s obviously not wind. The federal subsidies only work for a certain amount of days of the year and that time is very limited.

Even if the utilities could be located somewhere that would work, the best place is on a farm where wind doesn’t blow and the land doesn’t have any restrictions on what the winds can generate. But this can’t be done because when it snows they can’t till it to create a winter range, and in the summer they can’t harvest corn if it will fall on the field.

Paine has a contracting company called Kean Paine & Associates in Agawam, Massachusetts. He has tried talking to utilities. They simply won’t hear of it. They say, “We have an agreement with the guy who owns the land and we haven’t found anyone who can operate the facility for us.”

No one else will take it on.

We have enough problems in the country without insurance companies not underwriting these projects with wind, solar or other alternative power sources. They don’t have to.

Owen Sheers is president of Advantage Strategy, LLC in Agawam, Massachusetts.

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