June 1, 2009

A LOOK AT WHAT WIND DOES to wholesale electricity prices in West Texas. “I suspect the wind power generators have an incentive to drive power prices negative due to a production tax credit on wind power generation. The wind generators can not earn the tax credit unless they sell what they generate. So they pay to use the transmission lines so they can sell their electric power to more distant customers. What I want to know about wind power and electric transmission costs: Will industries with high electric power needs migrate to where the wind blows strongest? Or will transmission line build-out enable the wind farms of West Texas to eventually sell their electric power over much greater distances?”

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