Michigan Wind Energy Facts“ Falsehoods not only disagree with truths, but usually quarrel among themselves.” - DANIEL WEBSTER

Energy markets are driven by policy. Let’s drive Michigan’s toward growth.

Policy

PolicyState Renewable Portfolio Standards: Are they constitutional and necessary?

Michigan’s renewable portfolio standard has helped the state become one of the nation’s leaders on clean energy. Claims that this policy is unconstitutional are based on a single statement from a court case that carries no legal weight. That case concluded that MISO’s policy for broadly spreading the costs for transmission lines to carry low-cost wind energy to consumers is lawful because they do benefit consumers. Michigan’s RPS and MISO’s transmission cost allocation have together paved the way for the construction of Michigan’s Thumb Loop Line and, in turn, the state real-izing substantial economic benefits.

PolicyEnergy is not a free market. Support for renewable energy is a fraction of what has been given to other electricity sources historically, and other sources still do get subsidies.

Most forms of energy in the U.S. receive some type of federal assistance. Some tax incentives for fossil fuels have been in place for nearly a century and it takes an act of Congress to change or remove them. In contrast, clean energy tax incentives require Congress to reauthorize clean energy tax benefits, creating policy uncertainty that dampens investment.

Wind developers have been using the Production Tax Credit based on actual electricity produced. This sup-ports wind power, solar, biomass, and other renewable energy sources in Michigan. Other energy sources receive many times more in incentives than renewables, including special accelerated depreciation for oil and gas exploration equipment, liability insurance under-written by the government, and other incentives. Through 2010, more than 94%1 of all energy subsidies have gone to fossil fuels and nuclear energy. Fossil fuels in their start-up period got five times more in government incentives than renew-able energy has, and nuclear got 10 times as much.2 1 http://bit.ly/1G3ssVt2 http://bit.ly/1vGyJAf

O&G, $446.96 1918-2009

Nuclear, $185.38 1947-1999

Biofuels, $32.34 1980-2009

Renewables, $5.93

1994-2009

Cumulative Historical Federal Subsidies

2010 $, billions

O&G, $446.96 1918-2009

Nuclear, $185.38 1947-1999

Biofuels, $32.34 1980-2009

Renewables, $5.93

1994-2009

PolicyEmbracing wind energy can avoid uncertainty and improve control over future regulatory requirements to reduce carbon dioxide pollution.

With Michigan’s current Renewable Portfolio Standard set to expire in 2015 and EPA’s Clean Power Plan set to take effect in 2017, it’s important to keep a successful economic engine and compliance tool humming along, rather than sputter and stall just when Michigan needs wind ener-gy to continue to grow to comply with regulations.

Wind is a great value for Michigan.

Value

Phot

o: E

DP

Rene

wab

les

Nor

th A

mer

ica

Phot

o: C

reat

ive

Com

mon

s; X

avez

ValueWind energy can stabilize the cost of our energy supply.

A renewable generator’s business model is different from fossil fuel generation: up-front capital investment followed by low and stable oper-ating costs. The price of the output of a wind farm does not fluctuate with global commodity markets because wind farms don’t have to buy coal, oil or natural gas. In an energy supply portfolio, wind energy is a “bond” and can stabilize the overall portfolio costs.1

1 http://1.usa.gov/1DrvK6B

ValueWind energy is not only cost effective, it can lower wholesale power prices.

The Department of Energy has found “Consumers in the top wind energy-producing states have seen their electricity prices actually decrease by 0.37 percent over the last 5 years, while all other states have seen their electricity prices increase by 7.79 percent over that time period.” Studies in Ohio, Illinois, New York and Texas have shown that wind energy can lower wholesale electricity market prices.1

1 http://bit.ly/1m8mpmH

Phot

o: N

REL:

OH

Offi

ce o

f Ene

rgy

Effici

ency

ValueWind costs have dropped out of the sky.

The cost of wind energy has declined rapidly in Michigan and is now below the cost of energy generated from both new coal and natural gas plants as demonstratedby published power purchase agreement figures. Modern wind turbines have evolved to include taller towers and longer blades that are capable of generating more and cheaper electricity with moderate wind resources such as in Michigan. This pace of change is accelerating with high tech research into composite materials and blade coatings, as well as incremental operational changes that can squeeze even more kilowatt-hours out of each wind turbine.

http://1.usa.gov/1kB0A3f

ValueWind energy reliably integrates with the regional electricity grid.

Michigan is part of a regional power pool, managed by the Midcontinent Independent System Operator – MISO – which operates a sophisticated market to ensure constant matching of electricity demand with electricity supply, among other technical requirements.1 Wind energy is reliably integrated with other sources of supply on a regular basis. Constant-ly-improving wind forecasting technology helps manage variability, and capitalize on the benefits of inexpensive, emissions-free energy replacing other sources when the wind is blowing.

1 http://bit.ly/1AxWAcQ

ValueHarvesting wind provides a drought-resistant cash crop.

Phot

o: E

DP

Rene

wab

les

Nor

th A

mer

ica

Sustainability means the harvest never stops.

Sustainability

Phot

o: E

DP

Rene

wab

les

Nor

th A

mer

ica

SustainabilityWind energy is popular with businesses of all sorts and can help meet corporate sustainability goals.

Wind turbines project an image of a clean future, and that’s why they are regularly featured in prominent advertisements for cars1 and trucks, as well as cosmetics2 and other consumer products. Google, Yahoo, Microsoft, Facebook and Apple have all made major investments in renewable energy to power their facilities, and businesses are making siting decisions based upon the availability of clean energy resources. Access to wind energy brought Facebook to Iowa.3 Additionally, a coalition of Fortune 500 companies issued the Corporate Renewable Energy Buyer’s Principles aimed at making it easier for corporations to purchase renewable energy directly.4

State policies that support renewable energy can help attract investments by these growing companies. 1 http://bit.ly/17rdX1s2 http://bit.ly/1vjeY783 http://bit.ly/1FyaHfY4 http://wwf.to/1E6wb5y

SustainabilityWind farms cause significant decreases in greenhouse gas emissions from our electricity sector.

Wind turbines produce significant amounts of electricity without air emissions, including greenhouse gases. Throughout their operating life, wind farms will cause net reductions in carbon dioxide.1, 2 In fact, currently installed U.S. wind power avoids the carbon pollution equivalent of 28 million cars. This is important because greenhouse gases and climate change are already impacting Michigan, potentially altering the winter tourism market and agriculture.

1 http://1.usa.gov/1ERmy8K2 http://bit.ly/1AlRiOs

For a free calculator, click here: http://1.usa.gov/1jtj6d5

SustainabilityWind farms can be sited in harmony with local wildlife and are less harmful than other forms of electricity generation.

Wind farms in Michigan undergo scrutiny from the Michigan Department of Natural Resources and U.S. Fish and Wildlife Service. Typically, pre-construction site surveys are conducted over multiple years to determine wildlife risk, and the facilities are designed to minimize or mitigate any expected impacts. It is important to put bird and bat impacts from a wind farm into context relative to other human activities, particularly energy production. Considering all stages of energy production, wind energy is far less harmful than energy sources it displaces,1 and reduces the air pollution associated with climate change, which represents a more significant threat to wildlife. Beyond electricity production, other human activities are orders of magnitude more harmful to birds and bats than wind energy generation.2

1 http://on.ny.gov/1vjeZrw2 http://usat.ly/1rlSJbb

Wind WORKS for Michigan!

Jobs

JobsWind farm construction is an enormous source of new jobs and investment.

Prior to construction, wind farms typically require significant investments often with local companies for engineering, geotechnical services, surveying, environmental studies, mapping, and permitting. Construction involves significant, temporary job creation.1 One thousand MWs of construction can create 2,100 full time equivalent jobs.2 Michigan now boasts several experienced wind energy general contractors such as Barton Malow and Aristeo, as well as electrical contractors like MJ Electric. These and other contractors employ Michigan workers for work on roads, foundations, electrical equipment, concrete, hauling, and civil construction.3

1 http://1.usa.gov/1ATe55Z2 http://1.usa.gov/1zoc0uc3 http://1.usa.gov/1Epfy2R

JobsManufacturing! Producing electricity-generating machines that get their fuel from the wind is a big growth market in Michigan.

The majority of the value of a wind farm is made in the USA. Michigan has seen a turbine tower company startup near Detroit. In total, there are an estimated 120 businesses in Michigan that contribute to the wind turbine supply chain, with over 4,000 jobs tied to the wind industry in Michigan.1

1 http://bit.ly/1BmJEGD

JobsWind turbine technicians are highly skilled positions that don’t get outsourced.

Wind turbine technicians have to be highly trained on safety, high voltage electricity, computer control systems and mechanical and hydraulic systems. And they have to be in good shape and not afraid of heights! These highly-paid, highly-skilled jobs are very stable opportunities in rural communities. With long term power purchase agreements, these wind farms aren’t going anywhere and wind farm operators will always employ people to help keep the wind turbines running.

Good Neighbors in Rural Communities.

Local Issues

Local IssuesWind energy works with agriculture.

Wind energy generation is compatible with the modern, large-scale agriculture. Typical wind turbines with gravel access roads occupy less than 1 acre each, leaving plenty of land for farming around them. Lease payments from harvesting wind energy are farmers’ most dependable revenue stream, unaffected by droughts, flood or disease and help stabilize income at family farms. Responsible leases compensate farmers for crop damage during and after construction, drainage tile damage, and also protect landowners with insurance policies.

Local IssuesWind farms often become one of the largest taxpayers in rural communities.

The 212.8 MW Gratiot County project owned by Invenergy and Detroit Edison pays $2 million per year in new property taxes, doubling the tax base of the two local school districts.1 Wind farms can really be a windfall to rural school districts that do not already have significant tax bases.2 The American Wind Energy Association reports land lease payments of more than $4 million annually, increasing the tax base of the communities that host them.3

1 http://bit.ly/1rCVqFT2 http://bit.ly/1AGjKxC3 http://bit.ly/1BRnVFf

Local IssuesDecommissioning is part of the plan and steel can be recycled.

Decommissioning requirements are typically required as part of local permits. Wind farms will often post an independent funding assurance to ensure money is available to remove the turbines at the end of their useful life and restore the land around them. Each wind turbine contains hundreds of tons of steel, and that alone can fund much of the removal work. Other commodity prices besides scrap steel figure into decommissioning economics also; depending on the state of the energy market at that future date, removal and refurbishment of the turbines might be feasible.

Phot

o: E

DP

Rene

wab

les

Nor

th A

mer

ica

Local IssuesWind turbines are safe for neighboring residents.

There is nothing about the sound from wind turbines that presents a health hazard.1 Careful design of wind turbine layouts involves modeling sound and including large setbacks from residences to reduce sound to the equivalent of a whisper to comply with local ordinances. Shadow flicker will occur for a few residences within ¾ of a mile of the turbines for a limited portion of the year, but it is not a health hazard.2 Claims of adverse health effects may be caused merely by suggestion.3 These claims have been studied thoroughly and debunked by expert panels run by the States of Maine4 and Massachusetts.5

1 http://bit.ly/1LdTGvk 2 http://1.usa.gov/1vXqrtE3 http://bit.ly/1Fu3vVC4 http://1.usa.gov/1vGIHS45 http://1.usa.gov/1vXqTbb

Phot

o: E

DP

Rene

wab

les

Nor

th A

mer

ica

Local IssuesLocal property values are not harmed by wind farms.

The most comprehensive study to-date,1 performed by the U.S. Department of Energy’s Lawrence Berkeley National Laboratory, examined more than 50,000 homes near 67 wind farms in 27 counties across 9 different U.S. states. It found “no statistical evidence that operating wind turbines have had any measureable impact on home sales prices.” The total estimated revenue to local units of government in 2014 was nearly $24 million according to a 5 Lakes Energy analysis.

1 http://1.usa.gov/1LbHFF0

Local IssuesProtecting our Great Lakes is important to Michiganders.

Emissions of heavy metals and acid gases from coal plants have polluted the Great Lakes and Michigan’s inland lakes, rivers and streams. Mercury from coal plants becomes a potent neurotoxin that contributes to the restrictions on fish consumption affecting Michigan’s surface water resources. Wind energy is pollution free.

http://1.usa.gov/1LmZNh9

Mercury in Great Lakes from Power Plants

Power plants in the Great Lakes Region with the highest mercury emission projected for 2010-2015, Graphic: Natural Resources Defense Council

Scientists discovered that U.S manmade mercury sources account for 32 percent of the mercury entering the Great Lakes. Chinese sources deposit nearly half as much with 14 percent.

Mercury in Great Lakes from Power Plants

Gra

phic

: Nat

ural

Res

ourc

es D

efen

se C

ounc

il

Local IssuesWind farms can become tourism attractions.

People visit Michigan for many of the same reasons that people like to live here: it’s beautiful and there are lots of great activities, everything from hiking and boating to NASCAR races and snowmobiling. Wind farms make a contribution to preserving the climate that helps to attract visitors and enables outdoor activities,1 and the project also shows the state’s commitment to renewable energy. Wind turbines have become tourist attractions right here in Michigan,2 as well as in California,3 home of some of the first utility scale wind farms in the world.

1 http://bit.ly/1DD775r2 http://bit.ly/1CJejM93 http://bit.ly/1AGTSlx

Phot

o: E

DP

Rene

wab

les

Nor

th A

mer

ica

Thank you to Iberdrola Renewables and EDP Renewables North America for photographs not credited elsewhere.

Thanks to the Wind on the Wires Michigan working group for developing the content of this fact book.

Copyright Wind on the Wires 2015

Wind on the Wires570 Asbury Street, Suite 201

St. Paul, MN 55104

651.644.3400

windonthewires.org