Conway, Mathias join O’Malley in electric rate hike bid

It’s more than just the regular hot air coming from Annapolis – in this case, they want to mandate that it turns a wind turbine.

Proponents of a wind farm off Ocean City say electric rates could ONLY increase $1.44 a month for residential electric customers, but others claim it could be more like $3.61 per month. Or it could be much, much more – what government-sponsored plan ever comes in on time and under budget?

Included in that group backing the rate hikes are Delegate Norm Conway and Senator Jim Mathias. They are respectively co-sponsoring House of Delegates and Senate measures that will force utilities to purchase power from a offshore wind farm which could be on line as soon as 2016, according to a recent Washington Post story by Aaron C. Davis and Steven Mufson. Never mind that:

  • the project will produce power at 16.4 cents per kilowatt hour (the average going rate is about a dime.) I thought wind was free!
  • O’Malley’s former Chief of Staff, Michael Enright, is spearheading the effort for one company to secure federal leases. No conflict of interest there, move on, there’s nothing to see…
  • The last line of the Post story: “Banks consider the projects high-risk, so developers are seeking Energy Department loan guarantees to bring down financing costs.” Can you smell the pork? I can.

Contrast this with O’Malley’s approach to extracting the proven and much less expensive natural gas reserves at the opposite end of the state, our small portion of the Marcellus Shale formation. He’s supporting a moratorium on natural gas permits until August, 2013. (A bill dubbed the “Marcellus Shale Safe Drilling Act of 2011” is also in both the House of Delegates and Senate; notably, none of the co-sponsors are from the affected area. Instead, it’s the usual gang of limousine liberals, mainly from MoCo.)

If it wasn’t already crystal clear, this is more proof that O’Malley and his environmentalist wacko friends are just a bunch of liberal do-gooders who would love to saddle the average consumer with much higher energy costs. Even if they wouldn’t love to do so, their actions will create the situation of making Maryland even less industry-friendly than it already is, if that’s indeed possible.

A far smarter approach would be to leave the wind farmers (who ironically are leasing territory originally intended for oil exploration) twisting in the wind and let the natural gas companies do what they do best out west in the Maryland panhandle. Considering unemployment in two of Maryland’s three far western counties was above even the national average in December, they sure could use the jobs that natural gas exploration would bring.

And I’d rather have jobs in the hand now than those pie-in-the-sky green jobs in the bush, perhaps three years down the road (if they ever come at all.) The electric ratepayers of Maryland, who already get about 3% of their power from natural gas, would be thankful as well.

As for the duo of Conway and Mathias, well, we see where their loyalties lie. Sure, there could be some temporary job creation as these windmills are built, but those rate increases are much more permanent. It’s worth noting that Delegate McDermott isn’t signed on so apparently he stands with the ratepayers and not the special interests and friends of O’Malley. But I repeat myself.

Author: Michael

It's me from my laptop computer.

3 thoughts on “Conway, Mathias join O’Malley in electric rate hike bid”

  1. Another totally flawed assessment of one of the nation’s most forward looking energy plans. A few key rebuttals:
    1. Your comments on price are misleading. Estimates from the public service commission show that the price range would most likely fall between $0.92 and $1.44. Those are based on real world numbers that come from similarly sized wind project underway in Delaware and Massachusetts. Also once the contracts for the wind power are signed any cost overruns for construction or maintenance that weren’t figured in to the original price per kwH will be squarely on the shoulders of the developers, not ratepayers. Contrast this with nuclear where the public is (already) on the hook for billions of dollars in loan guarantees, and with natural gas where “externalized” costs from polluted air and water are passed on to the public in the form of higher health costs.
    2. Wind energy is the only commercial scale energy source available that can offer us a fixed price for energy for the next 25 years. Once the contracts are signed the price to consumers can only go down. No other energy source can guarantee price for that long. Contrast wind’s stable prices to the fact that the costs our heavily fossil-fuel dependent energy supply in Maryland has risen 75 percent in the last decade.
    3. Construction and manufacturing jobs for this particular project are only the beginning. There are huge untapped wind resources along the northeast coast. Once we establish a wind turbine manufacturing industry here and workers capable of producing turbines, that industry will be ready to service the full scale development of our offshore wind resources – a project that could last decades. That’s why companies like AC wind are already preparing to invest tens of millions in a Salisbury facility that will put hundreds of unemployed composite workers back to work making turbine blades. And why the steelworkers have called this plan our only viable plan for revitalizing Maryland’s manufacturing sector.

    Get your facts straight.

  2. I think I do have my facts straight; you are dealing to a great extent with speculation.

    I would love to have a link to the PSC estimate, but you didn’t provide one. Perhaps this link, the fiscal note for HB1054, will be illustrative of additional incurred costs. In even their most optimistic scenario, electricity COSTS MORE than it does through conventional sources.

    Another point you gloss over regarding cost overruns is that the developers are seeking loan guarantees from the federal government, so any cost overrun actually will come out of taxpayers’ pockets indirectly. In the meantime, while there are outside costs involved in nuclear and natural gas the price point we begin from is much less than we are for wind turbines. Otherwise, utilities would have been falling all over themselves to slap up wind turbines all over. (By the way, land-based turbines are far more competitive price-wise than water-based.)

    And the fixed price is a mirage, set artifically high now in the hopes of making a profit sometime toward the end of the term. It doesn’t mean that after the term the price won’t double or increase tenfold. Nor does it prohibit the state from tacking on additional surcharges like they are trying to do with this bill. And fixing a price may backfire – what if we decide to get back to drilling oil and drive the price back down to $20 a barrel for oil and $2/mmBTU for natural gas (currently it’s around $4/mmBTU.) Suddenly wind power is at a huge disadvantage, yet we are stuck with it. This is why some don’t want to drill more, to keep the price of fossil fuel artificially high.

    As for your last point, how many people does it take to run a wind turbine once it’s built? Aside from maintenance, I don’t see the job creation aspect here. Meanwhile, making turbine blades here in Salisbury is nice but will they be able to compete with other companies both domestic and overseas? (I’ve heard the number is about 200 jobs.) But obviously that depends on a market being created out of thin air, whereas we already have a market for oil and natural gas.

    My biggest issue with this whole idea is that the government decided, based on a false and all but disproved theory of manmade global warming, that we should eschew inexpensive, proven, reliable, and relatively plentiful energy sources for sources which need to have just the right conditions to work. Just ask yourself: when electricity was brought to rural areas how many farms abandoned the windmills which were in place to provide power? Think it was a reliability issue?

    The only reason AC Wind may come to Salisbury is because the state government is forcing a market. Sure, we may gain 200 jobs locally but how many will be lost thanks to higher energy costs? We have no way of knowing that number, but based on the Spanish model 440 jobs will be lost.

    Simply put: if the market were there, people would be rushing to do it. The reason nuclear is so difficult now is the excessive regulation compliance needed to build a plant; back in the 1960’s utilities were falling all over themselves to build plants because the belief was electricity could be created both cheaply and in abundance. No one was rushing to build wind turbines ten years ago.

Comments are closed.