American taxes subsidizing Canadian electricity?
Though Montana is losing out in the cutting edge technologies of alternative energy (i.e. coal liquefaction and gasification, and clean coal-fired generation), we are making some progress in wind-generated electricity. The Cut Bank Pioneer Press reported last week that progress is being made on the McCormick Ranch wind project north of Great Falls. This is great news from the area as they stand to reap benefits of new jobs and an improved tax base. However, there's one small problem; this project is currently slated to send all of it's generation to Alberta through a to-be-constructed transmission line from Great Falls to Lethbridge.
As it stands, wind generation is only economically viable due to heavy subsidies from the federal government in the form of the Production Tax Credit, which chips in $18 for every Mega Watt hour (mWh) produced.
Assuming a typical efficiency factor of 37% on the 300 mW the McCormick wind farm is currently projected to produce, the Production Tax Credit will pay out subsidies of about $175 million over the next ten years. In sum, that's $175 million that American taxpayers are going to shell out so Canadian consumers can get wind power at a competitive rate.
Senator Baucus has been instrumental in extending the Production Tax Credit through the Senate, and we applaud his leadership on promoting alternative energy, especially in Montana. (Making consumer's pay for the higher cost of wind-generated electricity through taxes rather than their utility bills is just a shell game, but we digress...) However, in this case he's doing American taxpayers a disservice by subsidizing a product that Americans will not benefit from.
Why it makes sense to Senator Baucus that we should be subsidizing Canadian electricity is beyond us. Perhaps he never contemplated that those environment-hating Canadians would never be interested in alternative energy. Or maybe it's just another example of old Max asleep at the switch.
Carter
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Reader Comments (3)
OK - let's see if I've got this right... US taxpayers will be paying $18 per mWh to make wind energy more affordable and then we're building a line and sending it to Canada? What - they don't have wind in Alberta? Why aren't we using it in Montana? Or if not here - can't it be connected to the grid in California where they seem to be a little short of the stuff these days? This makes absobloominglutely no sense whatsoever!! And Max has his fingerprints all over this deal???? With friends like Max Baucus - who needs that nutjob in Iran? Can we get Max a "do-over" on this one?
My vote is Max has been asleep for some time now. Speaking of wind, our good Governor has generated a lot of wind talking about energy being important for Montana. I wonder if we could figure a way to generate energy from empty promises.
What is the world happened? If we could read between the lines on this sweetheart deal, made for the Canadians, I would hope that there is some give-back on their part. But, it doesn't appear to be that way. While we pay for Canadian consumers to purchase pumped up electricty from our Montana homestead, the Canadians are sending us high sulfur oil (bad) accross the line to mix with sweet crude being pumped from Richland County, Montana oilfields. Just to be fair, I propose the Canadians cut the price of natural gas they sell us by $200 million (Canadian) and call it good.