Other Issues

The Cost of Wind Power

     One of the major issues facing the wind industry is the cost of wind-generated electricity relative to electricity generated from alternative sources. Consumers and taxpayers alike are, at the end of the day, very cost-conscious. While we expect that the vast majority of Ontarians support the concept of electrical power generated from the wind, we also expect that the ultimate success of the wind power industry in Ontario will be determined by the ability of the industry to generate power at a cost which is competitive with the cost of generating power from other sources.

     In that regard, the Blue Highlands Citizens Coalition is concerned by the March, 2004 study by The Royal Academy of Engineering (the “RAE ”) entitled “The Costs of Generating Electricity”. We find the analysis and results of this study to be compelling due to the independent nature of the RAE. You can view a copy of this study by clicking here. Some caution needs to be exercised in viewing the RAE study, since it was prepared in the context of the British (rather than the Ontario) electricity generating industry. However, its conclusions do provide some useful general information regarding the cost of different power generation options.

     The research carried out by the RAE indicates that the cheapest electricity will be generated from natural gas turbines and nuclear power stations. Taking into account standby generation requirements (due to the intermittency of wind-generated electricity production), the current cost of on-shore wind power was determined to be over twice as expensive as either (i) nuclear power-generated electricity, or (ii) combined-cycle gas power-generated electricity. Even when a future 15% improvement in wind turbine technology was factored into the study results, wind power-generated electricity was still found to be twice as expensive as the nuclear power alternative, and only slightly less than twice as expensive as the combined-cycle gas power alternative.

     The recent report by former Deputy Prime Minister John Manley to the Ontario Government regarding power generation options for the future places a heavy emphasis on the need for a refurbishment of Ontario 's nuclear power generating capacity. This emphasis is consistent with the cost-of-power information set out in the RAE study. Responsible and appropriately-sited wind power generation facilities can play a role in providing power to the Ontario market. Given power consumers' price sensitivities, however, it is likely not wind but rather cheaper power generation alternatives which will play the strongest role in contributing power to the grid.

     The Blue Highlands Citizens Coalition feels that unless and until large-scale commercial wind power generating facilities can be clearly demonstrated to be cost-competitive with other forms of power generation ( i.e., unless and until large-scale commercial wind power generating facilities are able to stand “on their own” in economic terms – without widespread government incentives, tax breaks and other benefits), a cautious approach needs to be taken before any such large-scale facilities are permitted within our community.

     Notwithstanding the higher current cost of wind-generated power, however, the Blue Highlands Citizens Coalition does encourage residents of our community and other concerned citizens to push for regulatory changes within the Ontario electricity industry so as to encourage the development of “small wind” systems as a viable power option. Those regulatory changes are a key component of the changes which must be introduced in order to assist with the Blue Highlands Citizens Coalition's vision of “small wind” systems making our community “self sufficient” in terms of electricity generation and consumption.

Copyright, The Blue Highlands Citizens Coalition, 2004.  All rights reserved.

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