Energy Secretary Rick Perry recently released a proposal aimed at saving coal from cheap renewable energy. The proposed rule would guarantee profits to power plants that maintain 90 days of fuel on site as a bulwark against the electricity grid failing. While these kinds of stockpiles once served a purpose, the proposal is a transparent subsidy to a fossil fuel industry threatened by rapidly maturing solar and wind technology.
One headline after another touts the falling costs of solar, wind power and energy storage. In fact, though both solar and wind have become competitive in many countries after accounting for subsides, health costs, or climate impacts, on-shore wind is now cheap enough to compete without any of these factors. For plants entering production in 2022, on-shore wind costs $55.8 per megawatt-hour, compared to up to $100.7 per megawatt-hour for natural gas.
The Midwest and Great Plains make up the wind power house of the nation. There is enough wind power potential in Illinois alone to satisfy half of the country’s electricity demand. Indeed, over the past 15 years, we have begun to tap those resources, with large increases in wind generation in Texas, Oklahoma, Kansas and Iowa. At the same time, other states with huge potential, like Illinois, Missouri and Wisconsin, have tiny wind systems and have experienced little uptick in the past 15 years. Chicago has just three wind turbines, but 33 fossil fuel plants generating over 100 times more power.
Nationwide, the trend is clear: States that are swimming in wind potential remain dominated by non-renewable energy, and neighboring states with similar potential have widely different production. Secretary Perry’s proposal would prevent states with high potential from taking full advantage of their resources. But, it’s not the only barrier to further growth. Political and regulatory realities are holding back renewables at a time when climate realities should be propelling them forward.