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  • Google to Back “Spine” That Could Transmit Wind Power

    Windmills

    Google is coming to a (future) offshore wind farm near you. In an announcement Tuesday, the technology giant said it is joining with investment firm Good Energies in a $5 billion investment to secure permitting for and begin constructing an underwater electricity transmission line. Also party to the venture is the Japanese trading company Marubeni and the Maryland transmission company Trans-Elect.

    The electricity “backbone” will extend 350 miles in federal waters off the Atlantic Coast, from northern New Jersey to Norfolk, Virginia. In the article, Federal Energy Regulatory Commission Chairman Jon Wellinghoff is quoted as saying it will offer “a gathering point for offshore wind for multiple projects up and down the coast.”

    This is good news for a couple of reasons. First, it is an example of private companies investing in the energy industry, a seemingly rare occurrence amid the usual array of government energy tax credits, subsidies, and loan guarantees. These “incentives” translate into taxpayers backing investments the private sector might normally shy away from and companies being slow to make their products more efficiently. Both Google and Good Energies will assume 37.5 percent of the equity for the project. More companies joining them would lower each party’s investment and risk. On its blog, Google proffered this statement:

    We believe in investing in projects that make good business sense and further the development of renewable energy. We’re willing to take calculated risks on early stage ideas and projects that can have dramatic impacts while offering attractive returns.

    Second, Google’s endeavor could also pave the way for future companies seeking permits for similar projects. Experts agree that the regulatory burden on this first-mover project will be significant, but they see a potentially positive outcome of pioneering in this industry. Some industry members question the immense price tag of such a project and would rather see actual turbines built now, but Google, which can invest its money as it sees fit, seems to be setting its sights on what it considers to be long-term benefits.

    Cape Wind off the coast of Massachusetts is the most developed offshore wind farm project, but years of legal issues have delayed its construction. Other proposals exist but are in preliminary research phases. Experts rightly still question whether energy companies will consider it economical to invest in offshore wind farms or whether states will push for wind energy standards that could result in higher average electricity prices for consumers. Wind power is not cheap. An estimated $200 million will be passed on to consumers in the first year as a result of the Cape Wind project alone, state Sen. Paul Sarlo of (D–NJ) noted.

    If it comes to fruition, this proposed project would mean a structural framework for wind power, which industry could plug into if it thinks wind power has market potential. Importantly, it indicates that companies can enter the market, to either succeed or fail, without government help.

    Of course, wind advocates like the Sierra Club in New Jersey worry that Google’s project could chip away at political support for future state offshore wind subsidies, since New Jersey would be backing power sold to other states. Why are they concerned about what will replace the wind production subsidies that expire in 2012? Because, like other subsidies, the production tax credit has come to sustain energy companies in an unhealthy way. Intended to fund new projects, it has become a lifeline for old ones.

    Another reason for Congress to get rid of this handout: It serves as a setup for establishing a renewable energy standard (RES). As The Heritage Foundation has reported, a national RES would only raise electricity costs, harm the economy and stifle competition among renewable energy sources. Removing the subsidies for all energy sources would allow the truly competitive ones to succeed and, ultimately, benefit the consumer.

    Emily Goff co-authored this post.

    Posted in Energy [slideshow_deploy]

    8 Responses to Google to Back “Spine” That Could Transmit Wind Power

    1. Bobbie says:

      This is terrific! "GOOGLE," the savior of the American economy and employment! wonder what obstacles will be placed from the mouths of ignorance and envy? at least now, the people of America, will see any obstacles perpetrated by American government authority.

      "Sierra Club in New Jersey worry that Google’s project could chip away at political support for future state offshore wind subsidies…"exactly what a free country, companies accountable, doesn't need! Government subsidies, waste costs and the wasted intellect of the members of the Sierra Club. .

      I don't know much about electricity, but I do know water and electricity don't mix?

    2. Pingback: PA Pundits - International

    3. W.A.MILLER, VISTA CA says:

      That is what should be done all over this GREAT country. Private enterprise; developing a better world for a all. Creating jobs, a better life through cheaper energy. May GOD bless all these companies and I hope they profit handsomely.

    4. Leonida Miller says:

      Great idea! Another is "ALGAE" for a mineral oil replacement. Works on all diesel and jet motors. Many good ideas that private industry wants to develop if the governments would get out of the way. Also everyone should study the "FAIRTAX" idea. If you read it with an open mind you'll see it will work and should be implemented.

    5. Red Dwarf says:

      LCOE (levelized cost of energy) in 2016 per US DoE estimates:

      Coal-Nat gas = $80-$100/MWHr

      Wind – Offshore = $191

      Solar PV = $396

      If this is a better life through cheaper energy, I'll have some of what you're smoking.

      Wind/Solar are inefficient and subsidies only mask the real costs. If those were actually passed on to energy consumers, businesses would not be able to compete. More "green" pipe dreams!

    6. Blue Dog says:

      The reason private companies shy away from these wind power projects is that they are not economically viable on their own virtue thus, tax money taken from the people to pay for such projects in the form of "incentives." I.E., tax credits, subsidies and loan guarantees. And even the democrat admits it will require the confiscation of an additional $200 millions from the people. Don't doubt me. Ask Denmark how they feel about their wind energy program.

    7. Drew Page, IL says:

      Government (taxpayer) subsidies to private industries? No thanks. G.E. is already licking its chops at the prospect. Wind power is a great idea so long as it produces electricity that is cheaper to purchase than that produced by coal, natural gas or nuclear power, and I don't mean for the first year or until the subsidies are no longer provided. If wind power ever does become economically feasible, no one company should be granted a monoply on producing it or transmitting it.

    8. Alex White says:

      I thought those guys from Google were smart.

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