American Electric Power (AEP) announced it is cancelling plans for a massive wind farm project in the Oklahoma panhandle because it cannot get the project approved before generous federal subsidies may run out. AEP’s decision is particularly noteworthy because the U.S. Energy Information Administration documents that the Oklahoma panhandle is one of the most favorable locations in the country to develop wind power. If wind power does not make economic sense in the Oklahoma panhandle, it is hard to argue it makes economic sense anywhere else.

The above map illustrates just how favorable the Oklahoma panhandle is for wind power generation compared to other regions. The Oklahoma panhandle is considerably more favorable than, for example, Vermont, Ohio, and northeastern Colorado where wind power advocates are pursuing new projects and claiming wind power makes economic sense.

The Oklahoma project, known as “Wind Catcher,” would provide wind power to Arkansas, Louisiana, Oklahoma, and Texas. AEP claims Wind Catcher would save consumers money, but the Texas Public Utilities Commission (PUC) is not convinced. As a result, the Texas PUC declined to give fast-track approval to purchasing Wind Catcher power. AEP cancelled its plans because the Texas PUC decision means AEP will not be able to build the wind project before the expiration of existing federal taxpayer wind power subsidies. Without those subsidies, the project will not be viable even if the Texas PUC eventually agrees to purchase wind power.

“I don’t believe that the benefits are there for the ratepayers,” said Texas PUC commissioner DeAnn Walker, according to the Wall Street Journal (https://www.wsj.com/articles/aep-cancels-plans-for-4-5-billion-u-s-wind-farm-1532727055). “The benefits are based on a lot of assumptions that are questionable.”

“AEP said it was pulling the plug on the project in part because without speedy regulatory approvals, it wouldn’t be able to fully take advantage of federal tax credits that made it more economically attractive,” the Wall Street Journal explained.

The bottom line is even the wind power industry admits it cannot produce power in an economically viable manner, even one of the most favorable places in the country, without generous taxpayer subsidies.

David Rothbard is the president of CFACT.org

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