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United States

COAL ATTACK

A coal-industry sponsored report stating that renewables would cost American taxpayers $52 billion by 2010 is being vigorously attacked by the US government's National Renewable Energy Laboratory (NREL) and the American Wind Energy Association (AWEA).

The report was seized upon by the international coal industry. In Germany, the mining information service Bergbau Information 1995, gleefully reported its conclusions.

However, both NREL and AWEA say there are fundamental flaws in "Energy Choices in a Competitive America," by the Centre for Energy and Economic Development (CEED). They also note CEED, based near Washington, is mostly funded by coal companies. NREL's report is even titled "The True Cost of Renewables: an Analytic Response to the Coal Industry's Attack on Renewable Energy."

CEED's prediction that even a 4% penetration of renewables -- twice today's penetration -- will cost $52 billion is more than 27 times higher than NREL's calculation that non-hydro renewables will in fact only cost $1.9 billion over the next 14 years, or an average of only $100 million yearly. NREL's principal policy advisor, Blair Swezey, also notes that NREL's estimated cost of renewables is less than one-tenth of one percent of the US utility industry's annual revenues. He says CEED uses unrealistically high costs for renewables in reaching its conclusions. For its part, AWEA maintains that some of CEED's basic assumptions about wind are false or out-dated and its theoretical $0.068/kWh wind base case is unrealistic. Whereas CEED assumes a capital cost for wind of $1195 per installed kilowatt, AWEA says installation of the new Zond plant in Minnesota is estimated at $850/kW. AWEA also notes that CEED bases its cost assumptions on a 200 kW turbine, instead of today's state-of-the-art 500 kW machine, or the larger machines to be installed by Zond in Minnesota. CEED also assumes that turbines operate at 40-60% availability, though modern turbines perform at better than 95% availability.

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