By Nick Sibilla

Oregon is a pioneer in green power. But we’re also a pioneer in wasting other people’s money. Right now, Oregon is home to one of the largest energy boondoggles in the nation: Shepherds Flat wind farm.

Currently under construction in Gilliam and Morrow counties, Shepherds Flat soon will have the largest wind farm in the world. Since wind power is expensive, Shepherds Flat has received over $1.2 billion in federal, state and local subsidies. Apologists say these subsidies will create jobs. But according to The Oregonian, this wind farm will create only 35 permanent jobs. In other words, each job created will cost American taxpayers over $34 million.

Meanwhile, Caithness Energy, the developer of Shepherds Flat, will bear only 10% of the cost. But Caithness will earn a 30% return on investment. In addition, this wind farm will not even power Oregon. All of the subsidized output will go to Southern California Edison, which provides electricity to places like Orange County. This project is nothing more than a triad of corporate welfare, government subsidies and exorbitantly expensive jobs. So is it any wonder residents in Shepherds Flat are calling this project the “boondoggle of boondoggles?”


Nick Sibilla is a research associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

2 thoughts on ““The Boondoggle of Boondoggles”

  1. It looks like the levelized cost per KWH of power from this wind project is about 10 cents per KWH (10 year financing at 3% (using a generous social rate of return instead of the regulatory rate of 10%), and assuming 30 percent capacity factor on the 845 Megawatt/$2 billion dollar project). The subsidy works out to 40%. On the positive side, the subsidy looks like it mostly comes in the form of a loan guarantee (some $1.2 billion over more than 10 years probably), rather than direct government cash payment for each megawatt hour produced (which is more typical). But on the negative side, wind power is unreliable for meeting peak electrical demand and Grand Coulee Dam is plain out of storing capability for such new wind projects). So, the project will actually require more gas turbines for back up, possibly adding another 10 cents per KWH in capital cost to this power. Seems a bit pricey when conventional coal and natural gas with conservation offsets come in at half this cost, and with no government subsidization.

  2. Oh, yeah, forgot to mention General Electric (a favored one by Bama) stands to take in most of the $2 billion project expenditures. GE loves green for the mega $$$$ it represents.

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