Wind and Ethanol: When Bigger Isn't Always Better

The guiding principle in most alternative energy projects being undertaken at the state and federal levels these days seems to be "bigger is always better." And while there is some merit in building larger, absentee managed renewable energy facilities — mostly relating to economies of scale — a new study by the Institute for Local Self-Reliance has found the potential for economic benefits to be stronger in smaller, locally owned facilities.

According to John Farrell, the author of the study and a research associate for ILSR, lawmakers have erroneously tended to place the onus on higher quantities of renewable energy production. This single-minded focus obscures an essential point: "Large facilities have a special class of costs that small facilities don't, such as shipping vast quantities of electricity or biofuel to distant markets." These large transportation costs are likely to offset a significant portion of the reduced production costs owners gain from having big facilities — reductions that often lead to larger profits for the owners. In addition, he argues that larger facilities are more likely to be wasteful and to incur a host of other diseconomies of scale.What it essentially boils down to, Farrell says, is maximizing the benefits renewable energy can bring to society. And, as he explains, this can best be done "from locally owned and widely dispersed production units." As devotees of the "local is better" movement, that certainly sounds like a valid argument to us.

Via ::ILSR: LOCALLY OWNED WIND AND ETHANOL—BETTER, NOT BIGGER (press release)

See also: ::Minnesota Gets New Chickensh*t Power Plant, ::House Shifts $16 Billion From Big Oil To Renewable Energy + Huffington Post Launches Political Donor Search Engine FUNDRACE 2008, ::Green Basics: Ethanol
Image courtesy of Paleontour via flickr

Tags: Congress | Ethanol | Wind Power

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