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Transportation cost is an advantage, but, for example, even if the transportation cost advantage is sufficient to employ all existing local capacity, if the financial basis for the continued expansion of the windpower installation is not secure enough to justify investment in more capacity, demand in excess of capacity will still spill over into demand for imports.

The transportation cost advantage still has to be leveraged by effective policy that provides long term assurance of the demand for productive capacity over the financed life of the plant.

And the most effective policy for providing that assurance is a well designed feed-in tariff policy, since as installation crosses the hurdle into the range where the merit order effect is reducing the average cost of kWh, that provides added political interests in favor of keeping the policy in place.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Tue Jan 10th, 2012 at 01:58:36 PM EST
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