Fact Check: Top wind power states saw electricity prices decrease, not rise

5 May 2014 by David Ward David Ward

Recently, we’ve noticed a wave of misinformation about changes in electricity prices in the states that use the most wind energy. Fortunately, more than a dozen studies by state governments, grid operators, and academic experts confirm that wind energy reduces electricity rates by displacing more expensive forms of energy.

That hasn’t stopped the other side from using faulty math to attack wind energy. The most prominent example of this was seen in a recent letter to Congress signed by many groups that are funded by the Koch brothers and others in the fossil fuel industry. Among other misinformation about wind energy, the letter falsely claims that states that use the most wind have seen larger average electricity price increases than the national average.

AWEA went to the original Department of Energy data source and did the math correctly, which shows that states that obtain more than 7 percent of their electricity from wind saw an average electricity price decrease of 1.31 percent over the time period the groups looked at, while the nation saw an average electricity price increase of 3 percent.

The anti-wind groups’ math error came from an apples-to-oranges comparison that used a demand-weighted average for the national change in electricity prices, but not for the electricity price changes in the top wind states. This mistake in the math for the top wind states gives equal weight to electricity price changes in South Dakota and Texas, even though the latter uses 31 times more electricity so a change in electricity prices has 31 times more impact.

In preparing its national average, the Department of Energy (DOE) correctly computed the relative impact of different states on the national average, but the anti-wind groups failed to do so in their math for the top wind states, resulting in an inconsistent methodology that makes it impossible to compare the two numbers.

DOE data for the 2005-2010 time period show the same pattern of consumers in the top wind states faring better than consumers in other states, with rates increasing by only 10.94 percent in the top 10 wind states, while the other 30 states saw their electricity prices increase by 26.74 percent.

Ranking for wind power Electricity price increase, 2005 - 2010
Top 10 wind power states 10.94%
Top 20 wind power states 15.72%
Bottom 30 wind power states 26.74%

That benefit was widespread across the states with the most wind, with 8 of the top 10 wind states seeing electricity prices increases far less than the national average, while the other two were in line with the national average. The below chart shows data for the top 10 wind states for the 2005-2010 period – only Kansas and Minnesota were in line with the 26.74 percent increase seen in the 30 states with less wind, and the other 8 of the top 10 wind states saw far lower increases than those 30 states with less wind:

Top 10 wind state average 10.94%
Texas 2.19%
Oklahoma 10.80%
Iowa 14.50%
South Dakota 18.48%
Oregon 19.24%
Colorado 19.76%
North Dakota 20.10%
Wyoming 20.16%
Minnesota 27.23%
Kansas 27.48%
Other 30 states 26.74%

For more information about how wind energy benefits consumers, see our white paper: http://bit.ly/1ijtvCB.