American Electric Power Texas transmission line investment

Texas passed a law like this, and American Electric Power has gone in and spent $1.2 billion building wind turbines. They have not yet built the transmission lines that are going to carry the power to Austin and Dallas, because nobody in West Texas needs that much electricity — it's just ranch land. We have solar power too. You drive down the interstates now and you'll pass big solar panels. I have ten kilowatts of solar on my roof, redone this year. Aside from helping with global warming, it also raises everybody's electricity rates by about fifty percent. So we can legislate and regulate environmentally friendlier sources of energy, but it costs money.

Infrastructure-externality case. AEP is spending $1.2 billion on West-to-East Texas transmission lines so that wind generators have a load to sell to. Tom's framing: no one builds wind towers until transmission exists, and no one builds transmission until towers exist — AEP's tax-credit-supported investment breaks the deadlock.

The wind farm. I've been working on some wind towers — electrical transmission towers — in Texas. Texas has lots of wind in West Texas. There's not much else except desert there. They have a lot of wind. In a lot of states, they've passed laws that say fifteen percent of your electrical power must come from renewable resources by 2025. For Massachusetts, that means we can buy from James Bay up in Canada where they have hydroelectric power, or we can put in a wind farm off of Cape Cod — and all the people in Martha's Vineyard are going to be whining, because they don't want to see the towers.