A friend sent me a link to this article on Grist yesterday. The five most important names in renewable energy that you’ve never heard of not only improperly ends a sentence with a preposition, but the author just plain, old makes crap up. While waxing poetic kissing the rear ends of FERC Commissioners current and future, Bill White, manager of the National Clean Energy Transmission Initiative for the Energy Future Coalition, contends that only Big Wind can save us:
But only the acceleration of utility-scale renewable energy projects can take us where we need to go.
This, of course, is incorrect, but still an arguable opinion (and it is, read the comments). However, next Bill demonstrates his mastery of FERC finance:
As you might imagine, the higher the ROE, the more incentive there is to build transmission. A company would never invest in our grid if the maximum ROE was 1 percent — meaning it would take 100 years to recoup the costs of a project. And if it was 100 percent, we would end up building much more transmission than we need and sticking consumers with the bill.
What an idiot (and you will notice he gets called on his misunderstanding of ROE in the comments as well)! ROE = Return on Equity = the percentage of yearly return (interest) investors earn on their equity (investment) in transmission projects. It has nothing to do with how long it would take to recoup the costs of a project. That's called depreciation, Bill. The two have only a cursory connection in that depreciation pays back a portion of the investment every year, plus interest (ROE) on the outstanding balance. The length of time it takes to recoup an investment is directly tied to its depreciable life. Investments should be paid for during their used and useful life. I'll do Bill a favor and stop there without even mentioning salvage value.
Now, don't you feel stupid, Bill? You should. You should also feel stupid about all those other brainless things you said in your Grist rant, like the fact that state regulators, who are complaining about FERC returns, are "misguided." What makes a financial genius like you qualified to judge the actions of professional regulators?
Yup, ol' Bill just doesn't know what he's talking about. Crash and burn.
Now, don't you feel stupid, Bill? You should. You should also feel stupid about all those other brainless things you said in your Grist rant, like the fact that state regulators, who are complaining about FERC returns, are "misguided." What makes a financial genius like you qualified to judge the actions of professional regulators?
Yup, ol' Bill just doesn't know what he's talking about. Crash and burn.
RSS Feed