Although this is more detail than most of you want to know, this does explain WHY WIND ENERGY IS NOT CHEAPER. Go to the original website and skim through the details and learn something to share…
The Real Cost of Wind Electricity By Norman Rogers
This article is a technical exposition on how to calculate the cost of generating wind electricity. The goal is to show the true cost of wind electricity compared to conventional sources of electricity. Wind is important because it is the lowest cost type of renewable electricity that is also scalable. Some types of renewable electricity may be cheaper but have limited scaling possibilities because they depend special circumstances such as underground steam or favorable hydro sites.
Various agencies and think tanks calculate the cost of generating electricity. The U.S. government Energy Information Agency (EIA) is prominent. The EIA is biased against coal electricity and biased in favor of wind electricity. They, for example, increase the interest rates used for coal plants by nearly 30%.
Usually the cost of electricity is computed by taking the yearly capital cost of the plant amortized over the life of the plant and the annual operating costs. This yearly cost is divided by the number of kilowatt or megawatt hours produced per year to determine a cost per unit of electricity. The electricity is taken as the amount of electricity exiting at the plant fence.
This approach is fatally flawed in the case of wind electricity that is non dispatchable. Non dispatchable means that the grid managers cannot order wind to turn on when needed. Wind can be turned off, but then the power that would have been generated is lost. Rather than ordering wind to turn on or off, the grid is assumed to accept all the wind electricity available and adjust the other generators in the grid to maintain balance between supply and demand. Wind has to be operated this way in order to be remotely competitive. The grid has to supply a backup source of electricity to take over according to the vagaries of the wind. The worst case is no wind, so the backup has to be able to take over 100% of the wind….