Paul Pollard CT Letters 24th Sep calculations on the cost of electricity from wind farms assumes that the interest charges on the money used to build the wind farms is 10%. If we removed the interest charge then the cost of electricity from the wind farms is way below the average price of 6 cents per kwh average cost of wholesale electricity and the wind farm will generate not only energy but profits.  The Reserve Bank has the power to issue a loan for $370M at zero interest to the people of Canberra to build a wind farm. There is no reason why this cannot be done. This is exactly what happens when companies seek investor money. Investors buy shares in new companies but do not ask for interest on the money. They ask for dividends on the returns. The government through the Reserve Bank can do exactly the same. This is not inflationary because money is spent building a new asset that is worth more than the money invested. The ownership of the wind farm is a political decision but my preference would be to divide the shares up between the citizens of Canberra in inverse proportion to the amount of electricity they consume. The same funding mechanism can be used for a solar thermal farm or even solar panels on our rooftops. This approach of reducing the capital cost of renewable energy is a simpler, cheaper approach to encouraging renewable energy infrastructure than emissions trading.

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