Average cost for new wind capacity in 2007 was per $1,710 per KW, according to the Annual Report on Wind Power 2007 [PDF]. Some of the largest new wind farms had costs as low as $1,240 per KW, while the smallest ones tallied costs as high as $2,600 per KW.

Further, large new wind farms got more use from each KW than small ones — as much 40 percent capacity utilization for big farms on the best sites vs. a 33 percent to 35 percent average. Since capital costs and capacity utilization overwhelmingly determine wind costs, big wind is simply less expensive than small wind.

One argument against big wind farms is that they need long-distance transmission. Gentle solar cells and fan-sized wind generators on roofs don’t need those nasty old long-distance lines, it is sometimes claimed. But regardless of where you generate solar or wind electricity, generation with long-distance transmission is less expensive than generation without.

If we limit ourselves to local generation and transmission, we either need to generate only a fraction of power from renewables or put in a lot of storage. If we want to get most of our power from renewable sources and still limit how much we invest in storage and how many emissions we generate from fossil-fuel backups, the least expensive alternative is to connect to other renewables across a long distance.

Take the example of solar electricity from desert farms or roof tops. The bulk of solar energy received at a site occurs during daily peak sunlight, which lasts about five hours. For local solar to provide most of electricity demand with little use of backup requires at least 20 hours storage. To compensate for at least some cloudy days that grows to more like 48 hours storage. Further, the difference between summer and winter sun can easily be 1.5 to 1 or worse.

On the other hand, wind tends to blow hardest outside of peak solar energy hours. Strong wind seasons tend not to overlap with strong sun seasons. Unfortunately, good solar energy locations and good wind energy locations mostly don’t overlap. Hence we need long-distance transmission even when energy is generated from rooftops and parking lots. And once we have long-distance transmission in place, large-scale wind farms are a lot less expensive per kWh than small-scale rooftop wind.