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pushing the pace of technological development beyond what made sense because they never knew when the playing field would shift. In fact, it was only the long-term Standard Offer 4 contracts that allowed the industry to grow in the first place. But perhaps the wind companies’ experiences in the passes of California should have taught them a different lesson about how to reduce the cost of energy they produce: Operations matters. In 1992 the R&D manager of PG&E, which bought most of the wind power in the world at that time, noted that half the cost reductions on the wind farms in California “have arisen from on-the-ground experience in building the machines, installing them and keeping spares.”64 What’s more, as noted in Time in 1992,

Wind’s success says something about a dicey political issue: Should government tamper with free enterprise to nurture a new technology? The answer for renewable energy sources is definitely yes. Had manufacturers and utilities not received state and federal assistance early on, the future of wind power would now be controlled by either Japan or Europe; both have consistently funded wind research.65

The problem is that American policymakers couldn’t make up their minds. Businesses lived in constant fear that their tax incentives or other support would be cut by capricious lawmakers, which made it harder to make sound long-term decisions. Congress has confirmed the industry’s worst fears: The production tax credit, the main governmental support for the wind industry, has been extended for arbitrarily short periods of time for almost two decades. It was allowed to lapse in 1999, 2001, and 2003. Those gap years devastated domestic wind farmers. 66 It’s not too much of a stretch to say that this is the worst way to dole out subsidies one can imagine and the one strategy least likely to lead to a healthy industry. The oil industry, by contrast, received a huge, steady tax break from 1913 until 1975, despite decades of criticism. Neither the break nor its abolition, in the words of Harvard’s Richard Vietor, was tied “to any rational concept of energy policy,”67 but the oil industry was powerful and its lobbyists got what they wanted until the energy crises of the ’70s. The wind industry has never managed such consistent success.

So whereas the American turbine manufacturers twisted in the legislative wind, Danish policymakers had no problems supporting their homegrown businesses and promoting their potential as an export industry. Even during downturns for the Danish wind industry over the last thirty years, the government has proactively worked to keep knowledge within the industry. “The Danish have preserved knowledge that otherwise would have disappeared or become worthless. They codified it in reports and kept a lot of the same people employed in the industry for 20 or 30 years. That just doesn’t happen at all in the United States,” said Gregory Nemet, an energy innovation researcher at the University of Wisconsin. “There is a real benefit to stability and avoiding this depreciation of knowledge.”

Like human archives, experienced hands help keep mistakes from being repeated. They have contributed mightily to the success of the world’s leader in wind energy, the Danish company Vestas, which employs twenty thousand people and generates six billion euros of revenue annually, largely from exports. So the lessons from thirty years of wind power development aren’t sexy or particularly shocking, but they are the kind of common sense that American energy policy needs.

First, technological breakthroughs, politically appealing as they seem, are rarely as easy to achieve or important as advertised. Second, cost reductions are as likely to come from learning by doing as by designing paper tiger machines. Third, consistent incentives are more efficient than the yo-yo versions that have typified American policy. Fourth, as shown by the Danish experience, creating high-functioning innovation networks requires more than tax incentives. Government support for R&D and reliability testing are essential.