The more people know about the wind-energy business, the less they like it. And when it comes to lousy wind deals, General Electric’s Shepherds Flat project in northern Oregon is a real stinker.
I’ll come back to the GE project momentarily. Before getting to that, please ponder that first sentence. It sounds like a claim made by an anti-renewable-energy campaigner. It’s not. Instead, that rather astounding admission was made by a communications strategist during a March 23 webinar sponsored by the American Council on Renewable Energy called “Speaking Out on Renewable Energy: Communications Strategies for the Renewable Energy Industry.”
Advertisement
During the webinar, Justin Rolfe-Redding, a doctoral student from the Center for Climate Change Communication at George Mason University, discussed ways for wind-energy proponents to get their message out to the public. Rolfe-Redding said that polling data showed that “after reading arguments for and against wind, wind lost support.” He went on to say that concerns about wind energy’s cost and its effect on property values “crowded out climate change” among those surveyed.
The most astounding thing to come out of Rolfe-Redding’s mouth — and yes, I heard him say it myself — was this: “The things people are educated about are a real deficit for us.” After the briefings on the pros and cons of wind, said Rolfe-Redding, “enthusiasm decreased for wind. That’s a troubling finding.” The solution to these problems, said Rolfe-Redding, was to “weaken counterarguments” against wind as much as possible. He suggested using “inoculation theory” by telling people that “wind is a clean source, it provides jobs” and adding that “it’s an investment in the future.” He also said that proponents should weaken objections by “saying prices are coming down every day.”
It’s remarkable to see how similar the arguments being put forward by wind-energy proponents are to those that the Obama administration is using to justify its support of Solyndra, the now-bankrupt solar company that got a $529 million loan guarantee from the federal government. But in some ways, the government support for the Shepherds Flat deal is worse than what happened with Solyndra.
The majority of the funding for the $1.9 billion, 845-megawatt Shepherds Flat wind project in Oregon is coming courtesy of federal taxpayers. And that largesse will provide a windfall for General Electric and its partners on the deal who include Google, Sumitomo, and Caithness Energy. Not only is the Energy Department giving GE and its partners a $1.06 billion loan guarantee, but as soon as GE’s 338 turbines start turning at Shepherds Flat, the Treasury Department will send the project developers a cash grant of $490 million.
The deal was so lucrative for the project developers that last October, some of Obama’s top advisers, including energy-policy czar Carol Browner and economic adviser Larry Summers, wrote a memo saying that the project’s backers had “little skin in the game” while the government would be providing “a significant subsidy (65+ percent).” The memo goes on to say that, while the project backers would only provide equity equal to about 11 percent of the total cost of the wind project, they would receive an “estimated return on equity of 30 percent.”
The memo continues, explaining that the carbon dioxide reductions associated with the project “would have to be valued at nearly $130 per ton for CO2 for the climate benefits to equal the subsidies.” The memo continues, saying that that per-ton cost is “more than 6 times the primary estimate used by the government in evaluating rules.”
Many liberal Texans tout their states wind energy capacity but as reported several months ago in NRO, wind failed to deliver during this past summer's devastating heat wave. Apparently the prevailing meteorological conditions were not accompanied by normal windy conditions in West Texas such that power generation was only 15% of rated capacity.
When it comes to green energy, it is heads the green power developers win, tails the taxpayer loses. The Obama administration is shoveling billions of dollars into unworkable or unnecessary green energy projects all the while ignoring the development of massive newly found natural gas and oil deposits that could be profitably developed not by the government but by the free market if only the government would permit the market to do so. Who gives a half billion dollar grant to a developer upon completion of a project in which the developer has contributed only 11 percent of the development cost? These green energy give aways are a scandal.
The CO2 removal cost for renewable energy seems to always be conveniently missing from the wind and solar studies. And there is a good reason why (from the proponents perspective)--- removing CO2 costs 10-20 times the expected market price of CO2.
For projects I've seen the cost of CO2 removal is more like $300-450 per ton or ten times the expected market price of $40 per ton.
With the US emitting 7 B tons of CO2 per year, a CO2 cost of 50-100 per ton amounts to $350-700B per year or a subprime crisis every year. The scale of the CO2 issue is so large that, if
we do decide to remove CO2, we need to pick the most efficient method. Government has once again proven that it is capable of finding a most expensive solution.
You don't have to be Don Quioxte to realize that fighting these windmills is akin to the little Dutch Boy putting his finger in the dike...but instead of water, the flood is cash. Might as well take the money, right? Wrong. Stop the federal crutch and let the market determine what source of energy works for the public.
That another big Obama-backer like Immelt is able to tap into this seemingly bottomless slush fund comes as a surprise to no one, I should think!
But hey, that's just business as usual for our honest, hard-working pols in DC. Nothing new here - but did you see who got kicked off 'Dancing With People You've Never Heard Of' last night?! Now that's news!!
Why demagogue GE/Enron for not paying taxes; they didn't owe any. As the Oil and Gas companies, I am sure, didn't either. Let's not blame the players for rules of the game. While I am not sure if it is fair or not that GE/Enron does not owe taxes for fiscal 2010, I am sure that our government has, once again, put the interests of some (green evangelist, green investors, companies in a position to take advantage of subsidies, i.e. GE who bought the wind and solar assets from remains of Enron) above the people. If my read of the Constitution is accurate, no where is the power for the feds to be in the energy creation business enumerated. This is just the latest in a never ending line of corrupt, illegal acts by the federal crime syndicate. GE/Enron may be the sleaziest corporate welfare baby of them all but, it was the feds who have made this fleecing of the people possible.
When the government is allowed to have (or create out of thin air) large amounts of money, there will be people with no ethics with their hands out. It's simple human nature.
That's the reason the founders created a small government. So those useless people wouldn't be there with their hands out. No money, no sleazy people! The more I read of the founders, the more I wish we had stayed with their vision on how to keep the federal government small.
It is not surprising that a fossil fuel funded (External Link) energy “expert” would try to tear down wind energy. The wind sector has enjoyed tremendous growth, adding more than a third of all new generation in the U.S. since 2007 while adding jobs in rural America and revitalizing our homegrown American manufacturing base. This growth can be seen as a positive force of American innovation, or to some, as a threat to the status quo. But you should at least expect Robert Bryce to get his facts right.
Bryce claims that the more people know about wind energy the less they like it. This claim is disproven by the facts. Iowa, for example, garners more of its electricity from wind power (20%) than any other state, making Iowans some of the country's foremost experts on wind power. And Iowa polling (External Link) shows that those with the greatest exposure to wind power support it overwhelmingly and on a bipartisan basis with a majority of Iowa voters naming wind energy as their preferred energy source for the state.
On the topic of federal support for wind energy, Bryce neglects to inform us that recent studies (External Link) have shown that renewable sources of electricity actually receive far LESS federal support than did “conventional” sources during similar periods in their development. As the study states: “current renewable energy subsidies do not constitute an over-subsidized outlier when compared to the historical norm for emerging sources of energy. For example: … the federal commitment to [oil and gas] was five times greater than the federal commitment to renewables during the first 15 years of each [subsidy’s] life, and it was more than 10 times greater for nuclear."
Modest federal support for wind energy has been extremely effective at keeping Americans at work and fostering a whole new American manufacturing sector. Unfortunately the program is set to expire soon. Unlike the oil, gas, coal, and nuclear industries that have permanent incentives, renewable energy industries will be stalled unless Congress acts soon to extend the program. Hopefully, Mr. Bryce will bear these facts in mind next time he tries to write about the American success story that is clean wind energy.
Oh, OK. Renewable sources receive less subsidies than than conventional ... um ... and the pie chart on your link compares "cumulative". So oil/gas is measured from 1859. Inflation-adjusted, I'm sure. With no indication as to how "subsidy" is measured. I cannot take this "study" seriously. It smells like cherries, picked at exactly the right time of the season.
You are right that the cumulative differential is not surprising. What is eyeopening however is that this report staters that if you zoom in and look at the federal support for all energy sources in their infancy, renewables actually receive far less support than did fossil fuels or nuclear energy at a similar point in their development. In fact, oil and gas subsidies were far greater than the more modest federal support renewable sources of energy receive today, even when those oil and gas supports were at historic lows during the Great Depression.
I'm still a bit skeptical of the meaning of these statistics, but let's give them the benefit of the doubt for a moment.
I think that what we see in these numbers is that we're comparing absolute amounts of subsidy, but a lot of subsidies are "tax expenditures". A "tax expenditure" that subsidizes a very profitable business will make the successful ventures appear to get larger subsidies than the unsuccessful ones. The main problem of "renewables" is that they haven't been particularly profitable, thus the "tax expenditures" (even if of a comparable % rate) won't add up to a large amount, and thus most of their subsidies will be direct loans, loan guarantees and grants. The direct subsidies will necessarily be much less in absolute terms than the tax breaks on the very profitable oil & gas industry.
This is why I referred how a "subsidy" is measured. While it is in some sense "fair" to count tax breaks as "subsidies", they are qualitatively different from direct subsidies. Moreover, if ALL that were measured were "tax expenditures", it would look even worse for renewables.
Since most of the O&G subsidies are of the "tax expenditure" variety, it is difficult to argue that the absolute monetary size of such a "subsidy" is a primary cause of the success of oil and gas. Rather, it is the opposite: the success is what made the absolute dollar amounts so high in comparison.
OK, let's use your logic. Kentucky gets over 75% of its electricity from coal therefore making the average Kentuckian an expert in coal fired generation.
And who was it who made the claim that the more people know about wind energy the less they like it? Not Bryce. He is quoting a wind energy advocate.
If wind energy is so wonderful why are we subsidizing it through GE? Let them spend their own money. Unlike GE the US is broke.
I do not start from a presumption that wind energy is better. That would be the only way to find a way to agree with the only two "arguments" here that wind is growing (is that good or bad or is that just saying everybody's doing it so you had better get with it?) and that it receives relatively little government and political support.
"Bryce claims..." Actually, a spokesman for renewable energy claims.
About that relatively little federal support, from the not un-biased link itself: "The fact that oil and gas have received more than 75 times the total cumulative dollar amount of federal subsidies that renewables have may not be terribly surprising ($446.96 billion [since 1859] vs. $5.93 billion, see below)." The total cumulative dollar amount of federal subsidies since 1859 for renewables is $5.93 billion? All of wind fields I see wherever I drive the interstate plus all of the solar panels and which are all federally subsidized (plus all of the Solyndras) have cost only $6 Billion since 1859? Doubt it. Really, really doubt it. And that's an understatement.
Like the renewable energy guy said, the more I educate myself, the less I like it. And the less I trust those who think the only problem is how it's communicated.
Follow
