Continued from part one.
– Why can’t we be more like China? No Tom Friedman didn’t testify today, but he might as well have. Democrats lamented that the United States does not spend, as China does, roughly $30 billion per year (officially) to subsidize its solar power industry. “China [not Solyndra] is the headline,” Rep. Ed Markey (D., Mass.) proclaimed, arguing that in the wake of the company’s collapse the government should be spending more, not less, on speculative “green” technology.
Jonathan Silver, who heads the loans program office at the DOE, defended the taxpayer-funded guarantees to solar and other “green” energy companies as “necessary to compete with China.” As he said in his opening statement: “The race for solar manufacturing jobs is a race worth winning.” Interesting that he emphasized the “jobs” aspect of “green” technology. As Greg Pollowitz points out, the DOE loans programs, by its own accounting, has dished out a total of $38.7 billion and created a whopping 65,578 jobs, which works out to a rate of just under $600,000 per job. And in Silver’s view, a $535 million failure like Solyndra simply “comes with the terrain of backing innovative technologies.” Though he left it out of his spoken testimony, Silver’s written statement includes a quote from JFK (re: the moon mission) to color his argument: “If we are to go only half way, or reduce our sight in the face of difficulty, in my judgment it would be better not to go at all.”
– California Dreamin’. Rep. Brian Bilbray (R., Calif.) had perhaps the most compelling questions for the witnesses (even though they ducked and dodged them all). For instance, why on earth did the administration approve a $535 million loan guarantee for to fund the construction of a new manufacturing facility in California — a state with significant financial problems, 12 percent unemployment, an abundant supply of empty warehouses (a result of businesses “fleeing” the state, Bilbray said), and some of the strictest regulations and permitting requirements in the country?
This was just “absurd,” he said, and raises questions about the competence of the agencies who ultimately approved the loan. Bilbray outlined the litany of permits and regulations a new facility in California would have to comply with, especially since the building site was located on “virgin farm land” and fell within a “non-attainment” zone as classified by the EPA. Because the resulting costs would be quite high, why build a whole new facility, as opposed to renting or retrofitting an existing facility? Or open a new plant in another state? Bilbray asked. Fair questions, but neither witness claimed to know anything about that aspect of the loan decision.
– Miscellaneous:
-
Rep. John Dingell (D., Mich.), midway through the hearing: “I’m still waiting to see something that makes me concerned.”
-
Markey accused the GOP of trying to “politicize” the Solyndra bankruptcy in an effort to “discredit” the entire clean-energy industry. Rep. Henry Waxman (D., Calif.) claimed that Republicans are “science deniers” at that explains their opposition to “green” energy.
-
Both witnesses claimed to be “surprised” by the FBI’s decision to search the Solyndra offices, and could think of no reason why the FBI would be investigating the company.
-
Solydra executives Brian Harrison (CEO) and W. G. Stover Jr. (CFO) were both invited to testify at today’s hearing but did not show. According to committee staff, they have agreed to appear before the committee next Friday, September 23, and will not plead the fifth amendment, despite being under investigation.
-
After the hearing, subcommittee chairman Cliff Stearns (R., Fla.) told reporters that, based on the evidence the committee has received, Energy Secretary Steven Chu should also testify at the hearing next week. “I think at some point you’re going to have to go to the top people and say why did this happen?” Stearns said. “You can’t lose this kind of money, and have the FBI indicate there is criminal activity here and not have somebody fired.” Whether or not that “somebody” is Secretary Chu, the chairman declined to say. Either way, Stearns said the Obama administration ought to launch their own investigation into the matter.
-
Stearns said the committee is “still looking” into whether outside investors like major Democratic donor George Kaiser exerted any undue influence over the loan and/or loan restructuring process. He has sent a letter to the White House asking for additional documents, but has yet to receive a response, he said. Republicans are hoping that next week’s hearing will provide “more concrete evidence of what tie-in there was between the White House and Solyndra and the investors.”
This may be an entirely stupid question (in my defense, I'm no energy expert) but...
...without the heavy retail-side subsidies on solar panels, in the US but especially in Europe, do they even make sense economically, irrespective of how much cheaper China might be able to produce them.
IOW, without the government largess that drives the demand, would anyone be making solar panels?
Also, at the risk of sounding like Ross Perot, we do have to start rethinking how we do business with companies that heavily subsidies manufacturing. That's not what Adam Smith had in mind.
Of course, given the direction we've gone with respect to Chrysler & General Motors, it might sadly be a moot point in a few more years.
Reply to this commentLinkReport AbuseThat should have been ...how we do business with countries, not "companies".
Reply to this commentLinkReport AbuseI've wondered the same thing. Few years ago a guy was changing our breaker box and he said he sold solar energy HVAC systems for houses on the side. I asked how much. He said it starts at $35,000. Laughed in his face. Felt bad but couldn't help it. About a month ago, a retail store opened up down the street selling these things called Solatubes.
External Link
I've never seen a solar retail store in my life, so apparently there's more of a market than there used to be. Whether it's a propped-up market I don't know, and it's almost impossible to find news stories that say what the real deal is.
Reply to this commentLinkReport AbuseHaving never heard of Solatube, I clicked on the link. Under residential, the solar attic fans look attractive. In very large print, "Save with 30% Federal Tax Credit".
I think it's partially propped up, although after the summer we just had, I'm curious.
Reply to this commentLinkReport AbuseThose Solatubes aren't "solar energy" in the same sense -- despite what their website says, they are indeed convoluted skylights.
Reply to this commentLinkReport AbuseRight. We put a couple of Solatubes in our previous house. They're very nice skylights, intended to focus daylight inside to rooms where it otherwise could not reach. To the best of my knowledge, they are not energy-saving devices, they are decorative. We don't have them in the new house, and writing this makes me miss them.
Reply to this commentLinkReport AbuseYou took the words out of my mouth. The Chinese Communist Party would not be subsidizing the Chinese solar industry if the West were not requiring its utilities to include solar in the mix, regardless of the cost, or subsidizing the private installation of solar panels.
Why do we do this? Three reasons are usually given, and none are persuasive. First, there is the goal of decreased greenhouse gas generation. But according to the climate change alarmists' own models, no amount of such reductions can have any measurable on the climate.
Second, there is the goal of decreased oil consumption, which is intended to cause the price of oil to fall and to save consumers money. Not only is solar electricity not going to reduce world oil consumption -- for one thing, oil is a transportation fuel and electricity is a fixed location fuel -- the impact on the pump price of gas will be more than offset by the higher price of electricity.
Third, decreased oil consumption will decrease the amount of money we send to Saudi Arabia and other oil exporters -- "people who don't like us very much" -- and it will also decrease our vulnerability to oil shocks created by those same unfriendly regimes. Again, electricity and oil are used for different things; we get most of our oil from American, Canadian, and Mexican sources; Saudi Arabia, et al., will continue to sell every drop they pump, all of it at the world price for oil, regardless of who steps up to buy from them; and likewise the price we pay for oil will always be the world price, regardless of the country of origin of the oil that we actually use.
Given that there is no upside to subsidizing the solar panel industry, and given that our efforts to do so benefit the Chinese more than anyone, why do we do it? The secular religion of Greenism, and traditional Democratic influence peddling, that's why.
Reply to this commentLinkReport AbuseFANTASTIC comments on this thread. NRO readers are a lot more clued in to the reality of "green" than anyone in the MSM and most of congress.
Chinese wouldn't be making solar panels at all if there wasn't a market for them in the west. There wouldn't be a market in the west if it wasn't mandated by govt.
Best policy in this area is: zero subsidies. Solar and Wind and Biomass (burning wood chips) will all go away. They are inefficient and frankly just plain dumb ideas that don't work in the real world. But govt is supposed to be all about "creating utopia" isn't it? At least that's what liberals think. They are so noble and good, how could anyone disagree? Don't be "anti-science." ;-)
Reply to this commentLinkReport AbuseI got some figures from a local solar panel contractor.
Reply to this commentLinkReport AbuseHere in Iowa, using best case scenarios, assuming that the panels will produce their peak summer output 12 months out of the year. They still lose money. That is, the carrying cost of the loan needed to install them, exceeds the amount of electricity you get from them. And that is after you factor in both the state and federal subsidies.
That was assuming a 30 year loan. And most of these panels won't go 30 years without having to be replaced.
Reply to this commentLinkReport AbuseScott: Not a stupid question at all. And even not being an "energy expert" you asked the proper questions and arrived at the common sense answer that the solar panels make no economic sense without the heavy government subsidies. That shows you are a lot smarter than Obama and his cronies in the "Green Jobs" scam business. Perhaps you should run for office?
Reply to this commentLinkReport AbuseYour common sense is needed in DC.
I keep hearing this China thing and how wonderful it is that China is subsidizing the solar panel manufacturing to the tune of $30 billion. The response to that is China also builds empty cities because they need to keep people employed. Should we also be building empty cities? I don't think so.
Reply to this commentLinkReport AbuseChu may be a smart physicist but he is an administrative idiot. On solar and wind, he simply does not know what he is talkiing about.
Reply to this commentLinkReport AbuseWhy on earth we would take the advice of a particle physicist (Chu) on simple everyday energy issues is beyond me. He probably has no experience or understanding of commercial power generation or distribution. None whatsoever. He's a partisan hack of the first order. Like Krugman on everyday economics. Nobel prizes ain't what they used to be.
Reply to this commentLinkReport AbuseYup, I want these guys in charge of healthcare. What could possibly go wrong?
Worse, these clowns access to nuclear weapons.
Reply to this commentLinkReport AbuseDemocrats are math deniers. you can't build something for $6 and sell it for $3 and maintain your company as an ongoing concern. Government subsidizing such stupidity and failure should be concerning to everyone, including Democrats. That it doesn't concern Dems like Dingel just shows that they're only interested in bilking the taxpayers so long as they can stay in power.
Reply to this commentLinkReport AbuseI think you missed a crucial accusation from Rep. Brian Bilbray (R., Calif.). Near the end of hte hearing, he said that he has strong evidence suggesting that certain loan guarantees were made conditional on plants being sited in certain locations.
I would desperately like to hear more about this, if Solyndra was approved because it was a jobs program for California, and particularly Waxman's or Pelosi's district, well, then that will be something.
(And it'll be yet another sign of the sheer corruption power of direct government spending, if that wasn't obvious already...)
Reply to this commentLinkReport AbuseDingell has been waiting a VERY long time to see something to make him concerned. I wish I had his job security.
Reply to this commentLinkReport AbuseIf there weren't government (read tax/ratepayer) installation subsidies, there wouldn't be a market - or at least it would be much smaller.
If the market were much smaller, the Chinese wouldn't consider the industry worth manufacturing subsidies.
If the Chinese weren't subsidizing the manufacture, the price would make the product even less viable economically, whether or not there were installation subsidies.
So the reality is that what we have is yet another government policy that - inefficiently, to be sure - shovels our tax dollars into Chinese pockets.
Free trade may be a framework around which one can build a trade policy, but it is not in itself a trade policy.
As for the reasons why 'alternative energy' programs are propped up - well, one might argue that ignorant bottom-feeders like Nostrils Waxman have to have a church to worship at.
Reply to this commentLinkReport AbuseAwesome comment!
Reply to this commentLinkReport Abuse