Planet Gore

Sec. Chu Uses Taxpayer Dollars For Multi-Billion-Dollar Spanish Company

You can’t make this up:

Energy Secretary Steven Chu also announced the DOE has offered a $133.9 million loan guarantee to Abengoa Bioenergy Biomass of Kansas LLC (ABBK).  ABBK, which is a subsidiary of Abengoa Bioenergy US Holding, Inc., the U.S. division of global energy giant Abengoa’s (MCE: ABG) biofuel development arm, will use the funds to build a commercial-scale cellulosic ethanol plant in Hugoton, Kansas.

When construction is complete, the facility will convert 300,000 tons of corn stalks and leaves into an estimated 23 million gallons of ethanol a year. In addition to creating alternative fuel, the facility will also produce its own electricity. Using unconverted biomass the plant is expected to generate 20 MW of renewable electricity.

Abengoa had revenues of €5.6 billion in 2010. On top of what’s mentioned above, Abengoa is the recipient of over $2.5 billion in other guarantees. This is about using taxpayer dollars to finance risky investments in the hope that jobs are created. How many jobs? According to the DOE, this $2.6+ billion will create 195 permanent jobs. That’s it.

This is from the DOE announcement of the Abengoa plant:

The Department of Energy’s Loan Programs Office (LPO) administers three separate programs: the Title XVII Section 1703 and Section 1705 loan guarantee programs, and the Advanced Technology Vehicles Manufacturing (ATVM) loan program.  The loan guarantee programs support the deployment of commercial and innovative technologies that avoid, reduce, or sequester greenhouse gas emissions, while ATVM supports the development of advanced vehicle technologies.  To date, LPO has issued loans, loan guarantees or offered conditional commitments for loan guarantees totaling nearly $40 billion to support 42 clean energy projects across the U.S.  DOE has issued conditional commitments or loan guarantees to support numerous projects, including several of the world’s largest solar generation facilities, three geothermal projects, the world’s largest wind farm, and the nation’s first new nuclear power plant in three decades.  For more information, please visit the Loan Programs Office website.

$40 billion is currently committed to this program and no real job creation as a result. This isn’t Keynesian economics. This is Marx — as in Marx Brothers economics.

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