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Posts Tagged ‘Alternative Energy’
November 15th, 2013 at 3:46 pm
Brace Yourself: Feds Take Sensible Step on Energy Policy
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It’s rare that we get anything other than green inanity in federal energy policy these days, which is why this news is so welcome. From Ben German at The Hill:

The Environmental Protection Agency (EPA) is cutting the amount of ethanol and other biofuels that must be blended into the nation’s fuel supply, a victory for oil companies that call the federal ethanol mandate unworkable.

On Friday, the EPA proposed draft 2014 blending volumes under the federal Renewable Fuel Standard that are lower than the 2013 requirements, and far less than called for in a 2007 law that expanded the mandate.

The EPA is proposing to require 15.21 billion gallons in 2014, down from 16.55 billion gallons in 2013, marking the first time the agency has lowered the target from the prior year.

A senior administration official said the Obama administration is firmly supportive of biofuels, but said  “market, infrastructure and other constraints” warrant paring back the mandate.

If you’re wondering when the hell the Obama Administration actually started worrying about the real-life effects of their policies, the answer is: when it put them at cross-purposes with a well-financed lobby. As the Wall Street Journal notes:

The EPA says it is trying to fix a problem known as the “blend wall,” which occurs when the annual requirement mandated by Congress exceeds the amount of ethanol that can be mixed into conventional blends of gasoline.

Oil companies and refiners have been warning of the blend wall for several years. If the EPA had stuck to Congress’s original target, refiners said they would have hit the blend wall in 2014 for the first time.

Which, of course, the ethanol lobby is using as an argument that this whole thing is one big gift from the government to “big oil.” That’s pretty rich coming from an industry that wouldn’t exist at any substantial scale without political collusion.

What’s the difference between ethanol and gasoline? You don’t need to pass laws to create a market for gasoline. The oil industry isn’t looking for special favors in this case; it’s looking from relief from a government-imposed drag on its business. The ethanol folks, meanwhile, are the ones trying to use state power to force people into buying their product. Which one sounds more corrupt to you?

As Drew noted earlier this week, ethanol is one big disaster. It doesn’t work in terms of economics, it doesn’t work in terms of energy, and it doesn’t work in terms of the environment. In a perfect world, we would’ve been able to abolish its mandate outright. In this flawed one, seeing it reduced at any level is a welcome change of pace.

October 4th, 2013 at 7:20 pm
Feds Mandate Non-Existent Solution for Non-Existent Problem
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In my column last week, I wrote about how rapidly predictions of catastrophic global warming are unraveling. Despite the fact that the case for skepticism is probably better than ever, the Obama Administration is still proceeding with new EPA regulations to cap carbon emissions, which will have the practical effect of crippling the coal industry.

What’s perhaps most remarkable about this crusade is that the EPA claims the problem can be handled through carbon sequestration — a technology that’s not commercially viable (though this should come as no surprise coming from the same people that think solar and wind power are the wave of the future). As Larry Bell notes at Forbes:

EPA’s latest climate battle plan is to prohibit construction of new coal-fired power plants that can’t achieve 1,100 pound per megawatt hour carbon emission limits. To accomplish this will require plant operators to capture and store (“sequester”) excess CO2, something that cannot be accomplished through affordable means, if at all. [The Institute for Energy Research estimates] that this “regulatory assault” will eliminate 35 gig watts of electrical generating capacity…10% of all U.S. power. As the Competitive Enterprise Institute observes, “If the carbon dioxide emissions standard for power plants proposed by the EPA today is enacted, the United States will have built its final coal-fired power plant.”

The liberal environmental establishment wants to bankrupt the coal industry. That’s their prerogative. But they should at least be honest about it instead of acting like they’re simply helping the industry transition to the next best thing. Perhaps they could take a page out of this fella’s book:

August 22nd, 2012 at 12:20 pm
Federal Energy Policy in Microcosm
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As a resident of the Los Angeles area, I’m accustomed to the petty indignities of big government. In a number of local communities, I can’t get a plastic bag from a grocery store and remain on the right side of the law. In the bedroom community of Calabasas (where I used to live), lighting up a cigarette is illegal virtually everywhere. There was even a small uproar earlier this year when it looked like L.A. was green-lighting $1,000 fines for playing football on the beach (of course that was the one that actually got the public incensed).

Traveling in South Florida last week, I encountered a new one: jam-packed parking lots where the only open spaces (and yes, they were virtually always open) were set aside for electric cars. In an instance of federalism working in exactly the opposite fashion it should — bad state and local ideas trickling up to Washington — it looks like the Capitol is about to get a taste of similar medicine. From National Journal:

Both the House and Senate approved plans to install public charging stations for electric vehicles earlier this month, and President Barack Obama signed those laws late last week. But in conversations with more than a dozen relevant Capitol Hill offices, the Alley could only track down one staffer with an electric car.

The phenomenon — whether in Miami, Capitol Hill, or anywhere else in the nation — is always the same: No one’s buying what the government’s selling. A better parking spot, a charging station, and a guest pass to the HOV lanes aren’t enough to convince the average American consumer to sacrifice quality, reliability, and safety.

This, I think, is the most telling part of the NJ piece:

Though few staffers currently drive electric cars, the sponsors of the legislation hope the stations will act as incentive for staffers considering purchasing one. There are only about 55,000 electric vehicles on the road, according to a CBS projection, which falls well short of Obama’s goals to have 1 million electric vehicles on the road by 2015.

Count me skeptical of the incentive argument. The proponents of electric cars think they have a chicken and egg problem on their hands: no one will buy electric cars if there aren’t widespread charging stations, but no one will build the charging stations if there aren’t widespread electric cars. There’s an oft-unacknowledged parallel with the infrastructure, of course: conventional vehicles require gasoline, but you don’t see government having to mandate the creation of your local service station. It turns out that when people actually want a good, the logistics normally sort themselves out.

The problem isn’t that the product creates a chicken and egg dilemma. If we stay with this metaphor, the problem is that the consumer is a vegan. No matter how you present the product, they’re just not interested. When we start realizing this — and applying the principle writ large — we’ll save billions in taxpayer dollars, unravel the green crony capitalism represented by firms like Solyndra, and get our energy economy back on track.

June 20th, 2012 at 1:45 pm
Federal Government Creating Green Jobs … at $12 Million a Pop
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Further evidence that the Obama Administration’s green jobs fetish defies all logic, economic or otherwise, comes from this report from CNS News:

An Obama administration green jobs grant program that spent $11 billion lacks a verifiable job-counting system and likely created only a fraction of the jobs it claims, according to a staff report by the House Energy and Commerce Committee.

While Energy Secretary Steven Chu said the grants “created tens of thousands of jobs,” the government’s own National Renewal Energy Laboratory estimates it created 910 direct jobs.

The House report criticized even those numbers, saying: “The job creation numbers that exist for Section 1603 are based on models, not actual data from completed projects. Neither Treasury nor DOE have turned over actual jobs data on the Section 1603 grants program to the committee.”

In the spirit of generosity, let’s assume the 910 number is correct. At $11 billion, that comes out to well over $12 million per job. A ludicrous amount to be sure, but also one that comes with an enormous opportunity cost. Scroll down the page to Ashton’s post on the cost-effectiveness of Washington D.C.’s Opportunity Scholarship program and you’ll find that the whole thing (which the Obama Administration has consistently targeted for elimination) could be funded at the cost of less than two of those green jobs.

The character of this administration can be defined by its priorities. Does anything more need to be said than that they would rather slip millions of taxpayer dollars to tech firms who haven’t so much as worked up a business model than to poor children in the inner city? Hope indeed.

May 29th, 2012 at 12:53 pm
The New Math of Alternative Energy
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In a recent commentary piece here at CFIF, I noted how the green energy initiatives that President Obama has repeatedly sold as the cure for the nation’s economic ailments have been shown to lead to economic ruin in places like Spain. For those who still doubt that a similar outcome will result stateside, this piece of representative math, courtesy of the Heritage Foundation’s David Kreutzer, should give pause:

In a speech at a wind-turbine blade manufacturer in Iowa, President Obama called for extending two sets of subsidies that turn energy economics upside down and force higher costs on consumers and taxpayers.

The first extension is for the production tax credit (PTC), which is set to expire at the end of the year. It provides wind-energy producers with a subsidy of about 40 percent of the wholesale cost of electricity. So, when a wind-energy producer sells $50 worth of electricity, Uncle Sam adds another $20 for a total revenue of $70 to the producer.

The second extension is for the Advanced Energy Manufacturing Credit—originally funded in President Obama’s “stimulus” bill. This 30 percent credit cuts the cost of $100 worth of equipment to just $70.

So there you have it. Fifty dollars of actual revenue is bumped up to $70 with the PTC and $100 of costs are cut to $70 after the special tax credit. That is, $50 = $100 after taxpayers make up the difference.

Imagine for a moment if the federal government was proposing to use taxpayer dollars to double the incoming revenue of major Wall Street investment firms. It would rightly be denounced as the worst kind of crony capitalism. So why should the reaction be any different when that money is going into windmills?

May 17th, 2012 at 3:41 pm
The Case for Green Jobs: America Should be More Like Bankrupt Countries
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At a time when Spain is in the news because it lingers on the edge of a full-blown economic meltdown, it’s instructive to remember that this is the country that’s supposed to be the model for the green jobs revolution that President Obama continually claims will help revitalize the American economy. Over at The Blaze, the American Enterprise Institute’s Kenneth Green looks at the factual case and finds it far from compelling:

Now, to the empirical evidence. When talking about our bold green energy future, President Obama held up Spain as an example of what America should be doing. Spain invested heavily in wind power and other types of renewable energy. Alas, after studying the Spanish Experience, Professor Gabriel Calzada Álvarez and colleagues at Spain’s Universidad Rey Juan Carlos found if America followed Spain’s example, for every renewable energy job that the U.S. managed to create, the U.S. should expect a loss of at least 2.2 traditional jobs on average. And they found that green jobs are costly: each green job created in Spain’s effort cost about $750,000, and only one in 10 of the new green jobs were permanent. Doing the math on that, creating even 3 million new green jobs would cost $2.25 trillion. Even in a time where the trillion is the new billion, that’s a lot of money.

Indeed it is. But the money isn’t the real issue. Any “jobs plan” that entails a net loss in jobs shouldn’t be taken seriously by anybody, let alone the President of the United States. If green jobs really are the future of the economy, then sufficient market demand will arise to compel their creation. If, as is far more likely, they are simply a progressive fantasy financed at taxpayer expense, they deserve to have their grip on the public purse shaken as abruptly as possible.

February 29th, 2012 at 4:31 pm
Obama’s Energy Secretary: Administration’s Goal is Not to Lower Gas Prices
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About the only thing that Dr. Steven Chu, President Obama’s Secretary of Energy, deserves credit for these days is honesty. Testifying before Congress yesterday, Chu was asked by Republican Congressman Alan Nunnelee of Mississippi whether the Obama Administration’s energy goal is to reduce the cost of gasoline. Chu’s response, according to Politico:

“No, the overall goal is to decrease our dependency on oil, to build and strengthen our economy,” Chu replied. “We think that if you consider all these energy policies, including energy efficiency, we think that we can go a long way to becoming less dependent on oil and [diversifying] our supply and we’ll help the American economy and the American consumers.”

… “We agree there is great suffering when the price of gasoline increases in the United States, and so we are very concerned about this,” said Chu, speaking to the House Appropriations energy and water subcommittee. “As I have repeatedly said, in the Department of Energy, what we’re trying to do is diversify our energy supply for transportation so that we have cost-effective means.”

In other words, “We’re perfectly content to see oil prices shoot through the roof if it means all you knuckle-draggers will start driving Smart Cars.” Should we really be that surprised from the man who once told the Wall Street Journal, “Somehow we have to figure out how to boost the price of gasoline to the levels in Europe,”? Chu’s intransigence represents a broader liberal pathology: an ideological allergy to economic growth.

February 1st, 2012 at 5:44 pm
Who Killed the Electric Car? The People Who Made It
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Over at RealClearMarkets, the American Enterprise Institute’s Kenneth Green has a wonderful take-down of California’s delusional alternative energy mandate, which would “require that 15.4 percent of all vehicles sold by 2025 must be electric cars, plug-in hybrid cars, or (currently non-existent) fuel cell cars.” Green notes that this is the second time the Golden State has gone down this road, after a similar mandate — imposed back in 1990 — had to be scrapped due to its total infeasibility.

As you may recall, it used to be fashionable amongst conspiracy-minded greens to posit that the electric car had been undermined by some nefarious cabal of big oil, the auto industry, and hydrogen fuel cell advocates. They even made a film about it: 2006’s “Who Killed the Electric Car?”, which included the contributions of such noted experts in transportation economics as Martin Sheen, Mel Gibson, and Phyllis Diller. As Green points out, however, the electric car and its alternative fuel cousins have never taken the market by storm for a much simpler reason — they’re just not economically viable:

The GM Volt sells for a non-competitive $40,000, and is barely selling despite federal tax subsidies up to $7,500, and some state subsidies that further sweeten the pot. Plug-in hybrid technology is more expensive to manufacture, more expensive to repair, more expensive to insure, and, after 22 years, they still have overheating and fire problems.

As Robert Bryce points out in his book Power Hungry, electric cars are the “Next Big Thing. And they always will be.” Bryce observes that EV-boosters have been flogging electric cars since 1911, when the New York Times declared that “the electric car “has long been recognized as the ideal solution” because it “is cleaner and quieter” and “much more economical.”

Scan the hard data on any alternative energy source being promoted as a panacea and you’ll find much the same thing: Too little performance for too much money and too little convenience. And that’s the real tragedy of mandates like California’s or federal handouts to firms like Solyndra. The reality is that we probably will shift away from our reliance on conventional sources of energy like coal and oil in the future. But in order to do so, alternative energy sources will have to be scalable, affordable, and efficient. Providing subsidies for those technologies before they reach that point only delays their viability by reducing the financial incentive to get a better product to market.

The upshot? Reliable green energy may indeed be on the horizon for California. But if it does arrive, it will be because of the efforts of businessmen, not bureaucrats.

January 20th, 2012 at 5:21 pm
Everything That’s Wrong About the Keystone XL Pipeline Decision in One Paragraph
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This insight, courtesy of Warren Meyer writing in Forbes, tells you everything you need to know about why the Obama Administration’s decision to block the Keystone XL Pipeline is misbegotten:

Some would argue that [the pipeline’s] opponents aren’t anti-energy, they just want to shift energy use from fossil fuels to “green” energy like wind and solar.  This is either disingenuous or unbelievably naive. The Keystone XL pipeline would have single-handedly carried more energy to the United States than the sum of all the green energy projects funded by the Obama Administration. And it would have done so entirely with private  funds rather than the Administrations increasingly ill-fated and ham-handed attempts at venture capitalism with taxpayer funds. The fact of the matter is that, for the foreseeable future, opposing fossil fuels is equivalent to opposing energy use.

That, my friends, is the nub of the issue. Liberal environmentalists — those same individuals that sneeringly deride their opponents as “anti-science” — can’t come to grips with the empirical reality: there are conventional energy sources that work and “alternative energy” sources that are viable only in the more fevered recesses of their imaginations. The greens can deny that reality all they want, but they won’t be able to deny the subsequent consequences: higher energy prices and lower economic well-being. That’s a very high price to pay for a sense of moral superiority.

September 19th, 2011 at 3:17 pm
Solyndra’s Not the Disease, It’s Just a Symptom
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The bad news about the Obama Administration’s more than half a billion dollar investment in Solyndra — the California solar energy company that has gone bankrupt and laid off approximately 1,100 employees — keeps piling up. In addition to being a waste of taxpayer money, there are also issues about whether or not the federal loan guarantees were properly vetted, about private investors getting to jump in front of the taxpayers as secured creditors, and about why Solyndra received dramatically lower interest rates than similarly situated firms.

While all those issues are both troubling and relevant, the proliferation of trees runs the risk of obscuring the forest here. That’s why this passage from Matthew Continetti’s new piece in the Weekly Standard is so valuable:

In today’s economy, risks are socialized while profit is privatized. The government uses deficit spending to shape investment decisions and support markets that otherwise wouldn’t exist. Political connections determine the recipients of government largesse. Rentiers conceal their self-interest behind the organic hemp cloak of environmentalism and global “competitiveness.” The illusion can be maintained for a time, but in the end the bill comes due. There’s no money left. And everything disappears.

Ably stated. There’s a reason they’re starting to call it “venture socialism”.

August 16th, 2011 at 9:40 pm
$20 Million Obama “Green Jobs” Program Creates Work for 14 in Seattle
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In the Obama era, the news on any given day seems seems like a real-time seminar on the disutility of Keynesian economics and “green energy” faddishness. The latest such entry comes from KOMO-TV news in Seattle, which reports the following:

Last year, Seattle Mayor Mike McGinn announced the city had won a coveted $20 million federal grant to invest in weatherization. The unglamorous work of insulating crawl spaces and attics had emerged as a silver bullet in a bleak economy – able to create jobs and shrink carbon footprint – and the announcement came with great fanfare.

McGinn had joined Vice President Joe Biden in the White House to make it. It came on the eve of Earth Day. It had heady goals: creating 2,000 living-wage jobs in Seattle and retrofitting 2,000 homes in poorer neighborhoods.

But more than a year later, Seattle’s numbers are lackluster. As of last week, only three homes had been retrofitted and just 14 new jobs have emerged from the program.

Fourteen jobs instead of 2,000. That means the Administration’s estimates were off by 99.3%. Since this president is so fond of telling us how much he respects the private sector, how about a few analogies from the real world?

— A baseball player with this level of accuracy would be hitting .007

— A financial adviser with this level of accuracy would have invested $250,000 and ended up with $1,750.

— A doctor with this level of accuracy who saw 850 patients a year would misdiagnose 844 of them.

If you had that baseball player, you’d cut him. If you had that financial adviser, you’d fire him. And if you had that doctor, you’d find a new physician and probably report the old one for malpractice. If you had this president …