American Energy Alliance

February 10, 2011

Case study on RangeFuels: Americantaxpayers invested $162 million in a biofuel company and all they have to showfor it is 4 million gallons of bio fuel, a closed plant and 4 employees WallStreet Journal (2/9/11) reports: Vinod Khosla stepped in with his hand out.The political venture capitalist founded Range Fuels and in March 2007 itreceived a $76 million grant from the Department of Energy—one of sixcellulosic projects the Bush Administration selected for $385 million ingrants. Range said it would build the nation’s first commercial cellulosicplant, near Soperton, Georgia, using wood chips to produce 20 million gallons ayear in 2008, with a goal of 100 million gallons. Estimated cost: $150million…The result has not been another Google. By the end of 2008 with nooperational plant in sight, Range installed a new CEO, David Aldous. In early2009, the company said production was not expected until 2010. Undeterred,President Obama’s Department of Agriculture provided an $80 million loan. InMay 2009, Range’s former CEO, Mitch Mandich, explained that the problem wasthat nobody had figured out how to produce cellulosic ethanol in commercialquantities. Whoops. Read IER’s Tom Pyle’s blogon Range Fuels.

 

We need to get WilliamShatner as the Priceline negotiator to call Republicans and start asking formore cuts WashingtonPost (2/10/11) reports: Top White House priorities would also come underthe knife: Key Republicans are proposing to defund President Obama’s high-speedrail initiative, slash clean-energy programs and cut the Office of Science by20 percent – trims that would deal a direct blow to Obama’s innovation agenda.They would also cut the Environmental Protection Agency by 17 percent…Programstraditionally favored by Republicans would not escape unscathed. The listincludes significant reductions in agriculture programs, which benefit many GOPdistricts. All told, House leaders are aiming to cut programs unrelated tonational security by more than $40 billion over the next several months, anunprecedented reduction.

 

One of the most difficultconcepts for greenies to grasp: opportunity cost. Ronald Bailey does a good joblaying it out and using CA as an example Reason(2/9/11) reports: Specifically, the Next 10 report finds that the number ofjobs in California’s green core economy rose between 2008 and 2009 from 169,000to 174,000—an additional 5,000 jobs. Green jobs account for just 0.9percent of California’s overall 18.8 million jobs. Note that California’sunemployment rate is 12.5 percent, which means that 2,270,000 Californians arewithout work…Unfortunately, when it comes to green jobs both the president andthe Next 10 report are focusing on the seenwhile ignoring the unseen. In hisbrilliant essay, “What is Seen and What is Unseen,” 19th century Frencheconomist Frederic Bastiat pointed out that the favorable “seen” effects of anypolicy often produce many disastrous “unseen” later consequences. Bastiat urgesus “not to judge things solely by what isseen, but rather by what is notseen.”

 

Allhat and no brains: Sec. Salazar argues that solar industry will collapsewithout continued government support. NewYork Times (2/9/11) reports: The Obama administration today saidaccelerated permitting and financial incentives have helped fuel a boominginterest in developing wind, solar and geothermal power on public lands butwarned that future development will depend on a strong commitment fromCongress…At a renewable energy forum hosted by the Interior Department,Secretary Ken Salazar joined officials of major solar companies to tout thesuccess of a Treasury Department grant program and loan guarantees from theEnergy Department in spurring 12 renewable energy and transmission projects onpublic lands in 2010…But Salazar warned lawmakers that investors will needdependable incentives and regulations to continue building. The Treasury grantswere extended by Congress in December but expire at the end of the year…Equallyimportant, Salazar said, is Congress’ passage of an 80 percent clean energystandard as outlined by President Obama in his State of the Union address lastmonth…"It’s very difficult for anybody to make a long-term plan when youessentially have a policy framework that’s at risk and changes from day today," Salazar said. "If we can get there with this Congress, we canachieve the clean energy future."

 

Waxmanparades around a letter from Bush’s EPA administrator that called for carboncaps in 2007. Remember folks, the Bush Administration ‘betrayed capitalism inorder to save it’ and also funded woodchip energy NewYork Times (2/9/1) reports: As a committee of the Republican-controlledHouse settled in to interrogate the Environmental Protection Agency’sadministrator, Lisa P. Jackson, about her agency’s efforts to regulategreenhouse gases like carbon dioxide, a senior House Democrat releasedthree-year old documents showing that the Bush administration’s E.P.A. soughtto follow exactly the same course…The documents, including a January 2008letter to President George W. Bush from Stephen L. Johnson, then the E.P.A.administrator, show that Mr. Johnson had determined that carbon dioxide posed adanger to the country under provisions of the Clean Air Act. He also believedthat the president’s cabinet had concurred with such action during a November2007 meeting, according to the documents, which were released late Tuesday byRepresentative Henry A. Waxman, Democrat of California…The documents recall aslightly surreal bureaucratic back and forth in late 2007 in which Mr. Johnsonsent a proposed endangerment finding to the Office of Management and Budget,where officials refused to open the e-mail with the attachment.

 

Focusgroups must still be saying public health is good branding for the EPA; weshould note that all major air pollutants are down over the past 40 years. LosAngeles Times (2/9/11) reports: Republicans on the House energy committeehave drafted a bill that would take away the agency’s ability to curb suchemissions. EPA Administrator Lisa Jackson says such a move is a threat topublic health…The head of the Environmental Protection Agency on Wednesdaycriticized a bill drafted by Republicans on the House Energy and CommerceCommittee, saying it would strip the agency of its ability to curb greenhousegas emissions…The committee’s proposed Energy Tax Prevention Act of 2011 would"eliminate portions of the Clean Air Act, the landmark law that allAmerican children and adults rely on to protect them from harmful airpollution," EPA Administrator Lisa P. Jackson told a packed committeehearing…Jackson’s aggressive defense of the EPA’s role in dealing withgreenhouse gas emissions, which most scientists link to global warming, seemedfor the moment to allay concern among environmentalists and many Democrats thatthe Obama administration would seek compromises on pollution regulation inorder to win over a disgruntled business community.

 

I’drather see GM spend $9 million on Super Bowl ads than see them waste our taxdollars down the green energy hole USAToday (2/9/11) reports: "We’re keeping all the doors open orajar," said Akerson, who took over as CEO in September. "I really dothink what is good for this country is good for GM."…Because otheralternative-fuel vehicles won’t come easy or fast, GM also is trying to makethe most of what it has on the road. That means finding ways to cut the cost ofits electric car technology. The new plug-in Volt, on sale since December,costs $41,000 before government incentives…Akerson said he hopes weightreduction, strides in battery technology and greater production volumes willreduce costs for the next generation without sacrificing quality. "We’reworking hard to get cost out of the Volt."…This year, GM will build 10,000Volts, which can run more than 25 miles on electricity alone before a gasengine generator kicks in. It’s shooting for 40,000 cars next year, says MarkReuss, GM’s North American president.

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