February 7, 2011

You can’tsqueeze blood out of a turnip or energy from woodchips, but you can squeezemoney out of a taxpayer WashingtonExaminer (2/6/11) reports: To turn wood chipsinto ethanol fuel, George W. Bush’s Department of Energy in February 2007announced a $76 million grant to Range Fuels for a cutting-edge refinery. A fewmonths later, the refinery opened in the piney woods of Treutlen County, Ga.,as the taxpayers of Georgia piled on another $6 million. In 2008, the ethanolplant was the first beneficiary of the Biorefinery Assistance Program,pocketing a loan for $80 million guaranteed by the U.S. taxpayers…Last month,the refinery closed down, having failed to squeeze even a drop of ethanol outof its pine chips…The Soperton, Ga., ethanol plant is another blemish onethanol’s already tarnished image, but more broadly, it is cautionary taleabout the elusive nature of "green jobs" and the folly of thegovernment’s efforts at "investing" — as President Obama puts it –in new technologies…Late in the Bush administration, corn-based ethanol startedto get a bad rap. Corn for ethanol was crowding out other crops, and food priceswere soaring. Mexicans rioted as tortilla prices spiked. So Bush startedtalking up "advanced biofuels" including "cellulosicethanol": roughly, ethanol distilled from plants that were not also foodproducts. Bush mentioned wood chips and switchgrass in two consecutive State ofthe Union addresses.

Battle toDefine EPA – Greenies say EPA is good for your health, but businessowners say EPA is bad for the economy. We prefer subtle branding: EmploymentPrevention Agency WallStreet Journal (2/7/11) reports: TheEnvironmental Protection Agency, which enforces rules that affect the U.S.economy from factories to farms, is the No. 1 target of complaints frombusiness groups collected by House Republican leaders…EPA rules were cited morethan those from any other agency in more than 100 letters sent by tradeassociations, businesses and some conservative groups to House oversightcommittee chairman Darrell Issa (R., Calif.) in response to his call forbusinesses to identify regulations they deemed burdensome, according todocuments reviewed by the Wall Street Journal. The letters are scheduled forrelease today…the letters will become fuel for a running debate betweenRepublican lawmakers and the Obama Administration over what role, if any,increased federal regulation is playing in the sluggish pace of job creation.The Labor Department reported Friday that non-farm employers added just 36,000jobs in January, far lower than most economists had expected.

Big Laborfights with Big Green over Mojave solar project – meanwhile unemploymentis at 12.3 percent and energy prices remain high; hey, at least they have goodweather LosAngeles Times (2/6/11) reports: Do Californiaconstruction unions raise concerns about building massive solar plants in theMojave Desert because they care about wildlife, water shortages and delicatevegetation? Or is it, as some fellow labor unions charge, a way to extortexpensive contracts from renewable-energy builders?..In the last decade, acoalition calling itself California Unions for Reliable Energy (CURE),organized by the State Building & Construction Trades Council ofCalifornia, has filed more than 1,300 requests for information about endangeredspecies, air pollution and groundwater effects as a part of government permitproceedings for all 12 renewable energy projects planned for the SouthernCalifornia desert…But when the developers of eight of those projects — onegeothermal plant and seven solar plants — agreed to sign expensive contractswith the building trades unions to supply workers, CURE dropped its objectionsto those plants…The contracts give CURE unions — which represent plumbers,pipe-fitters, electrical workers and boilermakers — control over work rules,including hiring. CURE also taps developers for payments as high as $400,000 toa CURE fund promoting the industry.

Betting onthe wrong horse – Oil surges 20 percent while renewables plunge 27percent. What are the odds President Obama doubles down? Boston (2/6/11) reports: A less obvious question is whethermutual fund investors will have the patience to stick with green investingprinciples that have recently left them in the red…The stocks of renewableenergy companies, such as wind and solar power providers, have been big losers.The Clean Edge Global Wind Energy Index, which tracks wind energy stocks, isdown about 27 percent over the last 12 months…That disappointment came as oilcompany stocks and the Standard & Poor’s 500 stock index both surged about20 percent…If his goal is to be realized, Obama and his successors will have tostick with the programs he embraced early in his presidency to support wind andsolar power. The government may even have to raise its commitment, likelythrough new subsidies that could create further opportunities for greeninvestors…Either way, Obama’s speech offered comfort to investors leftwondering how long to stick with it…“The sector is not much loved at themoment,’’ concedes Edward Guinness, co-manager of the Guinness AtkinsonAlternative Energy Fund.

Those oddsare pretty good – Secretary Chu has a mad scientist ‘sunshot’ moment anddemands solar energy be cost competitive by end of the decade NewYork Times (2/4/11) reports: The energysecretary, Steven Chu, was publicly using the phrase “Sputnik moment” twomonths before President Obama picked it up in the State of the Union speech todescribe the need for a national effort to improve competitiveness in atechnical field. Now he has moved on to a new space-challenge term:SunShot…Just as President Kennedy pledged in 1961 that the United States wouldland an astronaut on the moon by the end of that decade — a moonshot— Dr. Chu said the United States should attempt a “sunshot” by aiming tocut the cost of solar power by about three-quarters by the end of this decade,to $1 a watt for utility-scale projects. That would translate to an end-userprice of about 6 cents per kilowatt-hour, he said. “That would make solarenergy cost competitive with other forms of energy without subsidies of anykind,’’ he said in a conference call with reporters on Friday…(The averageretail price of a kilowatt-hour today is about 10 cents. The wholesale price,for electricity generated on a utility scale, varies widely over the course ofthe day and the year.)

Rockefellerwarns that “EPA-bashing” won’t work. But apparently he thinks wandering aroundpretending to stop EPA will Greenwire (2/6/11) reports: "I’m fighting hard to suspend EPAregulations on greenhouse gas emissions for two years, not for the sake ofEPA-bashing, but specifically because we need time to move forward with a majornew program on [carbon capture and sequestration], and we need a serious seatat the table for any other proposals on climate change," he said…Two moredraconian proposals floated by congressional Republicans, moving to shutter EPAor revoke its authority to address greenhouse gases, "simply won’twork," Rockefeller added. "And I promise you that most of the peoplein Washington who are pressing those ideas want a fight more than they want asolution."

Shock: New report finds that 20%of plug-in tax credits for EV’s were filed in error by inmates and Hyundaiowners. Bloomberg (2/6/11) reports: About 20 percent of U.S. tax credits forplug-in electric vehicles and alternative-fuel vehicles were filed in error,according to a government audit…The credits are important to companies such as General Motors Co. and Nissan Motor Co., which have entered the plug-inmarket with the $41,000 Chevrolet Volt and the $32,780 Nissan Leaf,respectively. Buyers of those vehicles can claim up to $7,500 from the federalgovernment, and the companies are relying on the credits to be competitive onprice with gasoline- based models…Most of the erroneous credits, according tothe audit, went to taxpayers who sought benefits for vehicles such as Hyundai Motor Co.’s Sonata and GM’s Buick Enclave that didn’t qualify fortax breaks. Prisoners and IRS employees were among those who erroneouslyclaimed credits…The 20 percent error rate means that about $33 million incredits were claimed in the first seven months of 2010 by taxpayers whoshouldn’t have received the money from the Internal Revenue Service, according to the Treasury Inspector General forTax Administration, which released thereport…“While IRS management did take corrective actions to reduce erroneousclaims when TIGTA brought these process weaknesses to its attention, moreclearly needs to be done,” said J. Russell George, the inspector general.



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