In the Pipeline: 2/10/11

Case study on Range Fuels: American taxpayers invested $162 million in a biofuel company and all they have to show for it is 4 million gallons of bio fuel, a closed plant and 4 employees Wall Street Journal (2/9/11) reports: Vinod Khosla stepped in with his hand out. The political venture capitalist founded Range Fuels and in March 2007 it received a $76 million grant from the Department of Energy—one of six cellulosic projects the Bush Administration selected for $385 million in grants. Range said it would build the nation’s first commercial cellulosic plant, near Soperton, Georgia, using wood chips to produce 20 million gallons a year in 2008, with a goal of 100 million gallons. Estimated cost: $150 million…The result has not been another Google. By the end of 2008 with no operational plant in sight, Range installed a new CEO, David Aldous. In early 2009, the company said production was not expected until 2010. Undeterred, President Obama’s Department of Agriculture provided an $80 million loan. In May 2009, Range’s former CEO, Mitch Mandich, explained that the problem was that nobody had figured out how to produce cellulosic ethanol in commercial quantities. Whoops. Read IER’s Tom Pyle’s blog on Range Fuels.

We need to get William Shatner as the Priceline negotiator to call Republicans and start asking for more cuts Washington Post (2/10/11) reports: Top White House priorities would also come under the knife: Key Republicans are proposing to defund President Obama’s high-speed rail initiative, slash clean-energy programs and cut the Office of Science by 20 percent – trims that would deal a direct blow to Obama’s innovation agenda. They would also cut the Environmental Protection Agency by 17 percent…Programs traditionally favored by Republicans would not escape unscathed. The list includes significant reductions in agriculture programs, which benefit many GOP districts. All told, House leaders are aiming to cut programs unrelated to national security by more than $40 billion over the next several months, an unprecedented reduction.

One of the most difficult concepts for greenies to grasp: opportunity cost. Ronald Bailey does a good job laying it out and using CA as an example Reason (2/9/11) reports: Specifically, the Next 10 report finds that the number of jobs in California’s green core economy rose between 2008 and 2009 from 169,000 to 174,000—an additional 5,000 jobs. Green jobs account for just 0.9 percent of California’s overall 18.8 million jobs. Note that California’s unemployment rate is 12.5 percent, which means that 2,270,000 Californians are without work…Unfortunately, when it comes to green jobs both the president and the Next 10 report are focusing on the seen while ignoring the unseen. In his brilliant essay, “What is Seen and What is Unseen,” 19th century French economist Frederic Bastiat pointed out that the favorable “seen” effects of any policy often produce many disastrous “unseen” later consequences. Bastiat urges us “not to judge things solely by what is seen, but rather by what is not seen.”

All hat and no brains: Sec. Salazar argues that solar industry will collapse without continued government support. New York Times (2/9/11) reports: The Obama administration today said accelerated permitting and financial incentives have helped fuel a booming interest in developing wind, solar and geothermal power on public lands but warned that future development will depend on a strong commitment from Congress…At a renewable energy forum hosted by the Interior Department, Secretary Ken Salazar joined officials of major solar companies to tout the success of a Treasury Department grant program and loan guarantees from the Energy Department in spurring 12 renewable energy and transmission projects on public lands in 2010…But Salazar warned lawmakers that investors will need dependable incentives and regulations to continue building. The Treasury grants were extended by Congress in December but expire at the end of the year…Equally important, Salazar said, is Congress’ passage of an 80 percent clean energy standard as outlined by President Obama in his State of the Union address last month…”It’s very difficult for anybody to make a long-term plan when you essentially have a policy framework that’s at risk and changes from day to day, ” Salazar said. “If we can get there with this Congress, we can achieve the clean energy future.”

Waxman parades around a letter from Bush’s EPA administrator that called for carbon caps in 2007. Remember folks, the Bush Administration ‘betrayed capitalism in order to save it’ and also funded woodchip energy New York Times (2/9/1) reports: As a committee of the Republican-controlled House settled in to interrogate the Environmental Protection Agency’s administrator, Lisa P. Jackson, about her agency’s efforts to regulate greenhouse gases like carbon dioxide, a senior House Democrat released three-year old documents showing that the Bush administration’s E.P.A. sought to follow exactly the same course…The documents, including a January 2008 letter 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 a danger to the country under provisions of the Clean Air Act. He also believed that the president’s cabinet had concurred with such action during a November 2007 meeting, according to the documents, which were released late Tuesday by Representative Henry A. Waxman, Democrat of California…The documents recall a slightly surreal bureaucratic back and forth in late 2007 in which Mr. Johnson sent a proposed endangerment finding to the Office of Management and Budget, where officials refused to open the e-mail with the attachment.

Focus groups must still be saying public health is good branding for the EPA; we should note that all major air pollutants are down over the past 40 years. Los Angeles Times (2/9/11) reports: Republicans on the House energy committee have drafted a bill that would take away the agency’s ability to curb such emissions. EPA Administrator Lisa Jackson says such a move is a threat to public health…The head of the Environmental Protection Agency on Wednesday criticized a bill drafted by Republicans on the House Energy and Commerce Committee, saying it would strip the agency of its ability to curb greenhouse gas emissions…The committee’s proposed Energy Tax Prevention Act of 2011 would “eliminate portions of the Clean Air Act, the landmark law that all American children and adults rely on to protect them from harmful air pollution,” EPA Administrator Lisa P. Jackson told a packed committee hearing…Jackson ‘s aggressive defense of the EPA’s role in dealing with greenhouse gas emissions, which most scientists link to global warming, seemed for the moment to allay concern among environmentalists and many Democrats that the Obama administration would seek compromises on pollution regulation in order to win over a disgruntled business community.

I’d rather see GM spend $9 million on Super Bowl ads than see them waste our tax dollars down the green energy hole USA Today (2/9/11) reports: “We’re keeping all the doors open or ajar,” said Akerson, who took over as CEO in September. “I really do think what is good for this country is good for GM.”…Because other alternative-fuel vehicles won’t come easy or fast, GM also is trying to make the most of what it has on the road. That means finding ways to cut the cost of its electric car technology. The new plug-in Volt, on sale since December, costs $41,000 before government incentives…Akerson said he hopes weight reduction, strides in battery technology and greater production volumes will reduce costs for the next generation without sacrificing quality. “We’re working hard to get cost out of the Volt.”…This year, GM will build 10,000 Volts, which can run more than 25 miles on electricity alone before a gas engine generator kicks in. It’s shooting for 40,000 cars next year, says Mark Reuss, GM’s North American president.


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