Operative BG writes in after jotting a bunch of notes on a chalkboard, brushing off the dust and scratching his head:
None of the stories of my tax dollars being wasted on bad green investments surprises me.
But when you present these stories to Obama's worshipers, they claim that these failed investments represent only a small part of the investments in so-called green energy. I have to acknowledge that that may indeed be true. Problem is, I don't know if it IS true, and neither do Obama's acolytes, because nobody seems to know how much of my money is being
placed on Lucky Daninvested in green energy.
If Uncle Sam is betting $100 billion of my money on
Lucky Dan to wingreen energy and only $2 billion turned out to be a bad investment, while $10 billion paid off, then it's money well-bet.
What happened to the other $88 billion? Ah, right, government efficiency at work, maybe.
In essence, what I see here is a numerator without a denominator. Can you take a quick trip to the near future - say 2050? - and tell us what the score was in 2012?
GorT fired up the fission reactor and took a quick trip. Here’s a quick look at this issue. Basically, the Department of Energy has three loan programs:
- 1703 - Section 1703, Title XVII of the 2005 Energy Policy Act, that focus on clean energy that include: biomass, hydrogen, solar, wind/hydropower, nuclear, advanced fossil energy coal, carbon sequestration practices/technologies, electricity delivery and energy reliability, alternative fuel vehicles, industrial energy efficiency projects, and pollution control equipment.
- 1705 – Section 1705, added to EPAct. It is a temporary program designed to address the current economic conditions of the nation and authorizes loan guarantees for certain renewable energy systems, electric power transmission systems and leading edge biofuels projects that commence construction no later than September 30, 2011.
- ATVM - Section 136 of the Energy Independence and Security Act of 2007 established an incentive program – the Advanced Technology Vehicles Manufacturing (ATVM) Loan Program – consisting of direct loans to support the development of advanced technology vehicles and associated components in the United States.
Currently, the DOE LPO site shows three 1703 programs. Two are for nuclear power totaling $10.3B and one is for a company making energy efficient windows with a loan commitment of $72M. All three are in a conditional commitment stage.
There are 26 programs in the 1705 category with a grand total of $16.111B in loans that have closed and that forecast a creation of 2,428 permanent jobs. I remain a bit skeptical of the jobs numbers as one single solar project, Abound – the same one who just cut 70% of their Colorado staff – claims 1200 jobs. At the higher rate, that’s over $6M per job created (a larger number of construction jobs are cited, but these are not classified as "permanent" jobs). Let’s put our focus here as Solyndra, Abound and Beacon Power all are in this category. The simple answer to the question is that the total loan amounts affected in the companies mentioned as having issues amounts to 10% of the $16.111B. Maybe BG would approve of a 10% failure rate to date.
However, there are deeper issues here. Why should the government be in the business of choosing? Why is GE getting federal loan guarantees when they have plenty of capital to cover the project, they supposedly aren’t paying any federal taxes (much to the disappointment of liberals)? You won’t find it explicitly stated, but GE (and Google) is behind the Caithess Sheperds Flat project. There are other examples like this and the real reason behind it is money. With the federal subsidies and benefits, energy companies can realize a return on equity in the 17 to 22 percent range while typical returns on utilities are 7 percent. Conglomerations of companies can be seen in the data as well – for example, Abengoa secured over 17% of the 1705 funding alone.