On July 10, the House passed the 2014 Energy-Water Development appropriations bill which will cut spending on renewables and other green energy programs in half. The bill included an amendment to stop a $3.25 billion green energy loan program. The Fleming amendment draws attention to a pot of money that is, currently, largely unspent that allows a company to take a government loan and walk away from a project without paying taxpayers back. Despite the embarrassing failure of the green energy programs, many inCongress want to keep funding them. One of the most controversial commercial green energy projects, Cape Wind, provides a case in point.
Proposed in 2001 for Massachusetts' Nantucket Sound, the Cape Wind project will span a highly-congested 25-mile area known for frequent fog and storms that is surrounded by shipping routes used by shipping operators, ferry lines, commercial fishermen, and recreational mariners. The Cape Wind industrial offshore wind energy project consists of 130 440-foot high, wind turbines and nearly 100 miles of cable.
The National Park Service deemed Nantucket Sound to be eligible for listing on the National Register of Historic Places as a Traditional Cultural Property, or TCP, because of its cultural significance to the local Wampanoag tribes. (Note: a TCP designation successfully blocked uranium mining in New Mexico.) In opposition to Cape Wind, the Wampanoag Tribe of Gayhead/Aquinnah currently has a lawsuit pending in U.S. District Court in Washington, D.C.
Nantucket Sound is home to several species of endangered and protected birds and marine mammals and has been designated an Essential Fish Habitat. Numerous environmental organizations, led by Public Employees for Environmental Responsibility, have a lawsuit pending for violations of the Endangered Species Act and the Migratory Bird Treaty Act.
Cape Wind also has economic obstacles:
Even though Cape Wind faces widespread opposition, President Barack Obama and Massachusetts Governor Deval Patrick are working together to push Cape Wind forward for political advantage. Audra Parker, President and Chief Executive Officer of the Alliance to Protect Nantucket Sound, says Cape Wind is "a project that is controversial, extremely expensive, and one that has been propelled forward by shortcuts, bending of rules, and political favoritism."
Freedom of Information Act requests and House Oversight Committee research found significant coordination between the Patrick and Obama administrations through the Department of Interior to push Cape Wind forward and gain financial assistance through the loan guarantee program.
In April, US News & World Report addressed a new Government Accountability Office report that it says "finds substantial overlap in federal wind initiatives. This duplication allows some applicants to receive multiple sources of financial support for deployment of a single project."
The $2.6 billion Cape Wind construction is illustrative of how the overlaps can give the developer more in taxpayer-funded benefits than the project's actual cost. Federal incentives, including a $780 million energy investment credit, an Energy Department loan guarantee, and accelerated depreciation could be more than $1.3 billion -- or more than 50 percent of the project's cost. Add in state incentives and the combined total could be $4.3 billion -- exceeding the projected cost by 167 percent. Cape Wind claims to create only 50 permanent jobs -- which would equal a staggering $86 million per job.
Government agency recommendations and/or policy -- including the Advisory Council for Historic Preservation, Federal Aviation Administration, Bureau of Ocean Energy Management, Regulation and Enforcement, and U.S. Fish and Wildlife Service -- had to be overridden or overlooked to prevent "undue burden on the developer" that "could possibly bankrupt them."
For example, a May 3, 2010, FAA PowerPoint presentation to Eastern Service Area Directors includes a slide titled "Political Implications" which states: "The Secretary of the Interior has approved this project. The Administration is under pressure to promote green energy production. It would be very difficult politically to refuse approval of this project."
This quick overview of the Cape Wind project highlights the folly of allocating billions of dollars of state and federal money for green energy projects at taxpayers' expense. Any stimulus funds designated for green energy, but not yet "invested," should be withdrawn; taxpayers should be taken off the hook -- which is the goal of the Fleming amendment.
Because our government is operating on one continuing resolution after another, the 2014 Energy-Water Development appropriations bill is a mere formality. As pointed out on June 25 at Georgetown University, President Obama intends to "invest in the clean-energy companies" -- despite the exorbitant financial cost of the projects and economic damages they will cause the public.
The author of Energy Freedom, Marita Noon serves as the executive director for Energy Makes America Great Inc. and the companion educational organization, the Citizens' Alliance for Responsible Energy (CARE).