The “our industry creates jobs” argument is the last refuge of a subsidy seeker

SEPTEMBER 17, 2012 4:00 A.M.

The Cost of Wind-Energy Jobs

The “our industry creates jobs” argument is the last refuge of a subsidy seeker.

By Robert Bryce

 

EXCERPT:

Or consider the most egregious case of wind-energy corporate welfare: the Shepherds Flat wind project in Oregon, which is getting a $490 million cash grant from the federal government. The project, backed by General Electric, Google, and other companies, willcreate just 35 permanent jobs. Cost of each one of those long-term jobs: about $14 million. Even if we include the 400 temporary construction jobs the project created and count them as permanent jobs, taxpayers are still spending about $1.1 million per wind-related job.

Recall that during the first few months of the Obama administration, wind proponents claimed that their turbines were an essential method of cutting carbon dioxide emissions. But as the economy continues to limp along and a flood of low-cost natural gas is making wind energy less and less economically viable, Big Wind has defaulted to the claim that 37,000 jobs might be lost.

It’s instructive to compare the parallel tactics of Big Corn and Big Wind. About a year ago, as Congress was debating an extension of the tax credit for corn-ethanol production, the Renewable Fuels Association (RFA) abandoned its absurd claims about “energy independence” and instead began running ads touting the “70,000 quality jobs” that rely on ethanol production. The ethanol industry, according to the RFA’s CEO Bob Dinneen, was a “job-creating engine fueled by innovation.” Implicit in Dinneen’s message: We need subsidies for just a little while longer.

That’s awfully similar to a statement made by AWEA’s top executive, Denise Bode, that the PTC is an “effective, job-creating tax policy.” Letting it expire, she claims, will put “good American jobs” in peril.

And that brings us to another parallel: Until last year, Big Corn had both a mandate and a subsidy. Congress finally killed the ethanol tax credit, which cost taxpayers $6.1 billion in 2011, but the corn-ethanol scammers still have a federal mandate that requires motorists to use their hydrophilic, corrosive fuel adulterant.

Big Wind has a mandate: Twenty-nine states and the District of Columbia are subject to mandates for renewable electricity production, which is affecting the cost of electricity for their 220 million residents. And just as Big Corn did last year, Big Wind is campaigning hard because it wants to keep both the mandate and the subsidy.

The “our industry creates a lot of jobs” argument is the last refuge of a subsidy seeker. Congress took away Big Corn’s subsidy last year. It should do the same for Big Wind. 

 Robert Bryce is a senior fellow at the Manhattan Institute. His latest book isPower Hungry: The Myths of “Green” Energy and the Real Fuels of the...

 

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Comment by Willem Post on September 17, 2012 at 10:16am

Robert,

It gets a lot worse. Whenever an inefficient use of resources is introduced it raises costs, reduces jobs.

Overstating Job Creation:

People should clearly understand subsidized RE build-outs increase jobs in RE sectors and suppliers to these sectors, but decrease more jobs in non-RE sectors, for a NET JOB LOSS. 

Heavily-subsidized RE build-outs divert resources (funds, materials, labor, etc.) to inefficient ways of producing energy, which increases electric rates and the prices of goods and services and lowers NET job creation, thereby LOWERING the living standards of working households and reducing profits for non-RE businesses, instead of using these resources for more efficient ways of producing goods and services and increased energy efficiency, which decreases the prices of energy and goods and services and increases NET job creation, thereby RAISING the living standards of working households and increasing profits of non-RE businesses; per Economics 101.

http://theenergycollective.com/willem-post/71771/energy-efficiency-... 

http://theenergycollective.com/willem-post/98061/irelands-wind-ener...

 

Net Jobs From Renewables is a Hoax:

RE promoters and politicians often tout job creation by RE projects, but do not mention the jobs lost in others sectors of the economy. 

Economists have used standard input-output analysis programs for at least 40 years to the determine the plusses and minuses of various economic activities. Numerous studies, using such economic analysis programs, performed in Spain, Italy, Denmark, England, etc., show for every job created in the RE sector, about 2-5 times jobs are destroyed in the other sectors. 

Also, for every 3 green jobs created in the private sector, 1 job is created in government, but, as a general rule, for every job created in government about 2 jobs are destroyed in the private sector, largely due to added economic inefficiencies; no one would claim government is more efficient than the private sector. The above in tabular format:

Total job gain = 3, subsidized RE + 1, government = 4

Total job loss = 6 to 15, private sector due to RE + 2, private sector due to government = 8 to 17

Net job LOSS due to subsidizing RE = 4 - (8 to 17) = -4 to -13 

Such job “creation” is unsustainable. Whether these government jobs are good or bad, needed or not needed, is irrelevant.

http://vtdigger.org/2012/03/27/digger-tidbits-vermont-ranks-no-1-in...

 

Note: This is not the case with increased energy efficiency subsidies. They create jobs in the EE sector, but also create a net increase of jobs in the other sectors, because the reduction of energy costs enables more spending on other goods and services. 

http://en.wikipedia.org/wiki/Input-output_model#cite_note-ref-0

http://en.wikipedia.org/wiki/Input-output_model

http://www.texaspolicy.com/pdf/2012-02-PP03-LearningFromOthersMista... 

http://conservativedailynews.com/2011/09/green-jobs-why-wont-obama-...

http://sistertoldjah.com/archives/2011/02/28/study-green-initiative...

http://greatlakeswindtruth.org/breaking-news/117-for-every-green-jo...

http://www.alabamapolicy.org/viewpoints/print.php?id_art=481

http://conservative-outlooks.com/2011/03/12/green-jobs-fruit-of-the...

http://budget.house.gov/News/DocumentSingle.aspx?DocumentID=261226

http://www.aei.org/article/energy-and-the-environment/the-myth-of-g...

Example of Job Shifting due to Subsidies:

Under the Vermont SPEED program it will take about $230 million of scarce funds to build 50 MW of expensive renewables that produce just a little of variable, intermittent and expensive power that will make Vermont less efficient at exactly the time it needs to become more efficient.  

The VT-DPS evaluated the program in 2009 and issued a white paper which stated about 35% of the $228.4 million would be supplied by Vermont sources, the rest, mostly equipment by non-Vermont sources, such as wind turbines from Denmark and Spain, PV panels from China, inverters from Germany.

There would be spike of job creation during the 1-3 year construction stage (good for vendors) which would flatten to a permanent net gain of 13 full-time jobs (jobs are lost in other sectors) during the operation and maintenance stage.

It gets worse. Under the SPEED program, these projects sell their energy to the grid at 3-5 times annual average grid prices for 20 years; the high-priced energy is “rolled” into a utilities energy mix, resulting in higher electric rates for households and businesses, higher prices of goods and services, fewer jobs, lower living standards.

Most of the larger SPEED projects are owned by the top 1% of households that work with lobbyists, politicians and financial advisers to obtain generous subsidies for their tax-sheltered LLC projects that produce expensive energy at high cost/kWh and avoid CO2 at high costs/lb of CO2; inefficient crony-capitalism under the guise of saving the world from global warming and climate change.  

http://publicservice.vermont.gov/planning/DPS%20White%20Paper%20Fee...

 

 

Hannah Pingree on the Maine expedited wind law

Hannah Pingree - Director of Maine's Office of Innovation and the Future

"Once the committee passed the wind energy bill on to the full House and Senate, lawmakers there didn’t even debate it. They passed it unanimously and with no discussion. House Majority Leader Hannah Pingree, a Democrat from North Haven, says legislators probably didn’t know how many turbines would be constructed in Maine."

https://pinetreewatch.org/wind-power-bandwagon-hits-bumps-in-the-road-3/

 

Maine as Third World Country:

CMP Transmission Rate Skyrockets 19.6% Due to Wind Power

 

Click here to read how the Maine ratepayer has been sold down the river by the Angus King cabal.

Maine Center For Public Interest Reporting – Three Part Series: A CRITICAL LOOK AT MAINE’S WIND ACT

******** IF LINKS BELOW DON'T WORK, GOOGLE THEM*********

(excerpts) From Part 1 – On Maine’s Wind Law “Once the committee passed the wind energy bill on to the full House and Senate, lawmakers there didn’t even debate it. They passed it unanimously and with no discussion. House Majority Leader Hannah Pingree, a Democrat from North Haven, says legislators probably didn’t know how many turbines would be constructed in Maine if the law’s goals were met." . – Maine Center for Public Interest Reporting, August 2010 https://www.pinetreewatchdog.org/wind-power-bandwagon-hits-bumps-in-the-road-3/From Part 2 – On Wind and Oil Yet using wind energy doesn’t lower dependence on imported foreign oil. That’s because the majority of imported oil in Maine is used for heating and transportation. And switching our dependence from foreign oil to Maine-produced electricity isn’t likely to happen very soon, says Bartlett. “Right now, people can’t switch to electric cars and heating – if they did, we’d be in trouble.” So was one of the fundamental premises of the task force false, or at least misleading?" https://www.pinetreewatchdog.org/wind-swept-task-force-set-the-rules/From Part 3 – On Wind-Required New Transmission Lines Finally, the building of enormous, high-voltage transmission lines that the regional electricity system operator says are required to move substantial amounts of wind power to markets south of Maine was never even discussed by the task force – an omission that Mills said will come to haunt the state.“If you try to put 2,500 or 3,000 megawatts in northern or eastern Maine – oh, my god, try to build the transmission!” said Mills. “It’s not just the towers, it’s the lines – that’s when I begin to think that the goal is a little farfetched.” https://www.pinetreewatchdog.org/flaws-in-bill-like-skating-with-dull-skates/

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