Days after the Wall Street Journal ran an editorial that assaulted green energy, and specifically wind energy, the American Wind Energy Association (AWEA) is fighting back.
The initial editorial categorized federal subsidies for renewable energy as “green pork.” But, like any good story there are at least two sides. Enter AWEA, which as a result of being increasingly in the crosshairs of a threatened fossil fuel industry has armed itself with a fact-loaded response. This includes comparing federal subsidies for fossil fuel to federal subsidies for the renewable sector -- and defending accusations that wind energy jobs aren’t worth America’s investment.
Let’s get the math out the way and start with a discussion of the subsidies. During a 53-year period starting in 1950, an estimated $725 billion in government assistance was doled out to American electricity producers. Of the $725 billion, the oil and gas sector took 60 percent of the government pie, while the coal industry bit off another 13 percent. The hydroelectric industry got 11 percent of the $725 billion, while the nuclear industry took nine percent. As for renewables, which in this case includes biofuels, they got just a sliver of the pie, as my dad would say. The sliver accounted for just six percent.
Of course, these statistics represent last century’s energy picture. But this century’s subsidy situation is still heavily weighted to the fossil fuel sector. In 2008, the Energy Information Administration (which is sourced in the WSJ editorial) reports that fossil fuels received more than five times the amount of subsidy dollars than the renewable and nuclear sectors received respectively. Another finding by the Government Accountability Office reveals that between 2002 and 2007 “tax expenditures largely go to fossil fuels: about $13.7 billion was provided to fossil fuels and $2.8 billion to renewables.” These figures seem to neutralize the fossil fuel industry’s argument that their power is available at the lowest cost. How can the fossil fuel industry argue that they are the most affordable when they take billions in taxpayer dollars each year?
Then there is this issue of jobs. AWEA picks apart the journal’s claims that the 85,000 wind jobs in the United States are a wasteful product of subsidies compared to the 140,000 coal jobs in America that produce 50 percent of our electricity. An email from an AWEA employee asked: “Setting aside the Economics 101 fallacy of assuming that labor is the only input of value into a production function, is the Wall Street Journal really trying to argue that creating large numbers of high-paying American jobs, building and deploying the clean energy technologies of the 21st century, is a bad thing?”
Still, the anti-wind editorial claims other inefficiencies, and uses a study by Christopher C. Horner to argue that, “the stimulus bill's subsidies for renewable energy cost taxpayers about $475,000 for every job generated. That's at least four times what it costs a non-subsidized private firm to create a job, a lousy return on investment even for government.” This point should be discussed and analyzed from a fair and actually balanced perspective. But quoting Horner may not be the way to have that discussion. Horner is, among other things, a best-selling author whose books include, “Red Hot Lies: How Global Warming Alarmists Use Threats, Fraud and Deception to Keep You Misinformed” and “The Politically Incorrect Guide to Global Warming and Environmentalism.”
In all, the attack on renewable energy subsidies (especially wind) seemed slightly out of left field when you consider what an easy target the fossil fuel industry is. Perhaps they are feeling threatened by Congress’ major accomplishments for renewables over the last two years or that cap and trade thing that loves to die in the Senate.
Ironically, the only renewable thing in Washington is the guaranteed subsidies for fossil fuels every year. Yet, every year during budget time, the renewable energy folks have to lobby and angle for their small piece of the pie to be reauthorized. But at least that gives an opportunity for the dirty energy folks to write editorials.