Is the green’s “Daddy Warbucks” helping the planet or himself?
Commentary by Marita Noon
Any comprehensive review of green energy and its politics and policies has to include the name of wealthy liberal Tom Steyer – who has been called the environmental movement’s new “Daddy Warbucks.” Having made his billions from his tenure atop Farallon Capital Management – much of it from coal projects around the world – Steyer apparently had an environmental epiphany and now wants to atone for his past sins by trying to save the planet from manmade climate change.
He is using his wallet to try to elect candidates who will promote policies and energy plans that agree with him. And that plan is “green.” As I’ve previously reported, he spent nearly $75 million in the 2014 midterms and intends to top that for the 2016 election cycle. Steyer - a long-time donor to Democratic causes - was a 2008 Hillary Clinton supporter. After her campaign failed, he emerged as a bundler for Obama in 2008 and again in 2012. Additionally, Steyer is a Clinton Foundation donor, and last year, at his San Francisco home, he held an expensive fundraiser for Clinton’s 2016 presidential run.
Along with researcher Christine Lakatos, whose Green Corruption File was recently praised on the Michael Savage Show, I’ve repeatedly addressed Steyer’s involvement through our work on President Obama’s Green-Energy Crony-Corruption Scandal. Anytime there is a pot of government money available for green energy, as Lakatos found, Steyer’s name seems to be attached to it. Some of the most noteworthy include: Sungevity, ElectraTherm, and Project Frog – all funded by Greener Capital (now EFW Capital), which is a venture firm that invests in renewable energy, with Steyer as a known financial backer.
Steyer claims to have “no self-interest” in his political activism. The Los Angeles Times quotes him as saying: “We’re doing something we think is good for everyone.” Yet, as Forbes columnist Loren Steffy points out, he is spending his fortune lobbying for “short term political gains” rather than into research and development “aimed at making renewables economically viable.”
While he may say what he is doing is good for everyone, the policies he’s pushing are good for him – not for “everyone.” The Washington Post called him: “The man who has Obama’s ear when it comes to energy and climate change.” In California, where he has been a generous supporter of green energy policies, he helped pass Senate Bill 350 that calls for 50 percent renewable energy by 2030. California’s current mandate is 33 percent by 2020 – which California’s three investor-owned utilities are, reportedly, “already well on their way to meeting.” It is no surprise that California already has some of the highest electricity rates in the country. Analysis released last week found that states with policies supporting green energy have much higher power prices. In October, Steyer spent six figures for an ad campaign calling for the next president to adopt a national energy policy similar to California’s: “50 percent clean energy mix in the U.S. by 2030″ – which will raise everyone’s rates.
With Steyer’s various green-energy investments, these rate-increasing plans are good for him but bad for everyone else – especially those who can least afford it. And, it is the less affluent, I recently learned, he’s targeting with predatory loans for solar panels through Kilowatt Financial, LLC, (KWF) – a company that listed him as “manager” on corporate documents. KWF recently merged with Clean Power Finance and became “Spruce.” The financing structure used, according to the Wall Street Journal (WSJ), allows “homeowners to get solar systems at no upfront cost and then to pay monthly for the use of the power generated. Homeowners end up saving on their total electricity use, while financing companies get steady revenue over 20 years.” WSJ, points out, the KWF financing can be offered to “people who wouldn’t be approved otherwise.”
In the KWF model, contracted payments come from homeowners and “create a steady and reliable income stream, part of which is owned by its venture investors, including Kleiner Perkins.” About the arrangement, KWF chairman and Chief Executive Daniel Pillmer said: “Kleiner Perkins will make a lot of money.” Apparently, the money to be made is from selling the loans that are then securitized on Wall Street – much like the “sub-prime” mortgage crisis that offered loans to people who couldn’t qualify with “traditional lenders.” KWF’s website brags: “We support financing terms for almost every customer and provide ways for dealers to participate in the pricing process to generate even more approvals and create even lower consumer rates.” KWF offers “Instant Approvals, even for customers with lower credit scores” and “Same-as-Cash and Deferred Payment Offers.” In these types of payment plans, a low rate is usually offered in the beginning and increases retroactively if all the terms of the loan are not met.
In this model, the homeowners don’t actually own the solar systems – which means KWF receives the benefit of the federal tax incentives, such as the 30 percent federal “Investment Tax Credit,” designed to benefit the owner of the solar system.
It is practices like this that have drawn the ire of Congress. Several congressional Democrats sent a letter to the Consumer Financial Protection Bureau that warned about the similarities between the solar industry and what led to the subprime mortgage crisis: “easy initial financial terms, increased demand and a rapidly expanding industry.” These factors create a high risk potential that could, ultimately, be harmful to consumers. Similarly, Republicans sent a letter to the Federal Trade Commission that noted pressure from Wall Street is reportedly leading companies who use “potentially deceptive sales tactics” – which doesn’t sound like it is something that is “good for everyone.”
Yet, it is these very types of finance products, promoted by Steyer’s Kilowatt Financial that Greentech Media reports are “doing well.”
While Steyer claims to want to give everyone a “fair shake,” his pet policies increase costs for everyone, and offer a hand-shake for Wall Street. Steyer and his billionaire buddies win, “everyone” else loses. This is how the green-energy crony-corruption scandal works: the political pals profit while the taxpayers get fleeced.
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). She hosts a weekly radio program: America’s Voice for Energy - which expands on the content of her weekly column. Follow her @EnergyRabbit.