A new international example for bad energy policy

August 30, 2016 · Posted in Business and industry, Marita Noon, Radical Green · Comments Off 

Commentary by Marita Noon

If a country’s goal is to decrease carbon emissions by increasing reliance on renewable energy, it only makes sense to install the new equipment in the location with the best potential – both in geography and government.

For Australia, which has a national Renewable Energy Target (RET) of 33,000 gigawatt hours of electricity generated by defined renewable sources by 2020, South Australia (SA) is that place. According to SA Treasurer Tom Koutsantonis, who is also the Energy Minister, the federal government had determined that SA is where “the best conditions for wind farms” could be found. The state government was amenable, with SA Premier Jay Wetherill promising to make Adelaide, its capitol city, “the first ‘carbon neutral’ city by 2050.” The state’s RET is for 50 percent renewable energy by 2025. Wetherall, in 2014, claimed: “This new target of half of the state’s power to be generated by renewable sources will create jobs and drive capital investment and advanced manufacturing industries.”

In reality, SA has now found that talk is cheap, but renewable energy isn’t.

The decision to set a 50 percent renewable target is now being called “foolish,” by Tony Wood, an analyst at think-tank Grattan Institute, and “complete naivety and foolishness” according to Lindsay Partridge, chief executive at Brickworks, one of the nation’s leading providers of building products.

Now the largest producer of wind power, SA has enough installed capacity that, under ideal conditions, it could meet 100 percent of the current electricity demand. “However, wind generation tends to be lower at times of maximum demand,” according to the Australian Energy Regulator. “In South Australia, wind typically contributes 10 percent of its registered capacity during peaks in summer demand.” In fact, on some days, Jo Nova explains, they actually “suck electricity instead of generating it.”

Last month, SA experienced an energy crisis that The Australian, the country’s largest newspaper, blamed on “an over-reliance of untrustworthy and expensive wind and solar.” The paper warned that the federal RET “will force other states down the path taken by South Australia, which has the highest and most variable energy prices in the national electricity grid.” Nova adds: “South Australia has more ‘renewable’ wind power than anywhere else in Australia. They also have the highest electricity bills, the highest unemployment, the largest number of ‘failures to pay’ and disconnections. Coincidence?”

In July, the confluence of several factors resulted in a huge spike in electricity prices – as much as 100 times the norm.

In May, pushed out of the market by subsidized wind, SA’s last coal-fueled power plant was closed. Even before then, The Australian reported electricity prices were “at least 50 percent higher than in any other state.” According to the Australian Energy Market Operator, the average daily spot price in SA was $46.82 per megawatt hour. After the power plant was turned off: $80.47. In June: $123.10 – more than double the previous year. In July: $262.97.

Fred Moore, CEO of SA components manufacturer Alfon Engineering, addressing the electricity price hikes that are smashing small and medium business, says his latest electricity contract had increased by almost 50 percent. Until the end of May, his businesses electricity bill was about $3,000 a month and is now about $4,500 a month. He says: “I don’t know how long the company is going to be able to afford it.”

As a result of the loss of coal, when there’s no wind or sun, SA is now reliant on natural gas generation and from coal-fueled electricity being imported through a single connector from neighboring Victoria.

In part, due to a calm, cold winter (weather that is not favorable to wind farms), natural gas demand is high and so are prices. Additionally, the Heywood interconnector was in the midst of being upgraded – which lowered capacity for the coal-fueled electricity on which SA relies. Because of SA’s abandoning coal-fueled electricity generation and its increased reliance on wind, The Australian reports: “The national energy market regulator has warned that South Australia is likely to face continued price volatility and ‘significantly lower’ electricity availability.”

Then came the brutal cold snap, which caused more folks to turn on their electric heaters – thus driving up demand. The left-leaning, Labour state officials were prompted to plead for more reliable fossil-fuel-generated power. With the connector constrained, the only option was to turn on a mothballed gas-fueled power station – a very expensive exercise. The gas plant had been shut down because of what amounts to dispatch priority policies – meaning if renewable energy is available, it must get used, pushing natural gas into a back-up power source. This, combined with the subsidized wind power, made the plant unprofitable. The Australian Financial Review (AFR) explains: “Energy experts say South Australia’s heavy reliance on wind energy is compounding its problems in two ways, first by forcing the remaining baseload generators to earn more revenue in shorter periods of time when the wind isn’t blowing, and secondly by forcing baseload coal and gas generators out of the market altogether.”

Big industrial users, who are the most affected by the power crisis, are “furious about the spike in higher power prices.” According to AFR, Adelaide Brighton Cement, one of the few energy-intensive manufacturing industries still operating in South Australia, said the fluctuating price was hurting business. “As a competitor in a global market, it is essential for us to have access to the availability of uninterrupted economically competitive power.” In The Australian, Jacqui McGill, BHP’s Olympic Dam asset manager, agrees: “We operate in a global market…to be competitive globally, we need globally competitive pricing for inputs, of which energy is one.” The report adds that some major businesses in SA warn of possible shutdowns due to higher power prices – the result of a rushed transition to increased renewable energy. The Adelaide Advertiser reported: “some of the state’s biggest employers were close to temporarily closing due to surging SA electricity prices making business too expensive.” Not the job creation promised by Wetherall.

“Of course, if you were some sort of contrarian eccentric,” writes Judith Sloan, Contributing Economics Editor for The Australian, “you could argue that escalating electricity prices, at both the wholesale and retail level, have made manufacturing in Australia increasingly uncompetitive and so the RET has indirectly contributed to the meeting of the emissions reduction target – but not in a good way.”

The SA energy crisis serves as a wake-up call and a warning to the other states, as the problem is, according to Koutsantonis, “coming to New South Wales and Victoria very soon.” But it should also, as the Financial Times reports: “provide lessons to nations rapidly increasing investment in renewables.”

Malcolm Roberts, CEO at the Australian Petroleum Production and Exploration Association, called the situation in SA a “test case” for integrating large scale renewable energy generation into the electricity grid. According to Keith Orchison, former managing director of the Electricity Supply Association of Australia (from 1991 to 2003), now retired and working as a consultant and as the publisher of Coolibah Commentary newsletter and “This is Power” blog, current policy is driven by “ideology, politicking and populism.”

Roberts added: “No technology is perfect. Coal is great for base-load power, but it’s not so great for peak demand but gas is well suited for meeting peak demand. You need gas as an insurance policy for more renewables.” Even the Clean Energy Council’s chief executive, Kane Thornton, in the AFR, “conceded conventional power generation such as gas would most likely be needed as a back-up.”

Perhaps the best explanation for SA’s energy crisis came from the Australian Energy Council, formerly the Electricity Supply Association of Australia, which called it an: “accidental experiment in how far you can push technologies such as wind and solar power in to an electricity grid before something breaks.” According to Orchison: “The council says that intermittent renewables at scale reduces carbon emissions but ultimately increases end-user prices and system reliability risks.”

On August 13, The Economist, in an article titled It’s not easy being green, addressed the three goals of Germany’s energy transformation: “to keep energy supply reliable; to make it affordable; and to clean it up to save the environment, with a target of cutting emissions by 95% between 1990 and 2050.” All three of which, Clemens Fuest, of the Munich-based Ifo Institute think tank, says, “will be missed.” He calls Germany “an international example for bad energy policy.” Now we can add South Australia, and, perhaps, most of Australia, as another.

This is the result, Orchison says, of “pursuing a purist view at the political expense of power reliability.”

The question remains: will America learn from these bad examples, or will we continue down the path President Obama has pushed us onto – spending billions, achieving little environmental benefit, and raising rates on households and industry? The result of November’s election will provide the answer.

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.

Trump: making America’s energy policy cheaper, faster, and better

Commentary by Marita Noon

Editor’s note: by Marita’s request – and so as not to come in the midst of other upcoming content from her – I’m posting this a day earlier than Marita’s normal Tuesday morning slot.

The name Donald Trump will occupy the news cycle during the Republican National Convention in Cleveland, Ohio. Other than comments from oil entrepreneur Harold Hamm, energy won’t be a huge topic on the stage – though it does hold a spot on the newly approved Republican Platform and has a starring role in Trump’s plan to “make America great again.”

Trump calls it “An America First Energy Plan.” In it, he calls for “American energy dominance,” which he sees as a strategic, economic, and foreign policy goal. Like every recent president before him, he seeks “American energy independence” – which he defines as being “independent of any need to import energy from the OPEC cartel or any nations hostile to our interests.” According to his energy adviser, Rep. Kevin Cramer (R-ND), this acknowledges that we will still use oil from our friends like Canada and Mexico and that, for example, due to refinery configurations, there will likely continue to be oil imports and exports. The thing to note is that we will not need to, not have to, do business with those who are hostile toward America.

He understands that our amazing American energy resources offer the United States tremendous wealth and economic advantage. In his May 26 speech in North Dakota, addressing untapped oil and gas reserves on federal lands, Trump exclaimed: “We have no idea how rich we are. We want to cherish that wealth.” In comparison, he pointed out that Hillary Clinton wants to lock up “trillions in American wealth” while her “poverty-expansion agenda” enriches her friends and makes everyone else poor. (Be sure to read more about Hillary enriching her friends in my column next week.) In the speech, Trump pointed out to the audience, largely made up of people from the oil and agriculture industries: “If Crooked Hillary can shut down the mines, she can shut down your business, too.”

His America First Energy Plan calls for a redirection of our energy agenda. Overall, Trump will move away from government-central planning efforts and return authority back to the states – an idea that has made it into the Republican Platform. His plan has three main components. Under a Trump administration there will be big changes in climate policy, regulations, and the management of federal lands.

Climate policy

While Trump is known to have called climate change “a hoax,” and has declared that he will not allow “political activists with extreme agendas” to write the rules, he is a true environmentalist. Coming from New York City where the only “nature” is Central Park, he has a heart for the environment. Cramer told me Trump holds a typical “Manhattan view of the West:” clean air, green space, and nature are precious. In his energy speech, Trump announced his environmental policy: “my priorities are very simple: clean air and clean water.” A Trump administration “will work with conservationists whose only agenda is protecting nature.”

In his “100-day action plan,” Trump says he’ll rescind the Climate Action Plan – which “gives foreign bureaucrats control over how much energy we use.”

[Note: this foreign control over energy use was a key component in the Brexit vote - as I wrote a few weeks ago. Since then, Theresa May, the UK’s new Prime Minister, who last week announced: "I want to see an energy policy that emphasises the reliability of supply and lower costs for users," has scrapped the Department of Energy and Climate Change and replaced it with a new Department for Business, Energy & Industrial Strategy. With a President Trump, we can expect similar action.]

Trump has pledged to “cancel the Paris Climate Agreement and stop all payment of U.S. tax dollars to U.N. global warming programs.” He says such policies are evidence of America bending to benefit other nations at a cost to the U.S. Once the “draconian climate rules” are eliminated there is no rationale for imposing a “job-killing cap-and-trade” scheme or to keep extending the subsidies for wind and solar. He is not opposed to wind and solar energy, and in fact, wants to “get bureaucracy out of the way of innovation so we can pursue all forms of energy,” but he doesn’t support the idea of “the government picking winners and losers.” Like other energy sources, once the subsidies expire, the wind and solar industry would benefit from typical business tax deductions and deferments.

Regulations

Trump’s agenda calls for “Regulation reform that eliminates stupid rules that send our jobs overseas.” He knows that “costly regulation makes it harder and harder to turn a profit.”

In his speech, he accused the Environmental Protection Agency of “totalitarian tactics” and pointed out the current enforcement disparity: “The Department of Justice filed a lawsuit against seven North Dakota oil companies for the deaths of 28 birds while the Administration fast-tracked wind projects that kill more than 1 million birds a year.”

Cramer told me we can expect Trump to roll back a lot of Obama’s regulatory overreach and take a different approach toward rules, like the Waters of the U.S. and the Clean Power Plan, that are currently under a court-ordered stay.

Coal miners have come out en masse for Trump because of his promise to “save the coal industry.” I asked Cramer how Trump planned to do that. He told me that while coal-fueled power plants that have already been shut down or converted to natural gas will not likely be reopened, a Trump administration can save what’s left and stop the bleeding by not artificially punishing the industry through regulation.

On July 14, the U.S. House of Representatives passed the 2017 Department of Interior, Environment, and Related Agencies Appropriations Bill. It provides an example of actions we can expect from a President Trump. Cramer says if this bill were to make it to Trump’s desk, he would sign it. Some of the bill’s provisions include:

  • Prohibiting the EPA from implementing new greenhouse gas regulations for new and existing power plants,
  • Prohibiting harmful changes to the “stream buffer rule” or making changes to the definition of “fill material” negatively impacting coal-mining operations, and
  • Requiring a report on the backlog of mining permits awaiting approval.

Additionally, the bill cuts funding for regulatory agencies – “a decrease of $64 million from last year’s budget and $1 billion below the President’s request.”

While the Obama Administration has issued near fatal regulations on the coal industry (which Hillary would take even further), other countries are using more coal. On July 11, the Financial Times announced that prices for coal surged on increasing demand in China.

In short, Trump explained: “Any future regulation will go through a simple test: is this regulation good for the American worker? If it doesn’t pass this test, the rule will not be approved.”

Federal Lands

In his speech, Trump reminded people that President Obama has halted leasing for new coal mines on federal lands and aggressively blocked the production of oil and natural gas by closing down leases and putting reserves off limits. He pointed out that these resources are an American treasure and that the American people are entitled to share in the riches.

One of the ways Americans will benefit from the riches of our natural resources is through a designated fund that, much like many natural resource states already do, will put a portion of the revenues directly into rebuilding roads, schools, and public infrastructure.

As a part of his 100-day action plan, Trump has promised to “lift moratoriums on energy production on federal areas.” Instead of slow-walking permits or being passive-aggressive with the permitting process, he’ll order agencies to expedite exploration, drilling, and mining permits.

Trump has said he intends to “trust local officials and local residents.” This idea will be played out in his approach to the management of federal lands – which Cramer explained will be more of a state and federal partnership where states will have a much greater say regarding their land use. This includes the regulation of hydraulic fracturing. In a blow to the Obama administration’s overreach, a federal court recently affirmed that the regulation of the technology is the jurisdiction of the states – not the Federal Bureau of Land Management.

We’ll see this same philosophy played out in the designation of national monuments – something the Obama administration has abused by turning the ability to designate national monuments into a land grab. His monument designations often prevent productive use of the federal lands – such as agriculture or mineral extraction. The GOP platform committee adopted language that empowers states to retain control over lands within their borders. New monuments will “require the approval of the state where the national monument is designated or the national park is proposed.” As a result, Cramer told me: “We will not see a lot of new federal lands.”

There are two additional important energy items to note. First, Trump would “ask TransCanada to renew its permit application for the Keystone pipeline” – which would be built by American workers. Second, Trump has long been a supporter of nuclear power.

Trump’s energy plan is a turn toward realism. It is based on the fact that our American energy abundance can allow for shared prosperity, better schools, more funding for infrastructure, higher wages, and lower unemployment. Isn’t that what making America great again is all about?

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.

Obama’s green energy plans kill jobs, hurt consumers, and cost taxpayers

June 21, 2016 · Posted in Business and industry, Marita Noon, National politics, Politics, Radical Green · Comments Off 

Commentary by Marita Noon

Proponents of green energy like to point out how the costs have come down – and they have. Though renewable energy, such as wind and solar, are not expected to equal fossil fuel costs anytime in the near future and recent growth has been propped up by mandates and tax incentives. But there are other, more subtle aspects of the Obama Administration’s efforts that have had negative impacts that are not felt for years after the policies are implemented. By then, it will be too late to do much about them.

We know that the push toward renewables has hurt the coal industry. As Hillary Clinton gleefully exclaimed: “we’re going to put a whole lot of coal miners and coal companies out of business.” We are already seeing this happen all over the country. Dozens of coal mining companies have gone bankrupt since President Obama took office and those that are still functioning are doing so with far fewer workers.

One such mine is in the Four Corners region of New Mexico – the San Juan Mine – which is one of the largest underground coal mines in the world. It has been a “top employer” in the region. Westmoreland Coal Company purchased the mine from BHP Billiton, with the sale completed on February 1, 2016. At the time, the mine employed more than 400 people. Shortly thereafter, 11 salaried staff lost their jobs and on June 16, another 85 workers – both salaried and hourly – were laid off. Which, according to the Albuquerque Journal, were “necessary because the San Juan Generating Station, which uses all the mine’s coal, plans to retire two of its four units as part of a negotiated agreement among plant operator Public Service Company of New Mexico [PNM], the Environmental Protection Agency, the Navajo Nation, and the state of New Mexico.”

The “agreement” to shut down half the power plant – thereby cutting the immediate need for coal – is the result of the EPA’s 2011 Regional Haze Program that, according to a report from the U.S. Chamber of Commerce, “seeks to remedy visibility impairment at federal National Parks and Wilderness Areas.” This, the report states, “is an aesthetic regulation, and not a public health standard” – though the results will be undetectable to the human eye. For this, nearly a quarter of the mine’s workforce has been terminated.

The Albuquerque Journal cites Westmoreland’s executive vice president, Joe Micheletti, as being unwilling to “comment on whether he expected to see more layoffs in the coming months.” It also states that PNM has promised “not to lay off any employees at the stations as a result of the unit closures” – though through attrition employment is down 20 percent from two years ago.

The reality is, anti-fossil fuel groups like the Sierra Club, wanted the entire plant shut down. In 2018, PNM will have to plead their case before the Public Regulatory Commission to keep the San Juan Generating Station functioning past 2022. PNM is currently considering a plan for meeting its needs for electricity without it. If the plant closes, all jobs, approximately 800, at both the mine and the generating station will be gone – greatly impacting the local economy.

Obama’s far-reaching green energy policies are insidious – hurting consumers in ways we don’t even think of. On June 10, Stephen Yurek, president and CEO of the Air-Conditioning, Heating and Refrigeration Institute (AHRI), gave testimony before the U.S. House of Representatives Subcommittee on Energy and Power. He addressed the nearly 40-year old Energy Policy and Conservation Act (EPCA) – which, he said, “has not been updated to reflect new technologies and economic realities” and “has been misapplied by the Department of Energy [DOE].” The Obama Administration has run amuck in its application of EPCA – issuing regulation after regulation. Yurek backs this up by pointing out the difference in the Clinton and Obama administrations: “While the Clinton Administration’s DOE issued just six major efficiency rules during his eight years in office, the Obama Administration’s DOE issued eight major efficiency rules in 2014 alone – a record according to the Office of Information and Regulatory Affairs. And DOE’s Unified Agenda indicate that between 2015 and the end of the administration, 11 additional major efficiency rules can be expected to be issued.”

These rules, Yurek explained, “use unrealistic assumptions” to create “higher efficiency levels than are economically justified for consumers.” He encourages Congress to force the DOE to “consider the real-world cumulative impact of product efficiency standards among agencies, businesses, and consumers” and suggests that “as DOE promulgates rules according to an accelerated regulatory schedule, necessary constructive dialogue falls by the wayside.”

Yurek summarizes: “An endless cycle of efficiency rulemakings continues to have an adverse impact on our global competitiveness and the American jobs we create.” This practice hurts consumers as “When new products and equipment cost more than consumers can afford, they find alternatives, some of which compromise their comfort and safety, while saving less energy or none at all or in some cases using more energy.”

In the name of energy efficiency, on December 6, 2013, Obama issued a memorandum ordering federal buildings to triple renewable energy use. He declared: “Today I am establishing new goals for renewable energy as well as new energy-management practices.” Now, nearly three years later, we get a taste of what his federal building initiative is costing taxpayers.

On June 16, 2016, the Federal Housing Finance Agency’s (FHFA) Office of Inspector General released a report - precipitated by an anonymous hotline complaint - on the 53 percent cost escalation at Fannie Mae’s extravagant new downtown DC building. As a result of the financial crisis, mortgage giant Fannie Mae received a bailout of $116.1 billion in taxpayer funds and FHFA now serves as the conservator over Fannie Mae. The Inspector General found that no one in the FHFA Division of Conservatorship “was aware of the 53% increase in the estimated build-out costs for Fannie Mae’s new office space.”

“Because Fannie Mae is an entity in the conservatorship of the U.S. government,” the report states: “FHFA, as conservator, will need to assess the anticipated efficiencies of specific proposed features against estimated costs of those features and determine whether the efficiencies warrant the costs.” The watchdog report found the ballooning costs created “significant financial and reputational risks.”

Addressing the excessive cost, Rep. Scott Garrett (R-NJ), chairman of the House subcommittee with oversight over Fannie Mae, said: “Like a child with a credit card in a toy store, the bureaucrats at Fannie Mae just couldn’t help themselves. After being forced to bail out the GSE’s [Government-Sponsored Enterprises] to the tune of nearly $200 billion [which includes Freddie Mac], American taxpayers now get the news that they are underwriting lavish spending at Fannie Mae’s new downtown Washington, D.C. headquarters. So while Americans around the country are living paycheck to paycheck, Washington insiders are blowing through budgets by designing glass enclosed bridges and rooftop decks.”

In response to the call for “immediate, sustained comprehensive oversight from FHFA,” Melvin L. Watt, FHFA director, defended himself. In the face of the Inspector General’s caustic criticism, he claimed that many of the upfront investments would save money over time. Watt’s memorandum only offers two such examples and one is more efficient lighting. He claims: “upfitting space with more expensive LED lighting instead of less expensive fluorescent lighting would result in significantly cheaper operating costs.” The other example he provided was window shades.

These are just three recent examples of Obama Administration policies that were put in place years before the resulting job losses and costs to consumers and taxpayers are felt. Gratefully, for now, the Supreme Court put a stay on one of his most intrusive and expensive programs – the Clean Power Plan. But there are plenty of little rulemakings, programs, and memorandums that will still be impacting jobs and increasing costs long after he is out of office.

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.

Trying to make winners out of losers

Commentary by Marita Noon

By now, most people probably know about one of Secretary Hillary Clinton’s biggest campaign gaffes to date: “we’re going to put a lot of coal miners and coal companies out of business.” As soon as I heard it, I tweeted: “Imagine a presidential candidate running for office based on putting people out of work?”

I wasn’t the only one shocked by the uncharacteristic clarity of her statement. Lacking the usual political-speak, her comments were all the more surprising in that they were not made at a fundraiser in billionaire environmental donor Tom Steyer’s posh San Francisco living room. They were made in Ohio – coal country, where coal production in 2015 was down 22 percent – at a nationally televised CNN town hall and just hours before the important state’s primary election.

In response, Christian Palich, President of the Ohio Coal Association sent this: “Hillary Clinton’s callous statements about coal miners, struggling under the weight of a hostile administration, are reprehensible and will not be forgotten. The way Secretary Clinton spoke so nonchalantly about destroying the way of life for America’s coal families was chilling. Come tomorrow, or next November, Ohioans in coal country will vote to keep their jobs and not for the unemployment line.”

US News reports that Democrats in the coal states of Wyoming, West Virginia, Kentucky, and Ohio have tried to “distance themselves from Clinton’s comments.” Former Ohio Governor Ted Strickland, a Clinton ally who handily won his party’s primary election for Senator, called her slip, “unartful.” Senator Joe Manchin (D-WV), who, last April, endorsed Clinton, took issue with her comments and contacted her campaign.

Facing the backlash, and in damage-control mode, Clinton sent a letter to Manchin: “Simply put, I was mistaken.”

But was she? I don’t think so.

Though her comments may have been “unartful” and, arguably, poorly timed, I believe they reflect private conversations and campaign strategy. It may be no coincidence that rumors of President Obama’s tepid support for Clinton – though the White House denies endorsing her – surfaced after her killing coal comments.

First, it is clear that Clinton needs President Obama’s endorsement. She needs him to generate excitement for her lackluster campaign – something Democrat voters are not feeling for her as they did for him. She needs his campaign machine to get out the votes.

But, he needs her just as much – his legacy hangs on her election. Because so much of what he’s done has been by executive action, his legacy can just as easily be undone – as every remaining Republican candidate would likely do.  Obama is, reportedly, committed to ”a hard campaign of legacy preservation.” He is ready to “raise money to fill Democratic coffers and target the key communities that would make up a winning coalition for the party, including blacks, Latinos, educated single women and young voters, to encourage them to go to the polls.”

Following the voluntary climate agreement in Paris, Politico stated: “Barack Obama wants to be remembered as the president who saved the world from climate change.” For this legacy to stick, all of his anti-fossil fuel policies must stay intact. To get his endorsement, a Democrat presidential candidate must embrace what he started and promise to “build upon President Obama’s legacy of environmental protections and climate action,” as Clinton has.

While Obama frequently claims to support an “all of the above” energy policy, actions speak louder than words. From his 2009 stimulus bill throwing billions at speculative green energy projects, his killing coal efforts, his stand that we can’t drill our way to low gas prices, his rejection of the Keystone pipeline, and his threat to veto a bill to lift the oil export ban – just to name a few – he obviously meant “none of the below.”

The White House denies a “war on coal.” In December, after the Paris climate agreement was signed, former Deputy Assistant to the President for Energy and Climate Change, Heather Zichal, defended Obama’s green platform: “Nobody’s screaming that their energy bills are on fire; jobs have not been lost.”

Bill Bissett, President of the Kentucky Coal Association called Zichal’s comments: “insulting and inaccurate.” He told me: “The Obama Administration and its allies have an intentional blind spot to the economic and social damage that their anti-coal policies are causing in the United States and especially in coal country. The top coal producing states in our nation not only benefit from the extraction of coal, but all of us benefit greatly from having low kilowatt-per-hour rates. But that economic advantage is eroding as Obama does everything in his power, and against the will of Congress, to move the United States away from coal production and use.” He added: “More than 8,000 Kentucky coal miners have lost their jobs since Obama took office and countless other Kentuckians have lost their livelihoods through indirect and induced job loss due to his anti-coal agenda. And, yes, our electricity rates are increasing in Kentucky as our country moves away from coal.”

“Ms. Zichal and the administration can spin it any way they like but no one outside of their fringe enviro friends is clamoring for their energy policies,” said Mike Duncan, President of the American Coalition for Clean Coal Electricity.

While much of the electricity price increases associated with the Obama Administration will only be seen later, the fact is, according to an Energy Information Agency data set, the increase in retail electricity prices since 2008 is 12.8 percent.

Clinton’s anti-coal comments got all the press. But she didn’t stop there. Almost under her breath, a few sentences later, she added: “We’ve got to move away from coal and all of the other fossil fuels” – more pandering for Obama’s much needed (and, so far, withheld) endorsement.

But how realistic is the Democrat’s goal of moving away from coal and all the other fossil fuels?

“Unlikely,” according to new research from the University of Chicago. The authors wanted a different answer. Like Clinton, and Obama, they believe fossil fuel use is driving “disruptive climate change” that will lead to “dramatic threats to human well-being” and a “dystopian future.” Reading the 22 pages of the report on their findings, one can almost feel their dismay.

Yet, after discussing “supply theory” – which posits the world will run out of inexpensive fossil fuels – they state: “If the past 35 years is (sic) any guide, not only should we not expect to run out of fossil fuels anytime soon, we should not expect to have less fossil fuels in the future than we do now. In short, the world is likely to be awash in fossil fuels for decades and perhaps even centuries to come.” Complicating matters, the authors acknowledge: “a substantial penetration of electric vehicles would reduce demand for oil. Provided that the supply curve for oil is upward sloping (as it is in almost all markets), this drop in demand would translate to lower oil prices, making gasoline vehicles more attractive.”

Then, on “demand theory” – the economy will stop demanding fossil fuels as alternatives become more cost competitive – they lament: “In the medium-run of the next few decades, none of these alternatives seem to have the potential based on their production costs (that is without the government policies to raise the costs of carbon emissions) to reduce the use of fossil fuels below these projections.” Additionally, they conclude: “Alternative sources of clean energy like solar and wind power, which can be used to both generate electricity and to fuel electric vehicles, have seen substantial progress in reducing costs, but at least in the short- and middle-term, they are unlikely to play a major role in base-load electrical capacity or in replacing petroleum-fueled internal combustion engines.”

While the authors support “activist and aggressive policy choices…to drive reductions in the consumption of fossil fuels and greenhouse gas emissions,” they reluctantly admit the proposed solutions are not apt to be the answer they seek. “Even if countries were to enact policies that raised the cost of fossil fuels, like a carbon tax or cap-and-trade system for carbon emissions, history suggests that technology will work in the opposite direction by reducing costs of extracting fossil fuels and shifting their supply curves out.”

Perhaps, before Clinton – who accuses anyone who doesn’t agree with her climate alarmist view as ignoring the science – makes mistakes, like declaring that she’ll put coal miners and coal companies out of business, she should check the science behind her claims to “move away from coal and all the other fossil fuels.”

Making her March 13 comments seem even more foolish, the following days cast a shadow over the specter of funding more speculative solar power, as she’s proposed to do. Three stimulus-funded solar failures made big headlines.

On Wednesday, March 16, the Wall Street Journal (WSJ)  announced that the massive $2.2 billion ($1.5 billion in federal loans according to WSJ, but other research shows more) Ivanpah Solar Electric Generating System may be forced to shut down because it has failed to produce the expected power. What it has produced: “fetched about $200 a mega-watt hour on average during summer months,” while “power from natural-gas plants went for $35 a mega-watt hour on average in California’s wholesale market.”

On the same day, SunEdison’s troubles worsened. After the company acquired stimulus-funded First Wind last year, it became “the leading renewable energy developer in the world.” Now, its “mounting financial woes” resulted in another delay to the filing of its annual reports. The company’s stock, according to WSJ, has “lost 67% over the past three months and 91% over the past year.” It “slid another 16% to $1.73 in premarket trading.”

The next day, March 17, the New York Times declared that Abengoa, the Spanish company hailed as “the world leader in a technology known as solar thermal, with operations from Algeria to Latin America” has gone from “industry darling to financial invalid.” I’ve written repeatedly on Abenoga – which is on the verge of becoming “the largest bankruptcy in Spanish corporate history.” Note: Abengoa was the second largest recipient of U.S. taxpayer dollars – more than $3 billion - from the green energy portion of Obama’s 2009 stimulus package.

It appears Clinton’s energy policies are aimed at trying to make winners out of losers. How can she help it? That is what the Democrat Party is trying to do with her.

Hopefully, voters know better. But then, as the University of Chicago’s study’s closing words remind us: “hope is too infrequently a successful strategy.”

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.

Radio days volume 20

I really had to blow a lot of dust off this series – its last installment was in July of 2013 – but I will be on the internet radio tomorrow morning at 11:00 thanks to radio hostess (and new monoblogue contributor) Marita Noon. She asked me to come on this week’s installment of her “America’s Voice for Energy” program to discuss a post I did last year.

It came about because she was doing a piece on where the candidates stood on energy (which will be her debut post here tomorrow morning) and I noted to her via social media that I had done quite a bit of research last summer on that very topic as part of my “Dossier” series. She wanted to discuss that piece and other thoughts I had on the subject, thus early this morning we recorded my segment of her show, which will be the opening segment. Thirteen minutes may seem like a long time to fill on the radio, but we were rolling so well I almost didn’t get to promote my site.

Yet there are some other things which were sadly left on the cutting room floor, so to speak. Something I would have liked to fill her audience in on further but didn’t have the time to this morning was the unique situation we have here in Maryland with regard to energy. I did get to discuss a little bit about the proposed offshore wind that Martin O’Malley was trying to push, but I wanted to mention that there are hundreds of other jobs at stake in Maryland’s energy industry. (I actually did a little looking up last night because I was curious.)

According to the most recent state report available (2013) there are 401 coal mining workers in the state of Maryland, all based out of Allegany and Garrett counties in Maryland’s western panhandle. No, we’re not West Virginia or Kentucky by any stretch of the imagination but the Obama administration’s “war on coal” isn’t going to help their employment situation, particularly since these coal fields lie close to shale deposits ripe for fracking – unfortunately, a short-sighted General Assembly and Hogan administration put that resource development on hold until 2017.

The other fascinating thing I didn’t get to was the fact that cities up and down the coast are being intimidated into opposing seismic exploration of the ocean floor for the purposes of oil and gas exploration - but had no objection when they went out and did the same thing to map the ocean floor for siting wind turbines. Apparently that was a noble enough cause to kill a few fish over. Honestly, I think the opponents are very aware what is really out there and that’s billions of barrels of oil and trillions of cubic feet of natural gas, all within easy reach of our shoreline and extractable at a cost that would blow the renewables out of the water. (Yes, the pun was intended.)

So take a listen, either live as it happens or later on when it becomes available as a podcast. I believe there are three other guests on the show, so I’ll be curious to see what they have to say as well when I catch the podcast (I’ll be at work when it’s on live.)

Let’s just hope that the long radio slump is over. Thanks to Marita for having me on as a guest, albeit a little reluctantly since I have been under the weather the last few days. But I managed to avoid a Hillary-style coughing jag and pushed through.

Odds and ends number 80

For awhile I wasn’t sure I would ever make it to the 80th edition of this longtime monoblogue series but I have finally arrived with more tidbits that require only a few dozen words to deal with.

Since this category has the item I’ve been sitting on the longest, I’m going to talk energy first. Some of my readers in the northern part of the state may yet have a little bit of remaining snow from the recent blizzard, snow that may be supplemented by a new blast today. But the fine folks at Energy Tomorrow worry about a regulatory blizzard, and with good reason: Barack Obama has already killed the coal industry, states are suing for relief from the EPA,  and a proposed $10 a barrel oil tax may further hinder the domestic oil industry already straining under a price war with OPEC. So much for that $550 annual raise we received, as Rick Manning notes in the latter story I link – for the rest of us, that’s like a 25-cent per hour raise without the increased taxation that normally comes with a pay increase. Yet that quarter would be lost to taxation under the Obama scheme.

It’s interesting as well that the Iowa caucus results favored Ted Cruz over Donald Trump despite their competing stances on ethanol, as Marita Noon wrote, but Cruz’s Iowa win also emboldened others to speak more freely about rescinding the ban.

Speaking of Cruz and Iowa, over the last week we’ve heard more about third-place Iowa finisher Marco Rubio in New Hampshire, as Erick Erickson predicted we would. It’s obvious to me that the media is trying to pick a Republican candidate for us, so they have been pushing either Donald Trump (who is far from conservative on many issues) or Marco Rubio (who has been squishy on immigration and perhaps can be rolled more easily on the subject again.) Or, as Dan Bongino writes, it could be the left’s divide-and-conquer strategy at work once again.

It seems to me that today’s New Hampshire primary should bring the race down to about five participants on the GOP side. The herd will almost certainly be culled of Ben Carson, Carly Fiorina, and Jim Gilmore based on results, polling, and financial situation, and that would cut it down to six. The loser between Jeb Bush, Chris Christie, and John Kasich should whittle the field to five in time for South Carolina and we will begin to see if Donald Trump’s ceiling is really about 25 percent.

Trump’s popularity has been defined by a hardline approach to border security, but once again I turn to Rick Manning who asks what Trump would do about Obamacare, He also shrewdly invokes Bobby Jindal’s name, since the policy wonk had a conservative approach:

Jindal understood that the Obamacare system has put down some roots, and tearing it out was not going to be an easy task that could be glibly done with the wave of a wand or a pronouncement from a podium. He understood that whatever health care system replaced Obamacare would set the tone for whether or not the federal government continued its expansion in scope and power. He understood that what we do about Obamacare is likely to be one of the most important domestic policy decisions that any president will make. So, he laid out his vision for what health care should look like in America. (Link added.)

Yet on another domestic issue New Hampshire’s neighbor Maine is making some serious steps in cleaning up their food stamp rolls. It’s a little scary to think that the Millennials and Generation X decided keeping the “free” stuff wasn’t worth actually getting a job (or taking alternate steps to improve themselves or their community.) Perhaps it is fortunate that these are childless adults.

Turning to our own state, Maryland Right to Life was kind enough to inform me that a rebadged “death with dignity” assisted suicide bill was introduced to the Maryland House of Delegates and Senate (HB404 and SB418, respectively.) The 2015 rendition never received a committee vote, but it also had a late hearing – this year the setup is a little bit more advantageous to committee passage and the number of sponsors (all Democrats) has increased. They thought they had enough votes to get it out of committee last year, and chances are they are correct.

I have postulated on previous occasions that this General Assembly session is the opportunity to plant the seeds of distrust Democrats desperately need to get back that which they consider theirs in 2018 – the Maryland governor’s chair. It will likely be a close, party-line vote but I suspect this bill will pass in order to make Governor Hogan either veto it (which, of course, will allow the press to make him look less than compassionate to cancer sufferers such as he was) or sign it into law – a course for which he will accrue absolutely zero credit from Democrats for reaching across the aisle but will alienate the pro-life community that is a vital part of the GOP.

Try as they might, the Democrats could not bait Hogan into addressing social issues during his 2014 campaign but that doesn’t mean they will stop trying.

On a much more somber note insofar as good government is concerned, the advocacy group Election Integrity Maryland announced they were winding up their affairs at the end of this month. As EIM president Cathy Kelleher stated:

The difficulty of maintaining a small non profit was a full time job and the responsibility fell on the same few individuals for far too long.

We can proudly say that in our 4+ years of operations, we made a difference in the way citizens view the record maintenance of the State Board of Elections and had an impact in the legislative process.

The problem EIM had was twofold: first, a lack of citizens interested enough to address the issues our state has with keeping voter rolls not just up to date, but insuring they are limited to citizens who are eligible to vote; and secondly just an overwhelming task considering there are over 3 million voters registered in Maryland. And for some of the counties that are more populous, the powers that be didn’t much mind having inaccurate voter rolls that may have had a few ineligible voters among them just in case they needed a few extra on election night.

And it’s that prospect of fraud which is among the reasons not to adopt National Popular Vote, as Natalie Johnson notes at the Daily Signal. It’s a good counter to an argument presented in the comments to one of Cathy Keim’s recent posts. After the angst of Bush vs. Gore in 2000, could you imagine the need for a national recount with states hanging in the balance?

I think the system can be improved, but there’s a time and place for that proposal and it’s not here yet. There’s also a time and a place to wrap up odds and ends, and we have arrived.

Is the era of full employment over?

Simply put, March was not a good month for job creation around the country. Numbers were down markedly from previous months while, as the Americans for Limited Government advocacy group pointed out, the labor participation rate tied a 37-year low.

The news was even worse in the manufacturing sector, where it contracted by 1,000 jobs. While Scott Paul of the Alliance for American Manufacturing blamed the strong dollar, calling it “a big loser for factory jobs in the United States,” it’s only a piece of the puzzle.

Paul would favor a more interventionist solution, adding:

There’s plenty that could be done to turn this around. The Treasury should crack down on currency manipulators, the Federal Reserve shouldn’t act prematurely, USTR should be assertive about enforcing our trade laws, and Congress must address currency and trade enforcement in the context of new trade legislation.

Based on Barack Obama’s promise to create a million manufacturing jobs in his second term, he needs to add 628,000 in the next 21 months – a Herculean task for any president, and almost impossible for this one. Let’s consider a few facts:

First of all, the continued low price of both oil and natural gas has tempered the energy boom to some extent. According to Energy Information Administration data, the number of oil and natural gas rigs in operation last week was 1,048. In terms of oil operations, the number is down 45% from last year and for gas it’s down almost 27%. While gasoline in the low $2 range is good for the overall economy, oil prices need to be between $60 and $80 a barrel for operators to break even, and the benchmark price has held lately in the high $40s.

As I noted, low energy prices are good for some aspects of job creation, but the energy boom is on a bit of a hiatus and that affects manufacturing with regard to that infrastructure. Throw in the unfair competition we’re receiving when it comes to OCTG pipe and it doesn’t appear this will be the cure to what ails us as far as job creation goes.

More important, though, is the financial aspect. Our corporate tax structure is among the most punitive in the developed world, which leads to capital flowing offshore despite the “economic patriotism” appeals of our government to demand it come back. Once you have the opportunity to take advantage of other countries’ willingness to charge 20% or even 15% tax, why should you willingly pay a 35% rate? Their slice of the pie may be less, but they get a lot more pies this way.

And then we have the aspect of regulations, particularly when it comes to the financial restrictions that Dodd-Frank places on the lending industry and the environmental mandates an overzealous EPA is putting on industry – look at coal as an example. If we went back to the conditions of 2006 the environment would likely not suffer serious harm and companies would have a much easier time with their accounting. I haven’t even touched on Obamacare, either.

Not all of this is Obama’s fault, but the majority of these problems can be laid at his feet. Alas, we have 21 months left in his term so many of these things will not change despite the presence of a Republican Congress which will be blamed for any setbacks.

So the question becomes one of just how many employers in general, not just in manufacturing, will be able to weather this storm. Even the recent news that both Walmart and McDonalds will be increasing their wages brought out the cynics and doubters. But it’s worth pointing out that both Walmart and McDonalds have stated they wouldn’t oppose a minimum wage hike. Such a move makes sense for them because their bottom lines can more easily manage a modest wage hike for their employees and they know their local competitors can’t. Both also have the flexibility to adopt more automation where they used to have a row of low-wage employees. As an example, most of the local Walmarts adopted a number of self-serve checkout lanes over the last year or so. If you hire a dozen fewer cashiers it’s easier to give the others another dollar an hour.

Change is a constant in the labor market, and we know this. But there are some circumstances under which businesses thrive and others where they struggle, and history has gone long enough to suggest the broad outlines we should follow. It’s unfortunate that some want to blaze a new trail when we know where the correct path is.

AC Week in review: August 17, 2014

August 17, 2014 · Posted in Business and industry, Campaign 2014, National politics, Politics · Comments Off 

I put together a few things this week, and what’s apparent to me is that the political world doesn’t really take a break in August.

Take for example the late-session attempt to promote “Buy American.” Does it really have a chance in Congress before the session ends? Probably not, but it keeps Ohio Sen. Sherrod Brown in the headlines and the favor of his friends in organized labor.

But labor should be more concerned about some of the points brought up by my AC cohort Ed Braxton in two articles this week, particularly if his assertion that manufacturing is moving beyond labor is correct. But he also contends that American-made is gaining credibility again in the global marketplace.

On the other hand, we seem to have an Environmental Protection Agency which is bound and determined to drive jobs back overseas. Coal miners and their allies came out in force to recent EPA hearings in Pittsburgh, driven by a proposed standard which they contend would all but wipe out their industry. As a buttress to their contention, it was also revealed that a separate EPA effort to reduce ozone standards to as low as 60 parts per billion (from a current level of 75 parts per billion, established in 2008) would cost the American economy dearly. Perhaps the worst thing is that the EPA doesn’t even know itself how compliance can be attained.

Having sat down and written a couple pieces for next week, I can tell you trade will be on my radar screen. As is often the case, politics will play a role there but you’ll have to wait and see how I interpreted it.

Christie appears courageous while O’Malley is oblivious

I wouldn’t have expected New Jersey to take the lead on this, but under Chris Christie’s leadership they’re renouncing their membership in the Regional Greenhouse Gas Initiative – this according to Tim Wheeler at a Baltimore Sun blog. I hope this is the start of a trend, with Pennsylvania, New Hampshire, and Maine racing to see who’s next to pull out of an organization which is unecessarily increasing electric rates in the name of combatting so-called global warming.

It’s interesting as well how Wheeler couches the $162 million Maryland has “raised” (read: extorted out of utility companies and job creators) from the series of auctions held over the last couple years. In truth, our state has helped to create yet another vast wealth redistribution scheme, with dollars flowing from “rich” companies to poor home occupants who need help paying their bills, which are increasing thanks to the state’s mandate. These increases aren’t helping the utilities’ bottom lines.

Yet before I praise Governor Christie for his decision to withdraw, it’s clear that he only believes the organization is “a failure” because his state has passed laws which more directly address the issue. Unfortunately he’s still swilling from the green Kool-Aid, and those who believe he could be the savior of the Republican Party’s 2012 chances had better know where he stands on this issue – it looks pretty well left of center to me.

Certainly Maryland can claim a similar set of regulations in addition to the RGGI statutes, but Governor O’Malley still believes that combatting so-called manmade global warming is “a fight for our children’s future.” At the rate Martin’s driving jobs out of Maryland, our childrens’ future will be spent in states like Texas, Virginia, or Florida anyway.

Besides, any decrease in carbon emissions may well be traced to the economic slowdown rather than any impact RGGI has created. There was a reason cap-and-trade died in Congress last year, and it was because the issue was properly couched as a job-killer and wealth redistribution scheme designed to favor particular “green” businesses at the expense of more tradtional, proven energy sources like coal, oil, and natural gas.

And notice what Christie has to say about coal in New Jersey: “(f)rom this day forward any plans that anyone has regarding any type of coal-based generation of energy in New Jersey is over.” Never mind that coal’s cheap, effective, and with proper management not all that polluting - Governor Christie is foolishly taking it off the table in order to be a “leader” in unreliable wind and solar energy. Perhaps there’s more hot air eminating out of Trenton than Annapolis, but the results of wind and solar power for New Jersey will likely be similar to those in Maryland.

In essence, those who are skeptics like me welcome Christie’s decision to pull out of RGGI but believe his reasoning is flawed. For us to expose these hucksters covering a wealth-redistribution scheme in green fig leaves, we need more bold leadership than Christie is exhibiting here.

And while O’Malley is critical of Christie, but for reasons way off base. The proper move is to scrap the mandates along with the membership, and hopefully some other state will lead the way on debunking the cap-and-trade scam once and for all.

Feelgood legislation is one thing, but securing a real, solid-paying job really makes one feel good. Stop listening to the scammers and start reverting to common sense.

Update: Isn’t it interesting how this AP story by Dina Cappiello highlights Christie as a 2012 GOP Presidential example, even though he’s not in the race? Yet it doesn’t bring up the points I make about the remainder of his comments last week and how environmentally friendly they were – must not be in the template.

Friday night videos – episode 35

Oh yeah, this one should be good. I’m liking the way this is shaping up already.

I’ll begin with a leftover from last weekend. You know how I celebrated Memorial Day weekend, but my blogging friend Bob McCarty found one man’s ultimate tribute to the veterans in his family and across the nation – a restored 1971 Mustang.

I found this fascinating as well. You know, we’ve all been transfixed by the Deepwater Horizon disaster, but, as former Virginia Governor George Allen explains, we have other energy resources which are being ignored.

But it’s government regulation which keeps us from accessing our resources, and the unpredictability of Washington is scaring some investors. Businessman Steve Wynn was on CNBC recently making his case.


So he’s going to reallocate his operations because China – a nominally Communist nation – is more predictable and friendly to business than our nation. Shameful.

Then again, in this video from CEI we see government run amok. While they bill the video as humorous, is this really all that far-fetched?

The cold hard reality of our economic future is detailed in this short piece.

Yes, we are basically making money out of thin air, tangling ourselves hopelessly in a web of debt.

I referred to this video earlier today in an Examiner piece, but financial crunches are affecting government all the way down to the local level. While I find there’s a little too much grandstanding in this example, the problem is real.

Maybe we all should just say screw it and rock. Ballyhoo! is an Aberdeen-based band soon to embark on another national tour of clubs and the occasional opening slot for other artists. They’re already popular on the college circuit as this video from a University of Delaware stop shows (some language NSFW).

A nice, summery groove. Can’t be dead serious all the time, can we? Until next time, enjoy the weekend.

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