Business

Alternative Energy Firms Don’t Have Power To Succeed

The thought of generating electricity using the natural power of the sun and wind struck a cord with environmentalists, investors, and legislators about 30 years ago. Federal and state tax dollars poured into the “alternative fuel” industry and laws requiring power companies to purchase the electricity from these sources came out of Washington and state legislatures.

Today the industry is on the ropes because it depended upon “free money.” Without the so-called incentives, these outfits can’t make it pencil out. Natural gas prices are at all time lows and that clean burning fossil fuel is looking better all the time–especially with construction of pipe lines to deliver the energy.

EXERGY, the wind generating firm known for promoting women’s bike races, can’t pay its bills for sponsorships and in a story today the DAILY PAPER‘s Rocky Barker reveals planned projects around Twin Falls are being abandoned.

Earlier in the Week, ASSOCIATED PRESS writer John Miller did a round up of failed or failing solar projects in Idaho. Politicians are first in line to welcome new alternative energy companies to the state, but they shy away when the promises of jobs, prosperity, and clean energy are broken. In Boise the worst example of the alternative fuel scam is the Dynamis so-called trash to energy project that has cost Ada citizens millions of dollars and is doomed to failure.

The problem as we see it is not with the technology, but rather with the corporate welfare system that evolved. There is no doubt fossil fuels pollute and are a finite source of energy, but they are the cheapest we have today and we know how to burn them.

Its naive to create a new industry (solar and wind) through subsidy and tax breaks and require the existing producer to finance it. Sort of like forcing the car manufacturers to buy vehicles from start up competitors instead of producing safer and better autos. Common sense dictates existing electricity producers should be the ones on the wire to alternative fuel.

If it takes government regulatory authority to make the change, so be it. Forcing the purchase of power through PURPA deals simply fractures the foundation of a national power grid while encouraging corporate welfare. A uniform national power policy–without hidden payoffs– is the answer.

Comments & Discussion

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  1. It will be a huge victory for the end power user if we end the power grid welfare. It is after all the same crazy thinking that bought us a trash burner in our backyard.

    Another welfare program we need to end is the forced production/use of E10 gasoline. Vote with your purchase and only buy pure gas.

    EDITOR NOTE–What about your Midwest farmer friends and Archer Daniels? Corn prices will tank.

  2. Well written.

    PURPA does need to be changed, so Idaho Power can decide which alternative sources work for its customer demand. They should not have to buy overpriced power from anyone who has an idea.

    BG- Those corn prices are only going up in the immediate future. The Midwest is in the worst drought in over 60 years. It is being compared to the Dust Bowl.

  3. Thank you for bringing this up. I can see the point of alternative energy, but it’s not financially viable in our tanking economy to anyone except for the producers. Wind and solar are expensive and unreliable, yet nobody is willing to offer an alternative that everyone can agree on.

  4. Calvin Jones
    Aug 17, 2012, 12:52 pm

    I wonder how competitive hydro, natural gas, coal etc would be were it not for the government handouts those industries received in their infancy.

  5. costaprettypenny
    Aug 17, 2012, 9:08 pm

    Great analogy! Thanks Dave

  6. Tami Kennedy
    Aug 18, 2012, 9:26 am

    Is it naive to subsidize the oil industry long after they have reached a commercially sustainable and profitable posture? Should I have to pay for CEO bonuses? Or is he a corporate welfare freeloader? Nuclear energy is far better for the base load power than artificially low priced natural gas. We run our current legacy power infrastructure at about 30% efficiency. Compared to other country’s greater than 70%, so we “Don’t” know how to burn them. Shouldn’t money be invested to fix that? Natural gas is already being exported for profit value without getting the country near self sufficiency. Our archaic power distribution system is too manual and 45 years old/stagnant.

    Yes ‘grumpy’ old electrical engineer.

  7. Safe Idaho Citizens
    Aug 18, 2012, 10:09 am

    While your article sounds promising, Safe Idaho Citizens group sees Dynamis as continuing to push forward, including delivering their building plans to the county for a building permit. Of course that does not mean the $150,000 building permit fee has been paid (unless the commissioners have secretly waived it). Nonetheless, while you may think Dynamis is doomed to failure, we see that happening ONLY when we file suit against them and expose the county issues that helped fuel that fire.

    In that light, we have read on ts blog, over the recent years, many obvious insiders with seemingly legitimate complaints about how the process was handled. Many have posted on this blog. I INVITE you to help us in our endeavor by sharing with us the information you have. You may email us at info@safeidahocitizens.org and remain anonymous. What we are looking for are the details to go with the accusations, things WE can conduct searches for and be able to gain documentation for our legal fight. Having detailed information is key to digging it up.

    We agree that this Dynamis project is a business model that should fail. We believe that we are in a position to stop it. We recognize that through the years a climate of intimidation has existed at the county and many people feel vulnerable. This needs to stop. Help us make a change.

    http://www.SafeIdahoCitizens.org.
    Idaho Cotizens for a Safe Environment and a Transparent Government, Inc.

  8. Your editors comment about ethanol is right on target. I see that the bastion of conservatism the Idaho Dairyman’s association is thanking our entire congressional delegation for asking the administration to lift the requirements on corn for ethanol. This comes after their plea for continued subsidys for renewable energy which are currently being debated by the Idaho Public Utilitys commission. Guess it depends on which en of the cow you are lookong at . An unintended consequence of all of this is going to be instability of the price of good sipping whiskey

  9. Rod in SE Boise
    Aug 18, 2012, 10:36 am

    We certainly need to end the oil company subsidies (corporate welfare). That would help level the playing field.

  10. @Calvin Jones, Tell us more. List some welfare numbers when those power sources got started. I think you make a good point, but coal, NG, and Hydro were solid ideas.

    The issue is that wind is 3x the cost of base-coal power with the govt welfare, without welfare the cost of wind will go nuts. This inability to compete is why the welfare is fading away and they are canceling wind projects. The middle man made a fast buck, just like a baseball stadium we don’t need. The workers building it think it’s a great idea too. Thinking ahead a few years, those wind farms are huge with lots of moving parts so the future upkeep will be huge too. Wind will make a comeback after the power companies have managed to creep the rates 3x higher and after they’ve figured out a better way to store energy.

    It’s very hard to beat the current system of BASE-power from Coal, Nuke, Hydro (all huge steam boilers), and PEAK-power from Natural Gas (huge jet engines). North America has the Worlds largest reserves of coal and gas and we are nuke and hydro experts too. The stupidity of the American voter having let D.C. and the green freaks turn this into a crisis is amazing to me. D.C. will fix nothing, they just tax and regulate industries until demand falls. That’s why utility and phone bills are 2x-3x ten years ago… Taxes and regulation, not a fuel shortage. D.C. will not explore using Natural Gas as a surface fuel because the raw product is so plentiful nearby that they will not be able to have a gasoline crisis and related taxes.

    By the way, America is a net exporter of refined gasoline and other fuels. Your gas price is so high because D.C. has allowed the oil companies to index your gasoline price to the World market even though they make it a few miles away. Forced ethanol mixing E-10 is also contributing and raising staple food prices.

    So this is what ya get when you elect sales people to run the country. Just think what would our economy look like if gasoline/diesel was $1/gal.

  11. I really don’t like any government subsidies in general, but where would we be if there were never any? You sure as heck would not see full size trucks that get 20 M.P.G. or full sized cars with 300 h.p. that get 30 M.P.G.
    I live in Florida and many counties have huge waste to energy plants. They subsidize our power and slow the trash going into the ground, extending the life of our landfills by double. I just can’t believe that anyone would rather put garbage into the ground when there are multiple ways to use it as a fuel. Counties in Idaho keep buying land for dumps, burying the garbage and polluting the ground water. Where are we going to be in 20 years? I have looked at Solar, Wind and Tides as sources of power and none can actually deliver. Of all the new concepts, waste is the only one that has proven results. Some plants burn and produce ugly amounts of pollution but there are a few newer companies that are pretty darn clean and can make a profit.
    Wind will never really make it. Tides have a shot if you live in a particular area and Solar will be a good thing in another 10 years. There are a number of new homes that are completely self sufficient… that means they use NO power from the grid and actually sell excess power back to the grid. Expensive? You bet. But so were flat screen’s 8 years ago. Now you can get a 55″ screen for 700.00… unfortunately none made here.
    We all know we need a shock collar on Washington, but some (darn few) things do work and need to be pushed if we want our kids and grand kids to have a shot.
    I have a solar charger for my GPS that I take with me whenever I am in the woods or boat. Ten years ago it would have been a grand. Last month they were under $60.00.
    Ten years from now they will come with your cell phone for free.
    It is our generations job to fix everything that has broken on our watch. Pick and choose wisely. We can’t afford any more mistakes.

    If you don’t do anything else today, thank a Vet for giving us the opportunity to debate freely….

  12. I guess we all missed this presentation of Pete Johnson(Dyanmis) at last year’s Harvest Clean Energy conference in Boise.

    http://wacleantech.org/2011/11/john-martin-goes-to-idaho/

    “Another speaker was Pete Johnson of Dynamis Energy, which develops high-efficiency incinerators for eliminating landfill of municipal solid waste (MSM) by burning the rubbish to generate energy. Johnson said that while Northwest energy costs are among the lowest in the world, and demand for incineration power is low here, Brazil will be prohibiting MSM landfill by mid-decade and has skyrocketing energy demands. There, the market for responsible incineration is strong.”

    It also looks like Dyanmis has some energy venture capitalist funding them. http://www.potomacenergyfund.com/portfolio.

    EDITOR NOTE–thanks again for the research.

  13. Don’t worry we got our money’s worth even though Transform Solar is now defunct. Transform Solar received more than $1.7 million in state training money

    http://www.idahostatesman.com/2012/05/30/2135854/transform-solar-got-1-million.html#storylink=cpy

    Transform Solar’s letter of thanks.
    http://idaholabor.wordpress.com/2012/08/16/employees-transferrable-skills-will-take-them-beyond-transform-solar/

  14. Let’s not forget to take the roads and highways off the subsidy too. People should pay tolls to privately owned roads so we don’t have to pay taxes because the govmt does such a crappy job of building and maintaining them. What about the military? Can’t really put my finger on the product they produce ie , freedom? Can you feel the freedom from the wars in Vietnam, Grenada (we won !), Iraq, Afghanistan? Love my Marmot, made in (commmunist) Vietnam ski jacket, so yeah, cozy warm feeling of that freedom. What about the communist made Chinese shoes you are wearing right now?

    Has there ever been one watt of nuclear power created and sold to the public without a government subsidy? If so, very insignificant.
    Most large hydro dams in the US were built with government money. Shasta was a defense project. All BPA hydro was built by the government.
    Are you ready for private power in private hands? How quickly we forget what ERON did to rate payers.
    Lets do the ERON thing again and monopolize even more utilities.

    I worked for the Dept. Of Energy right after the energy crisis of the late 70’s. That was a manufactured crisis and did not resolve itself from drill baby drill. The alternative energy industry was effectively killed the day Reagan took office and we jumped in bed with Saudi Arabia in a big way since we got cut off the oil spigot with the hostage crisis in Iran under Carter. I was on one of the last planes out of Teheran in 78. Cheap imported oil killed the industry in the early 80″s.
    Now cheap NG is killing the alternative energy industry. When Israel starts the hot war in Iran you will be paying dearly for every drop of fuel you use.
    Since Reagan set us on the path of globalization, you can expect your wages to stagnate or go down as global wage equalization slowly evolves.
    As long as oil companies can make big profits exporting US gasoline and NG, isn’t it anti capitalist to prevent them?

    Bottom line is everyone wants cheap power except the power companies. If gas was $1.50/gal right now and heavily subsidized no one here would be complaining except that your taxes were too high. Never in history has anyone complained the their taxes were too low.

    BTW, taxes paid for a large portion of G-mans career income. Soldier, cop, photos for school books. All subsidized by good old Uncle Sam and we appreciate that.

  15. The complete list of faltering or bankrupt green-energy companies:

    Evergreen Solar ($24 million)*
    SpectraWatt ($500,000)*
    Solyndra ($535 million)*
    Beacon Power ($69 million)*
    AES’s subsidiary Eastern Energy ($17.1 million)
    Nevada Geothermal ($98.5 million)
    SunPower ($1.5 billion)
    First Solar ($1.46 billion)
    Babcock and Brown ($178 million)
    EnerDel’s subsidiary Ener1 ($118.5 million)*
    Amonix ($5.9 million)
    National Renewable Energy Lab ($200 million)
    Fisker Automotive ($528 million)
    Abound Solar ($374 million)*
    A123 Systems ($279 million)*
    Willard and Kelsey Solar Group ($6 million)
    Johnson Controls ($299 million)
    Schneider Electric ($86 million)
    Brightsource ($1.6 billion)
    ECOtality ($126.2 million)
    Raser Technologies ($33 million)*
    Energy Conversion Devices ($13.3 million)*
    Mountain Plaza, Inc. ($2 million)*
    Olsen’s Crop Service and Olsen’s Mills Acquisition Company ($10 million)*
    Range Fuels ($80 million)*
    Thompson River Power ($6.4 million)*
    Stirling Energy Systems ($7 million)*
    LSP Energy ($2.1 billion)*
    UniSolar ($100 million)*
    Azure Dynamics ($120 million)*
    GreenVolts ($500,000)
    Vestas ($50 million)
    LG Chem’s subsidiary Compact Power ($150 million)
    Nordic Windpower ($16 million)*
    Navistar ($10 million)
    Satcon ($3 million)*
    *Denotes companies that have filed for bankruptcy.

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