60 Minutes Ignores The Facts In Clean Energy Segment
Originally published on ClimateProgress
by Joe Romm
Clean technology is booming by every key indicator — but you would never know that from Sunday’s absurd 60 Minutes piece touting an imaginary “Cleantech Crash.”
As documented in the recent Department of Energy (DOE) report, “Revolution Now: The Future Arrives for Four Clean Energy Technologies,” the only thing in cleantech that is crashing is the cost of key components. This price crash has enabled explosive growth in wind power, solar power, LED lights and electric vehicles, as shown in the four charts from the report reposted here.
Ironically, this boom is so self-evident that just Saturday the New York Times published a front page story on “the solar power craze that is sweeping Wall Street.” As the article notes, “Solar companies have had the wind at their backs lately.”
It’s true there have been some losers among cleantech companies, but that’s precisely what you would expect in an industry where the norm has become ruthless cost-cutting, which in turn is a great boon to consumers.
But for 60 Minutes, this incredible boon is a bust. Here’s a transcript of a clip from the show:
LESLEY STAHL (over pictures of solar panels, biofuels, wind turbines): “It’s called clean tech. And the new technologies that were developed in the energy sector were supposed to create jobs, and help America break its reliance on fossil fuels. The government supported it, and billions of tax dollars were spent. So how is the investment going?
STAHL (to DOE interviewee): “Solyndra went through half a billion dollars before it failed. Then I’m going to give you a list of other failures. Abound Energy. Beacon Power. Fisker. VPG. Pfff…I’m exhausted.”
INTERVIEWEE: “As I told you at the beginning, the energy business is tough!”
Memo to CBS: Every business is tough! In 2012, the Wall Street Journal ran an informative piece on just how tough the private sector venture-capital businesses is, headlined, “The Venture Capital Secret: 3 Out of 4 Start-Ups Fail.”
It seems at first that this is a secret 60 Minutes is unaware of, since the show focuses almost entirely on the failures. But CBS explains that “the venture capital model is that for every ten startups, nine go under” — except that CBS appears to see that as a bug, not a feature, failing to understand that the successes more than pay for the failures.
Moreover, 60 Minutes is apparently unaware that the DOE Loan Guarantee Program has a whopping 97 percent success rate, while the companies CBS focuses on such as Solyndra and Abound Solar were just three percent of the portfolio.
It’s as if 60 Minutes did a profile of the venture firm Kleiner-Perkins and focused primarily on its failed investments with only passing mention of AOL — and no mention at all of Amazon.com, Genentech, Sun Microsystems or Google! In fact, when 60 Minutes profiled co-founder Tom Perkins several years ago, they called him “the captain of capitalism” and only found time to mention the winners!
Let’s set aside the question of why 60 Minutes chose to do a hit-job on cleantech, which clearly was unwarranted, after producing widely criticized puff pieces on the NSA and Amazon’s wildly impractical delivery drones.
The key point is that the goal of DOE’s investments is not to make money. The goal is to accelerate the drop in price — and increase in deployment — of clean energy in the market, which it clearly has done in industry after industry. A secondary goal was to create jobs in this country, which it also succeeded in doing.
Every major independent review, including one by John McCain’s former National Finance Chairman, found the loan guarantee program was cost-effective for taxpayers. A review by Brookings found “DOE’s loan guarantee program will likely result in minimal costs and large gains for taxpayers.”
In fact, the Atlantic Wire reported last year that this one program successfully shepherded 28 companies with clean energy projects creating over 20,000 jobs — with a net cost to the public that will either end up being very low or zero. DOE projects that all of its clean energy loan programs taken together will generate some 55,000 jobs.
Inexplicably, the 60 Minutes correspondent asserts that according to “everything I’ve read there were not many jobs created” (and they even found an uninformed former DOE official to agree with them). CBS claims taxpayers have little to show for the investments when the data clearly show otherwise.
The whole segment is baffling. CBS asserts that the key cleantech investor they interview, Vinod Khosla, is “known as the father of the cleantech revolution.” He ain’t, and in fact he’s about the last person you’d want to talk to on the subject (see my 2010 post, “Is anyone more incoherent than Vinod Khosla?“).
They even found a Chinese cleantech entrepreneur to say “clean tech is not going well” — even though China is the leader in both solar and wind power. CBS complains that the Chinese have created U.S. jobs using some of the technology U.S. taxpayers supported, as if the only U.S. jobs that count are ones created by U.S. companies. CBS correctly notes that China is willing to take a long term view of clean tech, but never mentions how opposition to U.S. clean energy standards, cleantech investment, and a price for carbon by conservatives in Congress have hurt the competitiveness of U.S. companies.
For those who want the facts of the cleantech boom, a good place to start is the DOE report:
- In 2012, wind was America’s largest source of new electrical capacity, accounting for 43 percent of all new installations. Altogether the United States has deployed about 60 gigawatts of wind power — enough to power 15 million homes.
- Since 2008, the price of solar panels has fallen by 75 percent, and solar installations have multiplied tenfold. Many major homebuilders are incorporating rooftop panels as a standard feature on new homes.
- In that same five years, the cost of super-efficient LED lights has fallen more than 85 percent and sales have skyrocketed. In 2009, there were fewer than 400,000 LED lights installed in the U.S.; today, the number has grown 50-fold to almost 20 million.
- During the first six months of 2013, America bought twice as many plug-in electric vehicles (EVs) as in the first half of 2012, and six times as many as in the first half of 2011. In fact, the market for plug-in electric vehicles has grown much faster than the early market for hybrids.
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Save this for when they flip flop in 2016.
Unlike Solynrdra in the loan guarantee programme, the failures of “60 Minutes” are representative – of its collapsing journalistic standards..
I don’t expect the truth from CBS anymore than I would from FOX. These media conglomerates script the news and fashion editorial content to increase the sales and profits of their own products and properties and those of their advertisers. If you turn on the television you’ll get all the news that fits in the boardroom.
I support Utility Scale PV and Utility Scale Wind, but not all clean energy is created equal. It it time that we invest our precious tax dollars in the most efficacious and cost effective clean technologies and eliminate those for inferior ones.
The most expensive electricity comes from coal.
Don’t you think that’s the first one we should eliminate?
I wasn’t aware that new coal power generation received federal tax credits? Can you site the law to elucidate me? I was under the understanding that the new CO2 limits by the EPA on new coal power generation would make it now virtually impossible to start and new coal power plant.
You do understand that “subsidy” is a generic term? Subsidies can be tax credits, direct payments, costs picked up by the government/taxpayer, special discounts/deals for use of public land, taxpayer assumption of risk, and probably some stuff that doesn’t come to mind at the moment.
Coal’s many and varied subsidies – I’ll copy this over for you….
Environmentalists and public health advocates often talk about the harmful “external” costs of coal that are not accounted for in its price.
Those externalities include damage to the local environment, threats to public health, and, of course, climate change.
In a study last year, Dr. Paul Epstein of the Center for Health and the Global Environment at Harvard Medical School attempted toquantify how harmful coal is:
Our comprehensive review finds that the best estimate for the total economically quantifiable costs, based on a conservative weighting of many of the study findings, amount to some $345.3 billion, adding close to 17.8¢/kWh of electricity generated from coal…. These and the more difficult to quantify externalities are borne by the general public.
While these costs are very real, the economic argument can still be abstract to people. So it’s helpful to look at more tangible ways the coal industry is being subsidized by the American taxpayer. Indeed, coal companies benefit from tax breaks, public land loopholes, and subsidized railroads that help them continue being “cheap.”
Below are a few examples of the kind of government support we give the coal industry.
1. Tax breaks
Just as the oil and gas industry receives tens of billions of dollars in taxpayer subsidies, coal companies also receive preferential treatment from the Internal Revenue Service. The Treasury Department estimates that eliminating just three tax preferences for coal would save $2.6 billion between 2013-2022:
– Expensing of exploration and development costs: Under current law, coal companies can expense costs incurred by locating coal ore deposits.
– Percentage Depletion for Hard Mineral Fossil Fuels: As the tax code currently stands, coal companies can claim a tax deduction to cover the costs of investments in mines.
– Capital Gains Treatment for Royalties: Some coal royalties for private owners are treated as long-term capital gains, so they are taxed at a lower rate.
2. Public land loopholes
According the Energy Information Administration, 43.2 percent of U.S. coal comes from public lands. However, the coal industry benefits from a number of loopholes that make obtaining leases on public lands easier and cheaper.
For example, the nation’s largest coal producing region, the Powder River Basin in Wyoming, is not legally classified as a “coal-producing region.” This means that coal tracts within it are rarely competitively leased, which shortchanges taxpayers for the value of the land and the coal underneath it.
Additionally, some have alleged that the non-public process by which the Bureau of Land Management determines fair market value for coal on public lands is flawed. In a lengthy legal brief, Tom Sanzillo of the Institute for Energy Economics and Financial Analysis outlines how the value established by the government is much lower than would the market would command: “In the broader economic arena where coal is bought and sold, the FMV lease process does not capture the full value of the coal.”
3. Subsidized railroads
Coal is the most important commodity transported on railroads in America. As the Association of American Railroads describes, “In 2009, coal accounted for 47 percent of tonnage and 25 percent of revenue for U.S. railroads.” U.S. railroads get loans and loan guarantees from government agencies like the Department of Transportation/Federal Railroad Administration and have received numerous tax incentives for investments in new infrastructure.
The relationship between coal and railroads becomes more important when considering coal exports. On Tuesday, the Associated Press reported that American coal exports have “surged” to the highest levels since 1991. A large portion of these exports are going to Asian countries, where coal use has exploded. This begs the question: are American taxpayers subsidizing the coal boom in countries like China, thus helping accelerate global warming at an even faster rate?
In the end, the taxpayer is paying more for coal than the industry would like you to believe.
http://thinkprogress.org/climate/2012/04/13/463874/top-three-ways-that-american-taxpayers-subsidize-dirty-coal-development/#
Maybe it would be a good idea to shut down all oil production in the US and then we can get all of our oil and gas from those nice friendly nations in the Middle East. I bet you would love to send me back to Iraq, Yes I am ex-military. Unless you have a magic switch that can turn immediately all of our 300 million transportation vehicles into electric, I think maybe it might be the rational thing to keep supporting our domestic oil/gas until that time we can transition to non-hydrocarbon based economy. Or maybe you like having Americans die in the Middle East so you can drive your vehicles. Even Elon Musk says there is not enough battery mfg capacity on the planet to build his next iteration of a mere 300,000 vehicles per year, not to mention the current demand of ~ 14 million vehicles per year in the US alone. I am impressed with the progress that solar has made and support it, especially Utility Scale PV and Utility Scale Wind, but I am a realist in knowing this process is going to take decades to convert our economy.
I’m sorry Bush and Cheney sent you to Iraq. They had no business lying us into that war and causing the deaths of so many thousands of people.
We can’t turn all our vehicles into electrics overnight, but we could make a huge change in our oil use very quickly based on the technology we have in hand.
Battery plants are built in less than two years.
It will take decades to convert our grid. But we are underway and need to move much faster.
Now I asked you to not go off topic in this thread. If you continue I will take down further posts.
To all our service people, I Thank You for your service to an illegitimate government. It seems that energy solutions are not embraced……is it the mighty$$$.
I think so… remember that we had vehicles that could achieve nearly 50 mi/gal in the early 60’s, but of course that was wrong….. now we have mainstreet models that can get close to 25mpg…..WTH we have the ability, its the corps. and obviously the govt. that are controlling that…….we are being “consumerised” do your best to resist, but don’t believe all the propaganda……..But remember that the majority of electric power in the US is produced by “dirty” coal…..which we are flushed with.,..