Inflated Jobs Claim
The wind lobby is also making puffed-up claims about jobs, based on a 2008 study that the industry itself helped put together. It focuses only on potential winners — and ignores the potential losers.
The claim appears on the AWEA’s website (to which viewers of its TV ads are directed) and also popped up Feb. 8 in a print ad that ran in the newspaperPolitico, which is widely read in Washington and on Capitol Hill.
“[E]xperts say half a million more jobs could be created here in the next 20 years,” the ad says. The website urges visitors to “Join the fight to protect 500,000 new American jobs.”
But that figure is exaggerated, in a number of ways. Most important, it is a projection only of jobs directly and indirectly supported by a vastly expanded wind industry — without accounting for the many jobs that would be lost in other industries, such as the mining and transportation of coal and the production of natural gas.
The half-million estimate comes from a 2008 report issued by the Department of Energy, and it was never intended to be an official prediction. It was, to quote the report, a “scenario” produced in a “joint effort with industry” (including the AWEA), asking whether it would be “feasible” for 20 percent of U.S. electricity to come from wind power by the year 2030.
That would be a huge increase. Wind power supplied less than 3 percent of the nation’s electricity in the most recent 12 months on record, according to a report issued in January by the U.S. Energy Information Administration, even after several years of rapid growth fueled by the tax credit and by funds from the Obama administration’s 2009 stimulus bill.
The 2008 report concluded that the 20 percent goal was “ambitious” but “could be feasible” if “significant challenges” could be overcome. And in that case, the report said, “the wind industry could support 500,000 jobs” in the years after 2020. (See page 209, figure C7.) Only 150,000 of those would be “direct jobs” such as construction or operation of wind farms, and the rest would be from presumed “ripple effect” jobs in other industries.
But even assuming the “optimistic” prediction turns out to be accurate, it doesn’t mean that anywhere near 500,000 jobs would be added to the U.S. economy. As the study itself said, rapid growth in wind-power jobs will come at the expense of other jobs.
Buried on page 199 of the study, in “Appendix C” is this admission (with our emphasis added):
Energy Department Study, July 2008: Ramping up wind capacity and electricity output from windwould displace jobs and economic activity elsewhere. However, identifying such transfers accurately would be very difficult. Therefore, the impacts cited here do not constitute impacts to the U.S. economy overall but are specific to the wind industry and related industries.
Those job costs could be significant. The AWEA’s website contains a one-page summary of the study, saying that if wind power expands to supply 20 percent of U.S. electricity, that would displace about half the natural gas used to generate electric power, amounting to 11 percent of all natural gas used across all industries. Coal consumption would be affected even more dramatically, reduced by 18 percent. The report didn’t attempt to estimate the direct and “ripple effect” job losses in those industries.
And it’s not certain that the industry can reach its ambitious 20 percent goal, even if the tax credit is renewed. Since 2008, the supply of natural gas has grown dramatically, pushing down prices and making gas-fired electric plants “the cheapest option for new power generation,” according to a recent report by Bloomberg News. The wholesale price of electricity has plunged 50 percent since 2008, and some wind projects are already being cancelled. Bloomberg reported that the largest U.S. wind-energy producer, NextEra Energy Inc., “has shelved plans for new U.S. wind projects next year.”
Conservative Counter Spin
Meanwhile, conservative opponents of federal help for renewable energy are engaging in some spin of their own.
Pompeo, for example, says his bill, H.R. 3308, will repeal “all energy tax credits.” In an op-ed piece he co-authored after he introduced the bill, he said: “It is equal opportunity – not one single solitary tax credit would survive this bill.” But that’s not the whole story.
He’d repeal all “credits,” maybe, but not all energy tax breaks. He would still leave intact some long-standing tax preferences for the oil and gas industries, including the expensing of exploration and development costs, the depletion allowance, and amortization of geological expenses. Those three are worth a total of $1.8 billion to the oil and gas industries this year alone, according to the Joint Committee on Taxation (page 34). So when Pompeo writes that he’d “do away with energy subsidies once and for all,” he doesn’t include some valuable breaks that benefit the “drill, baby, drill” crowd.
Meanwhile, the Obama administration’s Solyndra scandal is encouraging partisan attacks on “green” energy subsidies in general. A new ad from Crossroads GPS claims that President Barack Obama’s administration awarded “billions” to clean energy companies that backed his 2008 campaign, which is true enough. But the ad deceptively attributes some dollar figures to Newsweek, when, in fact, they come from a conservative author’s book. Newsweek ran an excerpt.
This is the second ad from the Republican-leaning Crossroads GPS attacking Obama for his involvement with Solyndra — the now-bankrupt solar company that got a $535 million loan guarantee from the Department of Energy. This one is titled “Every Level” and is backed by a $500,000 buy on national cable TV.
The TV ad’s claims are echoed in a print ad that Crossroads GPS ran in The Hill and in Politico — two newspapers widely read by members of Congress and their staffs. The print ad makes a lobbying pitch: “Investigate It. Clean It Up. SHUT IT DOWN.”
The “it” in the print ad refers to “President Obama’s ‘green energy’ program,” which the ad calls “a disgrace” that is “sticking taxpayers with hundreds of millions of dollars in bad loans.”