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Does the PTC Make Sense (Executive Version)?

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Does the PTC Make Sense (Executive Version)?

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Does the wind energy Production Tax Credit (PTC) make sense? Is support for renewable electrical energies based on science or lobbyists influence? This is a very abbreviated version of the Professional Version slideshow which explains the Big Picture.

Does the wind energy Production Tax Credit (PTC) make sense? Is support for renewable electrical energies based on science or lobbyists influence? This is a very abbreviated version of the Professional Version slideshow which explains the Big Picture.

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Does the PTC Make Sense (Executive Version)?

  1. 1. Does The PTC Make Sense? (Executive Version) Alliance For Wise Energy Decisions 8/21/12
  2. 2. Make SURE to View This Presentation in the FULL SCREEN Mode! Click the “FULL” icon in the lower right hand corner.
  3. 3. Do NOT click on the Triangle below to run this presentation! Instead, use your keyboard arrow keys to navigate. This will allow you to proceed at your own pace.
  4. 4. Does The Production Tax Credit (PTC) Make Sense? This “Executive Version” is a VERY abbreviated edition of the more detailed “Professional Version” — which is intended for Congressional Staffers and citizens with energy knowledge. References and credits are on the last three slides of the Professional Version. The wind energy Production Tax Credit (PTC) has now been in existence for some twenty (20) years. The Energy Policy Act of 1992 originally enacted the Production Tax Credit and the first lapse came in June 1999. The PTC was extended in December 1999 until December 31, 2001. Once again the PTC expired in December 2001 and was not enacted again until March 2002 where it was then extended for another two years. At the end of 2003 the PTC expired for a third time until a one year extension was granted in October 2004. The PTC was extended through 2005 and also expanded the different types of renewable energies that would be included under the bill. The Energy Policy Act of 2005 (H.R. 6) modified the credit and extended it through the end of 2007. In December 2006, the PTC was extended for another year by the Tax Relief and Health Care Act of 2006 (H.R. 6111). The PTC was extended yet again by the American Recovery and Reinvestment Act of 2009 (H.R. 1). The Wind PTC was extended an additional two years, expiring the end of 2012. Every time the plea is that just a few more years will be necessary to get wind energy on its feet… Our underlying message is that our energy decisions should be made on the basis of sound SCIENCE — not on what lobbyists say. Hopefully you have already been to the “WindPowerFacts.Info” website, which has a collection of good reports on wind energy. The future of this issue lies in whether or not citizens are properly educated about basic energy matters. After getting more up-to-speed, they need to do some Critical Thinking about this matter. After citizens get more informed — and do some Critical Thinking — they will be in a much better position to express their more informed wishes to their federal representatives. Anyone trying to educate their local citizenry and representatives, is welcome to use the material found here. In you have any questions after you go through this, we will be glad to respond to any emails you send to the PTCFacts.Info website. If you like what you see, please pass it on to other open-minded people, plus your federal representatives. — ENJOY! Alliance for Wise Energy Decisions
  5. 5. — Outline of this Presentation — 1 - Rationale for the PTC by its Advocates 2 - Are Job Claims Accurate? 3 - The Cost Per Job? 4 - The NET Jobs picture. 5 - Even More About Jobs. 6 - The NET Economics picture? 7 - What do Utility Companies Say? 8 - Some Other Supporter Claims. — CONCLUSIONS —
  6. 6. DOES EXTENDING THE PTC MAKE SENSE? Part 1: Benefits Claimed by Lobbyists
  7. 7. The Claimed Benefits for wind energy subsidies have radically evolved over the last twenty years.
  8. 8. 20 Specious Claims: How the supposed Benefits of Wind Energy have continued to evolve, as they are proven to be false.
  9. 9. The Wind Lobbyists’ Current Major Excuse for the PTC to be extended are purported JOBs.
  10. 10. How do lobbyists take advantage of good legislators? 1 - By telling them what they want to hear, and 2 - by counting on the fact that few will take the time to really check things out!
  11. 11. They also know that there is no penalty for making unscientific claims.
  12. 12. In short, our position is that — 1) we do have environmental and energy issues, and 2) these matters should be solved scientifically. The Soundbite: Wind Energy = High Cost, Low Benefits
  13. 13. Part 1: Benefits Claimed by Lobbyists? — THE TAKEAWAY — Since there are no scientifically proven net Technical, or net Economic, or net Environmental benefits for wind energy — the lobbyists are hanging their hat on JOB claims.
  14. 14. DOES EXTENDING THE PTC MAKE SENSE? Part 2: Are Job Claims Accurate?
  15. 15. Independent Studies Have Concluded: Wind Job Claims are Exaggerated
  16. 16. Fact: Almost all US Wind Job Claims come from One Source: AWEA (Wind Industry Lobbyists — whose job is to hype their industry). AWEA: the PTC is needed to “...save 37,000 jobs...”
  17. 17. A Sample Independent Study
  18. 18. Do Real World Facts Correlate with AWEA Claims?
  19. 19. Part 2: Are Job Claims Accurate? — THE TAKEAWAY — Job claims from wind industry lobbyists have very little credibility. Independent assessments have concluded that they are wildly exaggerated.
  20. 20. DOES EXTENDING THE PTC MAKE SENSE? Part 3: Cost Per Job?
  21. 21. Every Independent Study Has Concluded the Same Thing: The Cost Per Job is OUTRAGEOUS!
  22. 22. The Congressional Figures $12.2 Billion / 37,000 jobs = $330,000 per wind job
  23. 23. A Sample Independent Study $1,600,000 per wind job
  24. 24. A Sample Independent Study $34,000,000 per wind job
  25. 25. Part 3: Cost Per Wind Job? — THE TAKEAWAY — No matter how it is calculated, the cost per wind job is extraordinarily excessive.
  26. 26. DOES EXTENDING THE PTC MAKE SENSE? Part 4: What are the Net Jobs?
  27. 27. Almost All Independent Studies Have Concluded the Same Thing: Wind Energy is a NET Jobs Loser
  28. 28. Indisputable Jobs Fact No Jobs claim has any merit unless it accurately considers the NET impact. In their claims, there is zero evidence that AWEA has burdened themselves with this obligation.
  29. 29. Independent Wind Jobs Study
  30. 30. Offshore Jobs Conclusions of Independent Experts: Conclusion: Net is 30,000 ± jobs years LOST (again due to a single offshore wind project).
  31. 31. (Other Offshore wind studies are cited in the Professional Version.) OK, Offshore Wind Clearly Results in Net Job Losses. What about Onshore Wind?
  32. 32. (The details are explained in the Professional Version.) SAME THING! When the big picture is objectively examined, a typical Onshore Wind Project will be an annual NET JOBS LOSER!
  33. 33. (Several other Independent wind job studies are cited in the Professional Version.)
  34. 34. Jobs Conclusions of this Independent Expert:
  35. 35. Part 4: Net Jobs — THE TAKEAWAY — In the typical case, wind development & subsidy is a NET JOBS LOSER. Remember: “NET” is a critical job indicator.
  36. 36. DOES EXTENDING THE PTC MAKE SENSE? Part 5: Even More About Jobs
  37. 37. The fact is That there is a lot more to the job claims, than is immediately obvious. (Several other perspectives about wind job are cited in the Professional Version.)
  38. 38. Another Perspective on Claimed Wind Jobs
  39. 39. Another Perspective on Claimed Wind Jobs There is nothing — no program, no hobby, no vice, no crime — that does not create jobs. For example, tsunamis, computer viruses and robbing convenience store clerks all create jobs. So since that claim applies to all it is an argument in favor of none! Instead of providing evidence of the merits of an enterprise, a jobs claim is a de facto admission that one has a specious case. — energy attorney Chris Horner
  40. 40. Another Perspective on Claimed Wind Jobs A top government official makes a very blunt statement. Tax credits don’t create wind jobs.
  41. 41. Another Perspective on Claimed Wind Jobs If Congress is determined to spend the $12.2 Billion that just a one year PTC extension would cost, an important question is: What would be the job (and other) benefits of spending that same amount on another energy source? According to the Congressional Budget Office if the same $12.2 Billion were given to the gas industry, over 9 times as many jobs would be created.
  42. 42. Another Perspective on Claimed Wind Jobs Less Expensive Energy is a Proven Way to create net jobs. Subsidizing expensive energy is a counterproductive strategy
  43. 43. Part 5: Even More About Jobs — THE TAKEAWAY — The jobs argument is a public relations ploy to distract us from the reality that wind energy is a very poor energy option.
  44. 44. DOES EXTENDING THE PTC MAKE SENSE? Part 6: Net Economic Impact?
  45. 45. Almost All Independent Studies Have Concluded the Same Thing: Wind Energy is a NET Economics Loser
  46. 46. Sample Wind Economics Study
  47. 47. Economic Conclusions of these Independent Experts: $1,080,000,000 Conclusion: over $1 Billion lost in one year alone!
  48. 48. Economic Conclusions of these Independent Experts: Conclusion: More $ Hundreds of Millions lost!
  49. 49. Economic Conclusions of these Independent Experts: In one county, property owners will LOSE $640,000,000± in real estate value!
  50. 50. (Other Offshore wind studies are cited in the Professional Version.) OK, Offshore Wind Also Results in Net Economic Losses. What about Onshore Wind?
  51. 51. (The details are explained in the Professional Version.) SAME THING! When the big picture is objectively examined, a typical Onshore Wind Project will be an annual NET ECONOMICS LOSER!
  52. 52. And There’s More. The Professional Version has 8 extra slides that identify Some ADDITIONAL Economic Costs. Almost none of these are normally included when the cost of wind energy is being presented.
  53. 53. In ADDITION to generous Federal subsidies (like the PTC), many states offer financial incentives for wind power, like: 1. Personal Tax Incentives 2. Corporate Tax Incentives 3. Sales Tax Incentives 4. Property Tax Incentives 5. Rebates 6. Grants 7. Loans 8. Industry Support 9. Bonds, and 10. Production Incentives. On top of these financial incentives, state and local governments have established rules, regulations and policies (like RPS), with the purpose of encouraging or mandating the development and increased sale and consumption of energy from renewable sources. Yet all this still isn’t enough???
  54. 54. E-V-E-R-Y-T-H-I-N-G about Wind Energy economics is problematic!
  55. 55. Part 6: Net Economics — THE TAKEAWAY — In the typical case, wind development is a NET ECONOMICS LOSER. Remember: “NET” is a critical economics indicator.
  56. 56. DOES EXTENDING THE PTC MAKE SENSE? Part 7: What Do Utility Companies Say?
  57. 57. Utility Companies are regulated by the government. As such they avoid saying anything that is not “politically correct”. Despite this constraint the TRUTH has a way of coming out.
  58. 58. A major utility executive’s very disturbing assessment When National Grid’s CEO was challenged about integrating wind energy, he said: “Families would have to get used to only using power when it was available, rather than constantly.”
  59. 59. One of a series of ads from Idaho Power “In the simplest of terms, special interest groups and wind developers are asking you to pay more for a less reliable product. And that just isn’t right.”
  60. 60. More real world evidence from utility experts, about the real cost of wind energy. They say: onshore = 2-3 times more offshore = 4-5 times more Note: this does NOT include the extra cost of the PTC!
  61. 61. Regarding wind subsidies, the CEO of Ohio’s North Central Electric Cooperative says:
  62. 62. This is the most advanced Utility Company report on wind energy, ever published.
  63. 63. Regarding jobs and economics, this study says:
  64. 64. Part 7: What Do Utility Companies Say? — THE TAKEAWAY — When utility companies have the courage to speak honestly about industrial wind energy, they are against it. (There are several other Utility comments cited in the Professional Version.)
  65. 65. DOES EXTENDING THE PTC MAKE SENSE? Part 8: Some Other Supporter Claims
  66. 66. Even though JOBS is their main argument for the PTC, some other assertions are periodically made...
  67. 67. Another justification put forward for the PTC: “The PTC is not Another Solyndra.” Objective perspective: That is correct — it’s much worse. Per government figures, Solyndra cost taxpayers $0.5± Billion. A one year extension of the PTC will cost taxpayers $12.2 Billion.
  68. 68. Another justification put forward for the PTC: “Some manufacturing jobs will be lost.” Objective perspective: That is correct — but that’s life. Modernization is continually making certain products out-dated, which means jobs in those industries are lost. Should taxpayers be subsidizing the jobs for those producing B&W TVs, 8-track tapes, horse carriages, hoola-hoops, etc?
  69. 69. Another justification put forward for the PTC: “Some landowners are making big profits.” Objective perspective: That is correct — but at whose expense?
  70. 70. Other justifications put forward for the PTC: “The Wind industry needs to have certainty.” “The PTC needs to be phased out.” Objective perspective: Both are correct — and both are already done.
  71. 71. Part 8: Some Other Supporter Claims — THE TAKEAWAY — When looking at the BIG PICTURE these claims do NOT justify a PTC extension. (Other supporter claims are cited in the Professional Version.)
  72. 72. DOES EXTENDING THE PTC MAKE SENSE? CONCLUSIONS
  73. 73. Attention Republicans: A PTC for 2013+ is a new TAX* as such it violates the ATR Pledge * “Specialists term these synthetic government spending programs ʻtax expenditures.ʼ Tax expenditures are really spending programs, not tax rollbacks, because the missing tax revenues must be financed by more taxes on somebody else. Like any other form of deficit spending … a targeted tax break coupled with a specific revenue ʻpayforʼ means that one group of Americans is required to pay (in the form of higher taxes) for a subsidy to be delivered to others through the mechanism of the tax system.” —Dr. Edward D. Kleinbard, Professor of Law at the Gould School of Law, UCLA
  74. 74. Attention Democrats: A PTC for 2013+ is a TAX BREAK, that will primarily be used by High-Income Taxpayers. As such it is a violation of your party’s campaign for Tax Fairness.
  75. 75. Is an “All of the Above” Energy Policy wise? Only if it makes sense to include: unreliable, expensive, and environmentally destructive energy options! We need an “All of the Sensible” Energy Policy.
  76. 76. — Conclusions — Wind Energy is a net jobs loser and a net economics loser, that has no scientific proof that it has any net technical, economic or environmental benefits. Why should US taxpayers pay for such a charade?
  77. 77. The wind PTC makes as much sense as the government subsidizing ranchers to have cows run in the Kentucky Derby.

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