Stimulus IV: Last Chance for the Green New Deal?

By Mark Krebs -- April 2, 2020

Don’t forget that just before the World was upended by coronavirus, we had another deep-decarbonization electrification bill: the 555-page American Energy Innovation Act (AEIA). 

Since “clean energy” unfairly discriminates against the leading (and clean) alternatives to electricity, this is contrary to the best interests of free markets and providing affordable energy for consumers.

Yes; another “stimulus” bill is possible and perhaps even likely. Expect Nancy Pelosi’s “Green New Deal” to be part of this effort given that the Senate and the President said NO to subsidies for solar panels and wind turbines in the CARES Act. 

Numerous special interests didn’t get their piece of the pie and were promised another shot in order to move the CARES Act out of the Senate.  It’s all politics, not consumer economics, for the pack of lobbyists in an election year, trading campaign contributions for legislative favors.

As we all know, such “horse-trading” is pretty much par for the course to move legislation.  In most cases, however, such intentions are not well publicized.  This time, some has been revealed. MasterResource has covered the latest:

• Green New Deal 2: “A Green Stimulus to Rebuild Our Economy”
• “How Embarrassing. This Is a National Emergency” Wind and Solar try an 11th hour sneak

For another example, as reported by E&E Daily in Green Bank Supporters Look To The Next Stimulus:

Rep. Debbie Dingell (D-Mich.) said that she’s pushing leaders on the Energy and Commerce Committee to get her bill, H.R. 5416, the “National Climate Bank Act,” into talks for future relief packages.

Excerpts from H.R. 5416:

(6) ELECTRIFICATION.—The term ‘electrification’ means the installation, construction, or use of end-use electric technology that replaces existing fossil-fuel-based technology.

“(7) ENERGY EFFICIENCY.—The term ‘energy efficiency’ means any project, technology, function, or measure that results in the reduction of energy use required to achieve the same level of service or output prior to the application of such project, technology, function, or measure, or substantially reduces greenhouse gas emissions relative to emissions that would have occurred prior to the application of such project, technology, function, or measure.

“(8) FUEL SWITCHING.—The term ‘fuel switching’ means any project that replaces a fossil-fuel-based heating system with an electric-powered system or one powered by biomass-generated heat.

Master Resource readers may recall the “Green Bank” concept from a critique back in 2009 by none other that Jerry Taylor: Busting the “Clean Energy Bank” (another problem with Waxman-Markey). His logic then can be used against him today.

Then and now, the fundamental purpose of “Green Banks” is to allow (highly speculative, at best) carbon reductions to substitute for reduced energy consumption as a metric for energy efficiency (which is already site-based). That’s exactly what the highlighted “or” does in the above excerpt. 

It is also noteworthy that the bill neglects to define what clean energy is.  Most certainly, any direct use of fossil fuels won’t be deemed clean, despite any adverse environmental consequences of renewables.

Energy Cronyism on Display

Some more E&E Daily articles reiterating the additional stimulus (porkulus?) narrative:

• Future Stimulus Bills Could Address Climate. Here’s Why
• Lawmakers Look to The Next Coronavirus Package

And some non-subscription ones:

• The Senate’s Stimulus Bill Is Full of Disappointments for Climate Advocates.
• Stimulus Bill’s Lack of Funding for the SPR and Clean Energy is a Lose-Lose for The Country

Meanwhile: Climate Activists Celebrate ‘The Benefits Of Coronavirus’: ‘It Is Fantastic For The Environment’ – Economic Slowdown Is ‘Good News For The Ecologists’. Regardless, to be even-handed in dispensing rent-seeking disdain, some trade associations not tied to the left (e.g., coal) are also groveling overtime for subsidies under the guise of the coronavirus (see Rent Seeking Goes Viral [competing energies seek special favor]).

American Energy Innovation Act (Green New Deal Lite)

Don’t forget that just before the World was upended by coronavirus, we had another deep-decarbonization electrification bill: the 555-page American Energy Innovation Act (AEIA). After AEIS started to flounder in Mid-March, DOE’s new Secretary Brouillette stepped-in on behalf of the proposed legislation as quoted by E&E Daily on March 13^th in an article titled Brouillette Urges Progress On Stalled Energy Package. Excerpts:

• Spending authorizations in the bill would add to some $24 billion over the next five fiscal years to beef up clean energy research and demonstration projects on storage, nuclear and carbon capture.

• During remarks to the Secretary of Energy Advisory Boards, Brouillette urged lawmakers to continue deliberations.

• “And we hope that they continue their work in the United States Senate and perhaps move forward to pass this bill and to begin some cooperation with the House, as well,” he added. “We’d like to see that work go forward; we’re very happy that they’re doing that.”

Why would Brouillette advocate for clean energy? Because it’s DOE’s Office of Energy Efficiency and Renewable Energy (EERE) official mission and strategic plan (both unchanged since the Obama Administration) and most of that $24 Billion would be overseen by DOE/EERE. 

Since “clean energy” unfairly discriminates against the leading (and clean) alternatives to electricity, this is contrary to the best interests of free markets and providing affordable energy for consumers.  In short, this picking of winners and losers does not help “make America great again.”

DOE/EERE “National Labs” and their subcontractors are also pushing this “clean energy” transition through the publication of studies, webinars, etc. that push energy regulators to “virtue signal” using OPM (other people’s money).  Such on-going conditioning was the subject of past Master Resource author Ken Costello in an article titled The Politicization Of Public Utility Regulation.

Looking Ahead

So, what gives? Unwittingly or otherwise, Congress (along with the Agencies whose budgets they dictate) and energy regulators are picking away at liberty and choice.  Most people don’t seem hesitant exchanging a little more personal freedom for the perception of financial security (think $1,200 “free” checks courtesy of the CARES Act).

Eventually, however, that perception fades as reality sets in. Freedom to choose, as long as that choice is electric, is economic capture that is perpetuated via regulatory capture.

To truly make America great again, don’t further entrench corporate-crony Darwinism “where only the connected survive.” Instead:

1. Focus Congress upon implementing Trump’s budget cuts
2. “Just say no” to energy subsidies; all of them.

Getting past the coronavirus crisis is obviously the most immediate need.  However, this is likely a short-term crisis.  Contrary to the claims of Green New Deal (GND) advocates, there are more important long-term crises.  These include:

1. Reducing our national debt
2. Meeting the needs of a growing global population (independent of the current corona virus).
3. Guarding against and reacting to a future Pandemic.

In addition to GND priorities, all of these three looming crises will require efforts that we can’t resolve by simply printing more money.  Some additional comments regarding 2 and 3:

• The tab for all 3 coronavirus legislation enacted so far is about $7 Trillion; and there will likely be more to follow.  Problem solving by printing more money causes other problems; namely reduced buying power.  This can be especially devastating for low or fixed income consumers.

• “An article titled Earth’s Soil Could Absorb 5.5 Billion Tonnes of CO₂ Annually, if We Get It Right summarized some recent soil science research.  To put 5.5 Billion tons per year into perspective, in recent years atmospheric carbon has increased at a rate of about  15.6 Billion tons per year (@ 1ppm = 7.81 Gigatonnes of CO₂).  Thus, theoretically, natural, photosynthetic soil sequestration of carbon could decrease atmospheric CO₂ “excess” by about 1/3.  Not bad; especially considering it’s something we should probably be doing anyway given the benefits of reduced inorganic chemical use, improved yields, less runoff, etc., etc. estimated at +$85 Billion just for the US.  Thus, possibly, this may be better than free.  And in so sequestering “excess” atmospheric carbon, the claimed rationale for eliminating the use of fossil fuels could be greatly reduced and environmental progress celebrated.

Conclusion

In summary, job one is to ultimately defeat the coronavirus.  Job 2 should be to prevail against economic parasitic infestations that would inflate prices and further weaken the economy by eliminating alternatives to electricity. Deep decarbonization in the name of averting a climate “crisis” is a ruse.

Government policy should favor the most efficient and productive means of cutting carbon (to the extent it is a problem), rather than inordinate funding of the costliest and most “high tech” as is current subsidy groveling practice. (For a series of posts on this topic, see here.)

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Mark Krebs, an engineer by training, has been involved with energy efficiency design and program evaluation for more than thirty years. He has served as an expert witness in dozens of energy-efficiency filings, which he first summarized in a Public Utilities Fortnightly article, “It’s a War Out There: A Gas Man Questions Electric Efficiency” (December 1996).

Tom Tanton assisted with this article.