nextera (2)

Despite Harm to the Environment and the Economy, Fiscal Cliff Deal Fuels Continuing Corporate Welfare 4063656008?profile=original


The new year began with “fiscal cliff” midnight drama and fantasy, and the wind-production tax credit (PTC), despite its negative impact on our environment and economy, packaged as a job creator and measure to save the planet, made its way into H.R. 8, the American Taxpayer Relief Act of 2012 –– a piece of legislation that was hyped as for the American people, yet it included a number of key tax extender provisions for special interest groups. “Congress extended wind energy tax credits worth billions of dollars in the last-minute deal hammered out by Congress to avoid the fiscal cliff, a move decried by free market organizations as corporate welfare,” writes the Washington Free Beacon.

Crammed through in the dark of night behind closed doors –– where the Senate was given minutes to read the bill, and the House caved under White House threats –– and with support of many Republicans –– the looming and controversial (PTC) that many high-powered energy corporations have taken advantage of, rely heavily upon, and were fiercely lobbying for, was revived once again.

"The wind industry hired a team of heavyweight lobbyists with cozy connections to Capitol Hill and the Obama administration to ensure the survival of the tax credit, the Washington Examiner’sTimothy P. Carney reported," more specifically K Street firm McBee Strategic Consulting, of which I've found over and over in my green corruption research.

NOTE: “The Lucky Seven Stimulus Authors” are those that helped craft the 2009-Recovery Act and have financially benefited, of which I have already covered General Electric, John Doerr of Kleiner Perkins, Senator John Kerry, which I wrote about last week. I have given mention to billionaire George Soros as well as the left-wing organization the Apollo Alliance, with TJ Glautheir and McBee Strategic Consulting topping off my list. Full report soon to be released.

“Congress first enacted the wind energy PTC in 1992 and has renewed it seven times since,” even as part of the 2009-Recovery Act. The Institute for Energy Research counts the hidden realities of the PTC extension, noting that "The Joint Committee on Taxation estimates that the one year extension will cost American taxpayers over $12 billion." "But that figure doesn’t begin to represent the full cost of wind power,” including the detriment to ratepayers. And if Big Wind gets its way over "the next six years, then the PTC would cost over $50 billion."

Unknown to the American public is another green government freebie blowing out of the stimulus package. The 1603 Grant Program –– a relative of the PTC, which is part of President Obama’s trillion-dollar spending spree –– is administered by the Treasury Department, where billions in favored-businesses are given tax-free cash gifts. This program was also touted as a jobs creator (of course saved and supported), yet most of the so-called green job gains are temporary.

According to energy.gov, “The Section 1603 program was created under the American Recovery and Reinvestment Act to support the deployment of renewable energy resources. The 1603 program offered project developers the option to select a one-time cash payment in lieu of taking the Investment Tax Credit (ITC) or the Production Tax Credit (PTC), for which they would have otherwise been eligible.”

Last week, the Energy and Commerce Committee released an “in-depth report on its ongoing investigation into the implementation of President Obama’s green energy stimulus spending,” exposing a shocking detail; “foreign corporations have received approximately one-quarter of $16 billion spent on 'Section 1603' renewable energy stimulus program.”


The report, “American Taxpayer Investment, Foreign Corporation Benefit,” states that as of December 5, 2012, “nearly $16 billion in federal funds (ironically, the same amount as the Department of Energy’s 1705 risky loan portfolio) has been awarded under this program,” of which “approximately $10.8 billion (68%) of the total amount in Section 1603 grants awarded was for wind and another $3.8 billion (24%) was for solar projects.”

Furthermore, “President Obama’s FY 2013 Budget proposes extending the Section 1603 grant program for another year, to include property with a construction start date of 2012.”

What’s funny is that as I was preparing my Big Wind findings, at the end of December 2012 I had downloaded the 1603 awards spreadsheet, which records 8275 awards, totaling $15,964,130,442. Moreover, tucked neatly inside the fiscal cliff deal is where we find the 1603 again ––– now part of the two-month delay on sequestration. This means that there was no “immediate reduction in 1603 cash grants from the Department of Treasury. However, this 1603 reduction can still happen on March 1, 2013 if Congress does not enact another extension or strategy to avoid sequestration.”

Now we know President Obama's priority for his second term –– he's dead set on pushing a fierce and radical climate change agenda and funding green energy with taxpayer money, no matter the cost or consequences. So, we’ll anticipate March; follow the president’s budget; and watch for future requests for stimulus funds as well as earmarks tucked away in unread legislation coming down the green pipeline, but for now we'll go back in time to the president’s job council…


Lewis Hay Chairman and Chief Executive officer of NextEra Energy, Inc.: Part of President Obama’s Multi-millionaire, Billionaire Jobs Council Club  

Lewis “Lew” Hay, III is executive chairman of NextEra Energy, Inc., and it is estimated by Forbes, that CEO “Hay earns nearly $10 million in total compensation from NextEra.” Despite the fact that Hay was actually a “major political contributor to Sen. John McCain in 2008,” he quickly learned which side his power company could generate the title of the "Third Largest Recipient of DOE Risky Loans." Hay too joined wealthy Democratic donors on Obama’s Jobs Council in 2011, along with the other two I have tackled in this series, “Spreading the Wealth to Obama’s Ultra-Rich Job Council” –– Jobs Czar, Jeffrey Immelt CEO of General Electric has raked in $3 billion and counting, meanwhile John Doerr, along with his “climate buddy" Al Gore's, VC firm Kleiner Perkins is tied to at least $10 billion of stimulus funds. Both General Electric and Doerr were key contributors to what went into the 2009 Stimulus.

In my opening, I had stated that “NextEra Energy’s Green Money” was at least $2.3 billion, but that’s just from the Department of Energy’s (DOE) 1703 Loan Guarantee Program, of which I recorded in another green energy, crony corruption post last summer. We’ll revisit the DOE and Big Wind, but for now there is more you should know about NextEra…

NextEra Energy, Inc. is one of the oldest, third largest, and arguably one of the most solid power companies in the world, with “2011 revenues [that] totaled more than $15.3 billion.” And NextEra Energy Inc. has two primary subsidiaries: 

  • Florida Power & Light is the third largest electricity producer in the US, of which a September 2009 report states: “it's a political dynamo, making millions in political contributions and lobbying assiduously to achieve its goals."
  • NextEra Energy Resources is the largest generator of energy from sun and wind resources in North America. The company also has the third largest fleet (8) of nuclear powered electricity generating plants in the United States.


NextEra: Biggest User of the Wind Energy Production Tax Credit 

As a follower of NextEra, I found a fascinating analysis by John Fund of the National Review Online which states, “Begun 20 years ago to spur the construction of wind-energy facilities that could compete with conventional fossil-fuel power plants, the tax credit [PTC] gives wind an advantage over all other energy producers. But it has mostly benefited conventional nuclear and fossil-fuel-fired electricity producers. The biggest user of the tax credit is Florida-based NextEra Energy, the nation’s eighth-largest power producer. Through skillful manipulation of the credits, NextEra from 2005 to 2009 'paid just $88 million in taxes on earnings of nearly $7 billion,' Businessweek reports. That’s a tax rate of just 1.25 percent over that period, when the statutory rate is 35 percent.”


Wind Turbines Kill 440,000 Birds Each Year 

Moreover, Fund gives us an astonishing and heartbreaking look at the “carnage inflicted on Mother Nature," quoting Paul Driessen of the Washington Times, "The U.S. Fish and Wildlife Service estimates that wind turbines kill 440,000 bald and golden eagles, hawks, falcons, owls, cranes, egrets, geese, and other birds every year in the U.S., along with countless insect-eating bats.”

Sadly, Fund states, “The actual numbers are probably far higher. The turbine blades of the nation’s 39,000 windmills move at 100 to 200 miles per hour and can mow down anything that gets in their path.” “Over the past 25 years, turbines at Altamont Pass, Calif., alone, have killed an estimated 2,300 golden eagles leading to an 80 percent drop in the golden-eagle population of southern California.”

Ironically, when you read the fine print, as exposed by the Manhattan Institute, who calculated “The Real Costs to Taxpayers in Subsidizing Big Wind,” –– federal taxpayers (under former President Bush and now Obama), in effect, are subsidizing the killing of federally protected birds.”

Where are the environmentalists and Rachel Maddow screaming bloody murder? The chirps are light, and prosecution is non-existent because our “federal government looks the other way as wind farms kill birds, but haul oil and gas firms to court” –– all the while the Obama administration protects Big Bird at all costs.

But then again, Big Wind, to many like the Telegraph, is the most corrupt industry in the world –– “without the lies it tells as a matter of course and without the cosy stitch-ups it arranges with regulators and politicians at taxpayers' expense, it simply would not exist.”


Much more to this huge Big Wind story–– continue reading...

Here are the rest of the topics I've covered: 

  • Gone With the Wind: Wind Energy Grants Gone Overseas and to the Politically Connected, Including NextEra
  • NextEra: A Gust of other Stimulus Grants 
  • NextEra: Third Largest Power Company in the World is the Third Largest Recipient of Risky Loans 
  • A Twister of Sweetheart Deals Found in the Department of Energy’s Four Risky Wind Projects 

This was Part Three of "Spreading the Wealth to Obama's Ultra-Rich Job Council: The Green Five" 

Part One10/31/12 DOE Emails Prove White House Pressure on $1.3 Billion Loan to General Electric Wind Project

Part TwoBank of Obama: John Doerr and Al Gore of Kleiner Perkins, The Mother of All Green Energy Stimulus Money Winners

Stay tuned for the final installment where we take a look at Billionaire Penny Pritzker as well as Richard Dean "Dick" Parsons, Former Chairman of the Board of Citigroup, Inc –– both part of Obama’s Multi-millionaire, Billionaire Jobs Council Club.

 

Signing off for now, THE Green Corruption blogger...

 
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Lewis Hay, III and President Obama NexEra Energy Viewpoints  

Through this special series on green-energy crony-corruption, we’ve been highlighting specific examples of green-energy loan guarantees and grants. What connects each of these cases is that they received fast-tracked approval from the Department of Interior (DOI) for their projects. Of course, they also have many other dots that connect, such as key players with White House visits, raising funds for Democratic campaigns, and serving within government agencies such as the Department of Energy (DOE) or as an appointed member to President Obama’s Jobs Council.

Now we come to the last of our “special seven” series. Like those before it, it contains many inside players and funding from various “stimulus” government programs. While Lewis Hay (the CEO of NextEra Energy) with his White House involvement and friendship with former Florida Governor Charlie Crist make for some juicy details in the NextEra story, we’ll begin with a brief background that will help put this next piece of the green-energy crony-corruption scandal in perspective.

 

NextEra Energy, Inc. is one of the oldest, third largest, and arguably one of the most solid power companies in the world, with “2011 revenues [that] totaled more than $15.3 billion.” It is estimated by Forbes, that CEO “Hay earns nearly $10 million in total compensation from NextEra.”

 

NextEra Energy Inc. has two primary subsidiaries:

  • Florida Power & Light is the third largest electricity producer in the US (about which a September 2009 report states: “it's a political dynamo, making millions in political contributions and lobbying assiduously to achieve its goals”).
  • NextEra Energy Resources is the largest generator of energy from sun and wind resources in North America. The company also has the third largest fleet (8) of nuclear powered electricity generating plants in the United States.

 

Money 

With its wealth and widespread influence, the DOE gave this huge energy conglomerate nearly $2 billion of taxpayer money, which includes the two risky projects listed below, plus hundreds of millions more in various stimulus grants.

 

Desert Sunlight: $1.2 billion

In September 2011, the DOE approved a $1.2 billion loan guarantee for the junk-rated Desert Sunlight project in California. A day after the loan was approved, First Solar, the project developer/owner sold Desert Sunlight to NextEra Energy Resources, LLC, the competitive energy subsidiary of NextEra Energy, Inc. and GE Energy Financial Services. Both CEO's are on President Obama's Job Council: Lewis Hay of NextEra Energy and Jeffrey Immelt of GE.  NOTE (and correction from the Townhal.com column): GE is another top Obama donor, donating $529,855 to his 2008 campaign, while they have raked in more than $3 billion of stimulus money, and counting.

 

Genesis Solar Project: $681.6 million

But as we reported in the beginning of this series, the Desert Sunlight Project is not the only large DOE “risky” loan that NextEra secured. NextEra Energy Resources also received $681.6 million from the DOE for its Genesis Solar project in Blythe, California. This was one of the few DOE 1705 loans that were not considered junk rated, as S&P placed it at a “lower medium grade.”

 

Environment 

 

Remember that the common denominator of these “special seven” projects was a “fast-tracked DOI approval?” The policy has come back to bite the projects.

 

According to the Los Angeles Times (LAT), “The $1-billion Genesis Solar Energy Project has been expedited by state and federal regulatory agencies that are eager to demonstrate that the nation can build solar plants quickly to ease dependence on fossil fuels and curb global warming. Instead, the project is providing a cautionary example of how the rush to harness solar power in the desert can go wrong—possibly costing taxpayers hundreds of millions of dollars and dealing an embarrassing blow to the Obama administration's solar initiative.”

 

The problem is the “expedited” process may endanger the whole project. The House Committee on Government Oversight and Reform’s March 20, 2012 report says, “To expedite site approval, NextEra opted for a less thorough process.” As a result, the site “encroached on the habitat of the endangered kit foxes.” NextEra had to move the foxes prior to grading the site. “Ultimately, seven foxes died from NextEra’s removal process.”

 

Additionally, there have been concerns of desert tortoises and a “prehistoric human settlement.”

 

But warring factions within the environmental movement also plague the NextEra Genesis Solar project.

 

A small environmental group, the Wildlands Conservancy, raised $45 million to preserve 600,000 acres of the Mojave Desert—with the intent that it would be protected forever. The LAT reports, the Wildlands Conservancy bought the land and deeded it to the federal government only to have 50,000 acres of that bequest opened up for solar development. April Sall, the organization’s conservation director says, the group is “watching this big conservation legacy practically go under a bulldozer.” Sall’s group and others are feeling “burned by the rush to build solar projects.”

 

The small environmental groups are trying to fight utility-scale solar projects while the big national groups, such as the Sierra Club, have “scolded” some of the local chapters for opposing the projects. A national office directive instructed local chapters to “fall in line.”

 

Michael O'Sullivan, senior vice president of development for NextEra Energy Resources, says that “the problems threaten the entire project” and “the project could become uneconomical.”

 

If that were to happen, the LAT explains, “80% of the project's outstanding loans would be covered by the federal government, and the U.S. Bureau of Land Management would begin shopping for another renewable energy company that was interested in leasing the property. If there were no takers, the scarred land would be restored with reclamation bond funds.”

 

Smart-Grid and Wind Energy Grants  

 

In October 2009, Florida Power & Light (FLP) was awarded the maximum grant amount of $200 milllion for Energy Smart Florida. Interestingly, this is connected to Silver Spring Networks, one of Kleiner Perkins shining green companies, where John Doerr (another jobs council member that was influential in what went into the energy-sector of the 2009-stimulus) and Al Gore are partners, of which their 2008 $75 million investment had scored over $700 million.

 

The DOE started dishing out billions from the Smart Grid Investment Grant Program (part of the stimulus plan) in August 2009 and awarded select utility companies for particular smart-grid projects––close to sixty percent of Silver Spring “customers” were winners.

 

In fact, Florida Power and Light, Silver Spring, General Electric, and a few others have joined forces on a Smart Grid Miami project, which was announced in 2009.

 

(Note: if you are not familiar with the Smart Grid, Brian Sussman’s book Eco-Tyranny offers an overview which includes this: “President Obama cleverly sold it like this: ‘We want to invest in the next-generation of high-speed wireless coverage for 98 percent of Americans. This isn’t just about a faster Internet or being able to friend someone on Facebook. It’s about connecting every corner of America to the digital age.’ The digital age Obama spoke of is the age of Big Brother monitoring your carbon footprint. The Smart Grid’s interactive broadband capability will enable your home’s PCT, HAN, and smart meter to be connected and communicating with your utility provider. Once complete, the utility company will be your government-sponsored Big Brother, constantly monitoring and regulating your carbon footprint. With a bureaucratic keystroke any electrical device in your home could be selectively turned off—or on—without your approval.”)

 

Also, you'll be “blown away” by the billions ($4.4) of “wind energy grants” that blew out of the stimulus package back in February 2010. General Electric is connected to at least 26% of these wind energy grants as the “Turbine Manufacturer.” NextEra is the “project owner” and the recipient of a $99.9 million grant for a wind project in Colorado.

 

Politics 

 

So, NextEra Energy, a multi-billion dollar company with a CEO who’s paid multi-millions, gets government grants and loan guarantees worth billions for risky projects that you and I wouldn’t have voluntarily invested in that even the environmentalists can’t agree on.

 

Despite the fact that NextEra CEO Hay was actually a “major political contributor to Sen. John McCain,” Hay quickly learned which side his bread was buttered on. (FPL employees and PACs have been known to give generously to both sides including $18,800 to Obama’s 2008 Presidential campaign.) On October 8, 2009, Hay dined at the White House in an intimate lunch “with President Barack Obama and a handful of other Fortune 500 executives.” Hay reportedly “boasted to the president about FPL Group’s environmental achievements and Florida Power & Light’s plans to open the nation’s largest solar power plant.” He also “discussed his belief that forward-looking, clean-energy policies are vital to America’s economic recovery and FPL Group’s strong support for legislation to combat global warming and strengthen America’s energy security.”

 

The opportunity to grandstand obviously worked. Later, in the same month, Hay’s FPL’s DeSoto Next Generation Solar Energy Center in Aracadia, Florida, provided Obama with the perfect backdrop for his announcement about the “nation’s biggest investment in clean energy.” The press release from the White House said: “President Barack Obama today announced the largest single energy grid modernization investment in U.S. history, funding a broad range of technologies that will spur the nation’s transition to a smarter, stronger, more efficient and reliable electric system. … The $3.4 billion in Smart Grid Investment Grant awards are part of the American Reinvestment and Recovery Act.”

 

While the announcement regarding the smart-grid grant disbursement was like “Christmas morning” for the 100 recipients, FPL received the maximum $200 million grant, as previously addressed, “to buy 2.6 million new smart utility meters to be placed in homes over the next two years and invest in other technology aimed at cutting energy costs.” And those risky loan guarantees issued to NextEra for the Desert Sunlight and Genesis Solar projects were approved after Obama’s “stimulus PR swing” appearance at FPL’s DeSoto Next Generation Solar Energy Center.

 

Hay and FPL have a long history of political contributions and have a “cozy relationship” with career politician former Governor Charlie Crist—Republican turned Independent to run against Marco Rubio in 2010, only to lose. In June 2009, FPL and its executives donated more than $36,000 to Crist’s Senate campaign, and Hay was an invited guest at Crist’s December 2008 wedding. While, we don’t know if Hay actually attended the Crist wedding, we do know that he donated to Marco Rubio’s 2010 campaign––what a difference two years make.

 

Thomas Saporito, an energy consultant and former FPL employee is quoted as saying: “It certainly appears to me that Gov. Crist and certain PSC Commissioners have a very cozy relationship with FPL at a time when FPL is seeking an unprecedented $1.3-billion dollar rate increase.” Crist announced his opposition to FPL's rate hike but objections were limited to a press release and a few comments to reporters.

 

President Obama's Council on Jobs and Competitiveness4063559941?profile=original

 

Keeping with the “cozy relationship” model of doing business, Hay joined wealthy Democratic donors on Obama’s Jobs Council in 2011—of which at least five members have direct ties (two indirect) to firms that were awarded billions of clean-energy stimulus money and four are confirmed Obama donors.

 

A Jobs Council by the way –– those advising President Obama on how to create jobs and grow the economy ––  "is full of deep-pocket Democratic donors and high-profile financiers of Obama’s re-election campaign," as reported by ABC News in October 2011. 

 

Since the creation of the President’s Council on Jobs and Competitiveness, the members have pushed for renewable energy subsidies. In October 2011, these Obama advisors who’ve financially benefited from green energy projects—such as Hay—issued a report calling for among other things, “a new federal financing program to attract private investment for clean energy projects via loan guarantees and other tools.”

 

Hay is just one of the many Council members with green energy connections. Citigroup’s Richard Parsons with ties to SolarReserve, as well as Penny Pritker, who wears many liberal hats, including those close to the president. Pritker brings along her relationship to the $465 million DOE ATVM loan that went to Telsa Motors, which also has quite a few other interesting ties, like Steve Westly, Obama bundler and DOE Advisor. We also find GE’s Jeffrey Immelt and its $3 billion of green-government subsidies, as well as John Doerr of Kleiner Perkins, who has Al Gore as a partner –– where as of 2010 we find that more than fifty percent of its Greentech Portfolio had received money from the energy-sector of the stimulus package and through other government programs approved by the Obama administration.

 

These Jobs Council members, also known for their “job outsourcing” –– and others like DOE Insiders and the Stimulus Authors –– who’ve benefited from the deal making, deserve a more thorough (forthcoming) exposé. We’ll call it “Spreading the Wealth to Obama’s Wealthy Jobs Council Members.”

 

Author’s note: Thanks to Christine Lakatos, the Green Corruption blogger, for research assistance. Unless project-specific funding is raised, this will be the last in the green-energy crony-corruption series.

 

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Published at Townhall.com August 17, 2012 as Third Largest Power Company in the World is the Third Largest Recipient of Risky Loans -- the final installment of our Special Seven Series, whereas: 

  • “Seven solar (two of which are geothermal) companies received fast-tracked approval by the Department of the Interior to lease federal lands in a no-bid process: Abengoa Solar, BrightSource Energy, First Solar, Nevada Geothermal Power, NextEra Energy Resources, Ormat Nevada, and SolarReserve,” as reported by the Washington Free Beacon in April 2012. 
  • Each of these seven companies received billions of DOE funds under the 1705 loan program as well as renewable energy grants from the Treasury Department—despite “junk bond” status. 
  • Christine's research of the DOE's 1705 Loan Guarantee Program, which she reported on in April 2012 –– Department of Energy “Junk Loans” and Cronyism, noted that 90 percent have "meaningful" ties to President Obama and other high-ranking Democrats –– or both.
  • We found these Special Seven on that DOE "junk" bond  portfolio, of which all have connections to President Obama and other high-ranking Democrats like Senator Harry Reid that has ties to at least four. 
  • Moreover, these 90 percent have plenty of Obama and Democrat "cronies" in the mix:  bundlers, donors, investors, operatives, lobbyists, aides, buddies, relatives, and so on. Throw in some White House appointees, staffers as wells as DOE Insiders (former and present), and you've got yourself a tangled web of "green" cronyism and corruption. 

That said, there is much more to expose...

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