Lessons from New York’s phony green bank
Credit: By Phil Hall |
Congress Blog |
The Hill |
January 06, 2014 |
thehill.com ~~
On December 19, 2013, New York Governor
Andrew Cuomo’s office quietly issued a press release announcing that
$210 million in initial funding was being poured into something called
the “New York Green Bank.” The governor’s spin doctors insisted that
this endeavor was a “bold, new market oriented approach to accelerate
clean energy deployment, create jobs, and help make our communities more
resilient and sustainable.”
Uh huh. The only genuinely green element of this press release was
its recycling of long-discredited arguments that a world full of solar
panels and wind turbines would strengthen the economy and boost the
environment.
Let’s start with the name. Although referred to as a bank, it is
actually a government agency whose funds included $165 million
redirected from other New York projects and $45 million thrown in from
the Regional Greenhouse Gas Initiative. Without the taxpayers’ money,
this project would not exist.
The Green Bank, according to the governor’s press agents, will
“partner with private sector institutions by providing financial
products such as credit enhancement, loan loss reserves and loan
bundling to support securitization and build secondary markets.” But
isn’t that supposed to be the exclusive job of the private sector? Is
there any reason why the nation’s leading banks – none of which are
showing any losses – aren’t actively pursuing these strategies?
Well, there is an excellent reason why the private sector won’t touch
this market with its own money: who would want to sink money into this?
At the moment, the renewable industry is in limbo because the federal
production tax credit program that keeps the U.S. renewable energy world
afloat expired at the end of 2013. Without this federal life support,
the companies creating so-called clean technologies are unable to
sustain themselves, let alone also sustaining a healthier environment.
Furthermore, this market plays almost no significant influence on
serving American power needs. According to the U.S. Energy Information
Administration, solar energy is responsible for a ridiculously miniscule
0.11 percent of all national electrical power generation – and half of
that tiny percentage is based in (where else?) California. Wind energy
is somewhat more prevalent, generating 3.46 percent of the nation’s
total power, but that comes at significant costs to electric customers
(a fact that the folks in Maryland will live with if the proposed
offshore wind farm serving their state ever gets built).
As for the green jobs being promised by Cuomo – whatever happened to
those green jobs promised by presidential candidate Barack Obama in
2008? It is astonishing that this old lie is still being trotted out,
when the past few years showed zero evidence that the renewable energy
world can create lucrative employment opportunities.
The Cuomo press release also enjoyed a quote attributed to Richard
Kauffman, chairman of Energy & Finance for New York State, which
represents a new low in double-talk. “The Green Bank is just one
component of the State’s new chapter on energy policy that focuses on
enabling self-sustaining private markets and reducing dependence on
subsidies,” says Kauffman.
Really? So, let’s get this straight: a “bank” that is really a
government agency is inventing “self-sustaining private markets” that no
private institution would build and is “reducing dependence on
subsidies” by spending $210 million in taxpayer money?
This effort is so patently phony that I wouldn’t be surprised if the
New York Green Bank started soliciting bids on a certain bridge in
Brooklyn.
Hall is a former senior editor at Solar Industry Magazine and the publisher/editor of Business-Superstar.com.
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