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Sunday, November 13, 2011
Mafia-Connected FirstWind Got $117M in Federal Loans for Kahuku Windfarm
By Selected News Articles @ 7:55 PM :: 8781 Views :: Energy, Environment, National News, Ethics

A Gold Rush of Subsidies in Clean Energy Search

by Eric Lipton and Clifford Krauss, New York Times 11-11-11 (Excerpted)

WASHINGTON — Halfway between Los Angeles and San Francisco, on a former cattle ranch and gypsum mine, NRG Energy is building an engineering marvel: a compound of nearly a million solar panels that will produce enough electricity to power about 100,000 homes.

The project is also a marvel in another, less obvious way: Taxpayers and ratepayers are providing subsidies worth almost as much as the entire $1.6 billion cost of the project. Similar subsidy packages have been given to 15 other solar-and wind-power electric plants since 2009.

(NOTE: Among the 15—Hawaii’s Kahuku Wind Power project owned by a shell company controlled by Mafia-connected First Wind. First Wind’s shell company received a $117M ‘loan’ from the US Treasury.)

The government support — which includes loan guarantees, cash grants and contracts that require electric customers to pay higher rates — largely eliminated the risk to the private investors and almost guaranteed them large profits for years to come. The beneficiaries include financial firms like Goldman Sachs and Morgan Stanley, conglomerates like General Electric, utilities like Exelon and NRG — even Google.

A great deal of attention has been focused on Solyndra, a start-up that received $528 million in federal loans to develop cutting-edge solar technology before it went bankrupt, but nearly 90 percent of the $16 billion in clean-energy loans guaranteed by the federal government since 2009 went to subsidize these lower-risk power plants, which in many cases were backed by big companies with vast resources.

When the Obama administration and Congress expanded the clean-energy incentives in 2009, a gold-rush mentality took over.

As NRG’s chief executive, David W. Crane, put it to Wall Street analysts early this year, the government’s largess was a once-in-a-generation opportunity, and “we intend to do as much of this business as we can get our hands on.” NRG, along with partners, ultimately secured $5.2 billion in federal loan guarantees plus hundreds of millions in other subsidies for four large solar projects.

“I have never seen anything that I have had to do in my 20 years in the power industry that involved less risk than these projects,” he said in a recent interview….

Richard Legault, the chief executive of Brookfield Renewable Power, the division that oversees the Granite Reliable project in New Hampshire, declined to discuss his profit expectations in detail, but said the project might not have happened without government assistance.

“When everything has come together, it is a good investment for Brookfield, it is no doubt,” Mr. Legault said. “We are quite happy with it.” Brookfield is also the owner of the small park in Manhattan that is home to the Occupy Wall Street protesters.…

(NOTE: If you think this is a coincidence, you just aren’t paying attention. “Occupy” is bought and paid for by crony capitalists who, like the protesters, want to get rid of the capitalism/competition and keep the cronyism.)

… Obama administration officials said the subsidies were intended to help renewable-energy plants that were jumbo-sized or used innovative technology, both potential obstacles to getting private financing. But even proponents of the subsidies say the administration may have gone overboard.

Concerns that the government was being too generous reached all the way to President Obama. In an October 2010 memo prepared for the president, Lawrence H. Summers, then his top economic adviser; Carol M. Browner, then his adviser on energy matters; and Ronald A. Klain, then the vice president’s chief of staff, expressed discomfort with the “double dipping” that was starting to take place. They said investors had little “skin in the game.”

read … A Gold Rush of Subsidies in Clean Energy Search

LINK: Solar and Wind Power Generation Projects With Department of Energy Loan Guarantees (pdf)

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