by Andrew Walden
A damning report by the Inspector General of the US Department of Defense hits wasteful spending on solar energy projects on board Navy and Marine bases in Hawaii and California.
The report, issued September 20, 2011 focuses on solar contracts let in 2009 but has obvious implications for alternative energy projects awarded in 2010 and for the $500M of DoD solar contracts hastily assigned last month for Pearl Harbor, Hickam and other military installations as part of a $1B solar contract to install photovoltaic systems on military facilities nationwide.
The Inspector General explains:
We determined that the Department of the Navy (in 2009) did not select and plan photovoltaic projects in accordance with the Recovery Act and applicable energy legislation and policies. As a result, the Navy will not recover $25.1 million of the $50.8 million invested in photovoltaic projects.
In other words, for every $1.00 spent on solar projects, less than $0.51 of electricity will be produced over the life cycle of the projects. The Hawaii projects evaluated are at Naval Station Pearl Harbor and at the Barking Sands Pacific Missile Range Kauai. With the nation’s highest electric rates and some of the worlds best solar production conditions, Barking Sands still manages to produce 6% less value than the cost of initial construction losing $420,000 over the life of the project. Pearl Harbor will lose the Navy $6.69M—41% of the initial cost of construction. Losses at the ten California military solar projects range from 49% to an amazing 105% of the initial construction cost at NAS Lemoore, a loss amount made possible because of the projected cost of maintenance.
The report is one of five IG reports documenting waste over $117M on alternative energy projects launched on military bases nationwide in 2009.
In response to questions from the IG, Naval procurement officers argued that the projects were not required to be cost-effective. The IG rejected this assertion, and is demanding further answers due October 24 from twelve high-ranking DoD and Department of the Navy civilian and military officials.
In an October 20 article, Greenwire explains:
In the two-and-a-half years since the stimulus projects were chosen, the military has heightened its focus on energy issues and the Obama administration made it a priority when it appointed officials with energy expertise to top-level posts. Hicks' office, for example, was newly created by the administration.
Jack Spencer, a fellow at the Heritage Foundation, said the military should not be held to cost-effectiveness rules for mission-critical projects, but he questions whether renewable energy meets that definition.
"Military investment should be driven by operational capacity -- whether something gives the military better or new capabilities," he said. "The problem here is that neither of those things are what drive renewable investment in the military. Instead it's a political agenda. It's this desire to promote renewable energy sources."
Heads may roll as lower ranking officers are held responsible for the political agenda. Says the IG:
We also recommend that the Department of Defense, Department of the Navy, the Navy, and the Marine Corps officials review the actions of officials responsible for planning and selecting PV projects that were not cost-effective, which resulted in Recovery Act funds not recovered. Based on that review, determine whether any administrative actions are necessary.
The report identifies several means by which loss-producing projects can be filtered out in the future but does not identify any means by which the twelve solar projects could have been rendered cost-effective.
Projected from the IG’s findings, the $500B spent on military solar in Hawaii will produce only $245M in net utility bill savings over a 20-year period.
Links to IG Reports (Very Large Files):
- Click here to read the IG report on Navy solar projects in California and Hawaii.
- Click here to read the IG report on the Air Force solar project in Colorado.
- Click here to read the IG report on Air Force wind turbines in Alaska.
- Click here to read the IG report on the Navy geothermal project in Nevada.
- Click here to read the IG report on the Navy solar and lighting project in Virginia.
Greenwire: Haste made waste as DOD dashed to tap stimulus for green projects