Sunday, June 2, 2013

C&P about PTC, RPS, IPA, FERC, RICL, PURPA, PUCHA, Cost Allocation, and Order 1000

OK, here's some interesting quotes from what I've been reading.  One is about Plains & Eastern Clean Line, a sister project to the Rock Island Clean Line (RICL or BLOCKRICL).  Others are from articles and blogs  for and opposing FERC Order 1000. Still others are classic economic literature and author Ayn Rand.

Perhaps this a good example of the crazy merry-go-round in my head.  While reading this, think about wind energy, the Production Tax Credit (PTC), Renewable Portfolio Standards (RPS), 20 year Power Purchasing Agreements, the Illinois Power Agency (IPA),FERC, Order 1000, transmission lines for "wind" energy, the sacrifice Illinois landowners are being asked to make, PURPA, PUCHA repeal, and all the other concessions (protectionism) we give the wind industry, and oh yes, lets not forget "Clean" Line Energy and the Rock Island "Clean" Line (RICL). Oops, I almost forgot cost allocations.

My gosh! This is absurd! Look at all the protectionism the wind energy industry gets.  That entire paragraph above is protectionism for one industry.  How much more sacrifice do I need to make?

Consider this some odd experiment in abstract cut & paste.

“Regular people only need to understand that this is likely the most progressive clean energy action the federal government will take this year.” – Center for American Progress 

“Not only is the wind power ‘made in Oklahoma,’ so too is the natural gas power that will power generators needed to fully utilize the transmission line capacity available when the wind does not blow,” said OCC Vice Chair Bob Anthony

OCC Chair Dana Murphy noted that the new transmission-only utility it will also require a new kind of regulation

“We have seen very little opposition,” Glotfelty said. 

“We’re not here to solve all the problems,” (Glotfelty) said

It takes a special person to fully understand all 620 pages of the Federal Energy Regulatory Commission’s new Order Number 1000, “
Regular people only need to understand that this is likely the most progressive clean energy action the federal government will take this year.
Congress can also meet the renewable energy industry’s unmet financing need by creating a Clean Energy Deployment Administration, which would provide a suite of financial products to help renewable energy projects attract capital.

Some day, perhaps, I shall speak to you also about association and organization, and we shall then see what you can expect of these idle fancies that you have allowed to lead you astray.
Meanwhile, let us see whether people are not doing you an injustice by passing laws that specify not only the persons from whom you are to buy the things you must have, such as bread, meat, linens, and woolens, but the price you are to pay for them.
Is it true that the policy of protectionism, which admittedly makes you pay higher prices for everything and in that respect harms you, also brings about a proportional increase in your wages?
Bastiat, Frédéric

To paraphrase the villain Ellsworth Toohey in Ayn Rand’s novel The Fountainhead: “Just listen to any bureaucrat, and if you hear him speak of ‘broad cost allocation’ — run. Run faster than from a plague.” 

EEI’s Transmission Projects: At A Glance report from March 2013 found that, of the $51.1 billion of transmission projects they identified, “projects supporting the integration of renewable resources represent approximately $38.7 billion (76 percent).”

Every major horror of history was perpetrated—not by reason of and in the name of that which men held as evil, that is, selfishness—but through, by, for and in the name of an altruistic purpose. The Inquisition. Religious wars. Civil wars. The French Revolution. The German Revolution. The Russian Revolution. No act of selfishness has ever equaled the carnages perpetrated by disciples of altruism. Nor has any egotist ever roused masses of fanatical followers by enjoining them to go out to fight for his personal gain. Every leader gathered men through the slogans of a selfless purpose, through the plea for their self-sacrifice to a high altruistic goal: the salvation of others’ souls, the spread of enlightenment, the common good of their state.

[J]ust listen to any prophet and if you hear him speak of sacrifice—run. Run faster than from a plague. It stands to reason that where there’s sacrifice, there’s someone collecting sacrificial offerings. Where there’s service, there’s someone being served. The man who speaks to you of sacrifice, speaks of slaves and masters. And intends to be the master.

Ayn Rand

Bootleggers and Baptists Abound
To better highlight the characters involved, let’s examine this issue in the context of the “bootleggers and baptists” theory of regulation. The Natural Resources Defense Council, a leading “baptist,” said about Order No. 1000: “the Commission should be commended for this transformative rule, which puts forth a framework that can move this country’s electric grid towards a clean energy future.”
The American Wind Energy Association, the biggest lobbyist for wind bootleggers, applauded FERC’s leadership and added that “the current system for determining how new power lines are paid for is flawed. The plans too narrowly define who should pay for new projects and stifle investment, resulting in inadequate expansion of the grid.
In one of his last letters, Frederic Bastiat asked a friend to “treat economic questions always from the consumer’s point of view, for the interest of the consumer is identical with that of mankind.” In that vein, Master Resource was keen to point out a powerful dynamicin the debate over the cronyism-riddled wind production tax credit.
As I’ve shown, the same dynamic applies to renewable energy mandates and socialized transmission costs — the bootleggers and baptists go to Washington to reap concentrated benefits, while the consumer minds his own business but gets fleeced. The dynamic plays out time and again, and the regulations keep coming, against the interest of the consumer and of mankind.


  1. Consider all the sacrifice we've given the wind energy industry. How much more sacrifice is needed?

    If you listen to the industry the Production Tax Credit is their only subsidy but there is a heck of a lot more protectionism than that.

    It's time for the industry to stand on its own.

    It is time consumers start stripping back their bag of goodies and benefits.

  2. It's like a bowl of alphabet soup with little dead spiders and bat heads floating in it. Yum Yum Yummy! Eat your soup, Scott!