http://farmindustrynews.com/blog/did-you-watch-60-minutes
[I did not see the 60 Minutes segment. This response makes me think it
was another piece of anti-renewables spin from the usual suspects.
Video at: http://www.cbsnews.com/videos/the-cleantech-crash
Transcript at: http://www.cbsnews.com/news/cleantech-crash-60-minutes/]
Did you watch 60 Minutes?
Jan. 10, 2014
by Lynn Grooms in Farm Industry News Blog
A 60 Minutes segment which aired on January 5 reported that the
cleantech industry "has suffered a string of expensive tax-funded
flops." But, there's more to the story.
Did you watch “The Cleantech Crash” on 60 Minutes Sunday evening?
Correspondent Lesley Stahl reported that the cleantech sector “has
suffered a string of expensive tax-funded flops,” with the segment
particularly focused on Vinod Khosla and his KiOR biofuel company.
Despite hundreds of millions of dollars invested, including $165 million
of Khosla’s own money, KiOR is still in the red, and its production of
green gasoline has faced delays, Stahl reported.
The 60 Minutes segment took a broad strike at biofuels, solar and
electric vehicles—reporting that the federal government has spent
billions on these technologies without much to show for it. Stahl
pointed out that Solyndra, the now bankrupt solar-panel company, alone
went through half a billion dollars of taxpayer money to build a factory.
But, as Michael McAdams, president, Advanced Biofuels Association
(ABFA), points out, “Solyndra has nothing to do with biofuels” and what
the 60 Minutes piece did not clarify is that of $38 billion originally
targeted for cleantech technologies in the economic recovery bill, the
biofuels industry received just $800 million in the form of grants to
build pilot plants.
The biofuels industry has received additional funding through the energy
title of the Farm Bill, and through the Department of Energy’s yearly
grants under the biomass program, which runs a total of approximately
$200 million annually. But, ABFA reports that biorefineries received
just $17 million of these grants last year. The ABFA also acknowledges
the Department of Defense Production Act, which has been limited to
awarding grants to the biofuel industry of up to a total of $570 million
(for Phase 1 and 2. Phase 2 should be awarded in July 2014). Even with
this funding, it is small compared to what the government has invested
in the oil industry over the years, McAdams says, adding that the
biofuels industry is still in its infancy and has made significant
advances in less than five years. He also points to a Bloomberg Energy
report that the private sector has invested $14.7 billion in the
advanced biofuels industry.
Moreover, after reviewing the government’s loan guarantees, none of the
biofuel companies (with the exception of Abengoa Bioenergy), signed the
agreements because the transactions costs were too high, McAdams said.
“In some cases, borrowing from a commercial bank would have been cheaper.”
The 60 Minutes segment also featured Pin Ni, who heads up China’s auto
parts company Wanxiang. Ni has purchased several cleantech companies
after American investors gave up on them. This is where McAdams feels
the 60 Minutes program got it right—an emphasis on the long-term
benefits. While Pin Ni acknowledged that cleantech is not currently
going well, “China is willing to make a long-term bet on the technology,
and spend what it takes to develop the manufacturing.”
In answer to Stahl’s question about whether American taxpayers have
gotten their money’s worth on cleantech spending, Pi Ni said, “If you
measure them by today’s standard, I would say definitely not. . . But if
you view this as a step stone to the future, when you get there, when
you look back, I would say yes.”
--
Darryl McMahon
Project Manager,
Common Assessment and Referral for Enhanced Support Services (CARESS)
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