$1.3 billion for 288 jobs: The failure of government-subsidized renewable energy

Another reason why government shouldn’t pick winners and losers in the economy 

In August, U.S. Senate Majority Leader Harry Reid hosted his fifth annual National Clean Energy Summit in Las Vegas. Delivering the keynote address, former president Bill Clinton claimed that if every state had a renewable-energy standard it would “put a lot of people back to work.”

Sen. Reid and his conference speakers, including California Gov. Jerry Brown in 2011, regularly claim that renewable energy will power job growth. The theme of Sen. Reid’s summit in 2010 was “Investing in American Jobs.” Gov. Brown has released a “Clean Energy Jobs Plan” and has even claimed that “Investments in clean energy produce two to three times as many jobs per dollar as gas, oil or coal.”

Despite the lofty promises, these “green jobs” are few and far between, even after massive federal subsidies.

Since 2009, the federal government has funneled more than $1.3 billion into geothermal, solar and wind projects in Nevada.

However, these projects have led — or are projected to lead — to just 288 permanent, full-time jobs.

That’s an initial cost of over $4.6 million per job.

The Silver State North solar plant located near Primm, for example, is to receive $50 million in tax credits from the stimulus — but has only two full-time employees.

The Cresent Dunes Solar Project in Tonopah received a $737 million stimulus loan, but once construction is complete, it will only employ 40 to 50 people.

The Copper Mountain solar plant in Boulder City employs only five people, but took in $40 million in federal handouts. President Obama even visited this plant in March to tout it as an example of a good government “investment.”

And — although each permanent job required more than $10 million from federal taxpayers — these are the success stories.

As the country saw with Solyndra, many green-energy companies, even after massive government subsidies, end up in bankruptcy.

For instance, auditors say Nevada Geothermal Power, which has received $145 million in federal subsidies, is on the verge of failure. The latest company audit questions the “company’s ability to continue as a going concern.” The company’s survival, wrote auditors, will depend “on its available cash and its ability to continue to raise funds….”

Worse, these federal “investments” are actually increasing electricity prices in Nevada and making the state less attractive to job creators.

Nevada already has the highest residential rates in the Intermountain West. That’s because state-mandated renewable energy costs up to four times as much as fossil fuels like coal and natural gas.

Currently, NV Energy, the state’s utility monopoly, pays 3 to 5 cents per kilowatt-hour for natural gas and coal-fueled power, 8 to 10 cents per kWh for geothermal energy and for wind energy, and 11 to 13 cents per kWh for solar photovoltaic energy. Wind and solar photovoltaic energy also require backup power for “intermittency issues.”

Sen. Reid’s thumb-on-the-scale tactics for green energy aren’t merely for subsidies. He also used his influence as Senate majority leader to delay and ultimately kill a state-of-the-art coal power plant planned for rural Nevada in 2009. Besides providing cheap, reliable energy, the privately financed plant would have created 200 permanent, full-time jobs.

In Nevada, more than $1.3 billion in federal grants and loans to “clean energy” power projects have led to fewer than 300 permanent jobs and energy costs up to four times more expensive than traditional energy sources like natural gas and coal.

And if this is the result in Nevada, which Sen. Reid likes to tout as the “Saudi Arabia of renewable energy,” imagine the performance of green-energy subsidies in California and the rest of the country.

Rather than “Investing in American Jobs,” perhaps a more candid slogan for Sen. Reid and Gov. Brown — and the entire push for federal and state handouts for renewable energy — would be “Investing in Higher Electricity Prices and Fewer Jobs.”

The government’s green-energy favoritism isn’t a path to economic development. It’s just another step down the road to serfdom.

Andy Matthews is president at the Nevada Policy Research Institute.  For more visit http://npri.org.

  • mutatron

    Mr. Matthews doesn’t seem to understand the basics of economics. The Crescent Dunes Solar Energy Project, for example, will produce 500,000 megawatt hours of clean energy annually when complete, and while under construction will employ 600 workers on site and more than 4,300 workers in direct, indirect, and induced jobs over a 30 month period. It doesn’t really matter how many people it will employ after it’s complete, because it will be providing enough power for up to 75,000 homes.

  • http://www.facebook.com/frilo2011 Stefanie Davis

    Do you know how to begin applying for the current employment positions? Any info would be greatly appreciated. Thanks in advance.

  • Kevin B Parsons

    While I agree with you about permanent, full time jobs, people worked to build those projects. I’m not denying the money spent for such dismal results is not only dismal but completely irresponsible, but more people worked than indicated.

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  • compareguy

    Does the author think the equipment is made by magic? What of all the jobs created in making all those panels? How about the jobs making the racks they sit on? Absurd analysis. One of the reasons that Renewable energy makes sense is because it is not wasting of labor. No mining or transporting of fuel needed. The fuel is free everyday hence the “renewable” part. A solar plant however will cause fewer jobs in healthcare. Fewer doctors will be needed to attend to lung-related diseases due to less coal being burned – sorry about that.

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