"Koch Brothers Fund Bogus Study Bashing Offshore Wind in New Jersey"
by Michael Conathan
As anyone who’s traversed the northern segment of New Jersey’s infamous Turnpike can attest, the Garden State has a bit of an image problem when it comes to clean air. And despite dramatic improvements over the past several decades, the state’s report card from the American Lung Association consisted almost entirely of Fs for ozone pollution, and counties received a cumulative 1.9 GPA for particle pollution, including 3 Fs and a D. Apparently, this suits the Koch brothers just fine.
Not content with the efforts of their group Americans For Prosperity to convince Gov. Chris Christie to derail New Jersey’s participation in the Regional Greenhouse Gas Initiative, or RGGI, the Koch brothers have also ramped up their efforts to ensure New Jersey’s air quality continues to live up to its historic reputation. Last month, the Koch-subsidized Beacon Hill Institute, or BHI, released the latest in a series of slanted cost-benefit analyses of offshore wind energy.
The report, proudly touted on the AFP website, misses the mark on both sides of the ledger by dramatically overstating the costs and underestimating the economic benefits of offshore wind. According to CAP Economist Adam Hersh, such accounting is “like trying to balance your checkbook without entering all the bills you pay or all the deposits you make.” Specifically:
- The study dramatically underestimates the economic savings realized from the environmental benefits by assuming a static price for the valuation of reduction of greenhouse gasses – which will inevitably rise over time – and by applying an absurdly high discount rate of 10 percent to the benefits when most economic studies use rates of 3-5 percent. The discount rate mistake alone could lead to underestimating the benefits of offshore wind by as much as 50 percent. (This Bloomberg article contains a concise description of how an excessively high discount rate dramatically undervalues future benefits.)
- It also artificially inflates the costs of the project compared to fossil fuel generation by failing to account for the reality that as costs go up, people will reduce their consumption thereby partially offsetting the price increase. Furthermore, the study estimates the cost of natural gas and coal based on historical prices rather than based on forecasts of future market conditions. While natural gas prices are difficult to predict, experts believe coal prices will rise in the future.
- The BHI study entirely fails to account for the jobs that would be created by the wind farm. Meanwhile, according to a 2009 report by the European Wind Energy Association, the wind energy sector in Europe created more than 60,000 jobs from 2004-2008. And today, Interior Secretary Ken Salazar will be in Rhode Island to tout the economic and job creation value of offshore wind.
Furthermore, the study assigns zero value to increased energy independence and vastly underestimates the reductions in greenhouse gas emissions New Jersey’s targeted 1,100 MW of offshore wind energy would produce.
This report isn’t BHI’s first foray into the admittedly complex world of offshore wind. A 2003 report from BHI on Cape Wind’s proposal to build America’s first offshore wind farm used similarly deceptive tactics, suggesting the project could cost the region $64 million to $134 million in tourism dollars. These findings were included despite polls that showed less than 3 percent of potential tourists would change their plans if the farm were built and despite ample studies of actual tourists’ behavior in areas proximate to actual wind farms in Europe.
Lesser-known brother Bill Koch has long been a vocal opponent of Cape Wind thanks in no small part to the fact that his seaside mansion in a gated, country club community in Osterville, MA overlooks the area of Nantucket Sound where the company is slated to begin construction of turbines as soon as 2012. A Greenpeace report details Bill’s efforts to derail the project, though it now seems his brothers and AFP are intent on using their oil-stained money to invent fictional accounts and fire up the scare tactics.
Most recently, they were joined in their erroneous interpretation of the costs of offshore wind by another prominent Cape Codder whose family manse overlooks the proposed Cape Wind site. In an error-riddled op-ed in the Wall Street Journal, Robert F. Kennedy, Jr. blasted the project, calling it a “rip-off” for ratepayers, instead suggesting Canadian hydropower would be a better way to meet clean energy standards. Amid the blatant hypocrisy of an environmentalist who has written or been quoted in multiple articles trashing hydropower as an evil that “has turned pristine rivers into power corridors, ancient lakes into holding tanks and a sacred homeland into an industrial complex,” his piece also rails against Cape Wind’s “heavy-handed backers.”
If Kennedy is looking for a “heavy” in the offshore wind conversation, he should first look in the mirror. And then look at the brothers who are standing right behind him.
Below are old comments from the earlier Facebook commenting system:
Considering that no one elected these clowns, it’s scary how much control they have of our society.
north carolina is going to go for offshore wind farms!
Take a look at this for more of the Kochs’ evil influences: http://witsendnj.blogspot.com/2011/08/whose-prosperity-david-and-charles-koch.html.
That is absolutely disgraceful. Your political system has been high-jacked by the rich and powerful. It limits choices at federal (why Obama has been rather limp), state and now as we see county level. The Kochs are the true anti-American movers and traitors to the system set up by the founding fathers. They are the Robert Magabes of the US.
It would seem that the AMCW solved nothing, does it really need a round two? I sure hope not.
And let us not forget their henchmen such as the odious Tim Phillips whom Rachel Maddow batted here:
Rachel Maddow-“You are parasites” she tells Tim Phillips of Americans for Prosperity
“F”s for you = $$$ for Kochs.
If you think democracy rules in the USA, tell me how many normal votes does it take over ride the influence of one Koch?
Quite a few more, now that the Supreme Court has distorted the meaning of “free speech” away from anything the Founding Fathers would recognize.
Ask Kansas Governor Brownback.
I live not far from where there are turbines. They are esthetically pleasing especially when it is foggy or actually where I’m at, the cloud deck touches the top of the mountain. They make absolutely no noise, the hunters find plenty of game as much of it is actually state game land, and everyone who comes to visit me wants to see them. We usually go up on one ridge and we are level with the turbine itself which is also cool. My thinking is you’ll really never regret it. It only adds another dimension. And if they are noisy contact GE or the installer as they did something wrong.
Evidently, we need to get rid of Christie and his cronies! This state was in bad shape before, but he has only made it worse!
Wind Energy is here to stay. The power of the few goes only as far as the many allow it through corruption, silence and ignorance. Debunk the misinformation of the few and expose their motives, give the many the true information to digest for themselves, and the majority will make a correct, informed choice.
Very interesting article! It is scary how much they control they have!
Why am I not surprised…. typical republican – tea party BS.
Future climate criminals.
Bad karma abounds.
No wonder so much misinformation comes out of Texas. Children in Texas don’t receive the same education as the rest of the country. I was a textbook designer in Boston. We did a National Edition and a separate TEXAS EDITION. Much information from the National Editions had to be deleted or changed for Texas. They are manipulating the education of children in Texas to strenthen their oun CONSERVITIVE agenda. When our publishing executives spoke to groups who bought the textbooks in Texas they were hissed at. Shows the level of intellegence that is in charge in Texas.
Directly related: http://thinkprogress.org/romm/2011/08/05/289367/bill-mckibben-why-cleantech-should-join-the-fight-against-tar-sands/.
“We ought to consider what is the end of government, before we determine which is the best form. Upon this point all speculative politicians will agree, that the happiness of society is the end of government, as all divines and moral philosophers will agree that the happiness of the individual is the end of man. From this principle it will follow, that the form of government which communicates ease, comfort, security, or, in one word, happiness, to the greatest number of persons, and in the greatest degree, is the best.”
Or are just supposed to keep two brothers happy.
Daniel Irvin · Top Commenter
Which continues to prove that unless Big Money (Koch brothers et al) profit from it, they will do everything possible to kill it. Our environment and the lives of the general public are simply “collateral damage”.
There are 5 turbines which provide enough power to entirely run the wastewater treatment plant for Atlantic City. I haven’t heard one single person say they wouldn’t visit AC because of this; quite the opposite – the county hosts tours and folks from around the world have visited them. I’m betting the Kochs aren’t going to win this one.
Yet another lying campaign by the gangsters Koch brothers: Bfavo to Michael Conathan.
The Koch Brothers at it again…I’m shocked! Who needs clean air anyway?
What are Pinky and the Brain doing this week?
I don’t know who the Koch Bros. are but this sounds like another plot to keep the cost of electricity high here in NJ.
Here is who the Koch Brothers are: http://www.newyorker.com/reporting/2010/08/30/100830fa_fact_mayer
The Koch brothers are billionaire oil people-plotting to keep us dependent on oil. Also, shockingly, Obama haters
Tom, how do you get a link to work here?
It is actually Mr. Conathan that “misses the mark” in his critique of the BHI study. Mr. Conathan makes baseless claims, reports only partial data and relies on irrelevant studies with no economic value or relevance to offshore wind power in New Jersey. We address his individual critiques at http://beaconhillinstitute.blogspot.com/2011/08/bhis-response-to-tps-climate-progress.html.
Koch Industries has a list of what it owns on its website. There are also unverified lists of public companies that the Koch brothers are also said to control. That’s the money that funds AFP and BHI, etc. Is there a fact-checked composite list of Koch holdings? It would take a list to avoid all the Koch-owned gas stations, paper products, spandex, lycra, carpeting, and what ever else.
New Jersey’s electricity is currently 50% nuclear and 37% natural gas, leaving only 13% to coal and other sources. In other words, whatever pollution statistics you pull has very little to do with generation of electricity and much more to do with heavy traffic levels and industrial factories, neither of which will change by building wind turbines off-shore. I’m not sure why this should be a public discussion at all… the government (state or federal) should not be involved in business initiatives. If someone thinks they can make money by building a wind farm, they should do it. It shouldn’t involve taxpayer funds regardless of whether it has compelling economics or any other perceived benefit. Government exists to protect our liberties, not to run our economy.
To say “government is here to protect our liberties” is naive. Good governments need to arbitrate business transactions; without a referee, chaos would ensue. Good governments foster the success of ALL citizens, not just protect the wealth of the rich. Good governments do not send its citizen’s children off to fight in foreign war based on lies. Good governments serve the will of it’s people. Oh, and I forgot to mention, despite all the BS being served up, corporations are NOT people.
Good governments do NOT serve the will of the majority at the expense of the minority. Protecting the minority is the express purpose of our government. Government “arbitration” of business transactions is what has destroyed our economy. Leave people alone to make their own choices! What’s naive is believing that the people in government are smarter, more frugal, and less corrupt than everyone else despite the overwhelming evidence to the contrary. I wouldn’t trust the government to tell me which way the wind is blowing let alone finance, build, or manage wind farms. If you’re a proponent of wind energy, then the best move would be to keep it as far away from government as possible. Just look at what happened with the ethanol fiasco.
kermit X (signed in using Hotmail)
I wouldn’t argue that government doesn’t often break stuff. But the government is far more open – not only by law, but because we have our eye on them. Do you really think that a corrupt government official can be *more self-serving than the CEO of a large corporation – especially one hidden from public view?
The free market *cannot fix most problems; collective costs will not be voluntarily borne by private companies. They couldn’t afford it. For example, I used to work for a chemical analysis lab, which produced relatively small amounts of all categories of hazardous waste – neurotoxins, carcinogens, caustics, oxidizers, explosives, low level radioactive. It cost money to dispose of that waste properly (i.e., legally and reasonably safely). If we were doing it voluntarily, our competition would have disposed of them using Billy Bob’s Pickup and Dump service at one tenth the cost. It was only because of laws threatening fines and jail time that (nearly all companies in the US now dispose of this stuff properly. What market forces would induce most customers to chose the more expensive product (analytical services)?
Just like the tobacco industry fueled bogus reports on the benefits of smoking, and just like the oil companies bury the hundreds of oil spills yearly, the Koch brothers are power hungry billionaires, who, with this bogus study, prove that they are amoral sub-human beings who desperately need death and fake bad news to support their foundationless empire.
If the Koch brothers had bought into the wind farm idea then they would do exactly the opposite of what they are doing now. I must see them as pursuing the further development of their own business which is coal and gas and that is why we must keep aware of just how they notify the public, since they do like to hide their involvement in studies like that.
I’m within a few miles from a large windmill farm.. They are majestic! and no nasty fumes, polluted waters, and yes even a plus for livestock and wildlife.. and even a great reason it’s almost free.. and plenty renewable for decades to come..
They are just huge, aren’t they! Much bigger than you think. We need more of them.
The irony never escapes me, that science funded by the people by those who do it not for money but to extend the knowledge of manking, is seen as bogus by the likes of the Koch brothers; but so-called studies done by hacks are the gospel.
Koch brothers nothing but aholes.
The Tea Party is a farce to be reckoned with.