A better policy change might just be to get rid of enterprise zones altogether. Much to his credit, my former state representative Joel Judd (A Democrat from House District 4 in northwest Denver) tried to do just that a couple years ago and met with bi-partisan opposition. Judd was quoted in a recent Post series on enterprise zones: “In effect, it’s the state general fund paying for a local developer’s curbs and gutters, and that’s just not the intent.”

The following op-ed, written in 2010 by former Independence Institute intern Jacob Zax, makes the case for a free-enterprise friendly tax and regulatory environment throughout the state, rather than in specially designated “zones.”

Every year, Colorado extends around sixty million dollars in targeted tax credits to businesses operating in specially designated regions called enterprise zones. Politicians, enabled by business interests, encourage enterprise zones as a way to promote economic growth by encouraging businesses to locate in underdeveloped areas and hire more workers. Although targeted enterprise zones might have been worth trying, they are not working well in Colorado. Statistical analysis demonstrates that enterprise zones have a minimal effect on employment, businesses, and the larger economy, and instead mostly benefit private property owners.

So why don’t lawmakers pursue equitable policies to help make the entire state of Colorado, rather than “specially designated regions,” an enterprise zone?

A 2005 report by the state of Minnesota that reviewed both the economic theory and empirical evidence on enterprise zones states, “Most of the more sophisticated studies (conducted on the subject) show no increases in employment or per capita income.”

How is it possible that considerable tax credits designed to encourage hiring are so ineffective?

The surprisingly trivial influence of enterprise zones on employment is the result of tax credits that reward the use of capital. Businesses in the special zones get tax credits for hiring workers; but they often use that money to buy more machinery in order to replace other workers. The net result is a negligible increase in employment. In the United Kingdom, the first country to implement enterprise zones and the model for current systems, a government-commissioned study published in 1987 determined that the 300 million pounds spent on enterprise zones from 1981-1986 produced an embarrassing net total of just 13,000 jobs. A 1989 Congressional Quarterly report concluded that each new job cost the United Kingdom 250,000 dollars.

Furthermore, the few employees that are hired because of enterprise zone credits don’t necessarily receive higher wages. Businesses profit from the subsidies regardless of the new worker’s salaries; because of the competitive nature of the labor market, prospective employees will always end up working for whatever is the normal wage rate that is paid outside the enterprise zone.

But if employees and the public aren’t profiting from enterprise zones who is? Surprisingly, it’s not businesses. It’s private land owners.

When an enterprise zone is established, property values within the area skyrocket. Previously unappealing lots suddenly attract serious interest because businesses are willing to pay a premium to relocate into the area and take advantage of the tax credits. Furthermore, because the benefits are solely predicated on location, all companies, including those already doing business in Colorado, are eligible and, therefore, interested in relocating into the zone.

The resulting demand for limited space creates the ultimate sellers’ market as businesses bid against one another for space. In the end, businesses are willing to pay so much to move into the region that the tax credits they eventually receive barely offset the initial cost of procuring the property.

In other words, businesses are not the ultimate beneficiaries of enterprise zones. By providing region-limited tax credits, the government is effectively giving a boost to some private landowners to the detriment of other landowners.

In a July speech at the Rocky Mountain soda company, Denver mayor and democratic gubernatorial candidate John Hickenlooper stated that he was “absolutely interested” in strengthening and expanding the use of enterprise zones in Colorado.

In his speech Mr. Hickenlooper also said on the issue of enterprise zones: “This is the 21st century, the key to all of these issues is how you measure them.”

But by almost every statistical and empirical measure, enterprise zones have failed. In the 2010 Colorado legislative session, State Representative Joel Judd (D, Denver) proposed a bill that would have eliminated enterprise zones in Colorado. The measure was largely condemned by politicians of both parties, including Don Marostica, the state’s economic development director, who opposed the measure by arguing that subsidies bring businesses to Colorado.

While that is probably true, it ignores the point that Coloradans do not profit from the relocation of those businesses. There are no long term benefits from the slight increase in jobs, and businesses fail to realize greater profits which might strengthen to the larger economy.

So should the government be funneling close to 60 million dollars a year in tax credits based solely on geography towards private land owners?

Considering the current budget deficit, the Colorado Legislature cannot afford to waste more money either maintaining or expanding enterprise zones, but rather should concentrate on fostering a business-friendly tax and regulatory environment throughout the state.

In an op-ed the Reason Foundation’s Harris Kenny wrote for us that landed on the pages of the Denver Post, we learn about Colorado’s version of corporate welfare gone crazy. (side note: Abound Solar will be next). Harris describes the filthy process that starts with an idea and ends with taxpayers getting hosed for millions of dollars. I find it odd that politicians discover these great “investment opportunities” and can only come up with other people’s money to use as capital…

Here’s the takeaway:

Government-issued loans are often based on insider favoritism and politics. They rarely fulfill their supposed purpose of the public good. The companies that receive government welfare are given an unfair advantage over those that don’t. Corporate welfare encourages companies to be good at politics, instead of good at business.

While the Denver Post played the role of Rocky Mountain eco-Chicken Little of record, another news outlet — the Casper Star-Tribune — reported former Colorado Senator and current Interior Secretary Ken Salazar’s opinion of the EPA’s premature press release about a “draft finding” regarding a link that may or may not exist between hydraulic fracturing and groundwater pollution in Pavillion, Wyoming.

Secretary Salazar urged caution at a press conference with Wyoming Governor Matt Mead last Friday, explaining that ‘the jury’s still out’ on the validity of the EPA’s theory.

the EPA’s findings were only preliminary and haven’t yet been reviewed by other scientists.

‘We’ll see what happens with this Pavillion study,’ Salazar said. ‘And I think it’s important that the real facts finally get to the table with respect to the peer review and seeing whether there’s something specific with respect to that basin that is different from what we have across the country.’

Salazar said fracking ‘can be done and is being done safely’ in the United States.

This from a man who isn’t exactly a friend to the oil and gas industry, especially when it comes to domestic production.

Also, Encana, owner of a number of wells in the Pavillion area, issued a strong and justifiable response critical of the EPA’s shoddy methodology:

• The EPA drilled two deep monitoring wells (depth range: 783 – 981 feet) into a natural gas reservoir and found components of natural gas, which is an entirely expected result. The results in the EPA deep wells are radically different than those in the domestic water wells (typically less than 300 feet deep), thereby showing no connection. Natural gas developers didn’t put the natural gas at the bottom of the EPA’s deep monitoring wells, nature did.
• Several of the man-made chemicals detected in the EPA deep wells have never been detected in any of the other wells sampled. They were, however, detected in many of the quality control (blank) samples – which are ultra purified water samples commonly used in testing to ensure no contamination from field sampling procedures. These two observations suggest a more likely connection to what it found is due to the problems associated with EPA methodology in the drilling and sampling of these two wells.
• The EPA’s reported results of all four phases of its domestic water well tests do not exceed federal or state drinking water quality standards for any constituent related to oil and gas development.
• The EPA report ignores well-known historical realities with respect to the Pavillion field’s unique geology and hydrology.

Let’s get this straight, the EPA drills monitoring wells up to three times deeper than normal drinking water wells in a geologically complex area, finds different components in the water, and then claims pollution from fracking.  The man-made chemicals found in monitoring wells were also found in the “ultra-purified” control samples. Encana is being kind to call the EPA’s conclusions “irresponsible.”

The Denver Post did report on Encana’s response but didn’t provide much in the way of details. Instead the headline reads “Encana disputes fracking finding.” Of course Encana “disputes” the “draft finding.” The news story is in the details, such as those listed above.

Finally, the EPA announced a public comment period from December 14, 2011 to January 27, 2012. (The document says January 27, 2011, but we’re pretty sure the EPA means 2012):

EPA is announcing a 45-day public comment period for the external review of the draft research report titled, “Investigation of Ground Water Contamination near Pavillion, Wyoming.” The draft research report was prepared by the National Risk Management Research Laboratory (NRMRL), within the EPA Office of Research and Development (ORD), and EPA Region 8. EPA is releasing this draft research report solely for the purpose of pre-dissemination peer review. This draft research report has not been formally disseminated by EPA. It does not represent and should not be construed to represent any Agency policy or determination. Eastern Research Group, Inc. (ERG), an EPA contractor for external peer review, will convene an independent panel of experts for peer review of this draft research report. Public comments submitted during the public comment period will be made available to the peer review panel for consideration in their review. In preparing a final report, EPA will consider the recommendations of the peer review panel.

Maybe the EPA should have announced the public comment period before it issued a press release and “disseminated” information to news outlets.

Secretary Salazar is smart to wait for the “real facts” swirling around the groundwater in Pavillion, Wyoming.  We’ll wait for them too, even if anti-fossil fuel zealots and their accomplices in the media won’t.

Thank you to Energy In Depth for its coverage of the EPA’s Frack-gate, and to Chris Tucker of EID for appearing on the Amy Oliver Show and sharing this information with listeners. All of this information can be found on the EID Web site.

Has any media outlet bothered to ask if the EPA’s theory on groundwater contamination in Wyoming and hydraulic fracturing is even right?

The Independence Institute’s Energy Policy Blog can’t be accused (at least not accurately) of being in the tank for the oil and gas industry. We’ve been on opposite sides of several of the industry’s key issues in Colorado. We opposed HB 1365, the fuel-switching bill, and HB 1291, the State Implementation Plan. We favored a repeal of Colorado’s carbon tax, while the oil and gas industry argued for the language to remain in statute.

Now, however, these pages are defending the oil and gas industry against attacks on the decades-old, proven process of hydraulic fracturing, which pumps a blended liquid into the ground (far below water tables) to increase the flow of natural gas and oil. Already heavily regulated, hydraulic fracturing is a safe, cost-effective way to expand production, lower the price of liquid fossil fuels, ensure an abundant domestic supply, create high paying jobs, and provide revenue to local and state governments.

The latest EPA announcement is just another battle in the war on fracking, which is an attempt by anti-fossil fuel activists to shut down domestic production and force consumers to use more expensive, less reliable wind and solar energy sources. And the media serves as a willing accomplice.

Today’s Denver Post jumped on the freaked out over hydraulic fracturing bandwagon following yesterday’s sensational EPA release that a “draft finding” MAY link hydraulic fracturing to groundwater contamination in Pavillion, Wyoming.

The front page, top of the fold print edition reads, “HYDRAULIC FRACTURING: Wells tied to fouled water. The Wyoming study could affect Colorado’s oil and gas industry.”

The online edition warns: “Hydraulic fracking linked for first time to groundwater pollution.”

With the exception of the last line in the first example, neither headline is accurate. Media around the world has reacted more like Chicken Little environmentalists rather than reporters of news, disseminators of information.

Energy In Depth (EID), a public outreach campaign supporting the development of America’s oil and gas resources, issued its own press release this morning about the media response:

Call it a sign of the ‘Times,’ let’s say, that less than 24 hours removed from the release of EPA Region 8’s report on groundwater sampling near Pavillion, Wyo., nearly a thousand different news stories have been generated — in 12 different countries, and best we can tell, four different languages. But set aside the breathless headlines for a moment and the triumphant quotes from a small segment of folks committed to ending the responsible development of natural gas, and one’s left with a pretty straightforward question: Is EPA right? And if so, what exactly does that mean moving forward?

It’s impossible to answer the second question without an answer to the first, but that hasn’t stopped the media from trying. In fact, they haven’t even considered whether or not the EPA is right.

The Denver Post’s first paragraph from both the online and print editions reads:

Hydraulic fracturing, a controversial oil-and-gas production technique used in Colorado and across the country, has been linked for the first time to groundwater pollution in a case near Pavillion, Wyo.

First, fracking isn’t “controversial.” The process of hydraulic fracturing has been used successfully since 1949 and is not “linked” to groundwater contamination. Colorado is proof that it can be done in an eco-friendly way. More than 90 percent of our nearly 40,000 wells produce using hydraulic fracturing, and not a single case of groundwater contamination. It is a highly regulated process within a highly regulated industry. The only reason it is “controversial” is because anti-fossil fuel activists say it is.

Second, it hasn’t been linked this time either. The EPA’s press release calls it a “draft finding,” meaning it hasn’t been through any kind of peer review process. Furthermore, even the EPA says fracking “may” be the cause, not “has been linked” to groundwater contamination.

The Denver Post continues to advance the story by assuming the EPA has correctly found a “link” and that this “link” is a game changer. Reporter Mark Jaffe quotes Wyoming Governor Matt Mead’s press release about how this could have a “critical impact” on the oil and gas industry and that more research must be done. But the paper leaves out the most important part of Mead’s release – the first line: “the Environmental Protection Agency’s draft study on Pavillion wells is scientifically questionable and more testing is needed.”

Mead is trying to answer the most important question first. Is the EPA right? Yet the Post and many other news organizations have jumped to the second question, of what does this mean, without any validation or curiosity about the first.

Anti-fossil fuel activists certainly won’t challenge the EPA’s theory. The Associated Press reported, “Environmentalists welcomed the news of the EPA report, calling it an important turning point in the fracking debate.”

EID actually provides several questions that should be answered first, but the mainstream media isn’t even bothering to ask:

Why the huge difference between what EPA found in its monitoring wells and what was detected in private wells from which people actually get their water?

After reviewing the data collected by Region 8, why did EPA administrator Lisa Jackson tell a reporter that, specific to Pavillion, “we have absolutely no indication now that drinking water is at risk”? (video available here)

Did all those chemicals that EPA used to drill its monitoring wells affect the results?

At least one member of Congress is calling for an answer to the most important question, “Is the EPA right?” Is its theory accurate? Senator James Inhofe (R-Okla.), Ranking Member of the Senate Committee on Environment and Public Works, made the following comments after speaking with EPA Administrator Lisa Jackson about her agency’s “irresponsible” announcement on fracking:

EPA’s conclusions are not based on sound science but rather on political science.  Its findings are premature, given that the Agency has not gone through the necessary peer-review process, and there are still serious outstanding questions regarding EPA’s data and methodology.

This announcement is part of President Obama’s war on fossil fuels and his determination to shut down natural gas production.   Unfortunately for Americans, his agenda destroys good paying jobs in one of the few industries that is thriving, and increases our dependence on foreign oil.

As recently as November 9, 2011 EPA Regional Administrator James Martin said that the results of the latest round of testing in Pavillion were not significantly different from the first two rounds of testing, which showed no link between hydraulic fracturing and contamination.  Yet only a few weeks later, EPA has decided the opposite.  EPA is clearly not prepared to be making conclusions.

There is a pattern emerging here.  Just a few months ago, the EPA Inspector General found that EPA cut corners on the endangerment finding to come to what appears to be a predetermined conclusion to regulate greenhouse gases.  This most recent study on hydraulic fracturing is apparently more of the same in the Obama Administration’s ongoing war on affordable energy.

It is irresponsible for EPA to release such an explosive announcement without objective peer review. Given the serious flaws in EPA’s process, I have asked EPA Administrator Lisa Jackson to release all the data, methodologies and protocols that have been used, and she has made a commitment to do so.

Even with the most stringent regulations, no energy source is completely without risk. But the EPA’s premature release of its theory on groundwater contamination, along with the anti-fossil fuel crowd’s cheers, and the media’s lack of critical reporting indicates more of an agenda to damage the oil and gas industry rather than assure safety in hydraulic fracturing.

By Michael Sandoval

Clean Water Action’s Gary Wockner plays the card in his Denver Post guest editorial that is usually intended to end any debate between advocates of renewable energy technology and those in favor of continuing the exploration of fossil fuel resources–”What are the environmental impacts?”

Typically, readers are treated to some sort of facile environmental comparison between say, coal power and wind turbines:

Casual readers are expected to deduce that in comparison to coal power, wind power generation is nearly neutral environmentally–aside from being “20-story high Cuisinarts” for flying animals like birds and bats.

Just a bad website oversimplifying. Ok. The American Wind Energy Association has this to say in its teaching materials intended for K-2:

“As long as the sun shines there will be wind moving across the earth. Wind is called a renewable energy source because solar energy makes wind all of the time. We will never run out of wind.

Wind turbines do not burn fuel, so they do not pollute the air. Wind is a safe, clean energy source for making electricity.”

Ok, we’re talking 7 year olds. What about high school seniors?

Nope:

“Wind is energy in motion—kinetic energy—and it is a renewable energy source. Along with wind, renewable energy sources include biomass, geothermal energy, hydropower, and solar energy. They are called renewable because they are replenished in a short time. Day after day, the sun shines, the wind blows, and the rivers flow. Renewable sources only make up seven-percent of the United States’ energy portfolio. We mainly use nonrenewable energy sources to make electricity.”

The education materials provided by the AWEA ignore completely the production of the permanent magnet (labelled “generator”) that converts wind, rather inefficiently, into electricity. While the mechanics of the conversion are explained, the manufacturing process of the magnetic generator has been elided.

Conveniently, these renewable energy industry lobbyists have carefully omitted the one very glaring portion of wind energy production that is most environmentally unfriendly: the creation of the wind turbines themselves. It’s as if they sprout up, pre-fabricated and ready to generate power, from a Dutch wind turbine bulb farm.

Aside from the rather obvious environmental cost of transporting the various large windmill components to their often remote final destination (wherever wind is deemed sufficiently consistent), it is in the actual creative portion of the wind turbine–the parts that convert the rotation of the turbine’s blades into energy–that the true environmental impact can be found.

In a few words? Rare earth elements. Simply put, without REEs, many of the most crucial components of most renewable energy platforms do not exist. REEs are the sine qua non of the “New Energy Economy,” and their production has been obfuscated by the most ardent green proponents.

The Environmental Protection Agency, in the report “Investigating Rare Earth Element Mine Development in EPA Region 8 and Potential Environmental Impact” (PDF) dated August 15, 2011, outlines a few of the specific uses of REEs over a range of “renewable” products, including wind turbines, hybrid vehicle batteries, lighting, and other electronics:

“Permanent magnets represent the staple clean energy technology of future green economies. They constitute main components of lightweight, high powered motors and generators due to their production of a stable magnetic field without the need for an external power source. Permanent magnet motors power contemporary electric, hybrid electric, and plug-in hybrid electric vehicles, while permanent magnet generators produce electricity from wind turbines (USDOE, 2010). The key element derived samarium-cobalt permanent magnets dominate rare earth technology because they produce a magnetic field in a much smaller size. The samarium-cobalt permanent magnet also retains its magnetic strength at high temperatures making it ideal for clean energy and even military applications, including precision guided munitions and aircrafts (IAGS, 2010).

Permanent magnets work in conjunction with high efficiency rare earth based batteries to store energy in electric, hybrid electric, and plug-in hybrid electric vehicles (USDOE, 2010). Current generation hybrid electric vehicles use a battery with a cathode containing a host of rare earths including lanthanum, cerium, neodymium, praseodymium, and cobalt (Kopera, 2004). Each hybrid electric battery may contain several kilograms of rare earth materials (USDOE, 2010). Plug-in hybrid and electric vehicles require even greater storage capacity and higher power ratings than typical hybrid vehicles. In light of this, automakers will likely use the lithium ion battery, increasing demand for yet another key element. Scientists at the Argonne National Laboratory estimated one lithium ion battery contains 3.4-12.7 kilograms of lithium depending on proprietary design (USDOE, 2010).

Perhaps the fastest growing consumer of rare earth material is the phosphor production industry. In 2008, phosphors alone accounted for 7% of all rare earth usage by volume and 32% of total rare earth value. Phosphor materials produce luminescence essential to today’s lighting technologies. Older generation fluorescent lighting used no rare earths, but rare earths make current fluorescent lighting phosphors more efficient and visually pleasing. Specific rare earths responsible for this include lanthanum, cerium, europium, terbium, and yttrium. Fluorescent lighting phosphor usage is expected to rise by 230% over current levels due to USDOE mandating increased efficiency ratings. Mass quantities of similar phosphor materials are produced for application in television screens, computer monitors, and electronic instrumentation, increasing demand for rare earth based phosphors (USDOE, 2010).”

Just as wind turbines don’t magically sprout from the ground, rare earth elements require extensive mining and refining processes pose significant environmental impacts–significant enough for the EPA to stipulate the each step of the destructive extraction, chemical processing, toxic tailing and contaminant disposal, and transportation. REEs are often derived as byproducts of other mining operations, as most REE deposits are not economically viable on their own, due to their, erm, rarity.

The EPA details the specific byproducts of the production of REEs, and they’re not very “green”:

“According to the Chinese Society of Rare Earths, every ton of rare earth elements produced generates approximately 8.5 kilograms of fluorine and 13 kilograms of flue dust. Additionally, sulfuric acid refining techniques used to produce one ton of rare earth elements generates 9,600 to 12,000 cubic meters of gas laden with flue dust concentrate, hydrofluoric acid, sulfur dioxide, and sulfuric acid. Not only are large quantities of harmful gas produced, alarming amounts of liquid and solid waste also resulted from Chinese refining processes. They estimate at the completion of refining one ton of rare earth elements, approximately 75 cubic meters of acidic waste water and about one ton of radioactive waste residue are produced. The IAGS reports China produced over 130,000 metric tons of rare earth elements in 2008 alone (IAGS, 2010). Extrapolation of the waste generation estimates over total production yields extreme amounts of waste. With little environmental regulation, stories of environmental pollution and human sickness remain frequent in areas near Chinese rare earth element production facilities (Figure 21). United States government agencies, including EPA, can learn a lot from China’s environmental issues related to rare earth element production.

As discussed, mining and refining processes can introduce radionuclides, rare earth elements, metals, and other potential contaminants into the environment at unnaturally high rates. Once introduced into the environment, the potential contaminants can be redistributed through the three “environmental mediums.” These three mediums include air, soil, and water. Living organisms depend on environmental mediums with stable chemical properties for their survival. The release of the possible contaminants from rare earth element production could alter the properties of the three environmental mediums.”

“Extreme amounts of waste.” These are not the words of a report from a think tank in the pockets of “big oil,” Mr. Wockner. Apparently the proponents of wind power that produced the earlier images somehow missed this report.

There are no “green” mulligans for renewable energy, it seems. But if pictures are worth a thousand words, then video is even better (including a cameo from Vestas, which coincidentally has four wind turbine factories and an estimated $1 billion investment in Colorado at the moment):

“Green campaigners love wind turbines, but the permanent magnets used to manufacture a 3 MW turbine contains some two tons of rare earth,” says the reporter.

Using the EPA’s numbers, each turbine in a windmill farm produces approximately 20,000 cubic meters of toxic gases, 150 cubic meters of acidic waste water, two tons of radioactive waste residue, plus a variety of other harmful dusts and chemical byproducts. Perhaps the largest wind farm in the world, the Roscoe Wind Farm in Texas, houses more than 600 wind turbines stretched out over 400 square kilometers. Quick mathematical calculations reveal that the environmental impact of these wind turbines is somewhat greater than just a bird blender. The American Wind Energy Association estimates the output of wind power in the U.S. at more than 43,000 MW through the 3rd quarter of 2011.

Roscoe Wind Farm as seen from Google Maps:

In the embedded video, Zhao Zengqi of the Baotou Research Institute of Rare Earth acknowledges the environmental impact of the production of the permanent magnets that comprise the “green” wind turbine technology. “The environmental problems include air emissions with harmful elements such as fluoride and sulfur, waste water that contains excessive acid, and radioactive materials too. China meets 95 percent of the world’s demand for rare earth, and most of the separation and extraction is done here, so the pollution stays in China too,” said Zhao.

China’s monopoly (which they threaten to enforce through decreased production of REEs) has forced the most damaging aspects of wind power out of sight and mind. But the planned reductions have pushed the U.S. to consider its own strategic defense implications–hence the EPA report–and push more homegrown REE mining projects, including the possibility of opening mines in Colorado.

As Jim Burnell, a senior geologist for the Colorado Department of Natural Resources told the Post in January, “There’s no such thing as no-impact mining. You can’t promise that.”

Not even when you’re “green,” Mr. Wockner.

Like their renewable cousins, solar modules, wind turbines are anything but “clean” and “green.” The EPA report examined the potential risks to air and soil quality, and particularly to water contamination:

“Water represents the environmental medium of overall greatest concern at Bear Lodge. Not only can the possible contaminants go into solution, a great deal of water is consumed during rare earth element mining and processing. Such issues generate both water quality and quantity concerns that will heavily depend on what management practices are put into place.”

The EPA strongly urges appropriate environmental mitigation efforts, pointing to the harmful effects of REE production that include cancer:

“The possible contaminants cause negative effects towards aquatic and terrestrial organisms in addition to humans. Some of the radionuclides and metals contaminants are even classified as human carcinogens by international and federal health agencies. Others possible contaminants increase the mortality rates of aquatic and terrestrial organisms. Cooperation between all government agencies designed to protect the environment and companies responsible for rare earth element production will prove invaluable in ensuring these operations do not pose a threat to human health and the environment in the United States . . . Areas of China have suffered the consequences of haphazard rare earth element production.”

Given the combination of China’s stranglehold on REE extraction and delivery, and the gross environmental negligence it allows such production to operate under, wind turbines for the foreseeable future will continue to be manufactured at less than “green” standards.

Environmental advocates like Mr. Wockner will quickly point to Vestas as an outstanding local alternative to the new exploration in Northern Colorado. Given the precarious nature of the wind energy sector sans FTCs and the turbines’ established environmental cost, a more proper evaluation comparing energy “futures” can be undertaken. The EPA’s report, combined with the realities of REE production, indict nearly every renewable energy platform due to the centrality of REEs as part of the actual energy generation or storage mechanism in each, respectively (magnets and batteries). These impacts can only be projected to increase given government pushes to expand renewables as part of state or national portfolio standards.

Wind power is only reliable 32 percent to 42 percent of the time. Fully diversified energy portfolios requiring significant amounts of renewables, therefore, necessitate significant backup capacity to bridge wind power’s production shortfalls. Furthermore, subsidizing failure is bad enough; subsidizing environmentally degrading platforms that could virtually disappear overnight without lucrative federal tax credits coveted by crony capitalist players is even worse.

Let us return now to the question posed by Mr. Wockner: “What are the environmental impacts?” As demonstrated here using the EPA’s own report, the environmental impact of wind alone is nowhere near “neutral” as some in the renewable energy cheerleading camp would like consumers and taxpayers to believe. Through rhetorical kabuki, they dress up or eliminate the actual manufacturing steps in the process of wind or solar production, skipping straight to the energy generation portion of the renewable unit’s life cycle and then conduct their comparison.

Dispelling the myth that “clean” and “green” energy is produced without environmental impact is critical for establishing a level playing field for comparison between renewables and fossil fuels.

Michael Sandoval is the Managing Editor of People’s Press Collective and a former political reporter for National Review Online.

The Denver Post gave Gary Wockner of Clean Water Action prime newspaper real estate in Sunday’s perspective section. Wockner’s guest editorial “Is Colorado Addicted to Oil?” was nothing more than a list of typical anti-fossil fuel questions that he tried to associate to Colorado’s and Weld County’s economic struggles as a result of the Great Recession.

Clean Water has a clear mission of advancing global warming hysteria to scare voters and policy makers away from reliable, affordable, and abundant fossil fuels and towards the economically unsustainable and environmentally unfriendly world of renewable energy.

Wolkner used 20 question marks in his column. For that reason, I cannot answer every question in one post. Over the next few days, I’ll answer most. Some, such as whether or not Governor Hickenlooper and the rest of Colorado are “thrilled” about the discovery of additional BOE (barrels of oil equivalent) in Weld County, are subjective and will be ignored.

The first question, contained in the headline, is Colorado addicted to oil? The answer is only to the extent that Colorado is addicted to a modern, civilized lifestyle and the economy needed to maintain it. Rankin Energy Corporation, an energy exploration and production company out of Oklahoma, provides a partial list of the products made with petroleum. One 42-gallon barrel of oil produces 19.4 gallons of gasoline. The rest, which is more than half the barrel, is used to make more than 6000 different products including:

Also, petroleum is needed to make solar panels and wind turbines. A little factoid from Rankin, “Americans consume petroleum products at a rate of three-and-a-half gallons of oil and more than 
250 cubic feet of natural gas per day each! But, as shown here petroleum is not just used for fuel.”

Are we addicted oil? Only if you enjoy and are “addicted” to a modern lifestyle made possible by the discovery of fossil fuels. I’ll revisit this question at the end of this series of blog posts.

Next up, the role of oil and gas in Colorado’s and Weld County’s economy. I’ll address the following questions from Wockner, “What is the actual role that oil and gas plays in our economy? Where do all the billions of dollars go?”

The unnamed Board member referred to Senate Bill 1 passed in 2010 with support for the PERA Board of Trustees, which was supposed to bring PERA back to solvency.

Oh, the horror of admitting a mistake! Surely wounded pride is much worse than continuing PERA’s unrealistic expectations on the rate of return, which will leave taxpayers and PERA members on the hook for a massive shortfall anywhere from $21 billion to $35 billion.

Certainly it’s better to ignore industry experts and save face in the present than face the reality of PERA’s insolvency.

In a Denver Post guest editorial last spring, Stapleton courageously exposed the “hard truth” of PERA’s future if we continue with current policy:

PERA is not structurally sound, and Coloradans are on the hook should the system fail. Although the stock market recouped some of its sharp losses in 2010 and Senate Bill 1 made incremental improvements last year, PERA still maintains an unfunded liability of close to $25 billion, which is the measure of what it owes compared to its assets.

If this current and growing gap is not addressed, which Forbes magazine estimates at $15,000 for every Colorado taxpayer, the people of Colorado are ultimately responsible for funding this massive shortfall.

Just add that $15,000 to our current unfunded federal liabilities, which is somewhere north of $1,000,000 per taxpayer.

The eight members of the PERA Board (five voted against maintaining the 8 percent rate of return) aren’t the only ones unwilling to face reality. State Representative Sal Pace (D-Pueblo), now looking to challenge Congressman Scott Tipton in the 3rd CD, did vote against SB 1 but only because he doesn’t think PERA has a solvency problem. The Pueblo Chieftain quoted from Pace’s Web site in February 2010:

‘I voted against the proposal because I don’t believe that the problems with PERA need an immediate fix and the solutions proposed unduly placed a burden on our seniors,’ Pace said in a statement on his Web site Tuesday.

Pace noted the high concentration of PERA enrollees in Pueblo and said projections that PERA would be insolvent within 20 years don’t take into account the possibility that the slumping economy will rebound, and that a target date for solvency of 50-60 years from now (which before SB1 had been the goal) ‘would be less onerous and more fair.’

The “possibility that the slumping economy will rebound”? I keep that “possibility” right next to my unicorn feed.

Yesterday Complete Colorado headlined a Denver Post story about wind power “Another Bubble Bursting?” The reason for the headline is that in 2012 federal tax credits for wind power are set to expire and, as we revealed several months ago in a post about Xcel Energy’s latest compliance plan, wind power is not economically viable with out those tax credits.

The real problem with wind from the perspective of a physicist is that it is not a viable large scale energy resource — period. Dr. Kelvin Kemm writes:

Wind power paranoia has bypassed science logic and is well and truly in the realm of mysticism.

Let me state categorically that, as a physicist, I am in favour of wind power that is genuinely economically viable. The problem is that large-scale wind power fed into a national grid is just not viable – either economically or practically – from an engineering stand point.

The dream of some enthusiasts that there is some major technological leap just waiting in the wings that will make wind power viable is extremely unlikely to take place. The total energy in any wind stream is measurable, and there is no known quantum leap waiting for a solution that could produce considerably more wind energy than at present.

The extreme language and wild claims concerning the potential glories of wind power are becoming more and more exotic and are rapidly being blown further away from reality by the wind of reason. We really need a wind of change to blow now to bring debate back to sound logical discourse on the real strengths and weaknesses of wind power.

He provides an example:

A spokesperson of the South African Wind Energy Association was quoted in the media as saying: “Contrary to what most believe, a 30 000 MW wind energy plant would have an average daily minimum power output of 7 000 MW and would displace 6 000 MW of conventional coal or nuclear power baseload.”

This statement is significant for a few reasons. Firstly, it is irresponsible fantasy. Secondly, it does admit that a ‘plant’ of 30 000 MW does not produce 30 000 MW but only an ‘average’ of 7 000 MW. Take careful note of the word ‘average’. This word means that, in practice, the ‘plant’ could produce any output from zero to 30 000 MW, depending on if and when the wind blows. On ‘average’, they say, one should get 7 000 MW ‘daily’.

But what does that mean? How can one use the terms ‘average’ and ‘daily’ together. Think about it. The most common error committed unknowingly by the media, and knowingly by the wind proponents, is that a quoted figure for installed capacity for wind power is not the amount you get. Wind power systems are fundamentally designed to produce about 25% of their installed capacity, so one designs to get about 7 000 MW out of 30 000 MW of installed capacity. Frequently, the operating wind systems do not even deliver the designed 25% – at times half of this or less. In contrast, with nuclear power, one would get more than 25 000 MW out of an installed capacity of 30 000 MW and one would get it all the time, not only ‘on average’ when the wind blows.

It does make one wonder why we continue to throw taxpayer money into an energy source that is neither economically nor practically viable.

Ultimately, Vincent believes we should do away with these transparent attempts at generating some easy revenue. The facts indicate that they do not make us any safer, and as Vincent points out, nor do they make our governments much richer.

Proposition 103 was badly beaten last week, failing worse than many had expected and sending a message (along with other measures that went down) that Coloradans do not want higher taxes. The Wall Street Journal, among others, took notice.

So what’s coming from the tax-and-spend crowd?

State Sen. Rollie Heath, D-Boulder, pitched Prop. 103 as a temporary fix, a five-year tax increase proposal that would be a stopgap until the so-called Big Fix, a systemic change in the way Colorado collects taxes and funds schools, which would entail changes to the state constitution.

So what’s the strategy of Big Fix proponents now that Prop. 103 is in ruins?

Tim Hoover at The Denver Post interviewed one of our favorite tax reformers (to write about), Carol Hedges of the Colorado Fiscal Policy Institute. She said that the problem was Prop. 103 wasn’t big enough.

“I think the message is that you have to keep trying,” said Hedges, who added, “I hope all the people who didn’t support 103 because they wanted the Big Fix are committed to holding people accountable to make sure that Big Fix comes through, because our state is at risk if we don’t.”

Alan Franklin of ProgressNow wrote to his supporters via e-mail…

“So we lost an election yesterday. The next one is right around the corner. I’ve been doing this long enough to know it sometimes takes several tries to succeed. With all this talk about the need for the ‘big solution,’ now is the time for our leaders to step up and show it to us so we can get to work on passing it next year.”

So it seems like Hedges and Franklin are all gung-ho for the Big Fix as early as 2012.

But Heath, as Hoover reported, is not up for that next year.

“I don’t think there’s a snowball’s chance in hell,” he said. “In a presidential year? To do what we need to do to educate folks? I don’t recommend doing anything in 2012.”

At a Prop. 103 debate on Oct. 20, sponsored by the South Metro Denver Chamber of Commerce [see video above], Heath said that “this is a conversation we must have” and that, “To sit here – with the average person out there, fat, dumb and happy – thinking we’re O.K., when we know we’re not…”

To move from “this is a conversation we must have” to “snowball’s chance in hell” shows that the hammering Prop. 103 received at the polls might keep Heath from being one of the people sitting at the table with the Hedges/Franklin contingent should they pursue a Big Fix next year.

[Post updated 11/11/11]