Hot air? White House takes credit for Bush-era wind farm jobs

Very lengthly articele, also very compelling....worth the read,
CREDITS TO : Writer Russ Chroma, MSNBC.COM

By Russ Choma
Administration claims 50,000 jobs created, but many projects were completed
Updated 10/21/2010 5:25:20 PM ET

Administration claims 50,000 jobs created, but many projects were completed


WASHINGTON— The Obama administration
is crediting its anti-recession stimulus plan
with creating up to 50,000 jobs on dozens of
wind farms, even though many of those wind
farms were built before the stimulus money
began to flow or even before President Barack
Obama was inaugurated.

Out of 70 major wind farms that received the
$4.4 billion in federal energy grants through
the stimulus program, public records show
that 11, which received a total of $600 million,
erected their wind towers during the Bush
administration. And a total of 19 wind farms,
which received $1.3 billion, were built before
any of the stimulus money was distributed.
Yet all the jobs at these wind farms are
counted in the administration's figures for
jobs created by the stimulus.

In testimony to Congress earlier this year, the
Department of Energy's senior adviser on the
stimulus plan, Matt Rogers, touted the wind
farm program for creating as many as 50,000
jobs. He acknowledges that these figures were
provided by a wind industry trade and
lobbying group. The trade group, in turn, cites
a government study, which found that most of
the jobs are short term.

The Investigative Reporting Workshop at
advertisementadvertisement Robert F. Bukaty / AP file The blades of a windmill blur as they catch the wind on Stetson Mountain near Stetson, Maine. The project by First Wind was eligible for $40 million in the2009 stimulus program, although federal records show that its wind towers were up by July 2008. Should jobs at Stetson Mountain be counted among those created by the Obama economic stimulus? Hot air? White House takes credit for Bush-era wind farm jobs

Administration claims 50,000 jobs created, but many projects were completed before funds were handed out
American University fact-checked that claim,
using the federal government's own
documents. Not only were 19 of the wind
farms already in place before the first stimulus
payments were made, but 14 of them were
already sending electricity to the grid.

First comes the project, later the stimulus
Here's how we checked the administration's
claim: Wind towers are tall — hundreds of feet
tall — making them dangerous to low-flying
planes. The Federal Aviation Administration
requires every structure over 200 feet to be
recorded in a database, including the date
each structure was built. We reviewed these
records filed by the wind farms that received
stimulus grants. We also checked records kept
by utility regulators, showing when wind farms
began producing electricity.

In western New York, for example, in the hills
near the economically hard-hit cities of
Syracuse, Rochester and Buffalo, the
Canandaigua Wind Farm could have created
the sort of green-collar jobs that the Obama
administration promised would be generated
by the stimulus package. The feathery blades
of the farm's 88 gigantic turbines reach more
than 400 feet in the air. Each turbine contains
8,000 components and is almost as
sophisticated as a jet engine. Hundreds of
construction workers were needed to haul
and erect the steel towers, each weighing
hundreds of tons.

The wind farm was built in two phases. The de-
veloper, First Wind, received a total of $61.8
million in stimulus grants on Sept. 1, 2009,
when the administration began rolling out
money for the program. But FAA records
indicate both were completed at least 15
months earlier — by May 20, 2008.
There are other examples.

In the coal country of eastern Pennsylvania,
FAA records show, the last turbine on the 51-
turbine Locust Ridge II wind farm in Mahanoy
City, Pa., was erected on Jan. 1, 2009, the first
day a project could be eligible for a stimulus g
rant. But the other 50 turbines were built in
2008 — 31 of them before Obama was elected.
The farm's developer, Iberdrola Renewables,
the subsidiary of a Spanish utility, collected
$59.1 million in stimulus money.

High above the rolling plains southeast of
Lubbock, Texas, the 166-turbine Pyron Wind
Farm represents the new wave of American
wind farm development. In the heart of the
country's "wind belt," it's far larger and more
labor intensive than the projects in
Pennsylvania and New York. German
developer E.On Climate and Renewables
estimated that 620 construction jobs were
created, and on Sept. 22, 2009, the project
received $121.9 million in stimulus money.
FAA records show the last tower had been
built on Dec. 11, 2008.

The program, known as the Section 1603,
reimburses developers of renewable energy
facilities, such as wind and solar farms, up to
30 percent of the project's cost. Applicants
need only prove they built the facility and are
automatically awarded the money. Unlike
other stimulus programs, the wind farms
aren't judged on job creation or required to
abide by "Buy American" clauses. The money
also comes with virtually no strings, and there
is no obligation to reinvest it.

Administration officials and the companies did
not dispute that much of the work on the wind
farms occurred in late 2008 or early 2009, but
said the stimulus money was vital for creating
jobs down the line. Even if the wind farms that
received the grants had been completed, they
said, the money was vital to ensure that the
next generation of wind power plants is built.

As the stimulus program continues to be hotly
debated on the campaign trail, the Obama
administration's record of touting all these
grants for creating "real jobs" continues.

"These programs were particularly effective in
getting money out the door quickly to put
people back to work on great projects that would otherwise have been idled in the face of
the Great Recession," Matt Rogers, the
Department of Energy's senior adviser on
stimulus, testified to Congress in April of this
year. At other points in his written testimony,
Rogers said the Section 1603 program was
In an interview in late September, however,
Rogers did not dispute the records showing
that a large portion of work on many projects
was completed before 2009. But he defended
the grant program as a vital tool to ensure the
recipients continued to invest in wind farms in
the United States.

"With the first set of projects that were done
before the passage of the Recovery Act — in
almost every case, what they did was reinvest
in the next set of projects," Rogers said.
"Because we now have a set of incentives,
project developers and sponsors are
reinvesting in the U.S. market, instead of
seeing a lot of that money go to other places.
That's one of the most exciting parts of the job
creation story."

Because of the way the law was written, the
Section 1603 grant program has no language
requiring that recipients reinvest their grant
money in the United States. Rogers said he was
basing his claim on the fact that many
companies have reported to the
administration that they reinvested their
grants in future wind projects in the U.S.

Most of the job gains are short term, study
finds

Although the administration has described
50,000 new jobs, Rogers, when pressed,
speaks of 40,000 to 50,000 jobs being
created, saved or supported. He said these
figures were provided by the American Wind
Energy Association, an industry lobbying
group. In February, for example, that group
said, "Were it not for the Recovery Act, we
estimated a loss of as much as 40,000 jobs."

The association, in turn, cites a study by the
Energy Department's Lawrence Berkeley
National Laboratory, which estimated that the
grant program supported more than 51,600
short-term jobs during the construction
phase, the equivalent of that many people
working full time for one year, and an
additional 3,860 long-term full-time jobs. The
study assumed that all the projects finished in the first half of 2009 were not caused by the
stimulus.

When the wind association and the Obama
administration cite such figures as 50,000
jobs, however, they don't mention that the
study found that most were short-term jobs.

Update: The American Wind Energy

 Association posted a response to this article,
which you can read here.

Since it gave out its first grants on Sept. 1,
2009, the renewable energy stimulus program
has handed out more than $5 billion to more
than 1,100 projects, many of them small
so lar-energy projects. The largest amount of
money, $4.4 billion, has gone to big wind
farms.

The Investigative Reporting Workshop
previously reported that the majority of the
money was going to foreign-owned
developers, and that the majority of turbines
being installed were built by foreign-owned
manufacturers. The
Treasury Department has rejected Freedom of
Information requests by the Investigative
Reporting Workshop seeking grant application-
s, citing trade secrets.Only one of the companies identified by the
Investigative Reporting Workshop as having
finished construction on a project before Jan.

1, 2009, disputed the date its turbines were
listed as built. The FAA records show that the
final turbine on the Wheat Field wind farm in
Gilliam County, Ore., was built on Nov. 10,
2008. But in a statement, Horizon said
construction on the project began in
September 2008 and the first turbine wasn't
"mechanically completed" until Feb. 2, 2009. In
the statement, Horizon said the FAA
information was filed in February 2008, and
the November 2008 date was only an estimate
to make sure the FAA had the structure on its
maps by the time the tower was built.
Power generated during Bush administration
The Investigative Reporting Workshop also
reviewed publicly available data on each wind
project's electrical generation. The Federal
Energy Regulatory Commission keeps records
of nearly all commercial energy transactions —
recording the time, quantity of power, price
and total cost of the transaction.

The records show that at least 11 wind farms
were generating at least some electricity and
selling it into the grid by March 1, days after
the stimulus bill was passed in late February.
And 14 wind farms were generating electricity
and selling it into the grid by the time the
stimulus money was first given out in
September 2009.

For example, the Locust Ridge II wind project,
in Pennsylvania, first sold electricity to PJM
Interconnect on Oct. 24, 2008, at 11 a.m.
Between Oct. 24 and Dec. 31, 2008, the
holding company that owns the facility sold
advertisementadvertisement
687.6 megawatt/hours of electricity to PJM,
charging a total of $32,788.

Paul Copelman, a spokesman for Iberdrola,
said the Locust Ridge II wind farm wasn't in f
ull commercial operation until March 2009.
The electricity generated in 2008 was the
result of testing, he said.

How they qualified
These wind farms qualified for the stimulus
grants for two reasons.

First, the stimulus bill allowed a wind farm to
qualify if it was "placed in service" on or after
Jan. 1, 2009. The money didn't start flowing
until Sept. 1, 2009, so it was inevitable there
would be payments for work previously done,
particularly for large wind farms that can take
years to develop. To get the money, these
companies didn't have to create new jobs;
they just filled out an application after the fact.

Second, "placed in service" has a peculiar
meaning. Generally, it means a piece of
equipment, like a wind turbine, is ready to be
used for the purpose it was intended. But,
when a developer finishes building the tower
and attaching all the parts — the labor
intensive part of the process where most jobs
are created — there are several more steps,
including testing and installing the equipment
that regulates the flow of electricity and feeds
it into the grid, before it is deemed "in service."

In the operation of other federal incentive
programs for wind energy, each turbine in a
large wind farm is evaluated individually
before being "placed in service." However,
under the Section 1603 program, tax attorneys
and the companies contacted by the
Investigative Reporting Workshop said that
developers were allowed to count all of their
turbines on a wind farm as one. In other
words, what counted was when the last
turbine was "placed in service," and the whole
farm was ready to operate at full capacity.

Tax attorney Jeffrey G. Davis, a Washington
partner at the law firm Mayer Brown, where he
specializes in representing renewable energy
firms, said it's not uncommon for a wind farm
to generate electricity — and even sell it —
before being "placed in service." Wind farms
may need to start turbines and generate
electricity to test them or prove viability for
commercial production.

In addition, all the wind farms contacted stressed that the process of qualifying a wind
farm as "placed in service" involves a number
 of steps, like testing and building associated
transformers and transmission equipment.
Iberdrola also noted that it was required to
submit third-party certification of the "placed in service"date.

Rogers, the Energy official, said that some of
the wind farms cited by the Investigative
Reporting Workshop could have been left half-
built during the recession, but that once
Obama was elected in November 2008,
developers decided to finish the work in
hopes of a stimulus package. When pressed
for examples, Rogers declined to name any
projects.

"It's a question you've asked; I've answered.
It's an incredibly successful program," Rogers
said.

Several of the companies contacted by the
Investigative Reporting Workshop said they
had considered halting construction during
the recession. These include Iberdrola, which
considered halting construction on half of its
projects, spokesman Paul Copelman said,
 which received $1.3 billion, were built before

any of the stimulus money was distributed.
Yet all the jobs at these wind farms are
counted in the administration's figures for
jobs created by the stimulus.

In testimony to Congress earlier this year, the
Department of Energy's senior adviser on the
stimulus plan, Matt Rogers, touted the wind
farm program for creating as many as 50,000 jobs. He acknowledges that these figures were
provided by a wind industry trade and
lobbying group. The trade group, in turn, cites
a government study, which found that most of
the jobs are short term.

The Investigative Reporting Workshop at when the administration began rolling out

money for the program. But FAA records
indicate both were completed at least 15
months earlier — by May 20, 2008.

There are other examples.

In the coal country of eastern Pennsylvania,
FAA records show, the last turbine on the 51-
turbine Locust Ridge II wind farm in Mahanoy
City, Pa., was erected on Jan. 1, 2009, the first
day a project could be eligible for a stimulus g
rant. But the other 50 turbines were built in
2008 — 31 of them before Obama was elected.
The farm's developer, Iberdrola Renewables,
the subsidiary of a Spanish utility, collected
$59.1 million in stimulus money.

Administration officials and the companies did

not dispute that much of the work on the wind
farms occurred in late 2008 or early 2009, but
said the stimulus money was vital for creating
jobs down the line. Even if the wind farms that
received the grants had been completed, they
said, the money was vital to ensure that the
next generation of wind power plants is built.

As the stimulus program continues to be hotly
debated on the campaign trail, the Obama
administration's record of touting all these
grants for creating "real jobs" continues.

"These programs were particularly effective in
getting money out the door quickly to put
people back to work on great projects that
would otherwise have been idled in the face of
the Great Recession," Matt Rogers, the
Department of Energy's senior adviser on
stimulus, testified to Congress in April of this
year. At other points in his written testimony,
Rogers said the Section 1603 program was
Energy Association, an industry lobbying

group. In February, for example, that group
said, "Were it not for the Recovery Act, we
estimated a loss of as much as 40,000 jobs."

The association, in turn, cites a study by the
Energy Department's Lawrence Berkeley
National Laboratory, which estimated that the
grant program supported more than 51,600
short-term jobs during the construction
phase, the equivalent of that many people
working full time for one year, and an
additional 3,860 long-term full-time jobs. The
study assumed that all the projects finished in
the first half of 2009 were not caused by the
stimulus.

When the wind association and the Obama
administration cite such figures as 50,000
jobs, however, they don't mention that the
study found that most were short-term jobs.

Update: The American Wind Energy

Power generated during Bush administration

The Investigative Reporting Workshop also
reviewed publicly available data on each wind
project's electrical generation. The Federal
Energy Regulatory Commission keeps records
of nearly all commercial energy transactions —
recording the time, quantity of power, price
and total cost of the transaction.

The records show that at least 11 wind farms
were generating at least some electricity and
selling it into the grid by March 1, days after
the stimulus bill was passed in late February.
And 14 wind farms were generating electricity
and selling it into the grid by the time the
stimulus money was first given out in

September 2009.

For example, the Locust Ridge II wind project,
in Pennsylvania, first sold electricity to PJM
Interconnect on Oct. 24, 2008, at 11 a.m.
Between Oct. 24 and Dec. 31, 2008, the
holding company that owns the facility sold before being "placed in service." However,

under the Section 1603 program, tax attorneys
and the companies contacted by the
Investigative Reporting Workshop said that
developers were allowed to count all of their
turbines on a wind farm as one. In other
words, what counted was when the last
turbine was "placed in service," and the whole
farm was ready to operate at full capacity.

Tax attorney Jeffrey G. Davis, a Washington
partner at the law firm Mayer Brown, where he
specializes in representing renewable energy
firms, said it's not uncommon for a wind farm
to generate electricity — and even sell it —
before being "placed in service." Wind farms
may need to start turbines and generate
electricity to test them or prove viability for
commercial production.

In addition, all the wind farms contacted
stressed that the process of qualifying a wind
farm as "placed in service" involves a number
regardless of how far along they were in the

construction process. And E.ON Climate and
Renewables said it had considered halting the
giant Pyron Wind Farm in Texas, which was
substantially constructed in 2008. Neither
company ultimately halted construction.

When asked how to reconcile claims from the
administration that the jobs associated with
these projects were a result of the stimulus —
even though the work was done months
before the stimulus was passed — Rogers did
not offer a direct response.

"I think it's the simplest thing. You can talk to
the 40[,000] to 50,000 people who have been
working on these projects since they were
passed," he said, "and ask if they are pleased."