This entry was partially inspired by a rather lengthy discussion I had with my eldest son the other day, whose main mission in life (apparently) is to poke holes in my logic. When I held him as a baby and said, "You're going to be smart!", this wasn't what I had in mind, but...such is life.
He made a valiant effort in this recent set-to, but I emerged from this patricidal exercise still conflicted about the subject at hand. So I decided to bring more logic pokers into the fray by airing some of my opinions here. Feel free to poke away.
First, let me explain my position on renewable energy. As I mentioned in this radio interview, in order to achieve the level of growth we need in renewable energy generation, private sector engagement is critical. That's what our (and other states') REPS is designed to do: create a market-based demand for renewable energy, to entice private investors into producing this valued item. Along with this "driver", tax credits, loan guarantees and other incentives are directed toward private entities, as well.
President Obama uses the word "catalyze" to describe the government's efforts to spur private-sector investment into renewables, and it's an apt description. And it's working. Wind power alone has increased to over 35,000 megawatts in the U.S., and that wouldn't have happened without those private dollars.
I believe (and here is a poke point for you) the state's efforts to capture Alcoa's license could have a chilling effect on private-sector investment in energy generation projects as a whole, and especially on the continued maintenance of (current) hydroelectric operations. Why spend the money to maintain them if they could be taken away? Don't forget, hydro is still the biggest producer of renewable energy in the U.S. (and the world, for that matter).
Another issue I have with this proposed takeover is the costs associated with. Just to get an idea of the dollars involved, you may want to peruse this fiscal note. As another reference point, consider the Electricities debacle (my son declared this irrelevant, by the way): the municipalities assumed the horrific debt burden for real property (including a nuke plant), and they compounded that debt by issuing bonds for maintenance and upgrades (and God knows what else).
While it has yet to be settled how much the state will have to pay Alcoa to acquire the dams and land in question, the tab for taxpayers is going to be substantial. And (like with Electricities) additional bonds will likely be issued, some of them for much-needed cleanup and water quality projects (which I agree with). But other projects may be funded as well, that have more to do with (local) economics than environmental stewardship.
See, this is not just about the state being able to sell renewable energy, it's also about:
(2) To ensure the equitable distribution of water for public purposes.
(3) To maintain recreational facilities associated with the Yadkin River.
Think about that. The single source of revenue to recoup the taxpayer's investment in this venture is the sale of electricity from the dams. Both of these major "goals" will result in less energy generated, because the hydro plants will need to be shut down more often to meet these (other) water demands. Less energy generated=less energy sold=less money to cover the costs.
And then there's these other (maybe worthy) projects this reduced revenue must support:
(4) Apportion up to twenty‑five percent (25%) of the net proceeds from the Yadkin Project's electrical output for use by a regional "Power for Jobs" fund to be established by the Department of Commerce. The Power for Jobs fund may make grants to businesses and not‑for‑profit corporations to create or retain jobs in the Yadkin River Basin.
(5) After performance of subdivisions (1) through (4) of this subsection, compliance with subsection (b) of this section, and retention of any necessary operating reserves, the Trust shall utilize up to twenty‑five percent (25%) of the remaining annual net revenues from the Yadkin Project to make grants to the Community Colleges System Office for allocation by the State Board of Community Colleges for instructional equipment at the community colleges as determined by the State Board.
I like #5, but I have a hunch #4 is going to be the squeaky wheel on this wagon. And you better believe I'm going to be watching who gets the grease.
Let the poking begin...
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