By Institute for Energy Research ——Bio and Archives--September 7, 2011
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BRUSSELS, Dec 10, 2008 (IPS)--An unconventional awards ceremony was held in Brussels Dec. 9. The 'Worst EU Lobbying Awards' gave recognition to those corporate interest groups that have resorted to deceptive tactics while seeking to shape legislation in their favour. Following an online poll which generated over 8,500 votes, the top prize went jointly to three firms that have been striving to convince policy makers that biofuels are ecologically benign. Abengoa Bioenergy (the U.S. subsidiary of a Spanish firm), the Brazilian sugar industry association Unica and the Malaysian Palm Oil Council (MPOC) were lambasted for the content of their advertisements. One ad by Abengoa attributed a quote to the European Federation for Transport and Environment (T&E), a green campaign group, which suggested that ethanol made from crops such as sugar was the only solution to addressing society's "addiction to oil". Not only did T&E never make that claim, it has been critical of the EU's efforts to use the increased consumption of biofuels as a pretext for avoiding measures to boost the energy efficiency of cars.Abengoa Bioenergy hasn't restricted its lobbying to Europe. Vice President Chris Standlee was head of the Renewable Fuel Association (RFA). The RFA has repeatedly pushed for the VEETC, a tax credit for ethanol blenders. On Abengoa's website they say that one of the reasons why the reopened their plant in Portales, New Mexico was the favorable legislation and administration conditions. Additionally their CEO said the plant could not have been reopened without the help of the New Mexico Senators who supported the VEETC.
In 1969, the Nixon White House asked a young assistant professor of engineering at the University of Maryland whether solar energy made sense for America. Absolutely, he replied. Four decades later, Fred Morse is still trying to persuade the government to put its muscle behind solar. Last week, he scored a big victory.The same article explains that in addition to the extension of the investment tax credit and the $1.45 billion loan guarantee, Abengoa Solar needed another set of training wheels for its Solana project, namely a government-mandated customer base:
[Arizona Public Service] has agreed to buy $4 billion worth of electricity from the [Solana] plant over the next 30 years, in part because to comply with a state law requiring utilities to generate at least 15 percent of their electricity from renewable sources.But don't take our word for it. Abengoa Solar itself acknowledges its reliance on government assistance:
Despite the prevailing financial uncertainty and the constraints on debt markets, the sector's development was bolstered by governmental support, including the confirmation in December of the current regulatory framework in Spain, the establishment of the Federal Loan Guarantee (FLG) program in the US, and the publication of stable and attractive regulatory frameworks in new markets.The website of Abengoa Bioenergy is even more candid about its dependence on government:
At present, Abengoa Bioenergy ranks as one of the leading biofuel producers in Europe, the United States and Brazil... The Bioenergy business unit is currently reporting excellent levels of business, reflecting its standing as one of the world's leading bioethanol producers and marketers... There is now a clear need for a change of practices and policies and various governments have already begun to act accordingly. Business performance depends largely on favorable legislation that facilitates the development of new technologies while enabling biofuel culture to expand and combat the obvious signs of climate change. 2009 turned out to be a very fruitful year in this respect. Two new legislative acts were enacted on June 25th 2009 in order to consolidate and kick-start the biofuel market over the coming ten-year horizon. European Directive 2008/28/EC on renewable energy sources dictates that at least 10% of transportation fuel within EU member states must be produced from renewable energies by 2020. The amendments made to Directive 2009/30/EC on fuel quality include an additional incentive for using biofuels by ushering in a compulsory reduction in greenhouse gas emissions during gasoline and diesel life cycles between 2011 and 2010. Working in tandem, these two directives ensure the future of existing biofuel production plants and those currently under construction. At the same time, they provide a platform for long-term growth within the biofuel sector by harnessing current commercial technologies, and also offer special incentives and support for those attempting to develop the next generation of lignocellulosic technologies. All in all, they provide the market platform and the outlook for the coming decade that the sector was hoping for.The true irony in all this is that, even with all of the government assistance documented above, Abengoa Solar has been losing money: €10.8 million in 2010, €60.2 million in 2009, and €8.7 million in 2008. It's thus not accurate to say Abengoa Solar is profiting at the expense of taxpayers and consumers--it's losing at their expense.
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