I’m curious … is “Yabucoa” the Spanish word for rip-off?

Back in February of this year, Western Wind Energy issued a news release containing this statement:  The total assets of the Windstar Project as of the expected Commercial Operation Date, are valued at US $481.8 million comprising the Project’s fair market value of US $357.9 million, plus the potential cash grant of US $99 million plus a further US $25 million of fully funded working capital, debt coverage and performance bonding reserves.

What caught my eye was the $99 million cash grant.  I thought this a tidy sum for some generous soul to voluntarily donate to this Canadian based, profit making enterprise.  How nice!

A couple of days ago, the same Vancouver Canada based Western Wind Energy released a “Project Valuations” report providing additional information on the Windstar Project, and others as well.  I thought you might like to know that the $99 million dollar benefactor mentioned above appears to be the US Taxpayer.  Seems, according to the press release, “the total project values were deternined [sic] by adding the US Federal cash grant.”  (A word to the wise … anytime you see the term “US Federal,” substitute the term “US Taxpayer” …  you’ll find what you’re reading takes on a whole new meaning.)

Believe me, I’m not a financial guru claiming to understand the convoluted stream of cash which flows to these projects.  But that aside, it seems clear to me that the industrial wind business in the US relies overwhelmingly on opportunistic for-profit foreign companies and, with that, I’m not thrilled.  We keep hearing from the wind lobby about “green” jobs and the US “green” economy and yet, project after project can trace its ancestry (and our money) back to some foreign shore.  Seems to me the only real jobs and profits of any consequence benefit wind developers, the wind lobby, foreign backed manufacturers and the major electric distributors like Edison, who just so happen to benefit from “green” energy profits while continuing to profit from their 23 coal-fired generating stations (as listed in 2005).  Oh, I almost forgot the politicians.

Looking back to March 1, 2010, an article at Brighter Energy News, prior to the project start, noted that the Vancouver Canada based Western Wind Energy would build the wind facility in California with Gamesa turbines.  Gamesa, of course, does assemble components near Philly, but the business is based in Spain.  I guess what irritated me, since the major players are headquartered off-shore, was this comment: “Once the project is operational, the company is intending to apply for federal economic stimulus money, under the American Recovery and Reinvestment Act, seeking around $70 million in grant funding – around 30% of the project costs.

Plus, the fact that in just one year the US Taxpayer’s obligation has grown from $70,000,000.00 to $99,000,000.00 is more than just a little salt in the wound.  And think about it … this is for just one project.  Not surprisingly, the project completion is scheduled for December 31, 2011, just in time to insure they cash in on the US Federal 1603 Grant handout – aka: US Taxpayer pockets.

It’s one thing to invest in research toward new and innovative energy sources.  I’m a big fan of providing taxpayer dollars, if available, to qualified, unaffiliated, non-profit institutions for the purpose of such research and development.  But handing cash out to select for-profit businesses, whether wind, solar, coal, natural gas, nuclear, oil … you name it … should not be in the scope of authority held by our elected representatives, and, by all means, must not be entrusted to the government bureaucrats hired to oversee and regulate these same profiteers.

Even if the federal government could find the magic to replace the negative sign on the $14,400,000,000,000.00 national debt with a plus sign, should we hand out hard earned taxpayer dollars to the very companies who will, in the end, make us pay for services rendered?  Really folks, even in the best of times … is that ever the right thing to do?

Oh, by the way … take a look at the Western Wind Energy Press Release to take note of the sweet little deal in Puerto Rico for their Yabucoa project? – “30% cash grant, 50% bonus depreciation and 50% Puerto Rico investment tax credit”  I’m curious … is “Yabucoa” the Spanish word for “rip off?”

And while I’m ranting on anyway, there’s another thing this cross border business has me wondering about – international treaties.  Now before anyone gets their shorts in a knot, this is not to single out Western Wind Energy, but only to use their structure to express a wider concern I have.  A concern that, hopefully, some expert reader will convince me to put aside.

Here we go:

Western Wind Energy’s site states that it “owns 1,840 acres of land in the Tehachapi Pass Wind Park, California. Parcels in excess of 1,015 acres are zoned for wind farm development.”  This general area, as I recall, is known as a trouble spot for the Golden Eagle, and other protected birds, due to impacts with wind turbines.

The Golden Eagle is protected by the US Endangered Species Act and, to the best of my knowledge, at least one international treaty.  The international agreement(s) is in place, presumably because the Golden Eagle migrates to places like, well, Canada.  (We posted an excellent piece from Wayne Wegner some time ago that, if you haven’t read, you should.)

One would assume that a company operating internationally, an effort which obviously requires it to be well versed in the business practices and laws of both countries, would be equally familiar with international treaties with which their business operations might conflict.

In the case of the international treaty negotiated to protect migratory birds for example, should we not have high expectations for companies conducting cross border businesses known to place these species in jeopardy to be fully aware of the “rules of the road,” so to speak?

As further disclaimer, the reason I raise the issue is not because I have any evidence or do I doubt that Western Wind Energy has done anything other than fully comply with all requirements.  My concern is based on my sense that US agencies, such as the Fish and Wildlife Service have been rendered somewhat ineffective enforcers of endangered species protections due to the political pressures in favor of “green” energy.  It is this that leads me to have little confidence that international treaties are taken seriously when, for example, a US company can simply choose to ignore USFWS warnings even when the agency informs the developer of their concerns for a dangerous condition prior to construction.

It is with this doubt in mind, that I’m am looking for some assurance that an international governing body exists to insure an international business complies with any and all treaty protections, without fail?  If this is so, where do I find information about the agency’s success in enforcing compliance and, of equal interest, any companies who have violated these treaties to which the United States is signatory?

Again, I can only assume that Western Wind Energy is in full compliance with all requirements.  I don’t mean to suggest otherwise.  What I don’t feel confident believing is that all wind developers are meeting wildlife protection requirements.  It would be nice to have my fears set aside or, if there are companies not in compliance, that some empowered agency is taking the enforcement issue seriously.  And since, at least for now, the wind business is sticking taxpayer’s money in their pockets, I actually think we have a right to know.

Finally, some may wonder why I don’t simply contact some of the major “environmental” groups to resolve my concerns.  Well, a visit to Jon Boone’s Stop Ill Wind may help answer that question for you.

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One Response to I’m curious … is “Yabucoa” the Spanish word for rip-off?

  1. Pingback: Breaking Wind – Quick hits from the industry for July 30, 2012 | Allegheny Treasures

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