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Is reality tricky?

11 Sep 2024 | OP ED Watch

A Heatmap newsletter warns about an Inflation Reduction Act program which supposedly installed 50,000 solar projects in “Low-Income Communities” yet “New data provided exclusively to Heatmap shows just how complicated it is to get money where it needs to go.” To which we might well retort “No duh” or something, more than half a century after the War on Poverty led to massive increases in federal government spending, ambition, overreach, profligacy and debt but also to a massive underclass, homelessness, addiction and just about everything bad but no decrease in poverty. On the other hand, if zealots for a government Green New Deal are starting to realize that there’s more to it than spending and cheering, we could be getting somewhere.

In this regard their concern is a little tepid. They say, as though no slip could intervene between grant and lip, that:

“According to data provided exclusively to Heatmap, in its first year, the Low-Income Communities Bonus Credit Program steered nearly 50,000 solar projects to low-income communities and tribal lands, which are together expected to produce more than $270 million in annual energy savings.”

Are expected to. By whom? The same people who dreamed it up? And how’s their actual track record in delivering a quarter-billion dollars in annual savings to anyone anywhere ever? Or a tiny fraction of that sum? Instead of these rather prosaic accounting questions, they leap to cosmic equity:

“those topline numbers don’t say anything about who will actually see the savings, or how much the projects will benefit households that have historically been left behind. In reality, the majority of the projects – about 98% - were allocated funding simply for being located in low-income communities, with no hard requirement to deliver energy or financial savings to low-income residents.”

Even if there were a hard requirement we would not expect any measurable results. We could also nitpick about the meaning of “households that have historically been left behind” since history generally concerns people who aren’t still alive, like Napoleon. Instead we’ll say that the whole thing sounds like an exercise in central planning by people who never heard of incentives or the Law of Unintended Consequences:

“To be eligible, a project must produce less than 5 megawatts of power and fall under one of four categories: It must be located in a low-income community, be built on Indian land, be part of an affordable housing development, or distribute at least half its power (and guaranteed bill savings) to low-income households. The first two categories qualify for a 10% credit; the second two, which stipulate that at least some financial benefits go to low-income residents, qualify for 20%. In both cases, the credit can be stacked on top of the baseline 30% tax credit for clean energy projects that meet labor standards, meaning it could slash the cost of building a small solar or wind farm in half.”

Not to mention the issue that solar might not work very well, could prove fragile, and is difficult to dispose of. Still, at least they’re wrestling with practicalities at all, which is good. Including, to our surprise, a piece in the New York Times “Climate Forward” by Christopher Flavelle that started:

“You’ve probably heard the pitch for heat pumps: They can cut greenhouse gas emissions by more than half compared with traditional gas-powered HVAC systems. They’ll save you money because you’ll pay less for energy. And, thanks to the tax credits passed by Congress in 2022, they’re more affordable than ever. What’s not to love? Based on my experience switching to a heat pump this summer, that pitch may gloss over some important points.”

Like it cost a lot and doesn’t really reduce emissions. How it works in winter, a major issue, won’t really concern him as he lives in Washington D.C. But when you actually start trying to do things, you notice that kind of stuff and if you’re honest and sensible you mention it.

Especially since the effort to grapple with practicalities isn’t always going well. For instance there’s a story about some farmers in Australia who:

“say their exports will become less competitive if Labor refuses to carve agriculture out of a key plank of its climate policy, raising pressure on Jim Chalmers to overhaul a mandatory requirement for companies to disclose climate risks.”

Well, what about everyone else? And it’s not just that this mandatory reporting of unknowable “climate risks” exposes them to cost, inconvenience, and potential liability if someone decides they weren’t sufficiently panicky. It’s that even if they manage it, or get their special-interest exemption, what actual reduction in emissions will be accomplished by this onerous provision, and what difference do the models say it will make to global temperature three quarters of a century hence? And what will the politicians do if it doesn’t work as intended like, say, 90% of all government programs because they’re designed by people who don’t pay attention to incentives?

The fact that everyone’s seeking exemptions, or a bolt-hole, from various green programs meant to make us all effortlessly rich as well as serene tells us something important. Namely that there’s no free lunch, and that this free green lunch is all bill and no food. As with the insistence that we all buy EVs, which Canadian governments are subsidizing massively into the bargain; as Lorrie Goldstein pointed out:

“federal EV mandates to increase the sale of new EVs to 60% of all new passenger vehicles by 2030 is only expected to lower Canada’s industrial greenhouse gas emissions by 2% to 3% compared to what they would otherwise have been, according to a recent report by the Canadian Climate Institute.”

So it’s how many tens of billions in subsidies, extra financial cost to motorists and foregone automobile performance, so a nation whose contribution to world human GHGs is tiny can make a tiny reduction in one part of its emissions? (To borrow a line from The Longest Day, “You mean we came all this way for nothing?”)

Then there’s the Climate Home News bit about how:

“In the heady late-pandemic days of 2021, countries and companies went climate target crazy. We had to stop updating our net zero tracker in September 2021 because we just couldn’t keep up with them all. But now, as 2030 gets nearer and nearer, some are starting to get cold feet.”

Or cold wallets. Reality sometimes bites. And thus CHN adds:

“In April, the government of Scotland – the host of the COP26 summit where many of these promises were made – reluctantly dropped its ambitious 2030 target after it was advised that it wasn’t going to meet it. And this week, Air New Zealand dropped its 2030 target because, it said, “many of the levers needed to meet the target…are outside of the airline’s direct control and remain challenging”. Others with similar targets – like China Airways, Delta and easyJet – may follow it out.”

It’s what happens as you move from the “what” to the “how” and go oh, the plan is bankruptcy all round and still the oceans rise or whatever.

Not only that, developers get the tax breaks you aimed at the poor, who don’t have accountants for some reason.

4 comments on “Is reality tricky?”

  1. I thought it was only advocates for more government policy and largesse to reduce poverty that claimed poverty has not been reduced.

    In reality poverty has been significantly reduced in the last century. Very significantly.

  2. Poverty has been reduced because of the abundance of low cost energy. As governments try to tax fossil fuels out of existence and insist on e pensive alternatives, poverty will become a big issue. See Great Britain for how it's treating its seniors and their home heat subs.idies

  3. The really funny thing is that those idiot bureaucrats have yet to spend $1 trillion of the money! This is good news!

  4. Sounds like yet another very expensive climate boondoggle.Let's do an audit on this IRA solar scam.And let's see,Canada emits 1.5% of CO2 emissions,so a 3% reduction by 2030 would be 0.045%.Nice virtue signaling there.And if humans only contribute about 3% of total carbon emissions you can stick another couple zeroes to the right of that decimal point.What a scam!

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