Newsweek Cloaks Koch-Funded Professor's Dirty Energy Agenda

Blog ››› ››› ANDREW SEIFTER

UPDATE (4/21): Newsweek added an editor's note at the top of Simmons' op-ed, which reads: "Editor's note: The author of this piece, Randy Simmons, is the Charles G. Koch professor of political economy at Utah State University. He's also a senior fellow at the Koch- and ExxonMobil-funded Property and Environment Research Center. These ties to the oil industry weren't originally disclosed in this piece."

Newsweek also published an op-ed in response by the Environmental Defense Fund's Jim Marston, and issued the following correction to Simmons' op-ed: "Correction: This article has been updated with a corrected figure for wind power's current share of US electricity generation. It also clarifies the range of cost estimates from Lazard."

ORIGINAL POST:

Newsweek missed by a mile when it promised to provide readers with "full disclosure" concerning the author of a deeply flawed opinion piece it published attacking wind energy.

Newsweek stated that the April 11 column's primary author, Randy Simmons, is a "professor of political economy at Utah State University" and added: "Full disclosure: Randy Simmons receives funding from the U.S. Department of Energy (grant has been completed and there is no current funding) and Strata, a 501 (c)3 non-profit organization."

But Simmons isn't just any professor of political economy; he is the former Charles G. Koch professor of political economy at Utah State's business school.* He's also a senior fellow at the Koch- and ExxonMobil-funded Property and Environment Research Center.

If Newsweek was serious about disclosing any pertinent information about Simmons' possible motives for arguing against wind energy, the obvious place to start would be with his ties to the Koch brothers, who have a vested interest in opposing sources of energy like wind that would reduce America's dependence on carbon-based energy sources. Instead, Newsweek considered it "full disclosure" to simply note that Simmons has received grants from the U.S. government and a non-profit organization.

In his op-ed, Simmons cited two other Koch-funded think tanks, also without proper disclosure. Simmons described the Institute for Energy Research, which has received hundreds of thousands of dollars from the Koch-controlled Claude R. Lambe Charitable Foundation, as "a non-profit research group that promotes free markets." And he referred to the Koch-founded Mercatus Center only as "the Mercatus Center at George Mason University."

Unsurprisingly, given his unmentioned fossil fuel ties, Simmons' attacks on the cost of wind energy were highly flawed and, in some instances, categorically false.  

Simmons began his op-ed by falsely suggesting that a "low end" estimate of the cost of wind energy by financial advisory firm Lazard ignored the added expense to taxpayers of subsidizing the wind industry:

As consumers, we pay for electricity twice: once through our monthly electricity bill and a second time through taxes that finance massive subsidies for inefficient wind and other energy producers.

Most cost estimates for wind power disregard the heavy burden of these subsidies on U.S. taxpayers. But if Americans realized the full cost of generating energy from wind power, they would be less willing to foot the bill--because it's more than most people think.

[...]

Proponents tend to claim it costs as little as $59 to generate a megawatt-hour of electricity from wind. In reality, the true price tag is more than two and a half times that.

This represents a waste of resources that could be better spent by taxpayers themselves.

But Simmons is misrepresenting the September 2014 analysis by Lazard, which did in fact account for energy subsidies. Lazard found that the unsubsidized levelized cost of wind energy is between $37 and $81 per megawatt hour (with the $59/MWh midpoint that Simmons cited), meaning that wind energy would cost $59/MWh without the benefit of any subsidies to bring the price down further. Lazard separately calculated that the cost of wind energy with subsidies is between $14 and $67/MWh (midpoint: $40.50/MWh). 

Simmons also alleged that "[w]ind gobbles up the largest share of subsidies." However, he conveniently ignored the historical context of fossil fuel subsidies, which have been around for many decades. As data from the Nuclear Energy Institute shows, since 1950 coal and natural gas have each received tens of billions more in federal subsidies than wind and solar energy combined, while oil has received approximately five times as much.

Simmons further complained that estimates like the one by Lazard "don't include costs related to the inherent unreliability of wind power." But he chose to completely dismiss a much more significant external factor that substantially increases the true cost of fossil fuels: health and environmental damages from pollution. 

A 2012 study by analysts at the Massachusetts Institute of Technology and the Brookings Institute found that once these health and climate impacts are taken into account, new wind generation (with natural gas backup) is significantly less expensive than new coal generation. And it reached that conclusion despite using a social cost of carbon (SCC) -- an estimate of the economic damages associated with carbon pollution -- that is about half as high as the SCC that the Environmental Protection Agency calculated in consultation with economic experts and other federal agencies. As The Washington Post noted at the time the study came out, if the higher SCC had been used in the study, "coal and natural gas would prove even pricier."

In addition to attacking clean energy subsidies, Simmons also targeted Renewable Portfolio Standards (RPS), which require states to get a certain portion of their electricity from renewable energy sources. Citing the Institute for Energy Research, Simmons claimed that "electricity prices in states with RPS are 38 percent higher than those without."

However, a report by an organization that doesn't have ties to the Koch brothers tells a very different story. Venture capital firm DBL Investors found that from 2001-2013, the difference in average retail electricity prices between RPS and non-RPS states was "minimal," and that "in 9 out of 12 years assessed, price increases were greater on a percentage basis in non-RPS states than in RPS states." DBL Investors also determined that since 2002, electricity prices have increased significantly more in the ten states with the least renewable energy than they have in the ten states with the most renewable energy, further undercutting the notion that Renewable Portfolio Standards are responsible for electricity price spikes.

Even basic facts seemed to allude Simmons.  As the sustainable energy blog Get Energy Smart Now! noted, Simmons claimed that wind energy "supplies just 2 percent of U.S. electricity" -- but it was actually more than double that amount in 2014. Perhaps these sort of rudimentary errors could have led Newsweek to think twice about publishing Simmons' op-ed, or at least convinced them to adequately disclose who he is. 

Posted In
Environment & Science, Climate Change, Energy
Network/Outlet
Newsweek
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