Say what??!! - Slick Willie Strikes Again

George Rebane

Former President Bill Clinton has it all figured out.  We’re putting all the laid off contractors back to work across the country doing “green upgrades” to every building that will stand still for it, and that will solve the jobs problem.  All it takes is a little money, and we’re gonna get it from the pension funds of unions like the AFL-CIO and AFT, and (wait for it) even CALPERS – they’ll all kick in billions.  These outfits are going into the banking business to make “Just say YES loans”.  And it’s all gonna turn out ‘cash neutral’ cause, the loan paybacks will come from all the guaranteed savings from lower cost utility bills after all that good green is stuffed into and strapped onto those houses, schools, colleges, hospitals, office buildings, factories, … .  Oh, one more thing, this will work just as well in Europe as here - God help 'em.

Now here’s how it will all come down – get out pencil and paper, and pay attention.

1.    The unions and pension funds will advertise the ‘Just say Yes’ loans for green upgrades.
2.    Building owners will trip over themselves to sign up for all that cash.
3.    Charlie the contractor will reassemble his crew, get them trained, and hang out his shingle again.
4.    Soon enough Charlie and Susie the building owner will sign a contract, and Charlie goes to work making the building as snug as a bug in a rug.  (Charlie probably doesn’t notice some small print at the bottom of the page, but we’ll get back to that.)
5.    The work is completed, Charlie packs up his stuff and goes on to the next job, and Susie starts enjoying lower utility bills and making loan payments.
6.    The stingy bankers out there holding on to their trillions are now supposed to be green with envy watching all those ‘Just say Yes’ loans pulling in the fat loan service payments.  Some might even ask ‘A few years back we made a ton from ‘Just say Yes’ loans, so how come we’re not making those loans now?'  Some cooler heads counsel a bit more wait and see.
7.    If after a while things don’t turn out exactly as predicted, and Susie can’t make her loan payments from her utility savings – not to worry, she picks up the phone, calls Charlie, and asks him to come over while reminding him not to forget his checkbook.
8.    A puzzled Charlie arrives wondering what all this is about.  Susie shows him the small print on the contract where Charlie guarantees that he will make up the difference between the loan payments and the utility savings.  Charlie says, ‘Holy shit!’
9.    Charlie writes Susie the check, calls his lawyer, ups the price on his next installations to cover run-ins with future Susies, and pours himself a very large adult beverage while he figures out what kind of business he has now gotten himself into.
10.    Mary has Charlie do her building also.  It costs a bunch more than what Susie paid, but what the hell, her ‘Just say Yes’ loan covers it, and Charlie guarantees it to be cash neutral.  Mary knows that ‘cash neutral’ means that to her the green upgrade is free.
11.    Charlie soon gets a call from Mary and discovers that he didn’t price in enough to cover the large checks he’s now writing to his former customers.  He sees that he’s signed himself up essentially forever with every building that he has greened.  Utility bills keep going up, and on the back of an envelope one day Charlie figures that he’s SOL, so he declares bankruptcy.
12.    All the lawyers involved have been waiting for this, and are now happy dancing in the streets as the lawsuits come rolling in – building owners suing contractors, suing pension funds, suing unions, suing utilities, suing greenie stuff manufacturers.  And then everybody involved starts counter-suing each other.  Tort law dreamland, cue the violins.
13.    The bankers go check the locks on their vaults to make damn sure that none of their cash gets suckered into the next tranche of ‘Just say Yes loans’ that another one of Obama’s pals is bound to announce sooner or later.

You probably don’t believe any of this and want to hear from the ol’ Slick himself.  Well here he is at his Clinton Global Initiative no less (notice absence of telepromters), and with a couple of would-be banker sidekicks in attendance whom you’ll recognize instantly.  (H/T to  RR reader Dave King for the heads up on this, and to another RR reader for the timely image.)

Comments

[Russ Steele]

Actually I think it is all bat shit! Bull shit is way too earthy, where as bat shit stinks much worse. Anytime the government get involved you are going to lose, one way or the other. And, one thing we can all count on is our energy bills are going to keep climbing under AB-32, with the EPA killing off coal generation, and strangling shale gas production with a lot of useless regulations. Poor Charlie is going lose no matter how hard he works.

One of the green home upgrade programs is already a failure as the cost were too high, as it required prevailing union wages be paid by the contractor. The home owners could get the job done by using local labor and parts from Home Depot for less money. No one wanted the green upgrades. I may have posted on the failure at NC2012.

[D. King]

Now the idiots want to shut down the nuclear plants.

Go Green energy! Yeah...well..sort of.

Ballot Measure Would Shut Down Nuclear Plants in California

http://www.ktla.com/videogallery/66293792/News/KTLA-Ballot-Measure-Would-Shut-Down-CA-Nuclear-Plants-Chip-Yost-reports

[D. King]

Sorry, bad link.

Here:

http://www.ktla.com/videogallery/66293792/News/KTLA-Ballot-Measure-Woip

[Douglas keachie]

The notion that the loans can be paid back with just the savings over regular propane and PGE is a bit odd. Our total for both is typically about 3 propanes at $550 each per year and 12 $140/month electric payments, unless we start burning wood, which we are with a vengence this year. The house is already insulated, except for cat and dog door anterooms, which I should build. assuming that at best we might save $1800 with a full solar install, on the grid, at a cost of $35,000, of which 80% is equipment and only 20% is labor, we have $35 grand to pay off at $1800 per year, but the house would be worth more. If you have your mortgage covered regardless, as we do off of my pension (assuming this scheme doesn't destroy CALSTRS), THIS WOULD CERTAINLY BE WORTH LOOKING INTO. On the other hand, if your job/income has all the stability of a waiter at Hooters, maybe not such a good idea.

[Walt]

At this point , all I can do is dig myself in, and watch things implode with morbid glee. ( can't help but chuckle at this point)
Tax this ,tax, that. New law here,etc. etc. Just how bad has it got? we are now EXPORTING refined gas. What does that tell you?
( some of the nuts would call it a good start) No money, no driving.

[bill tozer]

Good point Walt. If we clip the wings of all the cars and drivers and HUD people, then no worries about silly things like smog devices. I thought Willy was down there feeding all the hungry people of Haiti and rebuilding the shanty towns with nice green (hopefully) homes. "How is that working out for ya?" he says in his best Walt imitation.

[Dixon Cruickshank]

The big problem I see is that with current regulations kicking in electric is "supposed to higher". So I have a hard time seeing how you can save anything to pay the loan back if the KW Hr price goes up even if you don't use as much - but I'm just a stupid redneck. How much more would Charlie lose if in 2 yrs they do shutdown the nuke plants.

Like I say all the time uncertainity - how does Charlie write a business plan???? just like its been for the last 3 yrs its fluid baby.

[Account Deleted]

D.K. has fallen into the usual nonsense of solar paying for itself. Run the numbers. How does $1800 a year pay off 35K? Remember interest has to be paid as well. The solar panels will be kaput long before you can pay off the loan. And this assumes absolutely no maintenance costs during the operating span of the panels. Not likely. This only works if we follow President Zero's dream of 'sky rocketing electric rates'. At that point our economy folds up like a paper hat and it won't matter any more.

[Douglas Keachie]

At 2% interest for 25 years, typical life of solar panels, many last much longer, you get:
($148.35)monthly payment ($1,780.19)yearly total
=PMT(2%/12, 300, 35,000)

Now if electricity continues to go up, and I don't see any signs it is not, then the interest rates could rise, and the homeowner would still bra=eak even, and of course the whole economy would be improving, which, despite the very best efforts of the job makers who just HAVE to keep their two to four trillion, it is not doing now.

[Douglas Keachie]

BTW, Obama didn't start Solyndra:

ou'd never know from the media coverage that:

The Bush team tried to conditionally approve the Solyndra loan just before President Obama took office.

The company's backers included private investors who had diverse political interests.

The loan comprises just 1.3 percent of the Department of Energy's (DOE) overall loan portfolio. To date, Solyndra is the only loan that's known to be troubled.

Because one of the Solyndra investors, Argonaut Venture Capital, is funded by George Kaiser -- a man who donated money to the Obama campaign -- the loan guarantee has been attacked as being political in nature. What critics don't mention is that one of the earliest and largest investors, Madrone Capital Partners, is funded by the family that started Walmart, the Waltons. The Waltons have donated millions of dollars to Republican candidates over the years.

[Steve Frisch]

This is not a new idea, nor is it as fraught with danger as George or Russ would have you believe. Tens of thousands of businesses and individuals in California have participated in programs very similar to what the CGI is advancing.

http://asset.sce.com/Documents/Shared/100816_OBF_FactSheet.pdf

and the contracts to secure this sort of financing are well established:

http://asset.sce.com/Documents/Shared/100802_OBF_Loan_Agreement.pdf

The same programs are being offered by many utilities.

By the way, the baseline to measure savings depends upon the work that is done--for example if one implements energy efficiency measures such as changing lighting, control mechanisms, HVAC systems, and other mechanical and electrical systems, and then layers installation of solar on top of that, the savings are aggregated to calculate baseline. Those savings are usually more like 40% -50% of total energy use, and can include both gas (or propane) and electric. Baseline is also pegged to kWh not price per kWh so there is no risk of changing payment terms as prices rise or fall.

SBC's energy watch program has done more than 650 building retrofits (using rebates and incentives as financing) in the last 18 months (for commercial and municipal facilities) and the average savings have been about 40%. These retrofits are on track to save 13 million kWh per year by the end of 2012, at a savings of $1.5 million per year to Sierra Nevada businesses and local governments.

Very similar financing is being used in Placer County right now as part of their mPower program. A similar program in Sacramento is doing $100 million in energy retrofit. The bottom line is the energy savings far outstrip the investment within a relatively short period of time.

This is energy conservation--how could anyone be against energy conservation?

This entire fear based resistance to good fiscal policy is simply nonsensical.

[Steve Frisch]

There is another point to be made here.

The Clinton Global Initiative is private money--don't they have a right to invest it any way they want? The AFL-CIO pension funds are private money, don't they have a right to invest their money as they see fit, and consistent with their own rules? CALPERS is a private system, with an elected board of directors selected by their members. The participants in CALPERS earned their money (whether one agrees with current amounts or not, it is their money). Don't they have a right to invest it as they see fit, based on their procedures?

http://www.calpers.ca.gov/index.jsp?bc=/about/organization/home.xml

Are you suggesting that these private entities should not be able to invest as they see fit? If not, who invests their money? What is the alternative?

I mean really, the issue here is just that you guys don't believe in energy efficiency or renewables, but its pretty clear that the world does not agree with you.

Any of you notice that for the first time ever investment in renewable energy outpaced investment in fossil fuels in the US?

http://bnef.com/PressReleases/view/173

[Steve Frisch]

If anyone wants to watch a nayional policy forum on renewable energy in the US there is a good one being webcast live right now from the Canon office building put on by ACORE

As a 501(c)(3) nonprofit organization, ACORE has employed a nonpartisan strategy in our work - not just a bipartisan strategy, but a nonpartisan strategy. Our nonpartisan heritage puts ACORE in a unique position to address the key issue of the day, which is the political gridlock that has stopped the policy process in recent times.

http://www.ustream.tv/channel/phase-ii-of-renewable-energy-in-america

[Account Deleted]

Ah - so little time, so much mis-information to correct. Let's start with your 2% loan. That's not a market rate as real inflation is rising faster. I wouldn't loan you the money for 2%. If you get a 2% loan, some one else somewhere is subsidizing it. If rates keep going higher in this state the economy will keep going down, not up. The stories I read about solar panels is that some will last, but most will not even go 20 years and still put out 90% of a new one. And the companies that 'guarantee' them are out of business. Maybe the new ones are better. Still doesn't pencil out in the real world, without govt subsidy.
George never said the private folks can't throw their money away - he just pointed out it wasn't too bright. Pensions (PERS) are not private money. There are stringent rules that govern how they are suppose to be run. Supposed to be run. That's the joke. I remember what happened to 'private' pension money from the unions in the 50s and 60s. Nowadays the mob is better organised and likes to consider themselves green.
No one said the Solyndra loan didn't start with the Bush admin. But the Bush admin didn't give them one dime and when President Zero's zealots got in, they found the loan had been shelved. Despite repeated warnings, Zero's crew pushed the loan forward anyway. Read the emails they have now. Then, Zero's bums re-structured the deal to put private investors ahead of the tax payers so they could scrape together some more cash to keep the thing afloat for a few more months. This was clearly against the rules. Solyndra is not the only loan that is 'troubled'. Nice choice there of words. I call it a swindle.
And of course, once again, we find that if we disagree with the libs as to how our tax money is thrown down the rat hole, then we are 'afraid' and against energy conservation.
If we don't like wealthy folks having their personal vehicles subsidized by poorer folks, then we are 'against' electric cars and if we don't like billions being spent on some stupid program that employs some ACORN goons to throw a few dollars of caulk on a wall, then we are 'against' energy conservation. I was a charter subscriber to Solar Age magazine. I'm only too happy to explain how a well built house can be far more comfortable and cheaper to operate than a currently built house. I can also tell you that the biggest impediment to having that house built is the govt. What the left doesn't understand is that the market must be the driving force to get things built to use less energy. Having the govt deliberately drive up the cost of energy and then spending tens of billions of tax dollars we don't have to make everything more energy efficient is just not going to work. Most of the gung-ho solar enthusiasts I knew in the 70s are libertarians and are horrified at the mess the govt has made of alternate energy.
We can talk about ways to be more energy efficient and I'm with you. If you lefties really care about the size of our carbon footprint, start thinking about the trillions in debt we have now and what the size of that footprint will be to pay off. Yes, I know - it will be 'paperless'. Ha Ha

[Todd Juvinall]

Renewable energy? How is a sunray renewable? I was under the impression energy was alway here but maybe in different forms? Wasn't oil once a tree? The energy under our American feet would put our country right back on top is only the econuts and the politicians would get out of the way.

[George Rebane]

Didn’t realize that Clinton’s points were so deep. Apologies for not making them more clear in my piece here. Let me take another cut.
1. No one argues that better/more insulation and alternative ways of generating electricity will not reduce utility bills.
2. It is problematic that the savings will be ‘cash neutral’ as advertised, especially with rising utility prices.
3. Requiring small contractors to guarantee in perpetuity the ‘cash neutral’ proposition is beyond silly.
4. No argument is made here to prevent union pension funds from investing private monies. However, I will argue that to the extent that the government will/must step in to use taxpayer funds to make good those ‘Just say Yes’ loans – e.g. for the AFT and CALPERS – they are not investing private monies. An up front formal stipulation that government will not make up any resulting unfunded liabilities could settle the matter if you trust future politicians. I am against government bailouts.

[Todd Juvinall]

I think electricity is a "right". Why not? If clean water, clean air and watching "bambi" run across the forest are rights, then why isn't the passage through a conveyance and use of electrons, the basic part of an atom, a "right"? LOL!

[Douglas Keachie]

If you tweek to slightly different nbumbers, you get:

=PMT(4.5%/12,360,30000)

($152.01)monthly ($1,824.07)yearly

Since I have not priced a system in two years, I think it entirely possible that prices have gone down. I'm sure that the 4.5% interest rate is doable in today's market, and there is one other thing. The framework the panels sit on, and the copper wiring and connection to the house, are not going to go bad. The voltage inverter might, the panels might, but in 30 years time, you might have replacement panels that would be twice as efficient, and thus would cover their replacement costs very quickly.

Todd, you are a gem. Did you fail to notice that the planet moves around the sun, and each and every rotation of the Earth from day to night to day, brings in a whole new burst of energetic sunbeams? That's why they can it , "renewable energy." "and a new day, has just begun..."

[Steve Frisch]

I can get 2% money from a couple of places right now. There are actually lenders who manage SRI funds that are looking for these investments, although I agree that calculating at market rate would be a more accurate depiction of reality.

Utility led on-bill financing programs usually are at 0% interest, with a 5 year pay back. They are willing to do this because of "avoided costs", that is conservation is saving them from having to build new infrastructure. I know that to many it may seem counter-intuitive but they get more bang for the buck by having existing facilities serve a larger population.

[D. King]

"I know that to many it may seem counter-intuitive but they get more bang for the buck by having existing facilities serve a larger population."

Counter-intuitive?

Shut down the nuclear plants, blow up hydro-electric dams...no, nothing counter-intuitive about that, just more CO2; right?

[Account Deleted]

Oh - I could get money a lot cheaper than that. If the Fed is your buddy it's free! If existing facilities serve more customers then rates should go down. But they are going up.
Zero interest loans from the utilities are subsidized by the rate payers. That would include me. I would like PG&E to please generate the most efficient electricity possible, not the one that employs the most people or kicks back money to politically connected crooks. If you want to go solar, then do it. Please stop using my money. That's all we conservatives ask. And I would ask that I be allowed to build an efficient home for my family that doesn't include putting a bunch of useless bozos on the payroll to do it.

[D. King]

It's a sad day. :) The death of the climate fraud.

http://www.youtube.com/watch?v=Xmtjh7yCrw4

A-Z report on fraudulent IPCC science.

http://tinyurl.com/7tch258

[Steve Frisch]

I think you may be missing the point Scott, utilities provide 0% money for energy efficiency and renewables because it is MORE economically efficient for them to conserve energy than build new generation. The cost per kWh is lower. So for you, as a customer, you are actually paying less to pay me to use a LED light than you would to pay to construct the facility to generate the electricity to provide the 80% more electricity a incandescent uses. So they are generating the most efficient electricity possible. The problem you have is a problem of belief, not a problem of economics.

[Steve Frisch]

D. KIng, I am not advocating shutting down nuclear or pulling out all dams. You must have me confused with some Luddite you saw in a cartoon. I am conscious of the fact that everything we build has an effective life, and at some point what we build needs to be de-commissioned other wise it either ceases to function or becomes increasingly dangerous.

[Greg Goodknight]

The latest generations of natural gas driven generators have far less capital costs per megawatt of capacity than that of the photovoltaics, wind and other so-called green renewable energy sources. Their only drawback is that they generate CO2 and water as the virtually sole effluents, and that is what has driven us to the most expensive power sources on the planet. The CO2 scare is winding down but with plenty of shouting still to be done before it's over.

[D. King]

It doesn't matter what you're advocating. The left's obsession with infrastructure destruction is on full display!

"For PacifiCorp, the Portland, Ore., utility that owns the dams, consenting to the end of the J.C. Boyle, Copco No. 1 and 2 and Iron Gate dams ultimately was a business decision."

http://articles.latimes.com/2009/sep/30/local/me-klamath30

The same excuse they used for blowing the dam in Washington State.

"PacifiCorp decided to blow up the hydroelectric dam after learning it could cost as much $100 million to build the fish passage structures required to relicense it. At 125 feet, it’s the second largest dam ever to be demolished in the U.S."

http://www.rawstory.com/rs/2011/10/26/watch-explosion-breaches-dam-in-washington/

Funny, same company???

Gregory E. Abel CEO

The Potential Heirs to Buffett’s Throne

http://dealbook.nytimes.com/2011/04/01/the-potential-heirs-to-buffetts-throne/

[Account Deleted]

Yes Steve - I've heard that argument for years. It's pure BS. If it were true, I would be paying less and less for electricity but I'm paying more. And using less and less juice. That theory works great in some kind of alternate universe that the left lives in but not in our reality. I do, indeed, have a problem with belief when I can show you my PG&E bills. Your way is a race to the bottom with everyone eventually using no electricity at all. At the same time I'm supposed to save a pittance on my bulbs, I'm told to go buy an electric car. If everyone was driving electric cars, our generating needs would soar. We need more generating capacity.
Removing hydro dams isn't going to get us there. Look who is pointing to the future.
http://www.foxnews.com/scitech/2011/12/07/bill-gates-to-build-next-gen-nuclear-reactors-with-china/?intcmp=trending

[D. King]

LOL Scott!

And he's the one who wants unlimited H-1B visas.

I'm I the only one seeing a pattern here???

[Douglas Keachie]

""PacifiCorp decided to blow up the hydroelectric dam after learning it could cost as much $100 million to build the fish passage structures required to relicense it. At 125 feet, it’s the second largest dam ever to be demolished in the U.S.""

For that kind of money you should be able to fly the fish over in a 747, First Class. No engineers here who can't design a fishcalador for less?

[George Rebane]

DougK 955am - plenty of engineers here and elsewhere who can design functional and efficient fish passage structures for a lot less. The requirement to conform to government regulations and the subsequently inevitably insane green lawsuits that pumps up the price. How do you think the government winds up buying $600 toilet seats for its submarines?

[Douglas Keachie]

Independence Day got that one right. They buy stock seats at Home Depot and then spend the money on super secret projects.

"President Thomas Whitmore: I don't understand, where does all this come from? How do you get funding for something like this?
Julius Levinson: You don't actually think they spend $20,000 on a hammer, $30,000 on a toilet seat, do you? "

If you like these line, you'll love this site, as movie is one of my favorites. http://www.imdb.com/title/tt0116629/quotes