Bits and Pieces: Misleading headlines, and other matters in Nevada Politics

Sometimes the headline doesn’t quite fit the story. Here’s an example: “Millions in the red an Obamacare insurer has failed” compliments of the Las Vegas Review Journal.   You have to read a few paragraphs down to get the basics of the story.  In addition to poor administration and long repayment waiting periods, “the co-op made a critical mistake: Only Nevada allows enrollment in non-exchange plans outside of the federal sign-up period, which runs from Nov. 1 to Jan. 31. Most insurers require a 90-day wait to discourage people from going without a plan until they get sick, but the co-op started with no waiting period, then added a 30-day window in late 2014. That created a sicker — and pricier — member pool,..”  [LVRJ]  These aren’t issues with the Affordable Care Act, nor is this indicative of any flaws in the overall system. What this illustrates is that the reason most firms go under is poor administration and management.

Speaking of management:  Is Waste Management Inc. living up to the terms of the contract it signed with Washoe County?  The Reno Gazette Journal reports on a crucial point: “One central issue is whether Waste Management has fulfilled the requirement to build an Eco-Center in Reno to sort its single-stream recycling and provide other services to customers. The city allowed Waste Management to raise rates, in part, to finance the construction of the Eco-Center.”  Back in March, 2013, The RGJ reported that the Eco-Center was supposed to streamline recycling in the area, noting that there were still some “kinks” to be worked out. Evidently, the kinks are winning?

The Washoe County Democrats have a quiz for us.  How do you score on a test of Rep. Joe Heck’s statements on Medicare? Social Security? Immigration?  I’ll give you one – yes, he’s called Social Security a “pyramid scheme,” and called for it to be privatized.  By July 2012 he’d called the basic social safety net program a Pyramid Scheme at least four times. [NVDems]

One win for Solar Power:  Perhaps not a long term one, but for now the efforts of NV Energy Inc to slap down the solar power industry in Nevada have been thwarted in the short term. [LVSun]  The power company is all for solar, except: “NV Energy’s proposed plan would reduce the value of credits paid to consumers and add a new fees. In filings with the PUC, the company said that the current structure unfairly shifts costs to customers without solar. The rooftop solar industry expects that the utility-backed proposal would reduce the rate of adoption of solar power.”  Original NV Energy filing here (warning: slow loading PDF)  and here (warning: slow loading PDF).  There’s the Solar Energy’s proponent statement to the PUC August 18, 2015 which makes interesting reading – again a warning: slow loading PDF.

All this in time for the Valley Electric Association to build a 15 mega-watt solar project in the northern part of Pahrump. [PVT]

GOP: Se Habla Anything?

** You have to love the consternation amongst anti-immigration factions in the U.S. and Nevada who “court” the Hispanic vote while calling for the “self-deportation” of undocumented persons.  The Nevada View notes:

Dean Heller has been trying real hard lately to massage his image with Hispanic voters in Nevada.  He wants Latinos to forget his long record of unfriendly rhetoric, votes against bills like the DREAM Act, and general disregard for the issues that matter most to their community.

Perhaps Senator Heller would like to explain his vote (#121) opposing the nomination of Maria Carmen Aponte to represent the U.S. as ambassador to the Republic of El Salvador?   The Republican filibuster of Aponte’s appointment was broken on a 61-37 Senate vote.   “Republicans had opposed Aponte over unfounded rumors that her boyfriend of years ago was a Cuban spy and over conservative outrage at an opinion piece she wrote last summer on gay rights. ” [Deseret News] (emphasis added)

Lest we consider the Hispanic community some sort of monolithic amalgam, Senator Heller’s opposition to Aponte’s appointment is a direct slap at Americans of Puerto Rican heritage.  The appointment also serves to increase the number of a traditionally under-recognized group: Hispanic women.  Aponte follows in the footsteps of Maria Luci Jamarillo, who served as ambassador to Honduras from 1977 to 1980. [USDip]

** Meanwhile back at the DREAM Act.  President Obama’s announcement of enforcement guidelines regarding children who were brought to this country by undocumented parents has candidate Romney on his back foot.   As of January 1, 2012 former Governor Romney was unequivocal:

Reporting from Des Moines — Republican presidential front-runner Mitt Romney has pledged to veto the so-called DREAM Act, which would provide a path to citizenship for children of illegal immigrants if they attend college or serve in the military. [LATimes]

That was before he was equivocal.   As of 36 hours ago the former Massachusetts governor was still dodging:

“But rather than flatly decrying the White House’s new policy as a reward for illegal behavior, as he did throughout the primaries, Romney has yet to explain what he’d do instead or even whether he’d even reverse Obama’s orders.”  [TPM]

It’s only June, so we have lots of time before Governor Romney invokes his best known position on all things: “I’m not familiar precisely with exactly what I said, but I stand by what I said whatever it was.”  [TPM]

** The former Governor has had yet another Etch-A-Sketch moment on alternative energy.  Dismissing his record promoting alternative energy during his tenure in Massachusetts, the Governor has moved:

Today he is a proclaimed skeptic on global warming, a champion of oil and other fossil fuels, a critic of federal efforts to develop cleaner energy sources and a sworn enemy of the Environmental Protection Agency. [NYT]

This is a bit out of step with the efforts of the Las Vegas Sanitary Sewer Enterprise Fund which has invested in solar power to 20% of the power needed to operate the Water Pollution Control Facility in Las Vegas.  One official reported:

When the solar array project at the wastewater treatment plant is finished, the city will be up to nearly 5 megawatts of total solar energy installed across 28 city facilities and will provide up to 20 percent of the city’s peak energy demand, Perrigo said. “That will save the city anywhere from $800,000 to $1 million on its energy bill,” he said. [LV Sun]

Isn’t the idea to save tax dollars?  Current estimates project city power costs at $15 million per year.  Reducing total power costs by about 6.7% annually means better value for Las Vegas water and sewer customers.

** Governor Romney is on record supporting the repeal of the Dodd Frank Act, which may not make some small investors very comfortable.  The Facebook IPO story keeps moving along, and we’re now informed that Facebook and Morgan Stanley stuffed Facebook stock into small investors’ accounts while the “smart money ran for the hills.” [BusinessInsider]   Mike Mayo (analyst for Credit Agricole CLSA) has some blunt words for the bankers — fix your system or it will get fixed for you, “and rightly so.”   And, if we think the problems in money market funds (MMF) were all finished with the issues of the Reserve Primary Fund in September 2008,  please think again:

“In particular, MMFs can still take risks similar to those that destroyed the Reserve Primary Fund and triggered the damaging run in 2008: MMFs still use the same set of tools, including rounded NAVs, to maintain principal stability; and investors still have incentives to run at the first sign of trouble. Thus, the SEC’s current efforts to modify the structure of MMFs to reduce incentives to run may be essential not only for protecting MMF investors—especially retail investors—but also for protecting the stability of the U.S. financial system and maintaining the access of businesses, consumers, and governments to credit. In a future post, we intend to describe a proposal for improving the stability of MMFs by making them less vulnerable to runs.”  [LibertyStreet]

“Vulnerable” and “runs” are NOT two words a person wants to see in any discussion of money market funds.  Perhaps we can be reassured by Governor Romney’s position on de-regulation of financial markets: “I’m not familiar precisely with exactly what I said, but I stand by what I said whatever it was.”  [TPM]

The Sun Can’t Shine Any Faster: Solar Development In Nevada

Living Proof: Large and complicated projects take time.  The solar energy project in Laughlin, NV doesn’t break that rule.  Yes, the land deal could move faster, but without customers no one can afford to build facilities in this sector on spec. [LVSun article]

Nevada, with its 1.0% year over year sluggish employment growth, and an equally intractable 13.4% unemployment rate [DETR] is perhaps justifiably impatient with any plans for economic development, but impatience doesn’t repeal the law of supply and demand.

And then there’s the matter of competition.  The Spanish corporation, Abengoa, has cleared the last hurdle for its plant in southern California:

The 250-megawatt project near Harper Dry Lake is under full construction after receiving a conditional $1.2 billion federal loan from the Department of Energy in June, said Scott Frier, Abengoa Solar’s Chief Operating Officer, on Thursday.  The last condition needed for the project to close financing on the loan was the CPUC’s approval of the project’s power purchase agreement with PG&E, said Frier.

Frier said that now that the last condition of the loan has been met, construction will begin in earnest. The project is already being graded and workers are beginning to put down bases for the pylons that will hold the solar collectors.  The project — which will power up to 80,000 homes once it is completed — is sited on 1,765 acres of private land near Harper Dry Lake. The project will use parabolic solar trough technology, which tracks the sun and allows for power storage. [DesDispatch]

Thus, the race is on, and California and Nevada aren’t the only states in which solar energy development is under way — New Mexico, Utah, Colorado, and Arizona are also in the mix.

More specifically, “Planning efforts that are currently looking at establishing new zones include: the Arizona Restoration Energy Design Program, the West Chocolate Mountains Renewable Energy Evaluation, and the California Desert Renewable Energy Conservation Plan. The Supplement also makes clear that there is opportunity for industry, the public and interested stakeholders to propose additional zones for consideration.”  [SEDP] (pdf)  Not only is the federal government looking to expand development, but it is taking an “All Hands On Deck” approach.  [SEDP]

Attracting Customers

One of the arguments brought forth by fossil fuel energy producers in opposition to solar, wind, and geothermal production is that solar is “too expensive.”  This argument works IF and only if one assumes that the relative price advantage remains constant over time.  One would also have to assume that manufacturing scales would also remain constant over the long term.  Neither one of these propositions is economically viable.

Manufacturing scales bring down consumer costs, but the scale depends on the level of investment.  In this instance, the U.S. has slipped to Number Three:

“On a global scale, China has now replaced the US as the country with the largest amount of clean energy investment, with $54.4 billion in 2010 and $34.6 billion in 2009. In 2008, the US was the leader in this category; now it trails both China and Germany. American Commerce Department has also predicted that the market value of China’s clean energy industry can reach $100 billion in 2020.”  [TCG]

How did the Chinese overtake the United States? The answer is simple, the Chinese invested almost twice as much in clean energy technologies as the U.S. in 2009.  [GuardianUK]

The Low Carbon Dragon

Unlike U.S. energy policy, long dominated by fossil fuel producers, and still clinging to outdated concepts like nuclear production, the Chinese have integrated their energy planning and focused their investment on FUTURE economic development:

“For too long, many governments, businesses and individuals have been wary of committing to action on climate change because they perceive that China – the world’s largest emitter – is doing little to address the issue,” said Steve Howard, chief executive of the Climate Group.

“However, the reality is that China’s government is beginning to unleash a low-carbon dragon which will power its future growth, development and energy security objectives.”

The report says that investment in renewable energy in China (around $12bn in 2007) is almost level with world leader Germany as a percentage of GDP.  The Climate Group also highlights China’s fuel efficiency standards for cars, which are 40% higher than those in the US. ”  [GuardianUK]

The Chinese have demonstrated that investment in cleaner energy technology can increase the scale of production; and, increased scale reduces prices over time.

Not to justify the Chinese practice of “dumping” on world markets, but the current flap concerning the pricing solar panels [Reuters] illustrates the principle that a producer can’t “dump” without the established manufacturing capacity to do so.

Prime Time

Another often repeated line from vested interests is that solar energy and other alternatives to fossil fuel energy production aren’t “ready for prime time.”   This contention might make more sense if the United States were the only country on the planet?  However, last March Germany produced 12.1 GW from installed solar PV’s — an amount greater than the entire 10.0 GW produced by all six of Japan’s nuclear reactor plants.  [Grist]

The hard fact of the matter may well be that the United States energy policy  isn’t ready for Prime Time — while others, notably the Germans and the Chinese, have already taken the global stage.

The U.S. can, and should be, a global leader in the production of alternative energy — Nevada certainly could contribute in terms of solar, geothermal, and wind — the question is not one of technology but of political will to break the bonds of fossil fuel dependency and to recoup our capacity for technological and economic progress.