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A Project of The Annenberg Public Policy Center

PAC’s Email Spreads Energy Conspiracy Theory

In a fundraising email, a conservative PAC claims President Barack Obama is raising natural gas prices to pay for failed green energy companies. But the letter offers only false claims and twisted facts to support this conspiracy theory.

  • The email says Solar Trust of America, a now-bankrupt company, received “the second largest loan ever handed out by the Department of Energy.” STA never took a government-backed dime. The firm was conditionally approved for the financing, but ultimately turned it down.
  • The email claims Obama “spent $17.2 billion dollars to create only 3,545 green jobs.” The jobs figure refers only to permanent jobs created under two Department of Energy loan guarantee programs. And the $17.2 billion wasn’t “spent” by the government. That money was backed by government guarantees.
  • The email says Obama appointed an aide to “crack down” on natural gas drilling to make prices “skyrocket.” The aide actually leads a task force Obama created to streamline regulation, a move the industry welcomed. It’s true, however, that the Obama administration has proposed new drilling regulations, which the industry says will increase costs.

The email was signed by AmeriPAC founder and gun-rights activist Alan Gottlieb. He founded AmeriPAC — formally known as American Political Action Committee — in 1980. The organization supports conservative candidates — sometimes donating directly to their campaigns — while opposing Democratic politicians through various forms of media, such as direct mail, radio ads and emails.

Gottlieb also is founder and vice president of the Second Amendment Foundation, a non-profit dedicated to promoting gun ownership rights. Both groups are based in Bellevue, Wash.

AmeriPAC’s emails often ask for donations. This particular letter requests contributions ranging from $19 to $119, with AmeriPAC promising to fax members of Congress to demand an end to “Obama’s green scams.”

Our thanks to Richard D. Rowlands of Saco, Maine, who forwarded Gottlieb’s email to Spin Detectors, through which we ask our readers to help us monitor political claims and campaigns across the country.

Solar Spin

Gottlieb falsely claims Solar Trust of America “was the recipient of the second largest loan ever handed out by the Department of Energy.” The company never took the money.

In April 2011, DOE offered to guarantee a $2.1 billion loan for STA’s Blythe Solar Power Project in California. But that August, STA declined the financing when it decided to use different equipment (see pages 19 and 20).

The terms of the government-backed loan supported the use of mirrors that heated tubes of liquid, which in turn produced steam to drive electricity-generating turbines. STA switched to photovoltaic panels, like those used on rooftops, because they were more profitable to use. The company sought commercial loans instead.

Then, in April, STA filed for bankruptcy. The company struggled financially after Solar Millenium, a German company with a 70 percent stake in STA, filed for court protection in December. Solar Millenium tried to sell its stake to another German company, solarhybrid AG. But that company filed for bankruptcy, too.

AmeriPAC claims STA’s bankruptcy was “bigger than Solyndra” and “virtually unreported.” But the company never borrowed a government-backed dime.

Spending Spin

Gottlieb’s email falsely claims Obama “spent $17.2 billion dollars to create only 3,545 green jobs.”

The jobs figure refers only to permanent jobs created under two Department of Energy loan guarantee programs. And the $17.2 billion wasn’t “spent” by the government. That money was backed by government guarantees.

Gottlieb’s figures are identical to those posted in September 2011 by a conservative blogger who twisted the facts from a Sept. 14, 2011, Washington Post story. The Post arrived at 3,545 jobs based on the DOE website‘s number of new, permanent jobs that renewable energy companies created after receiving government-backed loans, which at the time totaled $17.2 billion. (The jobs tally is now 3,484 — excluding the 14 permanent jobs still listed for the now-bankrupt Beacon Power Corporation. The loan guarantee figure under the two programs is now $26.3 billion, including projects under conditional commitment.)

All told, the DOE’s Loan Programs Office has financed or backed financing totaling $34.7 billion to more than 30 companies.

DOE offers assistance through a trio of programs. Two programs, known as section 1703 and section 1705, have guaranteed loans — totaling $26.3 billion — to companies building wind farms, solar power plants and other renewable energy projects. The third program, known as ATVM, directly loaned $8.4 billion to manufacturers — such as Ford — to build fuel efficient vehicles. The government expects the companies to repay those loans.

As we’ve noted before, DOE hasn’t “spent” taxpayer money on the 30-plus companies, except for two that have filed for bankruptcy. Those companies are Solyndra, which borrowed $535 million, and Beacon Power Co., which borrowed $43 million, according to a March report from the Government Accountability Office. And it looks as if DOE may recover as much as 70 percent of the loans it guaranteed to Beacon.

Still, worst-case scenario, the government is out a total of $578 million on those two deals. That’s less than 2 percent of the financing lent and guaranteed through the DOE Loan Programs Office. (The government could be out another $55 million, since EnerDel, a maker of electric-car batteries, filed for bankruptcy in February after receiving that amount, out of a $118.5 million grant, under a separate federal program.)

Gottlieb’s 3,545 jobs figure also fails to tell the whole story. The number excludes the 15,000-plus construction jobs required to build the renewable energy projects and the nearly 40,000 jobs “created/saved” by the manufacturers that received government loans, although the Post story cast doubt on the number of jobs created or saved.

‘Crack Down’ on Fracking?

Gottlieb claims Obama appointed an aide to “crack down” on natural gas drilling to make prices “skyrocket.” The Obama aide actually leads a task force created to streamline regulation of “fracking,” the process of extracting oil and natural gas from underground shale formations. An industry trade group welcomed the task force.

AmeriPAC email: Barack Obama appointed Heather Zichal to be responsible for crafting the administrations radical green energy policy. She is also in charge of managing and regulating fracking … Obama appointed Zichal to crack down on fracking which would make natural gas prices skyrocket and green energy prices lower.

Zichal is deputy assistant to the president for energy and climate change. She oversees a task force Obama formed to coordinate efforts — and “eliminate redundancy” — among more than a dozen federal government entities, such as the Environmental Protection Agency and DOE, involved in fracking regulation.

The American Petroleum Institute, which represents the natural gas industry, “welcomed” this task force after lamenting the involvement of so many federal agencies and the potential for duplicative regulation. Jack Gerard, API president and CEO, said in a press release in April: “We have called on the White House to rein in these uncoordinated activities to avoid unnecessary and overlapping federal regulatory efforts and are pleased to see forward progress.”

Carlton Carroll, an API spokesman, told us the association’s “position on the task force hasn’t changed.”

It is true, however, that the Environmental Protection Agency recently imposed new rules on hydraulic fracturing. And the Interior Department has proposed its own set of regulations, which the industry warns will significantly increase costs.

Readers can decide if the rules merit the term “crack down.”

In April, the same month Obama formed the task force, the EPA finalized new rules aimed at curbing air pollution. The regulations, which are required under the Clean Air Act, direct companies to install equipment to capture gas escaping into the atmosphere during the extraction process.

The agency changed its final regulations to address one of the industry’s main concerns — that companies need more time to install the gas-capturing equipment. The EPA gave the companies until 2015 to comply, prompting API to praise the EPA for making “constructive” changes.

The EPA says that companies will be able to offset the cost of compliance by selling the recovered gas.

The Interior Department has proposed updating its fracking regulations on federal lands. They were last revised in 1988, long before the current natural gas boom. The drafted rules require companies to disclose which fracking chemicals they use, and the rules would impose standards relating to well integrity and wastewater disposal.

The Obama administration has altered the proposed rules to address some industry concerns. The original proposal required companies to reveal their fracking chemicals 30 days before starting a well. The current proposal requires the information after drilling.

The Bureau of Land Management estimates the regulations would cost the industry up to $41 million a year but says the expense “is small and will not alter the investment or employment decisions of firms.”

API warns the regulations could duplicate state rules and have a “chilling effect on investment and jobs.” And a study commissioned by the Western Energy Alliance, an industry trade group, claims the new regulations could cost the industry up to $1.6 billion a year.

— Ben Finley