Jack Markell continues to promote highly questionable “Green Energy” policies and programs that are politically appealing but economically unviable. This is not in the best interest of the taxpayers of Delaware and will cost them hundreds of millions of wasted dollars and thousands of jobs.
At the sound bite level, helping Fisker buy the abandoned GM plant on Boxwood Road so that Delaware workers can be hired to build electric cars sounds like a no-brainer. However, when you dig into the business plan for this venture, it quickly becomes apparent that this project is extremely costly to taxpayers and a very long shot at ever succeeding. More than $650 million dollars of federal and Delaware taxpayer funds has already been spent. If it is successful, and if 2,400 workers are employed there, the cost to taxpayers per new job will be a staggering $270,000.
But more importantly, Fisker defines the success necessary to hire 2,400 workers as the production of 100,000 cars annually. If they sell fewer cars, they hire fewer workers. Keep in mind that Fisker has no brand recognition, no quality reputation, no dealer network, and that it will be fifth to market with the most expensive product. It will be competing with the Chevrolet Volt. Chevrolet has brand recognition that ranks with baseball, hot dogs and apple pie, a good quality reputation, over 4,000 dealers and a lower-priced product that was introduced years ahead of the Fisker product. Yet Chevrolet’s first- year forecast is just 10,000 units. Through September, year-to-date Volt sales were 3,895 cars. Fisker’s sales forecasts are wildly optimistic and designed to secure government subsidies, not accurately predict future sales or employment levels.
Bloom Energy is another example of Jack Markell grabbing a green energy headline at taxpayer expense. He bullied the state legislature into classifying the use of natural gas (a fossil fuel!) in a fuel cell as ”renewable energy” and now that the PSC has approved the plan, Delmarva customers will be paying the bill. Electric rates in Delaware are already 50% higher than the national average.
The critical factor in determining the cost of Bloom Energy boxes is the lifespan of the fuel cell “stack” – the part of the device where the magic of converting fuel into electricity takes place. Useful life of the stack has been the Achilles Heel of fuel cell economic viability. Replacing the stack if it goes bad is extremely costly and would severely affect the economic usefulness of Bloom’s devices. Although Bloom claims to have achieved a breakthrough on stack life, we simply do not know how long they will last. Regardless of the actual useful life of the product, our commitment to pay for them will go on until fulfilled. Our Governor is willing to bet our tax dollars that Bloom’s claims of fuel cell lifespan will be achieved. Jack Markell gets the sound bite and the glory; Delaware taxpayers get the risk and the bill.
Jack Markell continues to cling to the Regional Greenhouse Gas Initiative. RGGI is a mini cap and trade program adopted among a group of northeast states. It won’t significantly reduce carbon emissions unless all the states participate. Presently, Pennsylvania is not in the program and New Jersey has announced its intentions to pull out of the program by the end of 2011.
Delaware’s continued participation in the program does little to reduce carbon emissions but costs families and businesses between $15 million and $35 million in inflated electric rates. This is a strain on families and a job killer for businesses. Continuing to participate in a program that will have no benefit but which will put Delaware at a competitive disadvantage with neighboring states is irresponsible.
Instead of investing Delaware funds on high risk green projects from out of state companies, Jack Markell should work at improving the environment for all businesses. He should work toward reducing the cost of doing business in Delaware. He could start by proposing to eliminate the archaic Gross Receipts tax. That would benefit all Delaware businesses, not just a hand-picked few.