Tuesday, July 03, 2007

Fresh Greenwash

Greetings from London, where I have been detained for an additional week for family-related reasons. The weather has been reassuringly appalling, but I do not complain, because it keeps the Wimbledon Tennis Fiasco from dominating the pitiful collection of channels available to the Britons.

Interesting interview at CNET with the guy that finances renewable energy companies for GE. I say interesting because it represents a slight advance in the way that the "green energy" gnomes are doing their PR.

The interviewer snags his target, Kevin Walsh, at the Renewable Energy Finance Forum in New York, which is organised by the amusingly entrepreneurial American Council On Renewable Energy. Since he is surrounded by tubby people in suits prospering in the sector, he holds off from the whole "but I thought this environment business was all about hippies?" garbage.

Instead we get a fairly sober look at where the opportunities for GE are in the business, aside from making quite stupendous profits on the sale of its wind turbines, obviously. We learn that GE was canny enough to stay off the roller coaster that is ethanol production, less because of its dubious environmental benefits than its inability to attract cheap financing.

What we don't get is the equivalent of the old Mrs. Merton one-liner: "What first attracted you to the tax subsidy-riven renewable energy market?" We instead get this deliciously coy exchange, right at the end of the interview:

Is the financing anything special, or are they pretty standard financial instruments?
Walsh: Well, no, they are special in some instances when they are very tax-driven, in the U.S. anyway...So you need to understand how to take advantage of those features.

As if to suggest that GE, a really quite large corporation, with a really quite large tax bill, sort of stumbled on the tax subsidies while picking daisies at the bottom of a windmill. I can't help but think that the likes of GE would be best off in the long term by campaigning for subsidies to flow to producers in a more equitable and transparent fashion, rather than hoping no-one will notice how skewed the system is towards large corporations like GE and FPL.

Unfortunately, in the long term , as the market evolves, the whole tax subsidy regime is likely to be completely discredited, and creating useful subsidy regimes for other promising technologies will be that much harder. For now, what we get is this enormously secretive business tacked onto the crassest PR pitch imaginable.


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