We Don’t Do Party Politics

We just do good public policy

An Aug. 4, 2017, a Petoskey News-Review article reported that the Mackinac Center had been invited to speak about renewable energy to the Petoskey City Council. Petoskey has expressed interest in using only renewable electricity sources, so officials were looking for information on the costs and benefits of relying on renewables as their sole electricity resource.

Anyone who read that first article could be forgiven for expecting protest signs, or even torches and pitchforks, when I arrived to speak on Sept. 18. The article quoted one city council member who claimed that blog posts with titles such as “Do Renewables Really Make Economic Sense?” were proof of “an ultra-conservative” bias. A Petoskey resident claimed the Mackinac Center would be “spouting a paid point of view,” and should not be allowed to speak.

Mayor John Murphy and council member Izzy Lyman rightly noted that the council had invited two renewable energy proponents to speak. Having a free-market perspective, they said, would bring intellectual diversity to their discussions on renewable energy, adding that council members would not be doing their jobs if they didn’t listen to all sides.

My presentation focused on the need for elected officials to make well-informed decisions as they attempt to plan for their city’s energy future. Popular notions of renewable energy often do not give a realistic accounting of the costs and reliability challenges that renewable energy still faces. Many believe that renewable energy can simply replace other options. But the wind doesn’t blow and the sun doesn’t shine 24/7/365, and affordable electricity storage — like utility-scale batteries — is not yet commercially available. Eventually, that situation may change, but today, renewable energy’s intermittent nature means that wind and solar cannot replace more reliable sources like coal, natural gas and nuclear.

Many reports about renewable energy claim that it is competitive with, or even a lower cost option, than other energy sources. In contrast, I described some of the current renewable contract prices in Michigan. At just under $100 per megawatt hour, they are as much as five times higher than the $20 per megawatt hour that some people claim wind and solar cost. I also noted that wind and solar can claim to be competitive with other energy resources only due to the presence of renewable-friendly government policies. These include generous federal tax incentives and subsidies, as well as state renewable portfolio standards and mandates that force renewable energy into the mix ahead of other options.

The case of the Georgia-based solar provider Suniva illustrates the potential costs of relying on renewable energy. After having benefited from tens of millions in federal, state and municipal tax incentives, direct subsidies and other market preferences, Suniva declared bankruptcy. It closed its plant in Saginaw, laying off only 57 of the over 500 full-time employees it had promised to hire. It seems that the other 443 jobs were never filled. Then, soon after declaring bankruptcy, Suniva began an anti-dumping trade complaint against Chinese solar panels. If that complaint proves successful and tariffs are imposed on solar panels coming from China, this would lead to higher prices for all solar installations in the U.S.

At the council meeting, I also described some of the environmental impacts associated with renewable sources. They include bird and bat deaths and the pollution caused by mining for rare earth minerals in countries that don’t have the same strict environmental protections as the U.S. I also discussed the growing legal pressures and public resistance wind developers are now facing. The recent Huron County votes — as much as 2 to 1 against the construction of new wind facilities — show that public support for new renewable energy installations may not be as widespread as media reports suggest.

Overall, the presentation went well, although a small portion of the audience was made up of committed progressive and environmental activists who opposed Mackinac’s participation. Amusingly, these partisans and activists claimed to “welcome a wide range of perspectives.” Groups like Positive Energy Petoskey “enthusiastically [stood] behind” — and even established a GoFundMe campaign to cover the costs of — having former Grand Rapids mayor and renewable energy advocate George Hartwell give a pro-renewable energy presentation. But, they “viewed the Mackinac Center … with skepticism” given our history of advocating for free-market solutions to policy problems.

Despite the presence of this group, a Sept. 25 letter to the editor in the Petoskey News-Review gave a more balanced review of my presentation. The letter said Petoskey’s residents appreciated my transparency and my open support of free-market solutions to their particular policy issue. The author also thanked me for my suggestions to guide the council, saying they were helpful.

My talk was met with applause and thanks from the audience for presenting the council with balancing information. The mayor closed out the Q&A period by noting that respecting the rights of all sides of an issue to speak is “what democracy is all about.” In this example, the citizens and elected officials of Petoskey demonstrated their city’s ability to handle an important energy issue in a professional and respectful manner.