Tilting at windmills: We critique the critique of renewable energy

January 1, 2013

According to a new Synapse study, produced on behalf of the Civil Society Institute, the American Legislative Exchange Council (ALEC) has grossly misrepresented the costs and impacts of renewable energy. 
ALEC is a lobbying group known for drafting and advocating controversial state legislation, such as “stand your ground” laws. More recently, ALEC has sponsored state and national studies supporting its “Electricity Freedom Act,” which would eliminate all requirements for the use of renewable energy. Synapse’s analysis of ALEC’s studies found that they rest on numerous errors and misrepresentations of energy data, and on an idiosyncratic economic model that always favors cuts in regulations, taxes, and public services.
For example, while ALEC purports to present low, mid, and high price scenarios for wind energy, even their low case is well above the costs of 216 actual wind contracts—representing approximately 17,000 MW of wind capacity—signed by utilities over the last ten years. Backup generation requirements are exaggerated; transmission costs for new renewables are four times as high as more credible, independent estimates—in one area after another, ALEC’s studies have a loose and biased relationship to empirical data.
These unsupported energy cost assumptions are then fed into the STAMP model, developed by economists at Suffolk University’s Beacon Hill Institute. STAMP assumes that people are hypersensitive to tax rates—in this model framework, even small tax increases cause workers to quit their jobs, and some will move to other states. STAMP-based analyses routinely favor cutting public services and taxes, “finding” that any other course will drive away workers. In ALEC’s studies, their own exaggerated renewable energy costs are represented effectively as tax increases in the model, leading to the inevitable if fanciful conclusion that these resources harm the economy. View Synapse’s full study, Not-so-smart ALEC: Inside the attacks on renewable energy.