That’s Not How Commerce Works—U.S. Chamber Wrong (Again) in New Clean Power Plan Report

January 20, 2016 | 4:09 pm
Mike Jacobs
Senior Energy Analyst


Some sales efforts work from a false starting point. Some try to lead the gullible consumer by pretending to share an insider’s secret with them. Some fall back on old slogans. The U.S. Chamber of Commerce has employed all three of these tactics in its latest attack on the EPA’s Clean Power Plan.

We’ve sent the Chamber through the fact-checker before.  This time the claims are the same, but the flaws are more subtle.

The Chamber has made a lot of noise in this round on the way the EPA made renewable energy calculations and projections. I’ve done energy supply planning and renewable energy development work most of my career, so I’m going to stick to these areas.

A false starting point?

The Chamber wants us to think the EPA has done a great injustice by suggesting that future wind construction can equal the best wind construction year, 2012.  The argument goes that because there were unique circumstances that led to the construction boom in 2012, the industry 10 years later will not have grown, and will not be able to meet this EPA projection.

Below is the Chamber’s chart on this point. Notice they simply omit 2014 and 2015 actual data, and then assume there is no wind construction in the U.S. until 2021. That’s not how commerce works in an industry that has seen steady cost reductions and is beating new natural gas plants on price in many places. Indeed, that’s wacky.

U.S. Chamber of Commerce chart in 2015 report showing alleged challenge of construction in year 2023 at the same pace of 2012.

U.S. Chamber of Commerce chart in 2015 report showing alleged challenge of construction in year 2023 at the same pace of 2012.

In the real world, wind energy grew in 2014 and 2015, and is set to have a great year in 2016—and for years to come—thanks in part to the end of uncertainty over tax credits.

Psst, let me show you a secret

The Chamber suggests a conspiracy of unreasonable assumptions when it shows the difference between average productivity (i.e., capacity factor) of existing wind generation and the EPA’s projection for new facilities built. The Chamber is not anti-innovation, and concedes that technological improvements will enable higher capacity factors for future projects. It just doesn’t trust the evidence the EPA cites to support the projections.

Well, the same technology improvements that make wind competitive with today’s natural gas projects also raise the capacity factor. The target EPA used for 10 years away is already being hit. Despite the Chamber’s doubts, businesses will continue to adopt this new technology if they want to stay in business (which they do, just like other businesses).

A repeated falsehood

Last time, the Chamber had reported only the costs of a carbon reduction investment, and none of the benefits. This time, they suggest that when the greater carbon reduction from these (faulty) numbers are used, the cost of this increased carbon reduction can be found by multiplying each ton of CO2 by a $30 per ton price on CO2.  This is a novel, totally incorrect way to consider the cost of carbon pollution impacts, and it is not how commerce works.

The Chamber of Commerce should be able to understand the business case for wind power and carbon reductions—and know how to handle data—but their latest study gives little indication of those talents. The Chamber was wrong in its previous assessment of the Clean Power Plan, and its latest contribution is, unfortunately, more of the same.