There is an old adage: Lies, Damned Lies, and Statistics. With an advocacy piece, with heavy over tones of analysis and citations with reams of numbers, it is hard to work through a series of statistics to understand whether the basic material is truthful or contrived and manipulated to support a preconceived notion. This poses a real challenge to an editorial staff: how do they judge thought pieces in terms of fact checking? Is it enough that the reference says what is said or do the editors owe the readers more? Should basic asserted facts be accepted without examination or do the editors owe the readers more? And, if basic facts are wrong should the overall article be published or do the editors owe the readers more?
A 
pause for basic truth: wind power is providing tremendous value, around the world, with lower polluting energy that is helping to restrain (if not drive down) energy prices. Fully-burdened cost benefit analysis shows great benefits from supporting wind power.
Simply put, I am far from the only one who believes “editors owe the readers more”. Recently, The New Yorker‘s editors failed their readers by publishing Jonathan Franzen’s Birds-Climate without — it seems — giving a serious look at assertions and basic failures. Newsweek‘s editors have done a similar — if not more serious — disservice to their readers with the publication of Randy Simmons’ broadside attack on wind power. Simmons, in short, argues that government subsidy of wind power (such as the Production Tax Credit) is counter-productive and too costly.
As with Franzen’s piece, books could be dedicated to dissecting this one article and providing more accurate discussions to support public debate and discussion. This article gets things wrong on so many levels: from misstatements on basic facts, to misrepresentations, to playing with statistics, to not addressing fundamental issues to … Below the fold are three missing examples:
Getting basic facts wrong: an example:
Wind power is approaching five percent of total U.S. electricity generation and is — along with solar power — continuing to grow at double-digit rates year-to-year.
What does Simmons write and Newsweek publish?
wind energy—which supplies just 2 percent of U.S. electricity
Umm … no.
Rather than 2 percent of US electricity, according to the Department of Energy’s Energy Information Administration (EIA), wind produced 4.4% in 2014. And, due to capacity growth, that will be higher in 2015.
Have to say that this one basic factual error should have been a clarion call for Newsweek’s editors to send this piece back to the drawing board.
Key elements of financial equation missing
The economics of energy are, let’s be honest, quite complex. Even without accounting for “externalities” (see below), there are many elements of the cost equation that are not simply the “cost per megawatt hour”. When it comes to wind and solar power, for example, there is a very interesting market dynamic that even most (strong) advocates of renewable energy seem to miss.
As an example of Simmons’ gap as to financial implications, the article also does not examine the very real impact that wind (and solar) have on reducing costs to consumers by cutting peak pricing.
In Germany, “renewable energy (mostly wind, plus some solar) injections into the German electricity system caused, on average over the year, prices to be reduced by about 8 euros/MWh – about 15%. That translated into savings of 5 billion euros over the year for electricity buyers (utilities and other wholesale consumers),”
As discussed by Tom Konrad at Forbes,
How much lower? A 2010 Study by Charles River Associates [pdf] found that Cape Wind would lower prices on the New England wholesale market by 0.122 ce
nts on average. Since Cape Wind itself would be producing about 1% of all power on the New England market, the extra 14 cents per kWh on that power would be offset by a savings of .122 cents per kWh on all other power. By my calculations, the combination of price suppression and the increased direct price of power from Cape Wind, the net effect on the average price of power in New England of Cape Wind would be an increase of only $0.0002 (0.02 cents) per kWh, assuming the Charles River Associates study is accurate. Put another way, even if customers pay a 12.2 cent per kWh premium for power from Cape Wind, the net effect on utility bills would be zero because of price suppression.
Now, this doesn’t enter into the subsidy per megawatt hour discussion (PTC) but certainly is a significant portion of the financial equation meriting discussion in an article purporting to providing a serious look at “the full cost of generating energy from wind power”.
Stovepiping the discussion to avoid true cost-benefit discussion
Simmons clearly recognizes that there is a thing called pollution. He attacks wind power for supposed inefficiency in reducing carbon emissions because of stand-by power requirements. E.g., this suggests that he understands “carbon” as pollution. Yet, the very real costs associated with not just carbon but all pollution are not part of what he discusses even though he writes that this should be about “full cost” — not just the electricity bill but also the costs of “subsidies and grants”.
What are “subsidies”? They aren’t just measurable in direct dollars on the utility bill nor . We — as a society and as individuals — massively subsidize the burning of coal with our and our children’s lungs, mercury risks to brain development, climate risks, etc… Those very real costs are “externalities”, not considered in the financial equation. If externalities were considered on the bill, the “real” cost of a coal kWh might be well above 17 cents. The “externalities” subsidy for burning coal is potentially over 10 cents per kilowatt hour.
And, the list could go on.
A serious editorial — including basic fact checking — look would have found fundamental issues in this polemic posturing as analysis. Sad that Newsweek’s editors evidently did not feel that they had an obligation to their readership to do that serious look.
Note that the biography left out something that readers might have found illuminating:
Randy Simmons is professor of political economy at Utah State University. … Full disclosure: Randy Simmons receives funding from the U.S. Department of Energy (grant has been completed and there is no current funding) and Strata, a 501 (c)3 non-profit organization.
Yes, Randy Simmons is a Professor. He is the “Charles G. Koch Professor of Political Economy” (about this, see REPORT: Koch Fueling Far Right Academic Centers At Universities Across The Country).
Similarly, the cited sources of material are also marginally identified. Here are two examples where more robust identification might have informed readers
- The Institute for Energy Research is identified as a “research non-profit” without mention of its fossil fuel industry (including significant Koch) funding. (See this discussion of IER anti-wind attacks and this summary of IER and other anti-clean energy (front/astroturf) groups.)
- Citation of a study from “The Mercatus Center at George Mason University” fails to mention that “The Mercatus Center was founded and is funded by the Koch Family Foundations. According to financial records, the Koch family has contributed more than thirty million dollars to George Mason, much of which has gone to the Mercatus Center”.
Hmmm …
UPDATE: There have been a number of fact checks on Simmons’ work. For example, here and here and this very cogent and direct dissection of a Simmons’ OPED: Wind power blows past distortions of fossil-fueled opponents And, the American Wind Energy Association (AWEA) put out a piece directly taking on the Newsweek piece: Koch professor strikes out on wind There is a lot of substantive material there showing how Simmons’ work is based — being charitable — on dated material and how wind financials are far better when one uses actual up-to-date financial information. MMfA weighed in with yet additional examples where Simmons data is — being charitable — dated and incorrect.
UPDATE 20 April. Newsweek has published a (strong) response to Simmons, “The True Benefits of Wind Power“. They have also added this at the top of Simmons’ OPED:
Editor’s note: The author of this piece, Randy Simmons, is the Charles G. Koch professor of political economy at Utah State University. He’s also a senior fellow at the Koch– and ExxonMobil-funded Property and Environment Research Center. These ties to the oil industry weren’t originally disclosed in this piece.
UPDATE 27 April 2015. When this OPED appeared, as
per this screen shot, Randy Simmons’ LinkedIn had him current (as per the Newsweek editor’s note) as the Charles G. Koch professor. Post publication of the OPED and the resulting uproar, the LinkedIn page changed to this position ending in 2013. Some commentators have emphasized that it is inappropriate to call it questionable not to have revealed a past association — even though, in at least one professional venue, it was being ‘advertised’ as current.
UPDATE 29 April 2015: Checks & Balances Project caught Simmons on the phone and has an interesting report.