Perpetrating a Fraud: CO2 Offsets
by Bill Turlay
WA residents, you might take note (and mention to your legislature delegation) that RCW 19.29A.090 [here] requires each electric utility to provide to its retail electricity customers a voluntary option to purchase qualified alternative energy sources. Each electric utility must include with its retail customer’s billing statement, at least quarterly, a voluntary option to purchase qualified energy resources. OR residents, the basic premise of this message pertains to you also.
Ladies and gentlemen, the State of Washington is involved with perpetrating a fraud on its citizens. See Climate Swindle: The Mirage of Carbon Offsets by Mr. Todd Wynn of the Cascade Policy Institute [here]. Some selected excerpts:
Carbon offsetting has spread quickly in the past few years, fueled by worries of human induced climate change. Some assert that the combustion of fossil fuels is causing a buildup of greenhouse gases in the atmosphere and consequently increasing global temperatures. Accordingly, many environmental organizations and governments around the globe advocate restricting fossil fuel use and increasing the use of mechanisms that claim to decrease human emitted greenhouse gases. One of these mechanisms is carbon offsets.
The Climate Trust, a non-profit carbon offset provider in Oregon, defines carbon offsets as “reduction, removal, or avoidance of greenhouse gas (GHG) emissions from a specific project that is used to compensate for GHG emissions occurring elsewhere. One carbon offset represents one metric ton of carbon dioxide equivalent.” By purchasing a carbon offset, businesses, electric utilities, or individuals pay someone to reduce greenhouse emissions elsewhere, rather than change their own behavior. …
The newfound popularity of carbon offsets warrants a closer examination of their legitimacy. Studies of some carbon offset schemes have revealed examples of fraud and abuse. These examples caution against the use of offsets for regulatory compliance.
This report offers an in-depth look into one of the most prominent carbon offset marketers in the United States, the Bonneville Environmental Foundation (BEF). Because BEF is perceived as one of the nation’s leaders in providing quality offsets, any problems found there would indicate that there are systemic problems within the industry. …
The BEF founders agreed to endorse “select, environmentally preferred resources” such as wind, solar, and geothermal power, and the Bonneville Power Administration (BPA, the Pacific Northwest federal power marketing authority) agreed to sell electricity and “Renewable Energy Certificates” (RECs) from these power sources for an increased premium from their customers. This premium and the sale of RECs would ultimately help form and fund BEF. …
Since 2000, BEF has bought RECs from BPA, directly from renewable energy project owners, and occasionally from public utility districts. BEF resells these RECs (bought either at a discount or at cost) to their customers at a higher price. …
In 2008, BEF contracted to purchase just over 7,000 MWhs of RECs to be resold. This past year, BEF began selling carbon offsets and renamed its BEF Green Tags to BEF Carbon Offsets. Since carbon offsets have become more mainstream the change might seem appropriate from a marketing perspective. BEF representative Lindsay Hamilton said, “Green Tags are the same as carbon offsets. We just gave them a new name. …
In addition to selling BEF Carbon Offsets, BEF has partnered with several businesses to sell miniature carbon offsets which are marketed through programs called SkiGreen, Race Green, Paddle Green, and Tour Green. These offset purchases supposedly offset emissions related to the travel to and from recreational activities like skiing, running, rafting, kayaking, and touring.
There are significant problems with BEF Carbon Offsets. Unfortunately for BEF, it is not as easy as one may think to just rename RECs as carbon offsets. There are countless inconsistencies associated with selling RECs as carbon offsets to customers, including inaccurate assumptions of offsetting fossil fuel generation, lack of additionality, and inaccurate monitoring/verification of emission reductions.
The major problem with BEF Carbon Offsets is that they are not really offsets at all. There is a distinct difference between RECs (which BEF purchases to resell) and carbon offsets. …
RECs simply represent the supposed environmental amenities associated with green power production, bundled as a commodity for a given amount of kilowatt hours generated. In other words, RECs subsidize existing renewable energy projects. An offset is beyond “business as usual” and can only be considered additional and thus genuine if the project would not have been completed without the offset funding. …
In short, RECs generated from renewable projects only represent a megawatt of electricity sent into the electrical grid. It has not been shown that this megawatt of electricity reduces carbon emissions, though it may reflect other environmental benefits of value to the purchaser. …
BEF asserts, “A 1,000 kWh of electricity generated from clean, renewable resources (like wind and solar) displaces 1,000 kWh of electricity that would have been generated from dirty, polluting sources (such as coal or natural gas).”
But an investment in renewable energy does not mean that the energy actually reduces emissions, replaces fossil fuel generation, or convinces a utility to resist building a coal plant in favor of a renewable alternative like wind. One of the larger BEF REC suppliers is the White Creek wind project in Washington State. The energy from this facility is integrated into the BPA system. The interesting thing to note about BPA-integrated wind farms is that they are incorporated into the electricity grid using hydroelectric power as the back-up source, which negates BEF’s claim that renewable resources ‘displace’ fossil fuel generation.
In order to function properly, the electricity grid must remain in perfect supply and demand equilibrium. This means that adding an intermittent power source such as wind turbines to the grid makes it difficult for BPA to balance energy properly. When the wind blows and wind turbines begin generating electricity, another power source must be ramped down or shut off in order to prevent an overload of electricity. In the Pacific Northwest and under BPA, hydroelectricity is ramped down in order to accommodate wind power. This means that the production of wind power is not directly offsetting any emissions at all; it is simply replacing another renewable energy source. Thus the BEF claim that “1000 kWh of electricity generated from renewable resources (like wind and solar) displaces 1000 kWh of electricity that would have been generated from dirty, polluting sources” is false. …
The massive expansion of wind power in the Pacific Northwest is creating significant problems for BPA; the hydroelectric system is reaching the point where it can no longer compensate for the unpredictable nature of wind energy. Therefore BPA has announced that natural gas power plants are being considered for construction in order to back up the energy from wind on the BPA’s system.
When asked if wind power was reducing carbon emissions from BPA, Deb Malin, BPA representative, answered, “No. They are, in fact, creating emissions.” The reason is that natural gas-fired power plants used to back up wind farms must be kept on-line at all times. This is known as the “spinning reserve”, a phase that resembles the operation of an automobile idling. Though a natural gas facility may not be generating any actual electrical power while in spinning reserve, it is consuming fuel and emitting greenhouse gases.
Thus new wind farms do not add any direct energy capacity to the electricity grid because they must always be backed up by another power source. If that source is BPA hydro projects, the wind farms are roughly carbon-neutral; if the hydro is tapped out and BPA must use natural gas plants held in spinning reserve, the wind projects actually increase carbon emissions.
There are three wind farms from which BEF buys RECs where fossil fuel plants are used to integrate the power into the grid. This means that helping to fund new renewable generation from those wind farms through the sale of BEF carbon offsets does not necessarily prevent new fossil fuel plants from being built. It may actually encourage the construction of new fossil fuel plants.
In Germany, the heavy integration of wind power has not reduced carbon emissions, and additional coal and natural gas plants have been constructed to “ensure reliable delivery.” Flemming Nissen, the head of development at a West Danish generating company, ELSAM, one of Denmark’s largest energy utilities, has stated that “wind turbines do not reduce carbon dioxide emissions.”
In summary, RECs, which are what BEF purchases and repackages as offsets, do not offer a direct and verifiable emission reduction, and may actually spur the development of new fossil-fueled facilities. Thus BEFs’ claims of directly displacing fossil fuels by adding renewable energy to the grid are false. …
I just checked the definition of “perpetrate” and found the following definition: to carry out; enact; commit: to perpetrate a hoax.” I not only used a correct word, but found the perfect word to describe what our scientifically-deficient legislators are doing to the WA economy.
Vancouver’s Clark Public Utilities just jacked their rates by about 5.7% in part because of the RPS (Renewable Portfolio Standards), which is government language for taxing and subsidizing inefficient energy. In the past eight years, Clark Public Utility customers have attempted to “save the planet” and have purchased over $1.1 million in buying CO2 at $1.50 a ton. How’s this sound for an economy-killing government program?
See also Wind Energy: The Truth Blows [here] and Wind Energy Gets Huge Subsidies, So Where Are The CO2 Reductions? [here].
The U.K. has gone overboard, almost as nutty as California, which has enacted legislation to establish their own cap and tax system, see Energy Claims and Realities [here]. Please ensure your legislators read the conclusion at the end of the article.
By the way, who is backing the CA continued condemnation of CO2? See California’s Green Godfathers [here] which contains a pretty good look into the Green’s green.
Those speaking to your Olympians should also wonder why WA should participate in the Western Climate Initiative (WCI) when all you have to do is compare it with the Regional Greenhouse Gas Initiative (RGGI), which is a regional cap and tax organization of ten eastern states. RGGI has held 9 quarterly CO2 auctions [here]. They have collected over $777.5 million to fight the dreaded CO2 pollutant. To date they have purchased nearly $1 billion in carbon credits and exactly what has this money bought? Is there any measurement by which they can determine the cost effectiveness of the money spent?
For more on RGGI see [here, here, here, here, here, here, here].
