Expecting different results?

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Back in December of last year we reported out on the Navy's big biofuel push which started out with replacing a quantity of JP-5 which fuels the Navy's jets and helos. Here is what we said at the time:

The departments of Agriculture and the Navy announced plans Monday to buy 450,000 gallons of non-food biofuels -- at a cost of $16 per gallon -- in what will be the largest federal purchase of biofuels in U.S. history.

The purchase is being authorized by an executive order under the Obama administration's "we can't wait" campaign.

Administration officials gave no indication why they're not going through Congress, instead using a program that was established to promote rapid job growth by bypassing congressional debate.

Perhaps why Congress was not able to chime in on this decision was because the fuel that this biofuel is replacing, JP-5, which powers the Navy's jets and helos goes for about $4/gallon. Crazy theory, we know, but that might just explain it.

Back to real time: We went on to point out that one of the firms that was producing the biofuel was politically-connected. C'mon, you know where this is going. Back to December:

Two companies will participate in the program -- Louisiana-based Dynamic Fuels, a joint venture of Tyson foods and Syntroleum Corp, which makes biofuel from used cooking oil; and California based Solazyme, which makes fuel from algae.

Now we get to the part you've been waiting for:

Solazyme is not just any biofuels company, and its continued partnership with the Navy is not without crony connections. Its strategic advisor is T.J. Glauthier, Obama donor and part of President Obama’s transition team, as Solazyme’s website states:

TJ Glauthier is an advisor and corporate board member in the energy and “clean tech” sector. He advises companies dealing with the complex competitive and regulatory challenges in the energy sector today. He also served on President Obama’s White House Transition Team, where he focused primarily on the energy portion of the economic stimulus bill.

Here and now: Yeah, we are so cronying out our national security.





So, nearly 3 years after SecNav Ray Mabus* made the bold prediction that by the year 2020, half the Navy's fuel and power would come from green sources, how's all that working out?

On Wednesday, the Great Green Fleet is scheduled to make its first demonstration voyage in Hawaii, just as Mabus promised it would. But this is hardly the triumphant moment that the Navy Secretary depicted back in that hotel ballroom. Support for the Great Green Fleet — and for Mabus’ entire energy agenda — has collapsed on Capitol Hill, where both Republicans and Democrats have voted to all but kill the Navy’s future biofuel purchases. In the halls of the Pentagon, the Navy’s efforts to create a biofuel market are greeted with open skepticism. Even inside the environmental community, there’s deep division over the wisdom of relying on biofuels. And while the Navy has tried to deflect questions about the cost of its renewables push, a little-noticed Defense Department report shows that the Navy could spend as much as an extra $1.8 billion per year if it buys all the biofuel it’s pledged to burn.

Continue reading full article here:


The summary contains all the usual suspects but these paragraphs jumped out at us:

One reason why: Biofuel companies aren’t like high-tech firms that can start small and slowly scale up. A new biofuel refinery could cost anywhere from $65 to $300 million to build. (And that doesn’t even begin to address the costs involved with farming the land or transporting the product.) Investors are hesitant to lend out that kind of money without major customers who are committed to buy the fuel; customers are skittish about making those kinds of commitments until they know the biofuel-maker can actually deliver. Currently, there’s not a single commercial-grade biorefinery operating in this country (although several are in the works).

“You need that big anchor customer. And the Navy can afford a premium, because it knows how much petroleum really costs,” explains Brook Porter, an investment partner at the venture capital firm Kleiner Perkins Caufield & Byers, which has put more than $1.5 billion into so-called “clean tech” companies. For some of these firms, a big military contract could mean the difference between life and death.

A struggling, expensive industry that is dependent upon one big customer is ripe for the temptation of picking winners and losers and crony capitalism.



And at the end of the day, the Pentagon has simply worn out of Mabus' crusading for bio-fuels:

Even within the Pentagon, doubts about the program crept in. Top Defense Department officials, ordinarily supportive of green tech efforts, rolled their eyes when I asked about the Navy’s biofuel push. ”We’re not in the fuel production business. We’re not into scaling up new new fuels,” says Kevin Geiss, a former computational chemist now serving as the Air Force’s Deputy Assistant Secretary for Energy.

You know, it's a shame we can't figure out this energy independence thing as we keep finding more and more of that black sticky stuff underneath us here in the good ol' US of A.



* Being in the shipbuilding industry, we've been able to see some of Mabus' maneuvering. To say he is a political animal would be an understatement of the highest order.

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Hey, maybe we are going to try to grow our way out of this, afterall.

Good news for U.S. farmers is not so good news for the 3rd world and developing countries with respect to food prices.

Mr. Obama, a Democrat, nominated Sen. Ken Salazar of Colorado as secretary of the interior and former Iowa Gov. Tom Vilsack as agriculture secretary.
Mr. Obama said that Mr. Vilsack "led with vision" and "understands the solution to our energy crisis will be found not in oil fields abroad but in our farm fields here at home."

Shoot, we’d settle for oil fields right beneath our feet but that lacks that whole “vision” thing – way too easy. Additionally, it is noted that since Obama has not been accused of or linked to any wrongdoing in this article, it's safe to print his party affiliation.

But back to biofuels and ethanol: Just when we thought that this idea would die a nice quiet death, slowly crushed under the weight of its own stupidity, it’s back… and not only is it back, it too is looking for a handout.

"The Renewable Fuels Association, a trade group for the U.S. ethanol industry, has spoken with staff members from Capitol Hill and President-elect Barack Obama’s team and “provided them with some ideas on how to craft the language of” an economic recovery package, said Matt Hartwig, a spokesman for the RFA.

Hartwig said RFA has suggested a number of steps including setting up a $1 billion short-term credit facility so ethanol producers could finance current operations; a $50 billion federal loan guarantee program to finance investment in new renewable fuel production capacity and supporting infrastructure; and a requirement that any auto maker receiving federal aid only produce new vehicles that can run on any blend up to 85% ethanol, beginning with the 2010 model season.”

Yes, you would be correct in figuring here that we are going to bailout an industry that is essentially a bailout of sorts in the first place. Of course, playing connect-the-dots, we will be subsidizing cars from Detroit that no one wants to buy, the purchase of the same which will be incentivized by rebates (more of your tax dollars) and where those very cars that have been subsidized on the production and purchase ends will be fueled by a subsidized form of energy that is inefficient, drives up fuel prices, drives up food prices and is ultimately harmful to the environment.

wow. We stand in awe. The monumental and breathtaking calamity that is this arrangement is stunning in both breadth and depth and is something that could only be concocted by the Parliament of Whores that currently resides in D.C.

Fred Thompson is looking more and more prescient every day.

This Vehicle Powered by Recycled Sanctimony

Spied this afternoon outside the Joan Kroc center. (click to enlarge)

UPDATE #1: Commentor 'Dawg passes along article here that suggests we were perhaps taking some chances with our safety with our nosy behaviour.

P.S. This artcle may have been sent to us previously via email or perhaps we saw it somewhere else on the interwebs, perhaps even in the Theocracy because it has a distinctly familiar feel. Let us know if were failing to give due credit and we will rectify the matter right quick.

Not to be Outdone...

In more too-little-too-late rear-guard action, Senate GOPers blocked passage of the Senate’s alternative energy bill on Tuesday. Article here. An earlier version of the bill was passed by the House 3 weeks ago (our thoughts here). We say alternative energy because the House’s idea to get more oil to the pump was granting this country the ability to sue OPEC if it thought they were getting out of line.

The Senate’s equally logical Big Idea would be to tax what they believe are “unreasonable” profits of the Big 5 U.S. oil companies and then…then... take all that money….. and… burn it… ? Honestly, what the hell else would you do with all that paper – at least it might keep some people warm this winter when fuel prices will make June ’08 look like the good ol’ days.

But this one’s different, they cry…..

"The bill's supporters argued that their proposal was different from the windfall profits taxes of the early 1980s that thwarted domestic production and led to a rise in imports. The oil companies could avoid the tax by using their "windfall" to push alternative energy programs or refinery expansions, they said."

Why do we expect and why do we ask oil companies to be something they are not? Businesses make a big deal of core competencies… those things your company does most effectively to bring the highest rate of return on its investment. Having never set foot inside Exxon’s or Shell’s offices, we’re willing to bet that historically speaking, Big Oil’s core competencies have been exploring for oil, drilling for that crude oil, recovering and transporting that crude oil to refineries, refining it and then transporting it to market. Just a WAG….

But now we want them to be similarly competent in wind and solar power, batteries, geothermal technology, growing corn, growing sugar, biofuels, ethanol, hydrogen extraction, etc., etc. How does this make sense?

By now, its apparent Congress really isn’t serious about formulating any sensible energy plan and as we have stated previously, the absolute best we can hope for these days is that they don’t make a horrible situation any worse.

RCP Congressional approval rating: 18.7%