Heartland Institute

Heartland-Institute

The Heartland Institute is a fossil fuel-funded front group with over $800,000 in contributions from fossil fuel interests that has routinely attacked clean energy policies and the science behind climate change. In 2012, Heartland was the center of controversy after comparing people that believe in climate change to the Unabomber. In the past, Heartland worked with the tobacco industry to minimize the negative public perception that second-hand tobacco smoke was bad for your health and lobbied against public health reforms.

Heartland is a primary player in attacks on renewable energy standards across the country. The organization sponsored the American Legislative Exchange Council’s “Electricity Freedom Act,” model legislation in 2012 that, if passed, would repeal state renewable energy standards. Efforts to eliminate these pro-clean energy policies failed in 16 states across the country in the last year and failed country-wide in 2015.

Supporters of Heartland’s efforts will point to West Virginia and Kansas as states where it had succeeded in repealing RES laws, but these supporters fail to acknowledge that West Virginia’s law featured coal as an eligible source of “renewables” under the law, and Kansas had already achieved the 20% renewables mandate. In addition, the North Carolina has yet to pass the senate’s version of an RES freeze bill. Heartland and allies can only point to Ohio as a state that has paused its RES law, which it did in 2014. Yet, they again fail to acknowledge that the renewable energy requirements begin again next year if no action is taken by the legislature.

Heartland was also involved in attacking pro-solar policies and initiatives in multiple states in 2015. In each of these fights, Heartland lobbied and advocated for the repeal of the state’s renewable energy law using misinformation and flawed economic research.

In Colorado, Heartland highlighted the Energy & Environment Legal Institute’s law suit claiming that the state’s RES was unconstitutional. Heartland also pressured state lawmakers to repeal the state’s RES, spread disinformation about how the law has caused electricity prices to rise faster than the national average. However, if one reviews the Energy Information Administration’s data on electricity prices, then one can find that Colorado prices increased only 3.3% faster than the national average – an increase that is mostly a result of the state’s fuel switch to natural gas and upgrades to pipelines. Heartland also promoted fossil fuel-funded Citizens’ Alliance for Responsible Energy Executive Director Marita Noon’s misinformed blog attacking renewable energy policies.

In Louisiana, Heartland pushed Governor Bobby Jindal and the state legislature to eliminate state tax credits for solar energy. The organization again used misinformation to attack the pro-solar policy, claiming that solar tax credits were responsible for “running up large deficits” and state credits were adding to a “mountain of federal government favoritism.” While solar industry tax credits totaled approximately $57 million in 2015, eliminating these tax credits would have little impact on the state’s projected $1.6 billion budget deficit. The bill passed by the legislature would save approximately $19 million.

Heartland Institute Attacks Clean Energy

Heartland’s attacks on clean energy fail to account for much larger subsidies to the fossil fuel industry. A calculation of total oil and gas subsidies in Louisiana by Earth Track details that oil and gas subsidies in 2012 were at a minimum over $500 million. In addition, severance tax losses, almost exclusively from oil and gas, cost the state $354 million in 2010. Severance taxes help insure the costs associated with drilling are paid by the producers to help alleviate the burden on state and local taxpayers. An example of this includes constructing and maintaining roads to extractive sites. Furthermore, the utility, oil, and gas industry received an additional $964 million from 2008 to 2010 as part of the state’s Industrial Tax Exemption. For the electricity generation and utility sectors alone, the state of Louisiana subsidized major utility companies by $276 million over three years. These ratepayer subsidies for utility interests are generally not factored into the price of electricity from natural gas.

In continuing their attack on solar in Louisiana, Heartland also cited Acadian Consulting Group’s flawed report for the Public Service Commission on net metering as proof that solar is passing costs onto other ratepayers. Acadian Consulting, run by David Dismukes, was criticized by solar companies for its ties to the fossil fuel and utility industry, which may have impacted the rigor and outcome of their report. In the past, Dismukes has “publicly criticized renewable energy subsidies, while praising those for fossil fuels.” According to reporting from The Times-Picayune, Acadian has received direct funding from industry groups on several research projects, including $20,000 from the America’s Natural Gas Alliance for a report that was critical of federal wind energy subsidies. Acadian’s clients include Duke Energy, NRG Energy, Sempra Energy. The Sierra Club exposed severe flaws in Dismukes’ report, stating,

No other net-metering cost-benefit analysis in the nation has included state-authorized tax incentives as a cost. Public utility commissions have no authority over tax incentives and legislative policy choices, and such incentives are a cost to the state treasury not utilities or ratepayers. When these tax incentives are excluded from the utility’s cost calculation, as they should be, the study demonstrates that actually net metering provides a clear economic benefit to utilities and ratepayers.

Heartland has joined other fossil fuel-funded opponents of the Florida ballot initiative, including Americans for Prosperity, in attacking the attempt to open the Florida electricity market to solar companies, citing subsidies for solar installations.

In Kansas, Heartland attacked the state’s RES, echoing a blog published by Bonner Cohen from the State Policy Network group, National Center for Public Policy Research. In the post, Cohen cites a report by the Utah State University Institute for Political Economy, which produced debunked economic analysis in North Carolina and Kansas attacking those states’ renewable energy laws. The Utah State University report was authored by Randy Simmons, the “Charles G. Koch Professor of Political Economy” and used inflated costs for renewable energy to claim a negative impact on ratepayers’ income and the state economy. Once corrected, the Utah State University/Strata study actually shows that renewable energy standards (and the increased use of wind energy) create economic benefits.

James_Taylor_Heartland_InstituteHeartland also advocated against the Kansas renewable energy standard in a Washington Times op-ed, claiming that energy prices skyrocketed without providing any evidence. Energy & Policy Institute debunked the Heartland’s claims about “skyrocketing energy prices” last year. James Taylor claims that because electricity prices in Kansas have risen faster than the national average since 2009, the state’s RPS is causing a spike in electricity prices. But Taylor ignores the fact that electricity prices are changing based on a number of different factors.

In 2015, anti-clean energy groups were only able to convert the state’s renewable energy standard into a “voluntary goal” but only after utilities exceeded the standard five years early. Heartland’s misinformation campaign and desperate efforts to repeal a state renewable energy will have no affect on renewable energy growth in the state of Kansas.

The New Mexico State Legislature considered a bill that would freeze the state’s renewable energy standard but it failed to move through the Senate after passing the State House of Representatives. Heartland published a misleading blog attacking opponents of the anti-clean energy bill and promoting the views of allied Rio Grande Foundation in promoting the renewable energy standard repeal. The State Policy Network’s Rio Grande Foundation also advocated for the bill.

Despite misinformation being echoed by the Heartland Institute and Rio Grande Foundation, data from the Energy Information Administration shows that the New Mexico renewable energy law is not causing an increase in electricity prices over states that do not have renewable energy standards. The average increase in electricity prices across the United States from 2012 to 2013 was 2.86%, while the increase in electricity prices in New Mexico was just 2.74%.  Also, according to an empirical study by Lawrence Berkeley National Laboratory, renewable energy standards have not caused electricity rates to increase more rapidly than states that do not have these standards.

In North Carolina, the House of Representatives passed a bill to freeze the renewable energy standard. It was sponsored by ALEC member Mike Hager, a former Duke Energy employee. In the Senate, the Chair of the Senate Finance Committee, Senator Bob Rucho, pushed the bill through his committee after refusing to count the votes during a controversial voice vote, amidst objections from both political parties. The entire state senate has yet to vote on the bill.

Heartland then published a flawed editorial on the supposed economic costs of the state’s renewable energy law by Bonner Cohen, a senior fellow at the National Center for Public Policy Research, a State Policy Network group. Cohen, as mentioned above, cites the work of the Koch-backed Institute for Political Economy at Utah State University, which produced misleading reports attacking state renewable energy laws.

In addition, Heartland signed a coalition letter spearheaded by Americans for Prosperity (AFP) that called on the state legislature to repeal the renewable portfolio standard. The letter cited the debunked Beacon Hill Institute report on the North Carolina RES that inflated the costs of renewable energy and ignored entire statutes written into the law to keep costs down. The AFP was also signed by a smorgasbord of fossil fuel-funded front groups and organizations tied to the Koch political network.

In Oklahoma, legislators reached a compromise with the wind energy industry, passing two bills that would phase out the state’s five-year property tax exemption for wind energy projects and eliminate wind energy’s eligibility for a job creation tax credit in the state, in exchange for keeping in place a zero-emission tax credit until the end of 2020. Governor Mary Fallin signed the bills in May 2015, stating,

Today, Oklahoma’s wind industry is among the strongest in the nation and is an integral part of our power grid and our economy. Wind energy is here to stay. It no longer needs the same level of support and encouragement from the state. I appreciate the wind industry’s participation in crafting this compromise and applaud the legislative leaders, especially Representative Earl Sears and Senator Mike Mazzei that invited them to the table. These bills will ensure we accomplish the dual goals of supporting an ‘all of the above’ energy strategy while delivering much-needed fiscal reform.

Heartland used the Oklahoma compromise as supposed evidence that states are backing away from RES laws. However, the bills passed by the Oklahoma legislature in 2015 were related to wind energy incentives and tax credits, not the RES. Oklahoma has already met its voluntary renewable energy goal of 15% by 2015. According to the most recent data available from the Energy Information Administration, Oklahoma produces 19.4% of its electricity from renewable energy sources like wind, solar, and hydropower.

The Texas Senate passed a bill in April, SB 931, that would have ended the state’s RES and the Competitive Renewable Energy Zone, which is a program to build high-capacity power lines that link wind-rich areas of the state to the highly populated cities. The Texas House of Representatives ended its 2015 legislative session without taking up the measure, effectively killing the repeal attempt. Heartland weighed into the debate by again promoting Marita Noon’s misinformed blog attacking RES laws.

The West Virginia State Legislature passed a bill in January 2015 to repeal the state’s Alternative and Renewable Energy Portfolio Standard, and Governor Earl Tomblin signed the bill in February. While this new law makes West Virginia the first state to fully repeal a renewable energy standard, the West Virginia statute did not actually require renewable energy development, because the standard could be met by natural gas, waste coal, and other carbon-intensive energy sources (like burning tires). Heartland applauded the West Virginia bill, and then claimed it as a victory. In addition, Heartland’s comments on the West Virginia standard repeated misleading claims that renewable energy standards drive up electricity costs and hurt the economy. Heartland’s James Taylor said,

West Virginia policymakers recognized, in a bipartisan and overwhelming manner, that renewable power mandates drive up electricity costs, kill jobs, punish the economy, and inflict substantial unintentional harm on the environment. Fortunately for electricity consumers and environmentalists, several other states are poised to follow West Virginia’s lead and will be considering similar legislation in 2015.