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Joseph Romm and Enron: More for the Record

[Editor note: For an in-depth look at Enron's political capitalism model applied to the climate-change debate, see Bradley's Capitalism at Work: Business, Government, and Energy (M & M Scrivener Press, 2009)] 

On four occasions,  Joseph Romm at Climate Progress (Center for American Progress) has deployed an argument ad hominem against me, using my prior employment at Enron and my direct association with Ken Lay (see here, herehere, and here). My response to Romm earlier this week has received thousands of views and several blog links, including here.

The irony here is two-fold. First, Romm ignores the fact that I was an employee who personally challenged the company’s rent-seeking via climate alarmism. Secondly, and more ironic still, Enron was his darling company. Specifically, he was an unpaid consultant and collaborator with Enron Energy Services (EES), whose contracts were money losers, reflecting of paucity of economic energy savings. The hidden losses and fake profits of this division were showcased at trial. EES was not a “cool company,” and the companies that outsourced to EES found out they were not that cool also.

A future post [now published] will explore the failure of EES, PG&E Energy Services, and Duke Energy Solutions–the big energy service companies, or ESCOs, that were touted by Romm and Amory Lovins as the next big thing and as leading the way to Kyoto compliance.

I add the following exhibits to the Romm/Enron connection (Enron is bolded below for ease of identification).

Romm’s Emails to Enron

“I hope there is something in [my book] Cool Companies Mr. Lay can refer to. I’m sorry Enron isn’t in it, but if you have any good case studies, I would love to use them as I talk to the media and Fortune 500 companies. Feel free to use my personal email.”

- Email communication from Romm to Enron, June 6, 1999.

“Your ESCO [Enron Energy Services] folk believe what I say is possible, and, more to the point, is a reasonable ‘goal’–I have that from [EES co-chairman] Tom White himself, though ‘Kyoto’ probably has more meaning as a benchmark goal so that is more my focus now. I have had many discussions with EES’s senior staff. The trick is to combine efficiency, cogeneration, and greenER power purchasing to cut CO2 emissions whiles cutting the energy bill.”

- Email communication from Romm to Enron, July 23, 1999.

“ESCOs are DEFINITELY the future. I intend to work with the big ones to transform the market, which I think will take about two or three years.”

- Email communication from Romm to Enron, July 23, 1999.

Joe Romm on Enron before Congress

In testimony before the Committee on Commerce of the U.S. Senate in September 2000, Romm, then executive director of the Center for Energy and Climate Solutions, stated:

“Outsourcing – another New Energy Economy trend – is starting to change this. Soon it may revolutionize corporate energy efficiency investments…. Some companies have turned over their entire power supply needs to outside contractors. In March 1999, Ocean Spray announced a $100 million deal with the energy services division of Enron, a major natural gas and utility company based in Houston. Enron will use its own capital to improve lighting, heating, cooling and motors and to invest in cogeneration (the simultaneous generation of electricity and steam onsite, which is highly efficient). Ocean Spray will save millions of dollars in energy costs, have more reliable power and cut pollution, without putting up any of its own capital. In September 1999, Owens Corning, the fiberglass insulation manufacturer, announced a similar $1 billion deal with Enron.”

 Joe Romm on Enron at his Website

From Romm’s Cool Companies website:

Polaroid will achieve the Climate Savers goal through a combination of sound energy management practices combined with efforts to use less carbon-intensive forms of power. These measures include renovating or replacing heating and cooling systems and industrial boilers, replacing old factory motors with more efficient models, installing high-efficiency lighting and energy management systems, purchasing “green” electric power, and switching to cleaner fuels for power generation.

“This deal will utilize clean, efficient technology in a real-world setting,” said Joe Romm, executive director of CECS. “Working with outside partners to provide technical and strategic expertise is the next wave in corporate energy management, which will dramatically improve the speed and cost of solving environmental challenges.” (italics added)

Polaroid will be working closely with Enron Energy Services, which partners with commercial and industrial businesses nationwide to provide integrated energy and facility management outsourcing solutions.

 Joe Romm on Enron in a Published Essay

“Increasingly, such technologies will operate over the Internet itself. Companies like SiliconEnergy have developed software that uses the Internet for real-time data collection and analysis and energy management. We believe energy outsourcers like Enron (discussed below) may ultimately manage hundreds if not thousands of buildings over the Internet.”

- Romm, “The Internet and the New Energy Economy” (2002).

7 comments

1 Ron Cram { 05.10.09 at 11:52 pm }

Thanks for this info about Joe Romm. I had never heard of the man before today. I happened upon his blog this morning and, as fate would have, found a blog post there by Carlin Rosengarten. I initially thought it was a post by Joe Romm. Anyway, the lead post had to do with a new climate science education project. However, it seemed to me to be more of an indoctrination program than promoting real science. I commented on this and a lively debate began. I posted five times before life called me away for several hours. When I returned there were a number of factually incorrect and unsubstantiated statements. Some of them by Joe Romm. I wished to comment learned the blog was now “moderated” meaning that people who agreed with Joe could comment but I could not. You can read it for yourself at http://skepticalscience.com/Is-the-climate-warming-or-cooling.html

I told this story on one of my favorite science blogs, Climate Audit, and one of the regulars there directed me to this article. Thank you for this background on Joe Romm. He is obviously a person who is profiting by climate alarmism and does not want his audience confused with facts.

2 Rob Bradley { 05.21.09 at 6:27 pm }

Interesting comment, Ron.

3 Enron and Waxman-Markey: Response to Joe Romm — MasterResource { 07.02.09 at 1:00 am }

[...] evidence for this conclusion in two posts: Joe Romm and Enron: For the Record (May 5, 2009) and Joe Romm and Enron: More For the Record (May 8, [...]

4 Rod Adams { 11.28.09 at 10:27 am }

Robert- I have had a number of run-ins with both Romm and his intellectual mentor, Amory Lovins. Romm started his political energy career at Rocky Mountain Institute, which has been Lovins’s vehicle for years.

I had not heard of Romm’s connection to Enron until this morning, when I read a comment that you posted on the Breakthrough Institute’s series on the bullying tactics that Joe uses against those who favor a different approach.

It has been my growing suspicion for years that the Lovins-Romm school of energy conservation, efficiency, and non nuclear fossil alternatives are simply cover for a profitable association with oil and gas extractors and service providers. Your information helps to solidify that interpretation.

Rod Adams
Publisher, Atomic Insights

5 Robert Bradley Jr. { 11.28.09 at 7:11 pm }

Rod:

I do not think these two have any secret agenda with “oil and gas extractors and service providers” as you say. Yes, Enron was pretty big in natural gas, but they were deep into solar, wind, and energy efficiency, as well as emissions trading, to want to parade as a “sustainable” and “green” energy company.

I am perplexed why Romm and Lovins have fought against nuclear, using free-market-sounding arguments that they would reject with wind and solar. Maybe you can explain that for the reader.

6 Rod Adams { 11.28.09 at 7:57 pm }

Robert – I know that it may sound counterintuitive, but support for solar, wind and efficiency does not prove that someone has any desire to break free from fossil fuel addiction. None of those sources has ever successfully taken market share from burning hydrocarbons – in fact, as Jevons pointed out at the beginning of the Industrial Revolution, more efficient machinery for using energy generally results in an overall increase in its use. There is a reason why you can find some very positive advertisements from established fossil fuel companies about wind, solar and energy efficiency.

Take a look at the consulting that the Rocky Mountain Institute has done over the years. You can find some records of the customers on their web site – they often involve established companies in coal, oil and gas. Lovins himself has stated in a matter of fact sort of way that he has worked for oil companies for more than 35 years. (July 18, 2008 during a Democracy Now interview.)

In contrast to unreliable and diffuse alternative energy sources, nuclear fission has successfully pushed oil, gas and coal out of markets and materially increased the supply of useful energy to the point where it forced the price of fossil fuels down. For example, what do you think supplied electricity in France, Japan, Taiwan, the UK, Switzerland, Sweden, and several portions of the US before fission was introduced into the market? What do you think supplied the US Navy’s aircraft carrier and submarine fleet before fission?

Lovins started writing negative things about nuclear way back in the early 1970s when he was the UK representative for Friends of the Earth. He became recognized by some as an energy guru with his publication in 1976 of an article called “Energy Strategy: The Road Not Taken” in the October 1976 issue of Foreign Affairs. http://www.rmi.org/rmi/Library/E77-01_EnergyStrategyRoadNotTaken

In that article, he called for a total elimination of nuclear energy in the US and casually accepted a “temporary” doubling of coal consumption. “Coal can fill the real gaps in our fuel economy with only a temporary and modest (less than twofold at peak) expansion of mining, not requiring the enormous infrastructure and social impacts implied by the scale of coal use in Figure 1″. (In “Energy Strategy”, Figure 1 was a graph of energy sources under a ‘business as usual’ path.)

As you found during your tenure with Enron, energy efficiency projects are often fraudulent or poorly designed. They are certainly not “easy”, a fact that Lovins and Romm should (and probably do) understand quite well. However, if people have been sold the idea that efficiency strategies are easy and cheap enough to allow them to avoid an investment in something hard like nuclear that takes a long time of dedicated effort, there will be a LOT of fossil fuel extracted and sold during the time that it takes for the data to come in and the failure of the strategy to become evident.

Rod Adams
Publisher, Atomic Insights

7 Robert Bradley Jr. { 11.29.09 at 9:39 am }

Rod, that is an interesting point that wind and solar have not reduced fossil fuel burning that much. The inefficiency cost of revving gas plants up and down to firm-up wind and solar is a very interesting debate as shown here: http://www.masterresource.org/2009/11/wind-integration-incremental-emissions-from-back-up-generation-cycling-part-ii/

I think that oil companies promoting energy efficiency is less about increasing demand for their product as it is two things: 1) good public relations or what the Left might call ‘greenwashing’ and 2) concern during times of high prices that there will be a political price to pay if demand does not subside to bring prices more toward historical levels that are acceptable to the public and politicians.

Jevons’s point about energy efficiency had more to do with natural conservation than government-mandated conservationISM where with CAFE, for example, economists believe that 20% of the fuel savings is lost by motorists driving more miles in their (mandated) fuel efficient cars since the incremental costs of driving are lower.

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