Category — Enron & Climate Change
“Wind is almost a pure subsidy play, which means that Enron will be at odds with the market and must continually intervene into the political processes to extend subsides and/or create new ones. This is an expensive process and may trade away what we are lobbying for elsewhere.”
In my last seven (of 16) years at Enron, my title was Director of Public Policy Analysis. In this role, I was Enron’s libertarian, balancing, I suppose, Enron’s Left environmentalist John Palmisano, author of the infamous Kyoto memo of December 1997.
Enron had multiple profit centers around the global warming issue, which made my internal case for rejecting climate alarmism/policy activism an uphill one. But I got my licks in, including with some ‘e-mail wars’ with Palmisano. I have written numerous posts at MasterResource on Enron’s rent-seeking business strategy and will further set the historical record straight with a forthcoming book in Enron-inspired trilogy.
But my biggest disappointment as an Enron employee was when the company bought Zond Corporation in late 1996, soon to be renamed Enron Wind Company.
Enron never turned a profit with the acquisition–and even got into trouble with the National Audubon Society over a site north of Los Angeles where California Condors, an endangered species, were at risk. Enron’s purchase was as much about PR as it was about money-making, even with generous taxpayer subsidies. The ‘greens’ liked Enron more than just about any other company, and, indeed, Enron was a savior to the U.S. wind industry.
When a hush-hush memo went out that Enron Wind was for sale in mid-1998 (less than two years after its purchase), I wrote a memo to CEO Ken Lay with my reasons to sell the subsidiary.
Alas, Enron could not find a buyer at the price it wanted, and Enron Wind was part of the corporate bankruptcy filing of December 2001. GE bought Enron Wind just months later.
My memo to Lay, nearing its 15th anniversary, is reproduced verbatim. How does it read today? [Read more →]
August 22, 2013 1 Comment
Last week, a Hall of Shame cronyism memo turned 15 years old. Dated December 12, 1997, it was written from Kyoto, Japan, in the afterglow of the Kyoto Protocol agreement by Enron lobbyist John Palmisano.
Global green planners such as Palmisano were euphoric that, somehow, someway, the world had embarked on an irreversible course of climate control (and thus industrial and land-use control). His memo reflects the train-just-left-the-station mentality, as well as the specific benefits for first-mover ‘green’ Enron. Enron, in fact, had no less than six profit centers tied to pricing carbon dioxide (CO2), and seven if CO2 were capped and traded.) The story of Enron as the darling company of Left environmentalists has been well told elsewhere.)
The Washington Post broke the memo soon after Enron’s demise, showing how Enron was hardly a free-market, capitalistic company. “[Enron] chairman Pushed Firm’s Agenda With Clinton White House.” Indeed, Enron was “the company most responsible for sparking off the greenhouse civil war in the hydrocarbon business” [Jeremy Leggett, The Carbon War (Penguin, 1999), 204.]
The Kyoto Protocol, also 15 years old this month, and now at the expiration of its 2008–2012 (non)compliance period, is predictably on life support, a topic which will be examined next week.
Here is Palmisano infamous memo, 15 years old last week. [Read more →]
December 24, 2012 No Comments