“[William] Baumol was worried, however, by a very different sort of entrepreneur: the ‘unproductive’ ones, who exploit special relationships with the government to construct regulatory moats, secure public spending for their own benefit, or bend specific rules to their will, in the process stifling competition to create advantage for their firms. Economists call this rent-seeking behavior.”

– Robert Litan and Ian Hathaway. “Is America Encouraging the Wrong Kind of Entrepreneurship?” Harvard Business Review, June 13, 2017.

MasterResource covers business entrepreneurship, not only the in’s and out’s of energy history and energy policy.

Good entrepreneurship is about serving consumers in a private property, voluntary exchange, rule-of-law setting. Bad entrepreneurship is about a business receiving special government favor to advantage itself at the expense of consumers and (free market) competitors.…

“I am writing to urge you to attend the upcoming United Nations Conference on Environment and Development [‘Earth Summit’] scheduled for early June in Brazil and to support the concept of establishing a reasonable, non-binding, stabilization level of carbon dioxide and other greenhouse gas emissions.”

– Ken Lay [CEO, Enron Corp.] to George H. W. Bush, Letter of April 3, 1992.

“The United States fully intends to be the world’s preeminent leader in protecting the global environment. Environmental protection makes growth sustainable…. [This] recognition … by leaders from around the world is the central accomplishment of this important [United Nations] Rio Conference.”

– George H. W. Bush, “News Conference in Rio de Janeiro, June 13, 1992.

“[Enron was] the company most responsible for sparking off the greenhouse civil war in the hydrocarbon business.”

The Institute for Energy Research (IER) and its advocacy arm, the American Energy Alliance (AEA), are in the news.

As reported last month in the Los Angeles Times, and more recently in Bloomberg Politics, IER/AEA are involved in the free-market directions that the president-elect and his team have followed to date.

One account described the founding of IER as follows:

The Institute for Energy Research was founded to be a clearinghouse for energy information in 1989 in Houston by Robert L. Bradley Jr., a speechwriter for Enron chief executive Kenneth Lay, who was later convicted of securities fraud.

Given that this association is part of the political conversation (Joe Romm started it in 2009: see below), and the continuing attention that is ahead for IER/AEA, I wish to revisit the historical record about my time at Enron that overlapped with IER.…

Editor Note: The post below, published at MasterResource in June 2009, has profound challenges for the notion that self-interested business underinvests in energy efficiency, giving a “market failure” rationale for government investments in and mandates for energy efficiency. This post introduced the term conservationism to differentiate government conservation from market conservation. It also documents the market failure of Joe Romm’s shuttered nonprofit, the Center for Energy and Climate Solutions.

“Enter the energy outsourcing model of energy service companies (ESCOs) in the 1990s, widely heralded as a ‘new economy’ breakthrough and a new feature of ‘natural capitalism’. Enron Energy Services (EES), in particular, the energy outsourcing division of the late Enron, was the next great thing…. ‘ESCOs are DEFINITELY the future,’ exclaimed Joe Romm. ‘I intend to work with the big ones to transform the market, which I think will take about two or three years.’