"In one year, (President Obama) provided $90 billion in breaks to the green energy world … into solar and wind, to Solyndra and Fisker and Tesla and Ener1."
Mitt Romney on Wednesday, October 3rd, 2012 in the first presidential debate in Denver
Mitt Romney says Barack Obama provided $90 billion in green energy 'breaks' in one year
In the battle of big numbers at the first presidential debate, Mitt Romney used one five times to attack President Barack Obama’s energy policy: $90 billion.
That was the price tag of "breaks to the green energy world" Obama provided "in one year," Romney said.
Later, he elaborated the president had put that money "into solar and wind, to Solyndra and Fisker and Tesla and Ener1."
So, tens of billions funneled from the Obama administration to troubled companies for alternative energy — in one year. Really?
We asked the Romney campaign about that $90 billion.
The number appears in a 2010 report from the White House Council of Economic Advisers on the American Recovery And Reinvestment Act, better known as the stimulus bill.
According to the report, $90 billion is the amount of money in the Obama law for "clean energy investments."
Here’s how Romney used the number in the debate.
Obama had attacked $4 billion a year in "corporate welfare" for the oil industry.
(His proposed 2013 budget called for removing a handful of "tax provisions that preferentially benefit fossil fuel production." PolitiFact Ohio reported that the nonpartisan taxpayer watchdog group Taxpayers for Common Sense estimates the U.S. tax code currently contains about $5 billion in yearly tax breaks that are exclusive to the oil and gas industry.)
Romney fired back:
First of all, the Department of Energy has said the tax break for oil companies is $2.8 billion a year. … And in one year, you provided $90 billion in breaks to the green energy world. Now, I like green energy as well, but that's about 50 years' worth of what oil and gas receives. And you say Exxon and Mobil. Actually, this $2.8 billion goes largely to small companies, to drilling operators and so forth.
So, Romney contrasted a "tax break" of a few billion for oil companies with "breaks" worth tens of billions for "green energy." Later in the debate, he got more specific:
But don't forget, you put $90 billion, like 50 years' worth of breaks, into solar and wind, to Solyndra and Fisker and Tesla and Ener1. I mean, I had a friend who said you don't just pick the winners and losers, you pick the losers, all right? So this is not the kind of policy you want to have if you want to get America energy secure.
Finally, Romney drove home the number, repeating it three more times, and linking it to companies who have "gone out of business."
You put $90 billion into green jobs. And I -- look, I'm all in favor of green energy. $90 billion, that would have hired 2 million teachers. $90 billion.
And these businesses, many of them have gone out of business, I think about half of them, of the ones have been invested in have gone out of business. A number of them happened to be owned by people who were contributors to your campaigns.
It’s fair to say that listeners may have gotten the impression that Obama gave $90 billion in tax breaks in a single year to companies for alternative energy like solar and wind, many of which didn’t fare well.
‘One year’ of ‘breaks’
Back to that report about stimulus spending on clean energy.
Were there $90 billion in "breaks"? Perhaps in a generic sense, as in — some folks caught a break by taking advantage of government spending. But not so much if Romney meant "tax breaks" like those for oil and gas.
Rather, the money was distributed in six different ways: private and public matching grants, tax credits, loan guarantees, direct loans and interest subsidies. Tax benefits were part of the package, but so were very different kinds of spending.
"The vast majority of the $90 billion for green energy weren't tax breaks," said Michael Grabell, a reporter for Pulitzer-winning site ProPublica who published a book this year on stimulus spending, Money Well Spent?
Meanwhile, the money would have been distributed over longer than one year, depending on the program. Some money — such as for high-speed rail — states still have a few years to spend, Grabell said. Weatherization projects, among the quicker programs, took two or three years. The loan guarantee program through the Department of Energy, which benefitted troubled solar panel maker Solyndra, focused on projects through September 2011.
So, Romney is off in two respects. They are not just tax breaks and they are not just for one year.
‘Solar and wind ... Solyndra and Fisker and Tesla and Ener1’
We’ll assume Romney meant "solar and wind" and "Solyndra and Fisker and Tesla and Ener1," as merely examples of Obama’s $90 billion in green energy spending in the stimulus.
But even as examples, they’re problematic. "Solar and wind" investments represented comparatively small parts of the $90 billion.
Solar-panel manufacturer Solyndra and electric-battery maker Ener1, which got stimulus-backed help, qualified for less than $700 million in grants and loan guarantees, and didn’t use it all.
Fisker and Tesla — troubled electric-car companies that got loan guarantees funded with money appropriated under President George W.Bush — had nothing at all to do with the $90 billion.
So, just what did make up the $90 billion?
The Council of Economic Advisers report cited by the Romney campaign breaks the spending into eight categories. Here’s the majority of it:
• About a third of the money, $29 billion, was for energy efficiency, such as "$5 billion to pay for energy efficiency retrofits in low-income homes." States and local governments directed a lot of the money. Grabell’s book on the stimulus says about 600,000 low-income homes were made more energy efficient — with, say, new furnaces, thermostats, windows, insulation or repairs.
• About 20 percent of the money, $18 billion, was for traditional transit and high-speed rail. The money went to more than 30 states for infrastructure projects.
• More than 10 percent of it, $10 billion, was marked for modernization of the electrical grid. Utilities used the money to install digital meters to track energy usage in real time, and for things like sensors and substation devices, Grabell reported.
That’s more than 60 percent of the $90 billion Romney’s campaign said he was talking about. Much of it funneled through state and local governments to contractors for specific projects, rather than as breaks directly for companies.
Less than 40 percent of the $90 billion included was for things such as the installation of wind turbines and solar panels, supporting American manufacturing of advanced batteries and other advanced vehicle technology, research and development of clean coal technology and a few billion in tax credits for alternative energy.
Those investments are more in line with Romney’s characterization. But they represent less than half the "$90 billion" he repeatedly mentioned.
Why does it matter if Romney mischaracterized how the money was used, as long as it went to clean energy? He draws a conclusion about winners and losers, and says, "and these businesses, many of them have gone out of business."
It’s a claim that our colleagues at FactCheck.org addressed this week, pointing out that might be true of companies that got loan guarantees in a single year — a sliver of a sliver of the money that Romney’s talking about. But less than 12 percent of the 26 companies that ultimately benefited from the program filed for bankruptcy, FactCheck.org reported.
And the entire loan guarantee program represented just a few billion of the $90 billion investment outlined by the Council of Economic Advisors.
"A very small percentage of all the companies that benefited from the $90 billion in green job spending have gone out of business," said Grabell, the author of Money Well Spent? "Not half of them. Not even half of the loan guarantees. "
Romney used the number "$90 billion" five times in the first presidential debate, claiming, "In one year, (Obama) provided $90 billion in breaks to the green energy world … into solar and wind, to Solyndra and Fisker and Tesla and Ener1."
That is incorrect in several ways. That $90 billion, as described in a report provided by the Romney campaign, wasn’t provided in one year, wasn’t distributed primarily via tax breaks, wasn’t primarily provided directly to companies, wasn’t primarily spent on solar and wind, and wasn’t spent at all on Fisker or Tesla.
In reality, more than 60 percent of it was directed to state and local governments and utility companies for energy efficiency, transportation and electrical infrastructure .
We rate his claim False.