Austin’s $2B Biomass Boondoggle

Texas Scorecard | 5/30/2019 | Jacob Asmussen
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Imagine this: You finally saved enough money to lease a new luxury car. You pay all of the monthly payments and all of the maintenance for years on end, and you even finally pay the entire purchase price of the car—then you have it towed to a junk yard.

Oh, and you only ever drove the car twice.

Scenario - Akin - Reality - Austin - Story

Such a scenario is actually very much akin to reality for Austin taxpayers—except their story is far worse.

Austin Mayor Steve Adler recently announced the city’s taxpayers will be paying a whopping $460 million to buy a biomass power plant in East Texas, a plant Austinites had already coughed up $128 million to build and were paying $54 million every year to operate.

Cash - Span - Years - Plant - Energy

Even after all that cash over the span of six years, the plant produced energy for only two months.

The story began in 2008, when Roger Duncan, then-Austin Energy’s general manager, sketched out a plan to help achieve Austin City Council’s renewable energy goals. He wanted local citizens to pony up the cash to build the Nacogdoches Generating Facility, then pay for all of the energy produced at the biomass plant.

Plan - Contract

His plan required a 20-year, $2.3 billion contract.

The idea immediately received backlash from wide sectors of the public. Environmentalists, businesses, and good government advocates all complained about a slew of problems: The deal was done behind closed doors, there wasn’t careful study or analysis of the details (especially for a long-term contract with citizens’ money), costs would likely overrun, and there wasn’t public input. Several experts warned the archaic, inefficient wood-burning plant proposal may totally bust due to advances in the rest of the energy market.

Duncan - Council - Deal - Month

Despite all of that, Duncan pressured the council to approve his deal just a month after it became public. They did, unanimously.

And over the following months and years, a...
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