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March 26, 2010

The Weatherization Boondoggle

By Peter Wilson
Leave it to the left to turn something as sensible as insulating your house into a big-government organized-labor boondoggle.

Dismal reports from Spain and other European countries about investing public funds in solar and wind power manufacturing seem to have shifted attention lately toward the humble goal of "weatherization" -- making our buildings more efficient by replacing windows, installing insulation, and caulking up leaks, and by "retrofitting" -- buying new, efficient furnaces and appliances for the deserving disadvantaged.

President Obama's proposed $6-billion program known as HOMESTAR, a.k.a. Cash for Caulkers, is only one of many energy efficiency initiatives taking place on federal, state, and municipal levels. To cite a few of many examples:

  • The City of Boston announced "the nation's largest public housing energy performance contract" -- $63 million for an energy upgrade at 4,300 Boston Housing Authority apartment buildings. That works out to $14,650 per apartment.
  • Boston's spending comes on top of a State of Massachusetts $1.4-billion Energy Efficiency plan signed by Gov. Patrick last November. The plan was in the news this week with the release of an Apollo Alliance report titled Energy Efficiency Employment in Massachusetts.
  • The American Recovery and Reinvest­ment Act provides an additional $220 million to the Massachusetts Weatherization Assistance Program.
  • Cambridge, Massachusetts announced last week the inauguration of a Green Jobs program to train low-income people in the weatherization trade.

Elsewhere around the country:

  • Clean Energy Works, a project of Green for All and the Apollo Alliance in Portland Oregon, aims to retrofit 100,000 qualifying homes. A budget is not offered, but at Boston rates, this would cost $14.6 billion.
  • Created last September, the New York State Green Jobs-Green New York Act (where do they come up with these names?) aims to retrofit one million houses and businesses in the next five years, with money raised by selling carbon offsets.
So, one might ask, what's the problem? It's foolish to waste energy by heating or cooling the outdoors. Supporters claim that the money invested up front will save money in the long run. Everybody wins. In my own house, I've followed this sane policy by installing insulation and a modern gas-fired furnace in order to reduce my heating bills. Furthermore, if we must concede ground to aggressive green advocates and their phobia about greenhouse gases, retrofitting existing buildings is far and away the most cost-effective, no-regrets means of reducing CO2 emissions. Better to spend money to upgrade the nation's buildings than give away ineffective solar panels that will be worthless in a decade or two.

The new weatherization schemes, however, are about much more than energy efficiency. As the name "Green Jobs" implies, the movement is both a green initiative and a government-run jobs program. It has brought together a strange coalition of environmental groups, labor unions, and businesses hoping to profit in green ventures. 

One leading coalition, the Apollo Alliance, co-founded by President Obama's former Green Jobs Czar Van Jones, is advocating for an "investment" of $500 billion in green jobs. Their board of directors offers a look at the cast of characters:

  • Natural Resources Defense Council
  • Green for All (also co-founded by Van Jones)
  • United Steelworkers of America
  • Service Employment International Union (SEIU)
  • Laborers International Union of North America
  • Pacific Gas & Electric
  • Center for American Progress
  • Sierra Club
  • Google's division for Climate Change and Energy Initiatives

Apollo's Massachusetts energy study was produced in collaboration with its local affiliate, the Green Justice Coalition, and Community Labor United. The Steering Committee of Green Justice includes nineteen local groups, including carpenters' and painters' unions, the Coalition for Social Justice, and New England United for Justice (formerly ACORN). The CLU board is similarly made up of executives from SEIU, other labor unions, and ACORN.

Government has previously been involved in weatherization from the sidelines, offering rebates and subsidized loans, often through electric utilities. Even the stimulus money currently being targeted toward weatherization proceeds on a familiar model: The owner of a home or business takes the initiative to lower his electric bill. He gets competitive bids for insulation or new storm windows, hires a contractor, and then applies to the proper authority for a rebate.

Apollo and green jobs organizations propose a new paradigm, described on the Green Justice Coalition website:

Under the new plans, the utilities will work with the Green Justice Coalition and:

  • Find up-front financing so residents can pay for home efficiency work;
  • Pay community-based organizations that residents know and trust to do energy efficiency outreach in their neighborhoods; and
  • Sign up hundreds of residents for home retrofits and "bundle" those together into a single contract...
  • So well-paid, well-trained workers can do the work through a high-road contractor.
In its next meeting, the EEAC will discuss plans for an Equity Committee, where working class and of-color communities can make sure that these new jobs and services get delivered.

Notice the following:

  1. GJC inserts itself in a position of power between the homeowner and the utility (collecting a management fee, no doubt).
  2. Up-front financing changes the process from a rebate system to a free service with no incentive for competitive bidding.
  3. ACORN and community groups get a piece of the pie for their "outreach" efforts.
  4. "Signing up" residents shifts the initiative for weatherization from homeowner to community organizers, who have the power to decide who is "qualified." 
  5. New legislation is needed to dictate weatherization employment conditions. Workers have become government contractors who must by law be paid a "living wage" and receive benefits. (See this Boston Globe editorial, "A living wage for weatherizers.")
  6. "Well-trained" means that only people who have gone through the training program are eligible. Private, non-union, "low-road" contractors currently engaged in weatherization will be pushed out of the market.
  7. "High-road" is code for the unions who are pushing for green jobs.
  8. Weatherization becomes an affirmative action program, both on the receiving end of the retrofit and in the selection of contractors performing the work. In the past, laws favoring minority-held businesses have led to corruption.
  9. The entire program is overseen by SEIU government employees, expanding the union's ranks.
Proponents frequently cite that weatherization programs are cost-neutral, since future savings reimburse up-front costs. This may work for the Boston Housing Authority, which owns the properties it is retrofitting. Weatherization, however, is financed by increases in utility bills, paid by all energy users. Benefits accrue only to, in the words of the Apollo Alliance, "people of color, speakers of other languages, women, and people with barriers to employment." It is thus yet another Obama-era vehicle for redistribution of income.

The Green Justice website lays out their strategy for getting legislatures to fork over the green:

Take a Climate Crisis... Add an Economic and Environmental Justice Crisis... ...And You Get the Green Justice Solution.

Rahm Emanuel would be proud.

Peter Wilson is a writer who blogs at walkingdogcapitalist.
on "The Weatherization Boondoggle"