Traverse City Record-Eagle

September 29, 2012

Truth Squad: Pro Prop 3 ads have sketchy bits


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---- — Who: Michigan Energy, Michigan Jobs — Pro-Proposal 3 group

Featured Truth Squad Material: TV ads

Truth Squad call: Technical foul

Michigan Energy Michigan Jobs (MEMJ) is a ballot proposal committee supporting Proposal 3, a measure to require utilities to obtain 25 percent of Michigan's electric needs from renewable sources by 2025 (with some caveats). MEMJ is a coalition of environmental, alternative energy, union and business interests.

In the latest reporting period ending July 20, the group raised $2,247,277, according to state campaign finance records. Of that amount, $1,772,000 came from clean-energy advocacy organizations in San Francisco and New York. Its largest in-state contribution was $450,000 from the Michigan League of Conservation Voters.

Questionable statements:

"Michigan spends billions importing coal from other states and oil from the Middle East. (Text on screen: '1.7 Billion to other states. Source: U.S. Energy Information Administration Website.'")

This state report says Michigan spent $1.39 billion to buy coal to produce electricity. And all of the coal was imported.

Michigan imports 97 percent of its petroleum needs.

The state is expected to use 4.12 million gallons of gasoline in 2012.

Largest single source of U.S. petroleum imports is Canada; Persian Gulf nations constitute the second-largest source.

In 2011, the United States spent $327 billion on net oil imports, says the Congressional Research Service.

"That's right, 60 percent of Michigan's electricity comes from imported coal. (Text on screen: 60% OF ELECTRICITY FROM IMPORTED COAL)."

This Energy Information Administration analysis says three-fifths of the state's electric generation stems from coal. As noted above, a state report says all Michigan's coal is imported.

"It will create 94,000 jobs Michigan jobs and spark new businesses (Text on screen: create 94,000 jobs Michigan jobs. Source: Jobs and investment impact study done by MSU, 8/10/12; www.mienergymijobs.com/economicimpact)."

The study can be found on the site of the Michigan Environmental Council. The MEC is a supporter of Prop 3 and a member of MEMJ. The study notes that its work was "supported by a contract" between MSU and MEC. And an MEC spokesman confirmed that the group paid for the study.

The MEMJ page says 74,000 jobs would come from work toward the renewable standard. Another 20,000 would come from a 50 percent market capture of the manufacturing, for a total of 94,000.

However, that's not exactly what the study says. The summary notes:

"The $10.3 billion investment in renewable energy in Michigan that would be required by the proposed 25 percent by 2025 policy could create 74,495 job years (emphasis added) in Michigan, which is divided into 31,513 construction jobs years and 42,982 operations and maintenance job years. "¦ Additionally, there is potential to capture manufacturing job creation; however, the magnitude of that gain is dependent on the success of Michigan manufacturers' ability to capture market share in the renewable energy market."

A "job year" is a technical term, defined in this report as "Full employment for one person for 2,080 hours in a 12-month span."

As the Mackinac Center for Public Policy, a Midland-based free market think tank, cheekily noted: "That is, a person newly hired by a wind company and who works 25 years would count as 25 job years, though it is still just one job."

MEMJ counters that "job years is an academic term that is always translated as jobs." The group pointed to a Detroit News story from Sept. 5 about jobs created by natural gas drilling, which MEMJ says is based on a report that uses the same terminology.

But not every economist you speak to will agree with the terms' flexibility.

"There are 8,000 parts in a wind turbine and all of them can be made in Michigan."

A study by the Center on Globalization, Governance and Competitiveness at Duke University says a wind turbine has an estimated 8,000 parts.

The state's Michigan Economic Development Corp. says, "Michigan's industrial base, tuned to supporting the needs of the automotive industry, has all the expertise and capacity to handle the advanced precision manufacturing needs of the wind energy industry. In fact, federal studies rank Michigan among the top four states in industrial capacity to develop and manufacture wind energy systems."

"In West Michigan they make the blades."

Holland-based Energetx makes wind turbine blades.

"Astraeus wind manufacturing in mid-Michigan manufactures hubs."

Astraeus Wind in Eaton Rapids (southwest of Lansing) makes hubs.

"Danotek in Southeast Michigan makes high-tech generators that create clean energy and jobs."

Canton-based Danotek makes "high performance permanent magnets." Those parts are key to modern wind turbines.

Overall impression:

The ad is better on describing Michigan's current electric generation situation than it is in describing the employment prospects if Proposal 3 is enacted. Michigan has seen considerable activity in the manufacture of, and siting of, wind turbines.

Truth squad call:

Technical foul, which Michigan Truth Squad defines as "A statement that implies something that isn't quite true and deserves additional explanation, or that is entirely false." A typical viewer is likely to think of a "job" being a "job" — something that will last, not something that ends in a year. Equating the word "job" with the economist term of "job year" certainly "deserves additional explanation."