We hate to spoil the big party at the Clark County Government Center — Tuesday’s commission meeting was teeming with promises of jobs, clean energy and sizable investments in Southern Nevada — but something about the sale of 9,000 acres of public land to ENN Mojave Energy just doesn’t add up.
Why did commissioners give such a steep discount to a Chinese company promising to spend between $1 billion and $6 billion developing the site near Laughlin? Charging ENN Mojave Energy just $4.5 million — $500 an acre — when two appraisals valued the land at between $29.6 million and $38.6 million was awfully generous. Expecting fair market value for county land shouldn’t be too much when big shots are talking about billions of dollars worth of business, right?
In fact, the deal given to ENN Mojave Energy reflects the viability of the project. The company is getting a bargain because the chances that its giant solar-panel manufacturing plant, 500-megawatt solar power array and futuristic “eco-city” and research park will actually be built are quite slim.
Green energy just doesn’t pencil out — even with massive taxpayer subsidies.
For starters, ENN Mojave Energy must find utilities willing to buy the solar power it plans to produce. That’s no sure thing. But assuming ENN Mojave Energy gets that far, its manufacturing plant would face some harsh market realities. Recall that California solar panel maker Solyndra shut down and went bankrupt this year despite collecting a $535 million loan guarantee from the U.S. Department of Energy. If it weren’t for tax incentives for both buyers and manufacturers — not to mention heavy political pressure — the entire industry would collapse.
Commissioners point to the promise of jobs and economic development as reason to authorize the land giveaway. ENN Mojave Energy says the deal could create up to 2,900 construction jobs and more than 2,000 permanent jobs, although the terms of the land sale require $350 million worth of investment and the hiring of just 500 workers by 2016.
Job creation is a worthy goal. And the county clearly took steps to ensure ENN follows through on its promises and can’t flip the land at a profit, then disappear. But so much of Tuesday’s commission meeting was political kabuki that it’s hard to get excited at this point. Senate Majority Leader Harry Reid has been pulling strings behind the scenes. ENN hired former Nevada Gov. and U.S. Sen. Richard Bryan to handle Tuesday’s final sales pitch. And both sides openly pandered to unions with assurances that everything possible will be done to ensure Nevadans are hired into every job.
We certainly hope ENN Mojave Energy succeeds and becomes a valued member of the Southern Nevada business community. But any entity that needs huge amounts of political juice and almost free public land just to get off the starting block is far from a slam dunk.