Dirty Harry’s Clean Energy Cronyism

How Harry Reid has been pulling strings for Chinese solar energy company

Sen. Harry Reid / AP
August 13, 2012

Senate Majority Leader Harry Reid (D., Nev.) has been working to secure sweetheart deals for Chinese green energy firms, according to reports.

Reid, who last week hosted the fifth annual National Clean Energy Summit at the Bellagio Hotel and Casino in Las Vegas, has been "pulling strings behind the scenes" for months on behalf of ENN Mojave Energy, a Nevada subsidiary of the Chinese-owned ENN Group.

After more than two years of secret negotiations beginning in 2009, lawmakers in Clark County, Nevada, unanimously agreed to sell 9,000 acres of public land to ENN for the bargain price of just $4.5 million ($500 per acre) in December 2011.

The Las Vegas Review-Journal questioned the "steep discount" ENN received for the land, which had been previously appraised for between $30 million and $39 million. The arrangement also included a bundle of tax incentives for ENN.

Reid, who reportedly helped secure a series of state and federal waivers as part of the deal, was actively involved in the negotiations with ENN. In April 2011, he led a delegation of senators to China, where the lawmakers met with senior Chinese officials and toured a number of green energy facilities, including the ENN headquarters in Langfang, China.

Upon his return, Reid called on the United States to pursue "new opportunities to collaborate on and advance clean-energy deployment here and abroad."

Several months later, ENN chairman Wang Yusuo spoke at Reid’s clean energy summit, calling for a "more open and comprehensive" partnership between China and the United States on green energy.

ENN hired Richard Bryan, a Democrat who served with Reid in the U.S. Senate from 1989 to 2001, to represent the company in negotiations with state and federal officials. Reid’s son Rory is a partner at Bryan’s law firm.

"Senator Reid has actually gone to China, has actually had visits with the chairman of ENN, the entire global enterprise, has actually taken a look at some of their developments there," Bryan said of Reid’s involvement. "It would seem to me that Senator Reid would exercise his persuasive powers on behalf of the state of Nevada."

Wang’s company wants to build a 720-megawatt solar farm, research park, and thin-film solar panel manufacturing facility in southern Nevada, and has said it expects to spend between $4 billion and $6 billion on the project. That is at least half the $8 billion ENN plans to invest in green energy in the United States over the next decade.

The project is threatened, however, because NV Energy—Nevada’s largest utility provider—has said it is not in the market for renewable energy at this time, citing the higher costs of solar power and the fact that it has already exceeded the state-mandated quota for renewable sources through 2014.

Reid has responded by badmouthing NV Energy and threatening to have one of its coal-fired power plants shut down.

"NV Energy is a regulated monopoly. They control 95 percent of all the electricity that is produced in Nevada and they should go along with his," Reid said in reference to the ENN solar project.

It is not the first time Reid has used his clout to secure favors for a Chinese green energy firm. In 2010, Reid was closely linked to lobbying efforts to secure $450 million in stimulus funding for a Chinese-owned energy company to build a wind farm in Texas, even though most of the turbines and other components would be manufactured in China.

There are indications that senior Obama administration officials were also involved in granting special consideration for the ENN project, and may have helped forge an agreement between the Chinese company and U.S. utility firm Duke Energy, which is run by a prominent donor to President Obama and the Democratic Party.

U.S. Energy Secretary Steven Chu and former Commerce Secretary Gary Locke visited China in July 2009, around the time negotiations with ENN are said to have begun. Chu toured the ENN headquarters—his sole visit to a green energy company—during the trip, and praised the company’s operations. (Locke is now the U.S. ambassador to the middle kingdom.)

An ENN press release noted that this marked the point at which the company "had begun catching the attention from high-level U.S. officers."

In January 2011, ENN and Duke Energy signed an "EcoPartnership" arrangement under which the two companies pledged to collaborate in the development of green energy technology. The two firms had cooperating on solar power projects since 2009; the new agreement expanded the arrangement to include other forms of green energy production.

The cities of Langfang and Charlotte, N.C., home to Duke Energy’s headquarters and site of the 2012 Democratic National Convention, signed a similar agreement.

Chu attended the event at which the agreements were formally announced, held the same day that President Obama hosted Chinese president Hu Jintao at a private dinner at the White House. Several months later, Chu singled out ENN for praise in testimony before two different Senate committees.

Duke Energy CEO Jim Rogers, who has been an enthusiastic supporter of clean energy, enjoys a close relationship to the Obama administration and the Democratic Party. He was reportedly on Obama’s short list for Energy Secretary.

Rogers and his wife Mary Anne have personally given at least $210,000 to Democratic candidates and committees since 2008, including more than $19,000 to Obama.

The Obama administration has, in turn, showered Duke Energy with taxpayer dollars. The company received federal grants totaling $230.4 million for a number of green energy projects as part of the 2009 stimulus package.

Duke created 196.6 jobs as a result of the grants, according to—a rate of about $1.2 million per job.

Shortly after President Obama was sworn into office, Duke enlisted the services of the Podesta Group, a lobbying firm founded by John Podesta, former president of the Center for American Progress and co-chairman of the Obama-Biden transition team, and his brother Tony.

Since then, Duke Energy has paid the group $860,000 to lobby to "support the passage of climate change and energy legislation" and "energy efficiency and clean energy solutions," according to a database maintained by the Senate Office of Public Records.

The company has spent more than $26 million lobbying the federal government on energy-related issues since 2007.

Rogers has been actively involved in fundraising efforts for the Democratic National Convention, which has struggled to raise money. Rogers helped entice Democrats to hold the convention to Charlotte by offering an unprecedented $10 million line of credit backed by Duke Energy shareholders.

Another Reid clean-energy connection has also come under recent scrutiny. The Senate majority leader has close ties to Nevada real estate developer Harvey Whittemore, who has been charged with making illegal campaign contributions.

Whittemore has donated at least $195,000 to Democratic candidates and committees since 2007. His family members have given at least $50,000 to Reid during that period.

Reid helped Whittemore secure favored treatment for a $30 billion land development project in Nevada, the future site of a 960-megawatt solar thermal power plant operated by BrightSource Energy, a company whose executives have given thousands to Reid’s campaign and hosted fundraisers for the senator.

BrightSource received $1.4 billion in taxpayer-guaranteed loans as part of President Obama’s $800 billion stimulus package, which Reid supported.