Guest essay by Eric Worrall
A Pennsylvania newspaper has reported details of a $50 million alleged renewable energy scam. More shocking is how easy it was, to allegedly defraud government subsidies.
An Easton engineer has admitted he rubber-stamped false reports to the U.S. Environmental Protection Agency for the owners of two Lehigh Valley biofuel companies charged in a $50 million clean energy scam.
According to the charges against Barnes [the engineer], company officials at Smarter Fuel and Environmental Energy Recycling hired Barnes in 2010 to complete engineering reviews of their plants to document their capacities as they applied for the EPA’s renewable fuel credit program.
To become eligible for the credit program, biofuel producers were required to submit to the EPA an independent engineering review based on a site visit to verify how the production plant would operate and how much fuel it was capable of producing each year.
According to the charges, Barnes took information he received from the company officials, including a ghost-written report by another consultant the companies had hired, and used it in the engineering reports without verifying it was correct.
The case is one of several across the country in which biofuel producers have been charged with fraud related to subsidies and credits made available by the EPA under the 2007 Energy Independence and Security Act.
The indictment says Dunham and Tommaso claimed subsidies and other payments for more than twice as much fuel as they actually produced by claiming in their totals partially processed waste oil that was sold to other refiners and wastewater produced in the processing of used cooking oil and ghost transactions that existed only on paper.
A $50 million local fraud case might not seem a big deal, but it should concern US taxpayers that there are other cases. Once fraudsters find an easily exploited systemic weakness, the situation can rapidly escalate. In 2010, Denmark lost 2% of their GDP, seven billion dollars, to out of control carbon credit fraud.
In this case, all the alleged criminals had to do, to get their hands on $50 million of federal money, was submit some paperwork, and find an engineer who was happy to pocket a fee without doing any work.