Abengoa Atrocities, the Sequel: California Mojave Solar Project is ‘dangerous,’ engineers assert

PHOTO provided by Power Technology.com 

My last bombshell blog post chronicled the Spanish conglomerate Abengoa that snagged billions of U.S. green energy stimulus funds, exposing how this foreign-owned entity screwed over American taxpayers, workers and vendors. This included a long wrap sheet of chilling, unethical and potentially criminal activity that only came to light due to the testimony, coupled with substantiated documentation, by a whistleblower, whom had worked for Abengoa for three years, from 2010 until 2013.
In summary Abengoa:

• Violated at least the spirit of the 2009-stimulus law as well as the Department of Energy (DOE) loan stipulations 
• Conspired and blatantly broke U.S. immigration laws and engaged in employee favoritism with Spanish (and other foreign) workers, while discriminating against and mistreating American workers 
• Committed insurance fraud 
• Shorted many U.S. vendors 

Due to the tenacity of this informant, we do know that at least two federal investigations are moving forward: Immigration and Customs Enforcement (ICE) and the Labor Department; however, other than Ryan Randazzo, reporter for the newspaper the Arizona Republic, the press on this is non-existent –– another travesty adding to the long list in this terrible tale.

Yep, we got screwed, but it gets worse….

Whistleblowers come out in droves: Contact the Green Corruption Files  

Since the release of this disturbing information, I was contacted by droves of former Abengoa employees via my blog, twitter, and emails, which prompted multiple telephone conversations, all confirming that these "indictments" are 100 percent accurate, but also of additional “Abengoa Atrocities,” including serious concerns over the safety of the solar project here in California.

Numerous former American engineers for the Mojave Solar Project have alerted me (again, substantiated with proof that they are willing to present to the appropriate channels) to the fact that Abengoa “took short cuts in its design.” This means that instead of clean, safe, efficient energy, we have an inefficient, expensive, and hazardous mess on our hands.

Before I get into the details of the danger at Mojave, let me set the record straight: In my last Green Corruption File I had assumed that the aforementioned offenses occurred at the Abengoa' Solar Solana Project in Arizona; however, I stand corrected. This foreign-owned firm committed these dirty deeds at all three clean-energy projects, and, what’s more outrageous is that this was done on the American taxpayers' dime: $2.6 billion in DOE loans and a reported $818 million in grants for two solar and one biofuel project.

Abengoa's top executives had the audacity to routinely bring in employees from Spain and Uruguay into the country for jobs that Americans could have filled –– and in hundreds of cases... illegally.

This new group of former employees not only confirmed the immigration violations, but also that discrimination against American employees were rampant at all three sites: the Arizona and California solar plants as well as the biofuel project in Kansas –– of which they also shared additional cases.

Immigration Violation

An engineer (from India) working on a special work visa was informed in April 2013, that he must leave the country, since his visa expired. His Supervisor, Mr. Diego Manuel Rodriguez Gonzalez told him to stay in Victorville, working out of his apartment, while the company worked on renewing his visa stay. The engineer would come to the office in Victorville, CA, to pickup his work assignments two to three times per week, and work at home. His pay was coming out of Spain and he wasn't paying income taxes. In addition, this employee was enjoying full medical coverage, while staying illegally in the USA.

Discrimination

Even when it comes to pregnant women, Spanish pregnant women were allowed to work, while American pregnant women were denied the right to work.

Additionally, I was provided with a long list of grievances that included examples of incompetence and lack of experience of the Spanish engineers, yet the American ones were ridiculed, demeaned and demanded to work extremely brutal hours. Other complaints ranged from Abengoa staff being dishonest, backstabbing, greedy, inhumane, destructive, etc. –– "they were just plain anti-American," I was told.

Abengoa “took short cuts in the design" of the California Mojave Solar Project: serious OSHA & CEC violations in question 

What these American Abengoa employees endured at the hands of this Spanish firm’s top managers at the Mojave project (Rafael Sanchez Mendoza, Nicolas Gallo Mass, Diego Manuel Rodriguez Gonzales, and Angel Pimentel Fernandez) is the most appalling part of this story; however, it is not the most shocking.

As I alluded to in the opening of this post, several former American engineers (some employed for more than 2 1/2 years), whom were directly involved in the development of the Mojave Solar Project located in the San Bernardino county here in my state of California, alerted me to the fact that Abengoa "took short cuts in its design."

What does this mean?

Abengoa's top management knowingly and willingly –– despite dire warnings –– did not comply with the proper requirements set by Occupational Safety and Health Act (OSHA) or California Energy Commission (CEC). What these engineers are asserting (not alleging) is that “these serious violations produced a solar plant that is dangerous.” 

Last but not least, these engineers told me that Abengoa, at the California solar project, used older, inefficient, and more expensive technology –– thus not only wasting American taxpayers' money and critical natural resources, such as excessive amounts of water (what about the CA drought?), but also their concern is the hundreds of thousands of gallons in synthetic flammable and dangerous oil used in this technology.

It turns out that while Abengoa has gone through about thirty American engineers, those that refused to "sign off" on the poor design, were intimidated, "black listed," ignored, demoted, and withstood other abuses until they were pushed out –– some quit, while others were terminated and forced to sign a "gag order." 

Even as they fear retribution, these former employees are ready to break their silence –– although anonymously for now. They want their story told for America, for clean energy and for the safety of all. I’m honored to be a part of exposing these atrocities, but my hope is that the press, politicians, and government agencies will wake up, investigate and hold someone accountable.

Abengoa Atrocities: The technical details

OSHA violations 

Steam and oil piping and equipment at the plant carrying superheated steam for up to 738 degrees Fahrenheit, is suppose to be properly insulated to meet OHSA standards for outside pipe temperature not to exceed 140 degrees. Abengoa decided to use improper "design parameters", resulting in unsafe outside pipe temperature close to 160 degrees, creating unsafe conditions and violating OSHA standards. Basically, people will get burned if they trip and fall over piping and equipment all around the steam generator, where piping is not properly insulated.

CEC violations (California State Seismic code) 

Abengoa again used improper "design parameters" to design piping carrying synthetic oil with temperature about 738 degrees. Pipe supports and restrains do not meet the California State seismic codes. Based on Abengoa's design, and during an earthquake event, pipes out in the solar field will break / disconnect spilling close to one million gallons of synthetic oil, causing an environmental disaster. These errors will cost the state of California $10-15 million to repair if an earthquake hits the plant. By the way, this oil is flammable, and if the spill lands on electrical equipment, there is a possibility of a fire igniting over two-square miles. 

Abengoa used older, inefficient, & more expensive technology

• This clearly wasted taxpayer money as well as critical natural resources, such as water 
• Other technologies don't use oil or water. For example: Topaz Solar Farm in San Luis Obispo, California uses photovoltaic technology. Photovoltaic doesn't use hundreds of thousands of gallons in synthetic flammable and dangerous oil, or millions of gallons of much needed water in California. 

Concentrated Solar Power (CSP) trough technology [of which Abengoa used] is more than 30 years old. It is based on using synthetic oil as the heat transfer media. Oil is circulated between the power block (where power is generated) and the solar field. The solar field for a 280 MW usually requires about 2000 acres of land. This is in-efficient design; since it requires lots of energy to operate the system and a whole lot more money to maintain it over the next 30 years. This power requirement to operate the equipment is called "parasitic load."

Simply put, if the plant produces 280 MW gross power, but requires 50 to 70 MW of power to run the pumps and other electrical equipment to produce the 280 MW, this will result in reduction to the plant's final output, or in-efficiency.

If you compare the "Trough Technology" with the "Solar Tower Technology" or "Photo Voltaic (PV) technology for internal plant consumption," you will see that the Trough Technology is very expensive and in efficient, in comparison with the Tower Technology that uses less pumping and less power consumption and the Photo Voltaic Technology that requires no pumping or power consumption (barely 1 percent in efficiency which means 99 percent efficient in American photovoltaic plants). Remember here, that we are comparing efficiency as the internal power consumption of the different plants, we are not talking about light to energy conversion, however, that also adds to the photovoltaic advantage as well. And we are not talking about the maintenance cost, where the solar thermal or CSP technology has a major disadvantage.

CSP price per megawatt breakdown example:

• Topaz cost was $2 billion for 550 MW net output, while Mojave cost was 1.6 billion for only 250 MW –– so the cost to MW ratio is double. Mojave: 6.4 Million per Mega Watt (all jobs to Spanish) vs. Topaz: 3.6 Million per Mega Watt (I'm sure American jobs) 
• Nowadays photovoltaic is even more cheaper: close to 2.3 million per megawatt.

In addition to all the above, maintenance cost to maintain all electrical and mechanical equipment, such as variable frequency drives, pumps, cooling towers, etc. will reduce the profitability of the plant, by reducing the net profit the plant's output. Add to that the waste of our natural resources, such as water. This plant consumes about 2,500 gallons of water per minute or 3.6 million gallons of water every day, while PV technology consumes zero water per day. Solar Tower technology requires water, pumps, cooling towers, etc. to operate. It is also inefficient.

Finally, the Department Of Energy (DOE) MUST ask and approve any plant design efficiency, instead of wasting our taxpayers' money and our natural resources.

Various Codes Violations

In some cases, engineers working for Abengoa's subsidiary "AGE" were copying technical designs from previous projects, which were done in Europe, and using the same design here in the USA (Solana and Mojave). A Chinese-American structural / civil engineer, licensed to practice engineering in California, was rubber-stamping construction documents and calculations produced in Spain. The engineer was not working hand-in-hand with the Spanish engineers to develop these documents. That was simply rubber-stamping someone else's work.
 

Financial fraud using U.S. taxpayer money 

I was also warned by a former Abengoa employee that this Spanish conglomerate, which has almost 600 subsidiaries, that operates throughout Europe, the Middle East, Latin America, and Asia, committed financial fraud –– using U.S. taxpayer money.

These serous accusations were revealed to me via a series of long telephone conversations, which made my head explode (similar to a Ponzi scheme of sorts), alleging that this whistleblower has proof contained in emails as well as contracts, documents, bids, etc. –– with even the engineers that quit and the ones that were let go as collaboration.

This informant's explanation is as follows:

The U.S. government issued loan guarantees to Abengoa as a part of the stimulus package to hire American workers, and purchase parts plus installation services from U.S. companies.

The loan guarantee program "essentially rained on Abengoa with free availability of billions of dollars in money," which covered projects such as Mojave's expensive $1.6 billion bill for just 250 MW power, but with strict rules to engage the American worker. Because of the financial clauses, Abengoa cannot hire non-U.S. workers or non-U.S. parts and services except if that service didn't exist in the U.S. Unfortunately, that didn't happen, because Abengoa broke the rule, hired a lot of Spanish workers and non-U.S. foreigners (even illegal ones). But it went further; Abengoa converted about 35 percent of the project loans into cash and straight into their pockets.

Read on to get the full picture...

And all the services were available in the U.S., even invented here, but were ignored.

Basically, this is how Abengoa converted the estimated 35 or more percents of the project monies into cash: Abengoa came here and started to create a lot of "1 to 5 person companies" such as Abengoa T&D, Inabensa, Nicsa, Abencor, and many others. Those paper companies went and hired real U.S. companies, and then those Abengoa paper companies (not real, no actual services) went on to engage in bidding and contracting with the EPC project branch of Abengoa called Abeinsa EPC.

So for example, Abeinsa EPC would contract Inabensa for solar fieldwork, for triple the cost, and get the cash.

Abeinsa EPC (of Abengoa) would get the bid from Inabensa (of Abengoa) and award Inabensa immediately. So, as with Abengoa T&D, Nicsa, and others. The other American bidders were chosen to be the most expensive (usually non local), with harsh financial restrictions such as non-payments for 6 months to a year on large contracts. Essentially, the paper Abengoa branches got hired to contract almost all the work in Mojave, and other projects.

The paper companies of Abengoa, such as Inabensa, after being hired by Abeinsa EPC (lots of names here) went ahead and hired U.S. or non-U.S. companies, South American companies, Spanish companies, etc, and make a large profit. This way the paper companies (essentially American but only on a piece of paper, again, so no real services) did create unnecessary profits for Abengoa, at the expense of the project.

Dire warnings 

This whistleblower also gave dire warnings that this type of activity is theft, and that they will continue to rip off American taxpayers, while mistreating American workers, along with their contempt for the USA in general. "The owners of Abengoa will keep doing this until Abengoa Solar (the branch that got the loans) declares bankruptcy. Then the owners of Abengoa will run away with huge profits from those paper companies," this informant declared.

The final caution is this: "Abengoa executives expect such article [mine for starters], and they have a plan already, because this article is too late. You see, Abengoa already made their cash: they will shuffle the papers, try to keep from drowning the loan by holding the branch of Abengoa Solar or around Abengoa Solar, until the loan holder branch declares bankruptcy. Then they will take all the cash. And they will run away."

Abengoa: The cost, connections & collusion

While Abengoa companies (subsidiaries) received $150 million from the U.S. Export-Import Bank for green jobs overseas, and more recently, $2 million from the SunShot initiative, here is a brief rundown on the stimulus funds (American taxpayer money) that Abengoa was awarded:

1. Abengoa Solar, Inc (the Solana Solar Project in Arizona): Rating BB+ by Fitch dated 12/2/2010. On July 3, 2010, the $1.45 billion DOE loan was announced by President Obama, and just before Christmas 2010, it was finalized –– with a reported $455 million grant committed by the Treasury. 
2. Abengoa Solar, Inc (the Mojave Solar Project in CA): Rating BB by Fitch dated 7/27/2011). In June 2011, the DOE announced a $1.2 billion loan guarantee, of which on September 14, 2011, it was finalized –– with a reported $340 million grant committed by the Treasury. 
3. Abengoa Bioenergy Biomass of Kansas LLC: Rating CCC by Fitch dated 8/26/2011. This $132 million loan was announced on August 19, 2011, and finalized on September 29, 2011 –– with a reported $23 to $30 million grant committed by the Treasury. 

In total these plants were funded with over $3.6 billion of green energy stimulus cash, of which $2.6 billion came from the DOE Loan Guarantee Program –– what I call their “junk bond portfolio.”

While former-Energy Secretary Steven Chu and those inside the DOE all claimed that these loans were based on "merit" (even under oath), we know otherwise.

Even though in 2011, we had our suspicions (Solyndra), the bombshell evidence became public in March 2012 when the House Oversight and Government Reform committee unleashed a damaging report revealing, amongst other incriminating facts, that it was all about "access and influence." Basically, cronyism and corporate welfare was the driving force behind these loans including Abengoa's.

The Green Corruption Files has exposed many times, how, in the process of doling out $32.4 billion of taxpayer money from the DOE's loan program (the 1703, the 1705 as well as the Advanced Technology Vehicles Manufacturing Loan Program) –– that at least 90 percent of the recipients have meaningful political connections (bundlers, members of Obama’s 2008 National Finance Committee, large donors to the Democratic Party, and/or favored green crones) to the president and other high-ranking Democrats –– in many cases, to both.

Meanwhile, President Obama in 2012, declared, "And these are decisions, by the way, that are made by the Department of Energy, they have nothing to do with politics;" however we debunked that fact when the treasure trove of documentation on the DOE deal making was unleashed (October 31, 2012) by the House Oversight and Government Reform Committee that included a memorandum as well as Appendix I and the 350+ page Appendix II.

This Intel proved corruption on many levels, and is where we discovered "significant White House [WH] support" and "WH intervention" were part of the decision making that went into awarding Abengoa $1.45 billion DOE stimulus loan for the Solana project in Arizona.

In our August 2012 reporting, we highlighted the cronyism behind Abengoa that comprises of the following Democrats: former Governor of New Mexico Bill Richardson, former Vice President Al Gore, California Senator Diane Feinstein as well as the utility giant Pacific Gas & Electric (PG&E), and various lobbyists.

PG&E is a big player inside this green energy scheme. So, it’s no wonder that this huge energy corporation has an invested interest in seven projects that won Energy Department stimulus loans worth $7.6 billion, including a contract to buy California’s required renewable energy from Abengoa –– all detailed in my April 2013 post, with an overview in my March 3, 2014 Green Corruption File and how it relates to the Mojave project is found in my SPECIAL REPORT on Abengoa.

However, since that time I discovered additional key payers such as Citigroup, former "climate czar" Carol Browner, and the former executive director of the DOE's Loan Guarantee Program Jonathan Silver. This and the detailed collusion that involved DOE officials and the White House in at least the Solana loan, again is all documented in my SPECIAL REPORT, which accompanied this Abengoa "whistleblower story" released on March 30, 2014.

We also know that in July 2010, President Obama touted this Spanish company as an “American jobs creator:

 After years of watching companies build things and create jobs overseas, it’s good news that we’ve attracted a company to our shores to build a plant and create jobs right here in America," the president heralded about Abengoa.

Well, the evidence in this case and copious others where this administration shipped out U.S. green energy taxpayer money and green jobs oversees, demonstrates a different perspective.

Moreover, the Mojave Solar project in California received “preferential treatment” from the Department of Interior (DOI) to lease federal land in a no-bid process, which involved Senator Feinstein, who early on, had written a letter on behalf of Abengoa.

Instead of getting further into the weeds, here is the Mojave Solar Project timeline:

• On March 22, 2010, California’s Democratic Senator Dianne Feinstein wrote a letter to the DOI on behalf of Abengoa asking the DOI to speed up the permitting process for accessing private land for DOE loan guarantees. 
• 2010: Mojave Solar Project gets California Energy Commission “green light”: AFC Filed August 10, 2009, and approved September 8, 2010. 
• June 14, 2011: Abengoa's Energy Department's $1.2 billion loan guarantee announced, which included praise from Senator Feinstein: "Today's announcement demonstrates the potential for the loan guarantee program to drive private investment for large-scale, clean-energy projects and create hundreds of jobs in California." Yet, this project is projected to create whopping 70 permanent jobs. 
• July 21, 2011: Abengoa Solar gets BLM (U.S. Bureau of Land Management) permit approval by the DOI then-Secretary Ken Salazar, which previously included an “OK from the Department of Defense –– and at that time, an anticipated EPA (Environmental Protection Agency) permit. 
• July 27, 2011: Fitch credit agency rates the $1.2 billion DOE loan as “speculative,” indicating “an elevated vulnerability to default risk.” 
• September 2011: Abengoa's $1.2 billion DOE stimulus loan finalized. 
• September 14, 2011, at the same time of this DOE loan approval, it was documented by PG&E: "Abengoa signed a power-purchase agreement with PG&E to buy the energy produced by the project for a period of 25 years" –– a deal that had been percolating years before. 
• November, 2011: The California Public Utilities Commission approved Abengoa Solar’s power purchase agreement with PG&E for the electricity to be produced at Abengoa’s Mojave Solar Project. 

This is another Energy Department taxpayer-funded green energy project that forecasts, "830 construction jobs over the project’s anticipated 28-month construction period, and 70 permanent jobs when the plant is fully operational,” which means that if you just factor in the $1.2 billion loan, that would be $17.1 million per permanent job “created or saved."

As ridiculous as that seems, the question remains: how many of those 900 Mojave jobs are going (went) to foreigners?

The construction of the project started in 2011, and Abengoa states “the Mojave Solar Project will come online in 2014," which means that after three years, it is still not done. Nevertheless, as presented in this Green Corruption File, incomplete is the least of their issues: it's the safety factor and more nefarious matters.

Another Abengoa California solar project could get "green light": public meeting set for April 15, 2014, & I'll be there  

Now the cost ($3.6 billion of American taxpayer money), connections and collusion may not be a red flag for many, but the blatant disregard for our laws and how this Spanish conglomerate mistreated American workers should enrage every citizen of the United States. Moreover, building a dangerous facility on our public lands should infuriate all, including those clean-energy advocates.

Where’s the oversight?

Where's President Obama standing up for the American green jobs or Vice President Joe Biden for that matter? After all the White House lent their "support and influence" on behalf of Abengoa and Biden is supposed to be the "Stimulus Sheriff."

What about the new Energy Secretary Dr. Ernest Moniz, whom during his April 2013 confirmation hearing, promised to make the monitoring and oversight of the DOE's loan program a "top priority."

Why isn't Senator Feinstein writing a letter on behalf of these abused American employees?

If Governor Jerry Brown is so concerned about our drought here in California, shouldn't he know about Abengoa's wasteful technology –– using excessive amounts of water?

And somebody must know about the ICE and DOL investigations by now.

Tragically, like the press, none of these political figures are anywhere in sight. Maybe they'll wake up once a worker is burned or killed at the Mojave plant.

Or will it take an earthquake?

What's disturbing is that earlier this year, Spain’s Abengoa Solar partnered with California’s BrightSource Energy to jointly develop the two-tower, 500-megawatt Palen Solar Electric Generating System. According to the Desert Sun a few days ago...

Just how many millions of dollars the companies developing the proposed Palen solar project might have to pay to mitigate the visual impacts of its two 750-foot-tall solar towers on historic Native American trails and sacred sites could be the focus of a public meeting set for 1 p.m. Tuesday at UC Riverside’s Palm Desert campus.

Yep, that’s this Tuesday, April 15th –– and it’s a CEC meeting of all things. You know, the state's primary energy policy and planning agency, which Abengoa has no regard for. And while they are not seeking a billion-dollar DOE loan (YET), the CEC wants to spend $5 million of California taxpayer money.

Folks this is another Abengoa project in the works, of which government officials in my state of California may soon give a "green light" to. In fact, Desert Sun's K Kaufmann, who is following these solar projects closely, wrote this:

Following the release of the commission’s proposed denial of the project in December [2013], BrightSource and Abengoa requested that the agency hold off on a final vote to allow them to gather more information to answer the commission’s concerns.

The companies have now requested that the repermitting process be reopened.

A vote on that request is expected at a second meeting scheduled for April 16 in Sacramento.

An injured Northern rough-winged swallow found 

at the Ivanpah Solar Electric Generating Plant.

(Photo: Courtesy BrightSource Energy)Taken from the Desert Sun

One of those concerns (and rightly so) is that BrightSource's Ivanpah facility (funded with a $1.6 DOE stimulus loan) located in the Mojave Desert of California has some environmental issues; they (and possibly other taxpayer-funded solar projects) are in the hot seat for burning and killing birds.

A small bird, barely the size of a human hand, had its wings reduced to a web of charred spines. No longer able to keep aloft, the bird was found on the ground after it had flown through the intense heat of a solar thermal project soon to go online in the California desert, Ms. Kaufmann reported last November. 

Nevertheless, what green energy advocates and animal activists should know is that "BrightSource may have paid $56 million to protect and relocate scores of desert tortoises. But, even that has not been enough to avert catastrophe. Animals were crushed under vehicle tires, army ants attacked hatchlings in a makeshift nursery, and other calamities have befallen tortoises made vulnerable by the project," explained the Heartland Institute in 2012 in regards to Ivanpah solar project.

And, I dare not get into the blatant hypocrisy related to green energy animal killings vs. oil companies. That just pisses me off!

Further, I won't distract from the focus of this important story (safety) and get too political, but it should be noted that BrightSource's green corruption tale is massive, of which I've shared many times, starting in the summer of 2012. This was due to its numerous ties to the Obama White House as well as key Democrats such as Majority Leader Harry Reid, and many other high-powered folks in D.C. 

What's relevant here is that BrightSource, like Abengoa, (both of their projects here in California), not only bagged huge DOE stimulus loans, but they were both part of the "lucky" seven that received special treatment from the Interior Department.

The charge as recorded in June 2012, by the Washington Examiner (and other news outlets) was this: then DOI Secretary Salazar "initiated a 'fast-tracking' process that allowed some companies to receive regulatory and environmental approval and permission to use government lands for clean energy projects without adequate vetting. Whereas the review process for establishing an oil or gas lease on federal land can take more than a decade, some of these favored projects were pushed through in less than a year." 

So, are we to trust Abengoa and BrightSource on another massive solar plant: it's safety and protecting our environment as well as any small creature that may get in their way of building or profiting from such a site?

I don't.

Will this Palen project follow suit and allow Abengoa to break our immigration laws and discriminate against American workers? 

What about those approving this deal?

Let's not forget, there's also Kansas?

Seems that a part three on this Abengoa tale is in order.

In closing

As I affirmed in my last post: this is not a "blue or red," "left or right" issue, this is an American one that should unite us all –– even as I, a die-hard conservative, today stand in this fight with my "new green friends" as well as those innocent birds that are being burned alive.

These former Abengoa employees are pro green energy and were ecstatic when they were given the opportunity to lend their expertise and talent to the cleantech world, making an impact for a greener, cleaner USA. Even as most are Obama supporters, none have a political agenda, other than justice for America and the hundreds of employees that suffered under this Spanish firms regime.

Stay tuned...