Pickens Plan: Gone With The Wind ?  

The Texas Monthly is wondering what happened to the "much hyped" Pickens Plan - Gone With the Wind. While I think the CNG powered cars part of the plan was misguided and doomed to fail, the setback to further expanding the Texas grid and wind power capacity is very unfortunate (via Energy Bulletin).

Remember T. Boone Pickens? In September, I wrote a flattering cover story (“There Will Be Boone”) on the Dallas billionaire and his plan to break America’s dependence off foreign oil. Basically, I gushed—and gushed.

Actually, back then, just about everyone in the media was gushing over Boone. With his newly published memoir and his $65 million advertising campaign to promote wind energy and natural-gas fueled automobiles, he was a genuine media sensation. On top of that, his energy-oriented hedge fund was raking in hundreds of millions of dollars in profits, leading some Wall Street experts to call him a financial genius. At the age of eighty, he was on top of his game.

Uh-oh. Since my article was published, Boone has been taking a shellacking. To begin with, he has taken a huge financial hit as the price of oil has collapsed. Since its peak in June, Pickens’s hedge fund has lost $2 billion, about sixty percent of its value, leading half of the fund’s investors to withdraw their money. (Now the fund has an estimated $400 million to $500 million left—a paltry number by Pickens standards.)

And remember that record-setting $165 million gift he made to his alma mater, Oklahoma State University, a couple of years ago—which he then had the university invest into his hedge fund so that he could grow it even more? The rumors are that much, if not all, of the OSU fund has vanished with the stock market collapse.

Yikes. Some of the Wall Street experts who once praised Boone as a wizard now say Boone has lost his credibility because he foolishly remained too bullish on oil, even as the market continued to slide.

But that’s not all. When I first wrote about the Pickens Plan, as it is now known, he was putting his money where his mouth was, declaring that he was going to build a giant 2,700-turbine wind farm in West Texas costing upward of $10 billion. Nope, not anymore. The nation’s credit crunch has gutted the wind project’s financing, putting the whole project on hold. He’s also delayed work on a state permit to build 170 miles of transmission lines from West Texas that would carry enough wind energy to power 300,000 homes. “For now,” Boone told one reporter, “the wind stuff is deader than hell.”

In fact, the whole Pickens Plan seems to be going, well, nowhere. In November, California voters resoundingly defeated a ballot measure he supported to put $5 billion in bond money into promoting natural-gas vehicles in the Golden State. (Pickens’s own company, Clean Energy Fuels Corp., the country’s largest owner of natural-gas filling stations, sponsored the plan and put up $19 million to back it.) What’s more, automakers have simply refused to embrace the idea of natural gas-powered cars. They are focused on building cars that run on electric power.