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Gotion is ‘wholly owned’ by a Chinese company, and 2 other takeaways from its foreign-agent filing

Gotion’s FARA declaration contradicts its articles of association

While Gotion is “wholly owned and controlled” by a Chinese company, the Chinese government has no stake in that parent company, one of its law firms said in an April Foreign Agent Registration Act filing. The FARA paperwork, filed with the U.S. Department of Justice by agents working on Gotion's behalf, shows the company has had to address concerns about wetlands on its proposed Michigan manufacturing plant. The filing also reveals that the law firm and Gotion had to consider a possible conflict of interest involving the firm and an economic development organization.

The filing was first reported by The Midwesterner, and it opens a window on the machinations that went into building political support for the $2.4 billion electric vehicle battery plant near Big Rapids.

Read it for yourself: Gotion’s FARA filing

“Gotion Inc. is wholly owned and controlled by Hefei Gotion High-Tech Power Energy Co., Ltd,” reads the answer to question 12 of the declaration form, which asks who owns and controls the foreign organization in question.

The declaration, however, says that the Chinese government has no say in Gotion’s controlling organization. Asked whether Hefei is supervised, owned, directed, controlled, financed or subsidized “by a foreign government, foreign political party, or other foreign principal,” it answered no to all.

Those claims are contradicted by Gotion’s articles of association, last updated in July 2022.  

As Article 9 of the articles reads:

The Company shall set up a Party organization and carry out Party activities in accordance with the Constitution of the Communist Party of China. The Company shall ensure necessary conditions for carrying out Party activities. The secretary of the Party committee shall be the chairman.

Among the party organization’s duties:

Ensure and supervise the implementation of the Party’s guidelines, principles and policies in the Company, and implement major strategic decisions of the CPC Central Committee and the State Council as well as relevant important work arrangements of the Party organization at the higher level...

The question of who owns and controls Gotion has been contentious, showing up in local township board meetings and in Congress.

In May, a member of Michigan's congressional delegation, Rep. Lisa McClain, R-Bruce Township, gave a speech on the House floor called “Gotion: Bought and paid for by the CCP.”

McClain asserted what Gotion’s FARA filing denies: The company is controlled by the Chinese Community Party.

The filing with federal officials also reveals that Gotion may have run into problems with wetlands regulations.

Seven times in January and February, Gotion representatives met with government officials to discuss wetlands. Two of the meetings were teleconferences with Michigan Department of Environment, Great Lakes and Energy Assistant Director Jerrod Sanders. Five others involved multiple staffers from both EGLE and the Michigan Economic Development Corporation.

On Jan. 30, three EGLE staffers were on the call, and four were from the MEDC. On a phone call about environmental issues, the business development team outnumbered the environmentalists.

The final outcome of those discussions is not known. EGLE did not respond to a request for information.

Local officials who have asked questions about the battery plant's environmental impact say they have received no answers.

Gotion and The Right Place, the economic development firm that lured it to West Michigan, are represented by the same law firm, Warner Norcross and Judd, which also filed the foreign agent form.

After the law firm conducted an internal review, it found no conflict in representing both firms, attorney Matthew D. Johnson explained in a two-page letter that is part of the filing. Gotion vice president Chuck Thelen signed off on the conflict-of-interest waiver, which is partially pictured below.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.

News Story

Clean energy isn’t clean

Wind turbines and solar panels don’t grow on trees

Wind and solar energy do not generate much electricity, but they have a great power to cloud people’s minds. It is now fairly well known that wind and solar can pose serious threats to the nation’s wildlife — from endangered right whales to tens of thousands of bird deaths each year from solar. But optimistic green energy advocates still don’t realize the many environmental impacts associated with manufacturing, maintaining, and disposing of solar panels and wind turbines.

It takes a great deal of material to produce solar panels and wind turbines. Wind and solar energy technologies collect diffuse and intermittent gusts of wind and rays of sunlight to generate electricity, which means they have a very low energy density in comparison to other generation technologies, like fossil fuels or nuclear.

Because of the diffuse nature of their fuel sources, renewables consume orders of magnitude more materials for the same electricity output, thereby causing greater environmental burdens than do more dense energy sources.

A single 100-megawatt natural gas-fired turbine about as large as a residential house will power 75,000 homes. Replacing that energy output with wind requires 20 wind turbines that occupy around 10 square miles of land, and it also needs “enormous quantities of conventional materials, including concrete, steel, and fiberglass, along with less common materials, including ‘rare earth’ elements such as dysprosium,” Mark Mills, senior fellow at the Manhattan Institute, wrote in a 2020 report.

Increased demands for materials leads to the first major impact: Wind and solar require massive increases in mining.

“Global mining today already accounts for about 40 percent of worldwide industrial energy use” Mills wrote. But “renewable plans proposed or underway will require from 400 percent to 8,000 percent more mining for dozens of minerals, from copper and nickel, to aluminum, graphite, and lithium.” The energy system “is dominated by hydrocarbons, and will be for decades,” Mills told the House Energy and Commerce Committee in April.

After the materials are mined, the wind turbines and solar panels must be manufactured. Construction materials—steel, glass and concrete—are produced in energy and emissions-intensive industries (cement/concrete and steel production account for 7% each of global CO2 emissions). The industry relies on iron smelting, cement kilns, petrochemical feedstocks and fuels for plastics and fiberglass. Fossil fuels are also needed to power ships, trucks and construction equipment, as well as providing lubricants for gearboxes on turbines.

In 2021, wind and solar combined to produce less than 5% of total U.S. primary energy. But President Biden has targeted “achieving a carbon pollution-free power sector by 2035 and net zero emissions economy by no later than 2050.”

“If wind turbines were to supply half the world’s electricity,” explains Mills, “nearly 2 billion tons of coal [around one quarter of all global coal use] would have to be consumed to produce the concrete and steel, along with 1.5 billion barrels of oil to make the composite blades.”

Economic and environmental damages aren’t the only problems with wind and solar power. There’s a third problem of moral cleanliness. Around half of the world’s polysilicon, a key ingredient in solar cells, is made in Xinjiang, China, where Uyghur Muslims are enslaved to produce it.

The majority of the world’s cobalt (over 70% in 2021) is mined in the Democratic Republic of Congo. Cobalt is essential to manufacture the batteries that will be needed to provide backup for wind and solar and to power electric vehicles.

“As of 2022, there is no such thing as a clean supply chain of cobalt from the Congo. All cobalt sourced from the DRC is tainted by various degrees of abuse, including slavery, child labor, forced labor, debt bondage, human trafficking, hazardous and toxic working conditions, pathetic wages, injury and death, and incalculable environmental harm,” Siddharth Kara wrote in his shocking exposé Cobalt Red.

I don’t know about you, but I prefer my energy, metals and minerals to be produced by well-paid roughnecks and miners under strict labor and environmental regulations rather than extracted under compulsion by poverty-stricken Congolese children or enslaved Uyghurs.

Finally, wind turbines and solar panels don’t last forever. Solar and wind energy sources are said to last an average of 25 years (though in practice, wind is often “repowered” after a median of only 10 years). As a result, the process of extraction and production is renewed in half the time, as the old panels and turbines must be disposed of.

“Clean” energy waste is nothing to scoff at, either. Many of the materials used to manufacture solar panels can be toxic, and if disposed of improperly, they can leach into drinking water.

Similarly, wind power will create “over 3 million tons per year of unrecyclable plastics from worn-out wind turbine blades,” according to Mills. “When the 20 wind turbines that constitute just one small 100-MW wind farm wear out, decommissioning and trashing them will lead to fourfold more nonrecyclable plastic trash than all the world’s (recyclable) plastic straws combined. There are 1,000 times more wind turbines than that in the world today.”

Both wind turbines and solar panels are coated with PFAS sealants. PFAS-covered waste in landfills has a record of leaching into groundwater. The Biden administration’s Environmental Protection Agency has proposed a pollution limit of these “forever chemicals” of four parts per trillion. That limit is almost certainly far too stringent to be reasonable, but if the administration is serious, it will need to hold wind and solar to a special, more lenient standard than other forms of electricity generation.

So is using wind and solar any better than burning fossil fuels? This is a false dichotomy. Wind and solar energy infrastructure would not exist without the fossil fuels needed to manufacture it. And the intermittency of wind and solar means “that some of the renewable advantage of ‘clean energy’ is offset by extra gas burned inefficiently as backup,” wrote Meredith Angwin in her book “Shorting the Grid.”

“Do not be fooled by the idea that a high renewable percentage is the most virtuous form of grid,” Angwin wrote.

This is especially the case if the grid isn’t stable. If green virtue is obtained only by ceasing the use of fossil fuels, renewables are entirely virtue-free.

Wind and solar simply shift fossil fuel usage from the electric generation portion of the life cycle toward the more inefficient backup role and increased use manufacture and disposal.

Recent data reported by nonprofit Environmental Progress show that because China powers its solar industry with coal, it’s quite likely that solar ends up more carbon-intensive than carbon-capture-aided natural gas.

Ostensibly clean wind and solar are “critically dependent on specific fossil energies,” according to scientist and policy analyst Vaclav Smil. “We have no nonfossil substitutes that would be readily available on the requisite large commercial scales.”

While nuclear offers a form of genuinely clean, scalable electricity generation, it’s nigh-impossible to build in the U.S.

In the end, wind and solar aren’t “clean” by environmentalists’ own standards. If environmentalists were to scrutinize wind and solar as much as fossil and nuclear power, they might find the benefits of the energy transition outweighed by its costs.

Joshua Antonini is a research analyst in energy and environmental policy at the Mackinac Center. Email him at antonini@mackinac.org.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.