That sounds plausible. There are two kinds of unhappiness; local unhappiness from population, and city unhappiness. Buildings only account for local unhappiness. Biowells can account for both. If you exploit the AI hard enough, you can get enough energy to basically let the AI bonuses fund your mass expansion. This is a supercharged version of what happens in CIV IV and CIV V high settings.
Full disclosure.
I think that that kind of play is stupid and breaks immersion. Milking free money off of a jacked up AI completely undermines the supposed higher difficulty setting. You might as well play a lower setting, because you're not playing an actually more difficult game.
Right now, part of how that happens is through the TRs. That hole should be shut off, but it's really not unusual for players actually looking for a challenge to simply decline to use broken cheaty mechanics. That said, that sort of exploit has existed since CIV IV, so there's some indication that there's a demand for loopholes of that nature. It's one of the reasons I don't like playing with those settings.
Essentially, the Biowells transform the city unhappiness limitation into Civ IV's gold per city limitation, and then you use humongous amounts of free money from the Super-Buffed AI to basically remove the limitation altogether.
