Why the US Isn’t Taking a Leading Role in Renewable Energy
Perhaps the most common refrain in the clean energy industry is this: Why isn’t the US taking a leading role? Why are countries all over the world leap-frogging us Americans in this critical arena?
Of course our own Bill Paul talks about this constantly – but so do many others. Green Chip Stocks’ Nick Hodge notes:
Perhaps the best example is Papua New Guinea (PNG), where ExxonMobil (NYSE: XOM) is leading a $15 billion project to bring the county’s 22.5 trillion cubic feet of natural gas to market. But PNG doesn’t want the gas… They want the revenue from the gas to build out clean infrastructure; harnessing their hydro, geothermal, and biomass resources as they sell the gas to the U.S. and the rest of the world. The message is clear: You guys go ahead and waste time with coal and oil. Pay us for it while we beat you to a clean energy future.
Perhaps there is more complexity here than I can see from where I sit. But I don’t think I’m going too far out on a limb when I suggest that the answer to this issue lies in the disgusting bickering and backbiting that lies at the core of the way in which our leaders get things done in Washington. If one side of the aisle wants it, the other side is forced to oppose it. That’s just sickening.
And until we find a way to reform the entire process by which political campaigns are financed, prohibiting corporations from making massive contributions that effective purchase the will of our leaders, there is, in my estimation, no possibility of improvement. Yet, as I noted here, the Supreme Court doesn’t seem to see the issue the way I do. I hope folks will comment on this.
In any case, as the late Robert Byrd said, decrying the partisanship that polarized what had earlier been a friendlier and more honest Senate, “The current system is rotten. It’s putrid. It stinks.”
The bickering is fueled by kick backs. Those that are fighting this in the senate and congress are those that are bribed by big corporations to keep the status quo or work law in their favor. The rich were given too much freedom with no accountability. When they became sickeningly rich while the middle income became the poor our economy went to hell. We will NEVER be a leader again in anything until the good of the people outweighs the good of the filthy rich and lawmakers choose, by conscience, what is “good” over what is “profitable”.
Let us pray for ‘true statesmen’ and not ‘good politicians’.
It is not about bickering – this is a red herring. The failure to adopt clean energy technologies is due to the political influence of the oil and gas companies in Congress and in the White House. These corporations have unfairly influenced subsidies and taxes to effectively shut out clean energy. They also, through their ownership of the news media, sow the seeds of doubt about these technologies with the public, effectively reducing or eliminating public pressure for progressive policies. America is being lied to by its biggest corporations, which want to keep the oil-fueled status quo because it is profitable for them and good for share price. These companies don’t care about the good of the country or its future, all they care about is share price – period. When viewed from this perspective, their actions are perfectly logical. Unfortunately, this logic will eventually destroy the industrialized countries as they are not sufficiently prepared to make the transition away from oil.
Dear Craig,
i thank you for sending me this mail.
But, alas. i do not have necessary knowledge as i am in India and do not have necessary info to answer to your rather question which is the heading of the article.
But, i would like to offer my views in this regard.
i am not against technology but i am strictly against the misutilisation of the technology. Initially, man lived as one with nature and this continued till the inception of the technologies of the modern science.
Greed is predominent from individual level to societal level. We depend on the centralised approach at individual level for every need of ours.
For eg. when we consider a sky scraper, we always think unidimensionally that the air space is disproportionately small to harness the solar energy to meet the demand of heating and lighting. But, we forget or ignore or neglect the eastern and western side of the horizontal walls of the sky scraper. For every problem, there is a solution but we think only unidimensionally and we cannot achieve anything with this restrictied perception.
Every person should be made to be a part of sustainable development.
This is what i feel.
Yes, regarding politics i am not at all an authority as i believe more in bureaucracy than politicians where the later lack vision and the earlier are eqyupped with knowledge.
Political dimension is the reaction of common man who’s action is dependent on multidimensional resultants. But, bureaucracy is a machinary which is equipped with knowledge and vision.
Bye for now, Craig.
Regards.
vasan.
Wind and solar power, using current technology, cannot REPLACE fossil fuels, although to a limited degree solar power can REDUCE our use of fossil fuels. The problem is that wind and solar power are INTERMITTENT sources of energy and currently there is no economically practical way to store power for when wind and solar power are not available. That is a problem which generally is not addressed by backers of wind and solar power.
Geothermal power has possibilities, at least in certain geographical areas, but it is unclear how much is actually available. We’ve already developed hydro power about as much as possible without doing such unacceptable things as damming the Grand Canyon.
Whether people like it or not, nuclear power is the only source of energy that can adequately provide the power requirements of most countries. Here in the U.S., we get about 20% of our electricity from 104 reactors; France gets 80% of its electricity from reactors. With currently available technology, it is the only realistic way to go.
The effect of ignoring nuclear power and pushing wind and solar power will be to delay our phasing out of coal.
We need all possible alternative sources of energy – solar, wind, geothermal, biomass, nuclear, etc. We also need to get corporations out of politics – if this can ever happen.
People, it’s all about the money. The majority of renewable energy projects in the United States are or will be under $1-million – these are the distributed power facilities this country needs because we have failed to adequately maintain and expand the power grid. So we need facilities spread across the “load.” But banks, equity investors, VCs, hedge funds, etc are unwilling or unable to support projects of this scale because the returns are inadequate, there’s too much risk, or the the combination of the two when most installers and integrators has short histories and weak balance sheets. So we slowly climb forward despite the looming end of the ITC grant, and an idiotic patchwork of rebates and incentives.
Solution: time, an extension of the ITC grant, a national RPS standard that is preempted by states that do more (how about a national RPS standard at $200/mw so states like Mass and NJ can keep doing what they’re doing), and a top-down mandate from the fed to encourage banks to at least lend on a 4:1 LTV based on these mandated financial incentives. Do that and we light the world!.
Rob, do we really want MORE government manipulation of lending? Not wanting to start a political discussion, but many would argue that didn’t turn out well in the recent past with mortgages.
The idea of a national “minimum” RPS has legs in my view. It has to be carefully constructed, however, to not penalize any one state. For example, as non-intuitive as it may seem, some SE states are not good candidates for either solar or wind, even if offshore. So either they would have to install a greater amount of such generators, increasing their unit power costs over others, or be allowed some concessions. For example, they may be better candidates for nuclear plants. Or, in another example, they might be allowed to build additional clean coal facilities that could be offset by purchasing/trading solar power or credits with states that exceed the minimum RPS at that time.
Private lenders I’ve spoken to consider plants built to meet known standards, such as RPS, with power purchase agreements (PPA) to be acceptable risks.
To scapegoat big corporations is to follow the empty mantra of politicians lately. As the Supreme Court stated in the majority opinion, the corporations are people too, or more specifically collections of people. One rational way to look at the issue is to ask, if a corporation benefits, who else benefits? Just one or two fat cat executives? Most often not. When a corporation benefits (e.g. makes a dollar or makes a million dollars), so do most of its employees, its stockholders, and perhaps other secondary companies such as suppliers. That doesn’t justify all positions for all corporations, but the opposition to their success I find completely misplaced.
And the example cited actually proves an opposite point in addition to what Craig intends. Namely, without the “profit” from the natural gas, would PNG have the needed funds for their own energy solutions, green or not? It’s a complex economic system, for sure, but existing fuel supplies and their infrastructure provide a tremendous amount of jobs, money, and positive benefit for developing and developed nations alike.
Transitioning to a greener energy supply has huge risks that must be properly managed and must include sufficient hedges and alternative plans. Some politicians recognize this. Some politicians are not willing to force the rate of transition such that costs become too much a burden. Some are not willing to allow over manipulation through shifting monies around (redistributing) to compensate for aggressively rising prices.
I suggest the rational solution sets a reasonable path by better leveraging existing means such RPS (renewable portfolio standards), gradually decreasing the level of breaks and subsidies that are currently allowed to fossil based entities, gradually shifting those breaks and subsidies to greener sources, and engaging the general population by giving us more of a role in the outcome. For example, just as people have voluntarily participated in many green behavioral changes already such as purchasing sustainable grocery bags or recycling, there could be a means by which they make choices with their utility suppliers over time. There are many options. The people are key. Living in MA, a state whose political self-image is one where many think the state is the leader in “new” or “progressive” ways of governing (true or not), the people are not properly engaged and the results are dismal. The public is very familiar with Cape Wind and the continued resistance, but there are also 3 biomass plants that are significantly delayed, at least two solar installations, and at least two other wind installations all due to resistance from different public factions and steady court battles. Money down the drain in my book. All have some common ingredients, two of which are the feeling of being forced and of being deceived.
The politicians on the extremes – those who want highly forceful regulation and a labyrinth of economic manipulation, versus those who think there are absolutely no reasons to promote alternative energy sources – I think are finally in the minority. The majority can meet in the middle to improve the transition with fair consideration for both corporations and the public burden.
John,
You need to get out more and speak to participants in the capital market. Show me a PPA on a project of under $1-million with a list of the financing sources that will commit. Your list will be short. Therein is the problem.
Rob
The political environment in Washington is rotten, absolutely rotten. We have mostly lawyers who only care about getting re-elected as soon as they are elected. But that is not the entire problem. Lawyers are not trained to be visionaries who look to the future and then examine what they need to do today to make tomorrow better. Joe shoots Sally and the lawyer tries to get his client off, regardless of the realities — but after the trial, the lawyer does not say, now what do I do to prevent these crimes in the future? No, to him it is over and now he waits for the next case to appear. Take energy policy in this country. This has been an issue ever since Eisenhower said we must reduce our dependence on foreign oil. No president, Democrat or Republican, has done anything about this. It is not the oil companies’ fault completely, but more the cowards in DC that won’t set Energy Policy over fear of losing the next election. They are masters of “spinning” stories.
Set a National Energy Policy that taxes the users, like everywhere else in the World and you will see changes. If alternative energy is less expensive than status quo, people will change their wasteful habits and business will start to produce what people will start to demand. Europe taxes gasoline and guess what, the people there demand small cars that are super efficient. What would happen here if we taxed fuel like oil and coal? Yes people would be upset, but do we not have a bad habit of wasting cheap energy because it is so cheap? Doesn’t that habit, like an addiction to drugs, need to be broken? Never easy, but don’t do something stupid like cap and trade which hides who has the addiction! It is a polictical croward’s way out.
Your immediate reaction is – you mean you are going to give the Federal beaurocrats more of our money to waste on pork barrel items? We can do great things with this tax money if it is regulated by law to be spent correctly. Put tax dollars into alternative energy, into rebuilding our cities where people are going to want to move back to, rebuild our highway and train infratstructures, build better mass transit, and help other less fortunate to adjust to the changes this will cause.
Breaking bad habits is never received well. But it takes a much different Washington than we have today. I would start by voting out every incumbent running. Enough is enough. Put in term limits of one or two terms and you are out of politics, so we can start to get a better make-up in Washington. As a businessman, I would consider it a privilige to give 1-2 terms in Washington to help set America in the right direction, so would scientists, doctors, bookeepers, blue collar workers…just like the first Congress was 200 years ago. Eliminate the positions as permanent jobs with all the politics it has created.
The problem is all of the people in Congress – vote them out. It can’t get any worse, but only better with fresh blood, particularly if it has the courage to act for us and to better represent us the American people.
Dear Craig,
I agree entirely that Washington is a big part of the problem. But it also extends to State governments and local politics as well as good old ‘bureaucracy.’ Money is also at play – the costs involved in accepting and implementing new technologies, and the moral courage of decision-makers and end users.
Kathy
Dear Craig,
i could not be elaborate in my first response.
Let me be specific now.
i have sent you the project outline to you about the sustainable development which we are taking to implementation level with the help of the Local Government body at Bagalkot, Karnataka State, India regarding Power, water and sanitation.
Emphasis is on public participation.
With fast depleting natural resources and the non-ecofriendly nature of power generation which includes mining of oil, eco-friendly technology should replace the conventional methods and for this public participation is a must.
Everyone look upon the Government with centralised approach for power, water and sanitation which has reached a state of unmanageable system.
Government will make it mandatory for every individual to generate electricity at individual level with the help of solar modules for lighting and solar water heaters for hot water usage.
Though this process require policy makers also, this gesture saves power significantly, that is more than 40 %.
City Corporations can save power by introducing solar powered streetlights.
Like this, individual to societal level renewable energy should be considered which reduces the burden on centralised approach to a very considerable extent.
vasan.
Dear Craig,
Let’s hold principally those who are responsible to craft laws in the interest of anternative energy demands but renage to do so. America in her quest to lead the world in the true sense of democracy, energy, the enviorment and climate change is acting below expectation as can be seen as a result of the gulf oil spill. However,
Dear Craig,
Let’s hold those who are principally responsible to protect and craft laws in the interest of alternative energy demand but renege to do so. America in her quest to lead the world in the true sense of democracy, energy, the environment and climate change is acting below expection as can be seen in the gulf oil spill. However, there will always be an alarming ecological disaster as a result of America refusing to play a pivotal role leaving innocent generations whose only interest is to pay for damages incurred by leaders with selfish ambitions. America has the influence to lead the alternative energy industry without further delay. International pressure must be brought to bear on the United States to garner support for this endeavor.
American Industry is the most capable, most innovative and ingenius of any nation and can do anything, absolutely anything… at gunpoint and forced to. And then six months later the very thing that would put them under, cause undue hardship, was impossible becomes the focus of the marketing campaign of the new and improved and safer thingy.
It seems at this point both political parties are more interested in eviscerating the other party then on helping the nation. It also amazes me that while the science is clear about global warming/climate change, you still have deniers, very much linke the cancer and smoking connection.
Faux News contributor Sarah Palin has claimed that studies about global warming are “snake oil science.”
http://thinkprogress.org/2010/02/10/palin-snake-oil/
It seems like a lot of the general population would rather be ignorrant than to face and fix our problems.
Donald: I agree with you 100%, for what it’s worth. The only thing I would throw in here is that I don’t think Sarah Palin honestly believes that global warming is “snake oil science”; I think it’s part of her on-screen persona, like all the great showboats: Lady Gaga, Mike Tyson, etc. I don’t credit here with too much intelligence, but who takes a position that opposes the vast majority of serious scientists for reasons other that power, fame, and money?
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