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President's Budget: A Welcome Commitment to Clean Energy and Innovation

2012-02-13T22:41:41Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

Today, the Obama Administration released its annual budget proposal, outlining spending priorities for the upcoming year. For supporters of renewable energy, it demonstrates a strong commitment to boosting investments in energy science and innovation, while supporting critical policies that level the playing field for renewables. Recently, the environmental community released its annual Green Budget, highlighting our spending recommendations for the year. In it, we propose a similar approach to building a new, cleaner, energy future for our country, and we are supportive of a number of elements of the President’s Budget. Among the more important aspects of the President’s energy and innovation spending requests:

Promoting a two year extension of important tax incentives for renewables (the production tax credit and the Treasury Cash Grant program, transformed after 2012 into a refundable tax credit) while providing $5 billion to encourage renewable energy manufacturing here in the U.S. These programs help renewables compete against the oil industry and other fossil fuel corporations, and have supported the installation of large amounts of new wind and solar energy.
Funding for the Energy Efficiency and Renewable Energy Program within the Department of Energy (the focal point for most of DOE’s investments in these technologies) would be increased in the President’s budget to about $2.3 billion, about 25% more than last year. In addition to continuing important investments in technologies ranging for solar, wind and energy efficiency, extra funding requests were made for “Advanced Manufacturing”, building energy efficiency, geothermal energy and electric vehicles.
Spending on innovation also increases under the President’s request, with ARPA-E, the well-regarded breakthrough research agency getting $350 million (an increase of nearly 30% from the year before), while the Office of Science would receive $5 billion to invest in critical science research and development (up $127 million from the previous year).
Funding to boost energy efficiency and separately open Federal lands to sustainable clean energy generation was also included, and are covered by my colleagues in other blogs on Switchboard.
Unnecessary fossil fuel subsidies would be cut significantly, saving $40 billion over the next ten years.

There are really two ways to look at this budget request. One is to break down the budget by agency and program, as I have done here, pointing out the requested increases in funding that renewable energy advocates strongly support. But the big picture is perhaps more exciting – as one sees more necessary investments in science, research, manufacturing and education across all levels of government and military, that will ensure our country remains a global leader in innovation, and can sell these clean technologies to the rest of the world.

After all, America has led every major technological revolution over the last 100 years, from airplanes to the internet, and sold the products from these advances to the world, making us richer and improving our lives. Why shouldn’t America lead the clean energy revolution as well? Americans in survey after survey say they want renewable energy that is safe, clean and dependable, and doesn’t harm our environment. Nine in ten Americans—including 85 percent of Republicans and 89 percent of independents—say developing renewable energy should be a priority for the President and Congress.

America has always been a leader in innovation, and it is this ingenuity and innovation that has made America great. We are doing it again with renewable energy technologies, and we shouldn’t turn back because of partisan instransigence or entrenched fossil fuel special interests.

Just like with other transformational technologies—space travel, computers, mobile communications - America is once again at a competitive crossroads when it comes to developing renewable energy technology. Are we going to compete and win on renewable energy, or let other countries lead and win the 21st Century economy? The United States invented solar photovoltaic technology and pioneered commercial wind turbines and then let other countries take the lead building them. Not this time. We can regain our lead in those technologies, and develop new ones as well. Importantly, if we don’t lead on renewable energy, other countries will. China is investing $1.7 TRILLION in renewable energy other strategic technology sectors over the next five years.

This budget may not be perfect, but for clean energy, it is an important step in continuing the rebuilding of America, to ensure that we lead the world in transforming to a new energy future.

E2 demonstrates the power of our emerging clean energy economy

2011-11-17T17:25:40Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

Wanted to pass along a great new Environmental Entrepreneurs (E2) report on clean energy jobs. They’re tracking clean energy job announcements, to correct any misperceptions about the strength and growth of the clean economy. This report looks at the 118 announcements they’ve come across in the last weeks (from over 100 clean technology companies) and outlines a few trends.

Clean energy job announcements from just the last six weeks have occurred in more than 40 states:

The media is missing an exciting story of innovation in American solar manufacturing by spending all of its time focused only on Solyndra:

And that clean energy job growth is most definitely a bi-partisan story.

This report (hopefully the first of many) lays out a powerful and important story - we are already benefitting from new jobs, new technologies and new companies produced in our growing clean energy economy. Maintaining that growth (in part through critical government programs), will allow us to continue to harness American ingenuity, and will ensure our private sector to take advantage of falling costs and breakthrough innovations to create a clean energy future with millions of new jobs, world-leading American companies, and a healthier environment.

Alternative Energy Future on Display at R&D 100 Awards

2011-10-28T20:21:41Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

This is a guest post from 2011 NRDC MAP Fellow Lauren Kubiak.

With policy makers tied up in largely irrelevant arguments about clean energy, I turned my attention to a different area of energy: research and development. Showcasing the most recent—and best—inventions, the R&D 100 awards in Orlando, Florida, honored health, information technology, and, of course, alternative energy innovations. An annual occurrence sponsored by R&D Magazine, the awards featured the inventors and developers in the U.S., and their remarkable energy system-advancing capabilities. It also provided a demonstration of the importance of government support for energy innovation.

From a fuel-cell innovation, to a silicon ink for high efficiency solar cells, a renewable methane combustion system for anaerobic digesters, and a new technique to measure the power capability of energy storage devices—50 times faster than current methods—the honored energy innovators are developing a new energy system that promises to generate electricity more efficiently, cleanly, and more sustainably.

Amongst the honorees was Robert Gaylord, R&D manager of IntelliChoice Energy, honored for their efficient gas-powered heat pump. The pump, co-developed by IntelliChoice Energy and Southwest Gas with funding from the Department of Energy’s Oak Ridge National Lab, the Department of Defense, and Southwest Gas Corporation, generates electricity on site to reduce peak demand and the ramp-up of extra power plants. Beyond its remote powering abilities, the technology is 50 percent more efficient than other gas-powered pumps, due in part to its ability to recover waste heat. This is on top of the already more efficient resource transport of natural gas, which, at 90 percent, is more than three-fold electricity transmission’s 27 percent efficiency. The pump also uses 83 percent less water to generate electricity which, in the desert southwest, is a highly valued commodity and one of the reasons it is already being used on six military bases.

Photo Credit: Lauren Kubiak

Another notable invention presented at the expo was the silicon ink solar cell, developed by the National Renewable Energy Lab and Innovalight Inc. By adding a low-cost silicon ink on top of the solar cells, the panels are able to achieve a 1 percent gain in sunlight-to-electricity conversion efficiency. While it might not sound like much by itself, this 1 percent gain translates to a 6 percent improvement overall, which reduces cost, increases the amount of electricity generation, and has a multitude of implications beyond.

As global energy demand grows, clean energy technologies will continue to become increasingly important. Speaking with the scientists and engineers from Oak Ridge National Lab, National Renewable Energy Lab, Lawrence Livermore National Lab, Sandia National Lab, (and more!) whose inventions are minimizing pollution and maximizing efficiency, I couldn’t help but notice how critical government support is for research. Take a look at the list of winners again and count the number of teams from national labs. It’s a national priority to maximize efficiency in the evolving clean energy system, and I have no skepticism in the honorees’ abilities to continue to invent the critical alternative energy technologies to get it done.

Photo Credit: Glenn Kubiak

Solyndra Shouldn't Overshadow the Growing Solar Industry or Need for Smart Government Energy Policies

2011-09-14T13:12:07Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

Last week, Representatives Fred Upton and Cliff Stearns stated the following regarding the Solyndra bankruptcy:

"President Obama's signature green jobs program went from a darling of the administration, to bankruptcy, to now the subject of an FBI raid in a matter of days…Irresponsibly choosing winners and losers on projects like Solyndra is a perilous and often doomed method to create jobs"

I’m picking on these two quotes specifically because I think it encapsulates how aggressively simplistic and inaccurate the rhetoric has become about new green jobs and the growth of a clean energy economy.

The idea that the failure of one loan guarantee somehow calls into question the effectiveness of government support for clean energy, or indicates impending doom in green jobs creation is just wrong. It’s like calling a baseball game based on one pitch in the second inning. And it’s a complete disservice to those interested in having an actual conversation about the future of energy policy in this country. Bill Gates and a host of investors and business leaders released a timely report to this point yesterday.

First – regarding the jobs argument - I’ve been emphasizing the impressive growth in green jobs in other posts. The bankruptcy of Solyndra in no way represents the death knell of the U.S. solar industry, or some insurmountable loss of green jobs. According to the Brookings Institution, the number of domestic jobs in the solar industry has more than doubled since 2003 – an impressive accomplishment for a nascent industry in these difficult times, of which Solyndra represents a tiny fraction. My colleague Nathanael elaborated further on the Solyndra story here – to paraphrase his post, Solyndra is hardly the only solar company in the U.S., and to focus on it ignores a compelling growth story in the solar industry (for example - according to a recent SEIA report, the U.S. is now running a $1.9 billion trade surplus in solar technologies, as compared to a $250 billion trade deficit in petroleum).

Second, the U.S. solar industry will be most effectively and efficiently built when private sector activity is integrated with smart government incentives and supporting policies. These policies are good investments returning job growth, economic security, reduced pollution and tax revenues that will quickly more that cover the cost of any government support. First Solar is a classic example of a next generation solar technology with has received a range of government support and is now becoming a global leader.

More skeptical analysts tend to forget or ignore the variety of market barriers and failures that can hinder the optimal deployment of solar and other renewables, despite the best efforts of the private sector. These include classic, well-known market failures such as pollution externalities, spillovers and information asymmetries as well as market barriers related to solar’s higher cost than traditional technologies driven in part by a lack of financing for innovative new technologies, limited private and public-sector innovation pipelines, a complicated regulatory environment and conservatism on the part of many utilities and state commissions, as well as more recent barriers concerning siting and permitting, and integration of variable generation into the grid. Addressing these barriers is not “perilous and doomed” but economically and politically justified.

Given this, it is critical that we not view current or recent energy policies in a vacuum, but rather as part of a larger strategy to spur long-term investment and job creation and develop a sustainable, stand-alone industry by addressing barriers hindering clean energy installation and manufacturing.

And importantly, we need to stop turning this discussion into the latest political battle. We currently face a challenging economic environment, with high unemployment and a weakened manufacturing sector. Competitively, the U.S. is being challenged by a plethora of countries in Asia and Europe. Energy security remains beyond problematic, and climate change isn’t going anywhere. As many companies and industries are demonstrating – the clean economy is one of the few that is growing, both globally and in the U.S., and these are the industries that our country has to lead in. To try to turn this rapidly growing sector into a political football, and somehow determine we should maintain our emphasis on old, mature and polluting fossil energy technologies like oil and coal, is irresponsible and selfish, and will only make confronting our myriad economic, security, and environmental issues challenges that much more difficult.

Green Jobs Aren't Going Anywhere

2011-09-08T18:20:14Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

In the last few weeks, it seems like every other day there’s been a different negative story about jobs in the new clean economy. I responded to an especially bad one in the Times, but I’ve seen several more since. Tuesday, David Brooks linked together a few anecdotes, quotes, and reports to proclaim the failure of government in driving clean energy jobs. Unfortunately, he’s not alone in that misperception, and more frustratingly, an inaccurate narrative is beginning to spread. Several other stories are all being circulated, all using the same narrow lens and timeframe, and ignoring anything resembling context or a broader discussion of macro trends. For example: here, here, here, and here.

But there’s an important distinction here. The reporting on the clean economy jobs may have turned negative recently, but that does not mean that the actual clean economy jobs story has turned negative. An undercurrent of criticism against investment in and projections of clean energy jobs has always existed, for political and other reasons. Recently, several incidents have occurred in the same time, and in the same industry, allowing folks to link them together in stories and call it a trend. It’s not.

As with taxes, fantasy drafts and Ikea furniture assembly, things are a lot more complicated than they first appear.

For example, I too can cherry pick anecdotes to advance a certain one-sided narrative. Let’s just look at news from August. For example, CaliSolar’s decision to open a $600 million facility in Mississippi, expected to create 950 full-time jobs. Or the 600 workers currently employed on the Brightsource solar project in California. Or the nearly 250 construction and full-time jobs at Nevada’s first wind project under construction – Spring Valley Wind. Or the completion of Amonix’s Nevada solar manufacturing facility, employing 300 people full-time. Or heck, let’s go small - the addition of a third production shift to Suntech’s solar manufacturing facility in Arizona, adding 30 jobs (totaling 100). Or an announced agreement to convert a California coal plant to biomass creating or maintaining a total of 250 jobs.

But does that really help advance this conversation? I’d rather look at these issues on a broader level, over a much longer-term time period. And so in the frame of moving the conversation forward, I’m calling out some of the issues I've seen repeated over and over, in hopes that avoiding them could enhance the overall discussion.

Using anecdotes Instead of analysis – I've certainly been guilty of analysis by anecdote, but we can now use a growing body of actual research attempting to quantify the size of the clean jobs sector. Counting actual jobs is difficult in any industry, and surveying capacity is still being developed for the clean energy economy. Especially challenging is developing the classification of a “green job”, what industries qualify, how they’re quantified, how to include indirect and induced jobs and tracking growth over time (for those interested in these issues, this is a good intro to these issues). The Brookings study is the most recent and a good non-partisan effort. It determined that wind and solar jobs grew from 10%-18% annually in the past decade, and that there are 830,000 jobs in the “Energy and Resource Efficiency” segment within the U.S. and 138,000 within the renewables sector. Pew also contributed a good study a couple years determining that clean energy economy jobs grew by 9.1% from 1998-2007, totaling 700,000 jobs (as of 2007). More importantly, the BLS is due out with its first effort soon, which will expand on the efforts of Brookings and Pew (see here). While none of these studies should be taken as the last word, I prefer this to individual quotes.
Ignoring the context of the weak U.S. economy, continuing financial turmoil, and pre-existing macro-economic trends. The U.S. has been operating in a challenging global economic downturn for 3 years. This has reduced limited investment across industries, including renewables. Further, this downturn has had ramifications for the U.S. power industry, beginning with falling commodity prices and reduced electricity demand, which is reshaping the U.S. energy industry in the short-term. Meanwhile, normal market dynamics are also leading to a fundamental restructuring of the global solar industry. Then of course, there’s the long-term trend of offshoring U.S. manufacturing jobs, and the difficulty of competing against China. All of this is to say – its unfair and simplistic to look at the super small sub-set of one company, say Solyndra, one of 36 to receive a government loan guarantee, or one town, suffering from a decade of underemployment, and make broad statements about the success or failure of government policies or the viability of U.S. clean energy industries, based on the experience of that one company.
Prematurely focusing on micro-trends rather than the long-term nature of this type of economic transformation. While frustrating for those seeking immediate results, these investments in clean energy have been made with the long-term in mind. The transformation to a clean energy economy won’t happen overnight – there’s a reason energy modeling goes out to 2050 and beyond. Therefore, to a great extent, the results of investments now and in the future, espeically for new technologies, will ultimately be measured in decades. Grabbing short-term anecdotes from individual companies, or local towns is a cute tool for setting up a reporting narrative, but it’s not an accurate measurement of what’s happening. We’re already extrapolating successes or failure from a very small sub-set of data developed in the last two years, when we need to keep a much broader prespective. This goes double for certain unnamed columnists who strenuously advocate for humility in forecasting the future.
Concentrating on individual technologies, not the entire portfolio of investments. In both the private and public sectors, we’re investing in many, many different technologies. Per BNEF, total global investment in all renewable technologies was over $250 billion in 2010. Public sector funding, driven mostly through stimulus spending during the recession, added several hundred billion more globally. Perhaps this is obvious, but not all of those technologies will prosper. And within each technology, some innovation will be transformational in impact, while other innovations will ultimately fail. To address climate change, eliminate our reliance on petroleum, switch from fossil fuels to renewables and drastically improve our energy efficiency, we can’t just rely on a few technologies. Similarly, when looking at green jobs, we have to look across the spectrum –wind and solar, electric vehicles, biofuels, efficiency, and so on. Individual solar manufacturers may go bankrupt, which will have a negative impact on jobs. But we would do well to keep an eye on the dozens of other opportunities - battery manufacturers, utility-scale solar projects, smart grid, storage, and so forth. For example, we shouldn’t forget the jobs building and running rail lines, rail cars, bus rapid transit and hybrid buses, as well as bicycle lanes and sidewalks. These are all green jobs too. And of course, green jobs are coming to auto companies as they innovate to comply with new fuel economy and GHG standards.

The bottom line is, new technologies such as energy efficiency and renewable energy are getting a real foothold in the market, with solar and wind manufacturers popping up all over Ohio and Michigan, and utilities making unprecedented investments in energy efficiency from Arizona to Tennessee to Maine. According to SEIA, the U.S. is now running a $1.9 billion trade surplus in solar technologies, as compared to a $250 billion trade deficit in petroleum (responsible for 40% of our overall trade deficit). The President and auto manufacturers recently agreed to an increase in mileage standards, which will make American cars more fuel efficient and competitive, while American battery manufacturers are growing dramatically, and now expect to own 40% of the fast-growing electric vehicle battery market in 2015. Then of course, there are the Brookings and Pew studies above.

The Midwest, especially hard hit by the manufacturing depression in this country, has been a critical beneficiary of new clean energy industries. According to the ELPC, in Michigan alone, there are 120 and 121 companies in the solar and wind supply chains respectively, and may see up to 62,000 jobs from the new advanced battery industry. A report issued last month by NRDC, UAW and NWF showing that over 50,000 “clean car” jobs now exist in Michigan and Ohio. Keep in mind, these two states lost over 100,000 automotive jobs between just 2003-2008. Finally - if you're fine with anecdotes, then clean energy success stories abound.

Recent investments made in our new clean energy economy have been both short-term stimulus leading to tens of thousands of new jobs and long-term down payments on a new clean energy future. It is clear that clean energy is the focus of the 21st Century global economy and we can’t win the future and prosper economically in this country if we don’t get back out in front.

Thoughts on the Green Scissors Report

2011-08-25T20:05:57Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

The most recent Green Scissors report is out, recommending hundreds of billions of dollars in subsidies that could be cut to reduce the budget deficit and improve our environment. Green Scissors provides a host of useful proposals to save tens of billions of dollars annually by eliminating unnecessary, environmentally harmful subsidies, including conventional fossil fuel subsidies and VEETC (i.e. the ethanol tax credit), reforming inefficient and expensive agriculture policies and farm subsidies, and reclaiming unclaimed royalties from mining public lands. These counterproductive programs and subsides are outdated and wasteful and should be first on the chopping block when Congress returns to debate the next phase of deficit reductions.

We fully recognize and support the idea that there are myriad inefficient and expensive subsidies that exist for mature energy technologies, especially fossil and nuclear. However, select incentives can be critical in helping new technologies overcome the plethora of energy market failures and barriers stifling their deployment. A couple of older NRDC briefs (here and here) still stand up in outlining this perspective and delineating the differences between good incentives and bad subsidies. As one example, we can invest tax dollars in creating jobs and building new industries by targeting the research funding of the Advanced Research Projects Agency–Energy (ARPA-E) towards energy alternatives that can end our addiction to oil and other fossil fuels, and bring new power innovations into the marketplace. Investment in this type of transformative innovation receives only limited funding (if at all) from the private sector, but is central to expanding our clean energy economy. NRDC’s support for ARPA-E is best outlined here and here.

Similarly, loan guarantees made for renewable energy and energy efficiency projects can be an important tool in sound long term energy and economic policy. Clearly, loan guarantees that either subsidize mature technologies or don’t have a net positive impact on the environment (such as to mature nuclear or advanced fossil fuel projects) are high-risk and ineffective. Ending this practice makes obvious sense. In contrast, the DOE loan program has made advances in conducting extensive due diligence on each clean energy project it has supported. These efforts have ultimately helped ensure over $20 billion in new capital for renewable projects. These types of targeted government activities should be continued.

As we focus on increasing jobs and strengthening our economy, it is vital that innovative clean technologies, which can provide tens of thousands of jobs now and millions of jobs in the long-run, and protect our environment, are given the space to reach their full potential. That means both eliminating wasteful, harmful programs that increase our deficit while polluting the environment while also putting smart energy policies in place that can drive a new clean energy economy.

Pushing back on a bad Green Jobs story

2011-08-19T13:09:06Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

Having just gotten back from a quick tour of Michigan and Ohio, and seen some of the early returns from our growing clean economy, I find this recent NY Times piece frustrating. In it, the author uses a few local data points without context and a limited reading of a recent study to claim that "green jobs" are a mirage. On closer review, it’s a local piece from a San Francisco paper, picked up by the Times. But it will likely get further coverage from national outlets and thrown around as evidence that somehow we’re not seeing the green jobs that have been promised by advocates and industry in the past few years. This could not be further from the truth.

With some colleagues, I recently drove through parts of Michigan and Ohio, stopping in at various companies connected to the new clean energy economy. (my colleague Lauren Kubiak is blogging the tour here). I toured factories that are manufacturing wind components, energy efficient roofing products and light fixtures and even a refrigerator recycling facility. In some of the areas hit hardest by both the recession and long-term outsourcing of U.S. manufacturing, the new clean economy is bringing jobs back. More importantly, these aren’t jobs that involve sitting at a desk all day pushing paperwork around (like, say, my job), but good-paying factory jobs for working class Americans, where things get built or made, and then sold.

Astraeus is in Eaton Rapids, Michigan, a town of about 5,000, and has developed innovative ways of manufacturing wind components quicker and cheaper. They’ve been able to hire back nearly all of the 100 workers that lost their jobs during the recession (and expect to create hundreds more jobs as their high-tech wind components are used by wind companies). In a community that size, that has real impact. Full Spectrum Solutions is based in Jackson, Michigan, another small town, and makes efficient lighting products. They’ve doubled in size during a tough recession.

There are literally dozens of stories just like this in the Midwest. We’ve got a backlog of companies we’ll be going back to visit on our next roadtrip and I look forward to sharing them.

Which is what makes this article so frustrating. First, I’ve read the Brookings report multiple times (and its great technical appendix) – and it’s not the depressing story the author makes it out to be. (my colleague blogged it here.) First – it was measuring the entire “clean economy”, not just clean technology (so analyzing 40 industry segments, including everything from public transit and types of farming, to pollution reduction and recycling). But if you just want to look at the “clean technology” segment of this clean economy, then you’ll see “explosive growth” per the report – wind and solar jobs grew anywhere from 10%-18% annually the past 8 years (see page 22). Overall, the clean economy accounts for 2.7 million jobs, making it a larger employer of Americans than the fossil fuel energy sectors.

Second – the point of this study was to analyze job growth across the U.S. So for example, while the South Bay (San Jose, Sunnvale, Santa Clara) lost 492 jobs from 2003-2010 (as referenced in the article), the region of San Francisco/Oakland/Fremont area increased total clean economy jobs from 2003-2010 by more than 44% in that time, adding 15,700 new jobs. (from the data downloads in their interactive map here). Nationally, similarly impressive stories are everywhere. During that same period, Knoxville, Tennessee added nearly 10,000 green jobs, as did Raleigh-Cary, North Carolina – tripling the size of jobs in their clean economies, while Little Rock Arkansas more than doubled the number of jobs in its clean economy.

Third, in terms of addressing broader, structural issues within the U.S. economy, according to the Brookings report, one quarter of all these jobs in the broader clean economy are manufacturing, with several segments (including those in energy efficiency, electric vehicles and chemical segments) more than 90% manufacturing. Further, these clean economy jobs pay median wages that are 13% higher than median U.S. wages (and for workers with less formal education).

So yes, looking at one community with 10.5% unemployment, you can write a story that the clean economy has not produced significant growth in the past 7 years. And looking at small sub-segments within the broader clean economy that are heavily exposed to construction and home building also probably won't paint a great picture. But looking across the nation, in areas and industries hit hardest by a tough economy, the story is much, much more optimistic. And if you don’t believe me, I’ve got some growing companies out in Michigan and Ohio that I can send you directions to.

Brookings Report Finds "Clean Manufacturing" Critical Component of Green Economy

2011-07-25T18:33:01Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

This is a guest post from 2011 NRDC MAP Fellow Lauren Kubiak.

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On July 13, the Brookings Institution, in collaboration with Batelle’s Technology Partnership Practice, released its highly anticipated green jobs evaluation. The report, “Sizing the Clean Economy: A National and Regional Jobs Assessment,” is, per Brookings, the first comprehensive national clean economy study that defines and identifies “clean jobs” across the entire U.S. economy. In addition to quantifying clean jobs trends in the U.S., it also provides a detailed breakout of state and local clean economies. While much of the discussion during the report release event centered around policy solutions that support innovation and economic development in the clean economy —and rightly so—I was drawn to the study’s conclusions on “clean manufacturing”.

The study found that clean manufacturing, or the production of goods with an environmental benefit, plays a critical role in the U.S. green economy. Clean manufacturing is currently responsible for 26 percent of all clean energy jobs—a share substantially greater than the 9 percent of manufacturing jobs that comprise the whole of U.S. economy. Because manufacturing jobs require more specialized skills and pay higher salaries than the average U.S. job, the manufacturing-intensive clean economy contributes to the report’s finding that clean economy workers earn 13 percent higher salaries than members of the U.S. economy as a whole. Indeed, while the average U.S. employee earns a median wage of $33,190, those in the clean economy earn $44,000.

But the benefits of the clean manufacturing economy don’t stop with high salaries. Clean manufacturing is becoming a growth engine for the U.S. manufacturing industry as a whole; between 2003 and 2010, clean manufacturing created 35,382 jobs, while the rest of the manufacturing industry shed 3.3 million jobs. What’s more, each new clean manufacturing job has an export value of $20,129—a number almost double the traditional manufacturing export value of $10,390 per job. This means that the average clean manufacturing worker is twice as economically productive and boosting the U.S.’s global economic competitiveness.

(Source: Brookings Website, Sizing the Clean Economy Indicator Map)

So where are these jobs and how do we make more of them? Brookings found that job growth has occurred most quickly in what the Institution calls clusters, or “geographic concentrations of interconnected firms often accompanied by supporting or coordinating organizations.” Current examples experiencing economic growth from clustering include the Silicon Valley, a hub for regional technology innovation, and Los Angeles, an energy and agricultural center. Clean economy establishments in close proximity to their peers between 2003 and 2010 grew 5.5 percent more quickly than those not in a geographical cluster. Given that such a high portion of clean jobs are manufacturing jobs, it makes sense for these manufacturers to cluster themselves among similar industries, as well as the organizations that support those industries.

Communities throughout the U.S. are doing just that. Speaking on a panel at the report release event was Rebecca Bagley, President and CEO of NorTech, an energy and economic development group in Northeast Ohio. Using the principles of clustering, NorTech works to help solar and other advanced energy industries grow—and there are signs that their work is paying off. Cleveland, which has a rate of establishment clustering nearly double Ohio’s state average, experienced job growth between 2003 and 2010 at a rate of 4.4 percent—a number almost double that of Ohio. On the opposite side of the state in Toledo, an even greater share of clustered establishments are likely contributing to its 8.1 percent clean job growth and Ohio’s current position as the number 2 exporter of solar panels.

With its recent growth, it’s easy to become overly optimistic about the future of the manufacturing economy. However, there are still many challenges that need addressing, beginning with the uncertain policy environment. Clean energy represents a rapidly growing segment of the green economy, but critical federal energy tax incentives are set to expire by the end of 2012. This makes investment in factories and businesses, even in regional clusters, a risky endeavor. Jeff Metts, President of Astraeus—a small wind turbine hub manufacturing company based in Michigan—voiced frustrations with the unstable financial climate and the challenge to make his voice heard politically. With 200 employees and a potentially innovative new turbine hub design, Astraeus stands to gain—and in turn contribute, in the form of jobs, technology, and turbines—much from continued federal investment in clean energy. While companies like Astraeus have thus far been successful based on smart innovation, Michigan’s skilled workforce, and supportive policies, their future is not guaranteed. What is guaranteed, however, is that clean manufacturing has the potential to be a pillar of the U.S. economy, while addressing significant economic, social, and environmental problems. We should do all in our power to make that happen.

Google Shows Importance of Climate and Clean Energy Policies Alongside Innovation Investment

2011-07-03T14:55:34Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

The recently released Google/McKinsey clean energy innovation study is a great way to lose a few hours (if, you know, wonky energy analyses are your thing). In it, Google sets out to fill in one of the rather sizable data gaps in energy innovation policy – quantifying the potential return on investment from major technology breakthroughs in clean energy. (I especially recommend the data set and toolkit that Google has made public)

For the study, Google hardwired massive (and artificial) cost performance breakthroughs (50%-90% reductions) in major clean energy technologies (e.g. solar, wind, storage, electric vehicles, natural gas, nuclear, etc.) and ran the results through a McKinsey energy dispatch and macro-economic model. In other words – the study creates an artificial scenario of a world where we’ve actually achieved the transformative innovation we believe is possible in clean energy, and draws a picture of what that world looks like. While certainly the usual caveats apply when reviewing multi-decade forecasts of complex environments (i.e. cite cautiously), these types of studies can provide us with at least some visibility in what potential outcomes we can expect from innovation investment, and even provide economic justification for certain levels of funding.

Not surprisingly, the Google/McKinsey study produces some thought-provoking outcomes. Among the many conclusions of this study:

Innovation in clean energy is great for job and GDP growth and emissions reductions, but these outcomes can vary widely based on different scenarios.
Innovation in transportation (specifically battery technology) appears especially impactful for economic growth, providing most of the incremental economic and security benefits through 2030
The first clean technologies to become cheaper than traditional options may have a sizable first mover advantage over other technologies
Displacing coal power appears to require more than just innovation breakthroughs in cost. Google theorizes that the cheapness of coal as a fuel requires significant cost reductions in competing technologies in order for fuel switching to take place – which only happen post 2030 even in these artificially induced innovation breakthrough scenarios, absent a carbon price alongside.

But for me, the most important outcome of this study was its overwhelming demonstration of the need for a full-suite of clean energy and climate policies alongside innovation breakthroughs – not just a piecemeal approach that favors heavy investment in innovation, or the picking of a couple technologies, or one or two targeted policies. Instead, this modeling concludes that a comprehensive approach featuring investment in dramatic innovation alongside critical climate and clean energy policies is the most effective at boosting jobs and GDP, deploying renewables and reducing GHG emissions. Put another way - just pushing on the technology lever doesn’t solve the climate problem in time.

This dynamic is demonstrated in outcome after outcome. The chart below shows jobs and GDP increases relative to a business as usual scenario (essential the EIA’s Annual Energy Outlook model). While technology breakthroughs and individual policies have significant benefits relative to BAU, it is the combination of innovation PLUS policy that leads to the best results. BT = Breakthrough, see Google report for description of scenarios

Similarly, renewable generation is almost 3 times higher under a comprehensive suite of policies plus innovation breakthroughs as it is under individual scenarios.

Household energy costs, see the largest reductions under a combined policy plus breakthrough innovation scenario.

The same applies, critically, for GHG emissions, where GHG emissions reductions are most significant through the combination of climate and energy policies and innovation.

My bottom line takeaway of this study - no one option can transform our energy and climate future by itself. While an individual policy, or breakthrough in a specific class of technologies (storage, vehicle batteries) can have a measurable impact, in order to meet our carbon reduction goals, grow our economy to its fullest, and have the cleanest power supply possible, we have to pursue comprehensive set of policies in addition to massive innovation investment, which must include climate and clean energy policies.

Oversimplifying a complex topic - measuring the "sustainability" of renewable energy

2011-06-09T18:17:05Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

The environmental impact of electricity generation is an incredibly complicated issue. Each electricity generation option, be it fossil fuel, nuclear or renewable, brings with it environmental costs and challenges. Some of these same energy technologies (such as renewables) also have environmental benefits when compared to others (such as coal power). It’s impossible to do the topic justice in one (or many) blog post(s).

Which is what makes yesterday’s NY Times op-ed by Robert Bryce so unfortunate. In it he raises questions about the environmental impacts of wind and solar generation, but does so by relying on incomplete and inaccurate data and extensive oversimplification, leaving information gaps large enough to ride a coal-laden train through (each one is over a mile long – so these are big gaps).

NRDC welcomes an intelligent and nuanced conversation about this extremely complex topic. We recognize both the critical need for utility-scale renewables projects, as well as the significant environmental damage that poorly sited projects can cause. It’s a difficult line to straddle, but as demonstrated by our engagement in multiple multi-stakeholder efforts across the country, and our support of important renewable policies and funding we are trying to find a balance between the two.

But before we can have that conversation, we need to have a common ground for discussion. And in that sense, fact checking Mr. Bryce’s column is a helpful exercise in laying out some key parameters.

Using “land use” and “steel use” is an incomplete measure of environmental impact. When analyzing environmental impact, a full lifecycle analysis of a specific energy technology is critical to understanding the many, varied impacts from each aspects of the entire production cycle. Among other things, this requires understanding water use and pollution, air pollution, habitat fragmentation and destruction, animal and/or plant mortality, soil degradation, noise, light and heat pollution, and waste disposal from not just the energy production process itself (i.e. generating electricity) but critically the full lifecycle of generation - the construction of the generation facility, the extraction and transportation of all inputs (e.g. fuel) and the decommissioning of the facility. In determining “demand on natural resources”, Mr. Bryce looks only at wind and solar and stops at a back-of-the-envelope quantification of land use and steel use in only one segment of the full production cycle. This paints a highly limited and inaccurate picture of total environmental impact from all energy technologies.
“Land use” is not simply a measure of acreage of the production facility. Even if we just focus on “land use”, not all land use is the same. Land intensity on a lifecycle basis is the critical metric – how the land is being disturbed, and whether it can be restored after use, and throughout the entire production cycle (i.e. extraction to generation to decommissioning). It is unreasonable and inconsistent with existing reality to consider wind project developments with livestock grazing underneath turbines or farmers harvesting crops alongside turbines, more damaged than land around a coal mine or natural gas field, or fuel transport infrastructure (e.g. pipelines, railroads), or surrounding fossil fuel generation facilities.
Specific to wind, calculating the land use of wind is more complicated than a simple “array spacing” measurement method. Mr. Bryce uses “array spacing” for his wind calculations (i.e. all land between the turbines) as opposed to “turbine footprint” (turbine structures themselves, plus permanent structures). Neither position fully reflects the environmental impact of wind power. Array spacing does not accurately account for the land impacts of wind energy because of the multiple complementary uses of the land and the relatively low intensity of the land usage. The footprint calculation does not fully account for the environmental effects of altering the flight space above the earth, causing avian habitat disturbance, and bird and bat mortality or habitat fragmentation due to road construction and transmission connection. To some extent, the same is true of solar facilities. Mr. Bryce’s method of determining land use is certainly defensible in some viewpoints, but others would consider this too expansive a definition. And to reiterate, either calculation remains a poor substitute for a more complete lifecycle environmental analysis.
Options to reduce the environmental impact of wind and solar are much greater than for fossil fuel and nuclear plants. Simply put, and as demonstrated by a number of the “fast track” solar projects permitted last year by the Department of the Interior, renewable projects can be resized and re-engineered to reduce environmental effects from water and land use, habitat fragmentation and other pollution. Decades of experience have shown this to be untrue in the case of surface coal mines, uranium mines, or natural gas fields, or extremely difficult to address in the case of toxic chemicals emitted into the air, soil and water from using that fuel. Given the great need for new generation resources in the future, and the need to meet the priorities of many stakeholders, this ability to reduce environmental impact has real value.
The diversity of less environmentally impactful renewable energy resources must also be incorporated in this type of analysis. Undoubtedly utility-scale wind and solar will account for significant portions of many state renewable portfolio standards, and with it the need for transmission. But so too will zero-impact energy efficiency (which will reduce the overall electricity load and therefore the amount of renewables required), and distributed generation that can be built on brownfields, previously disturbed lands, or buildings. Modeling for California’s 33% RPS is a good example of this concept. The either/or metric laid out by Mr. Bryce is too limiting and incomplete, and therefore flawed.

There are many other factors to be taken into account in analyzing the footprint and impacts of different energy technologies – we have highlighted just a few in this limited space. As multiple analyses have shown in recent years, there is a huge disparity between just land use calculations, where depending upon your assumptions, each technology can be favorably or unfavorably compared to the other. We do ourselves and all interested stakeholders a great disservice if we don’t paint a full picture of the impacts of all our energy choices, especially at such a critical juncture in building our clean energy future.

NOTE: Thanks to Leah Kuritzky for helping put this post together.

Strong support for alternative energy across the political spectrum

2011-05-06T18:13:40Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

According to a huge new Pew Study, support for renewables exists across nearly all of the political spectrum. Energy and climate were one small component of the survey (which featured a large 3,000 person sample, plus 1,400 person follow-up), but Pew’s attempt to classify American voters by political leanings add a layer of nuance to this issue that is very helpful in illustrating just how broad U.S. voter support is for alternatives to fossil fuels such as wind and solar.

In the survey, the question was asked:

“Right now, which ONE of the following do you think should be the more important priority for addressing America’s energy supply?”

By more than a two to one margin, respondents supported the development of alternative sources of energy over fossil fuels. Aggregating all responses:

63% said “Developing alternative sources, such as wind, solar and hydrogen technology”
29% said “Expanding exploration and production of oil, coal and natural gas
6% volunteered that both should be given equal priority
2% didn’t know or refused to answer

What’s great about this survey however, as seen in this chart, is the ability to further breakdown these answers by political viewpoints. As background – for the full study, Pew attempted to classify where Americans are currently lining up on the political spectrum, and broke out registered voters responses on the basis of both traditional Dem/Repub categorization, but also several new categories as defined by Pew. (if I’m butchering the background here, just read the survey).

Dicing up the numbers a bit more elevates an idea that offers at least a bit of hope for renewable energy advocates - namely that, if politicians are listening to voters, they’ll hear strong support for policy solutions to develop alternative energy technologies from nearly all sections of our widening political divide.

Just to re-visualize the chart above, among all registered voters, only “Staunch Conservatives”, representing 11% of registered voters, were in favor of more fossil fuel development over alternative energy (72% to 15%) while Libertarians, at 10% of voters, were split 44% to 40%. Beyond that, there was consistent to extremely strong support from the remaining political groupings (which collectively represent 79% of registered voters), with even two thirds of “Mainstream Republicans” (14% of voters) in favor of alternative energy over fossil fuels, and heavy majorities of suport from other political viewpoints.

I’m not sure how well this chart illustrates this beyond what Pew already showed, but the goal is to show the healthy majority of voters in support of alternative energies – basically, the heavier the green shading, the more support there is for alternative energy technology (i.e. non-fossil fuel) development in that political group.

Second, I took the political classifications developed by Pew and aggregated them by “registered voter” to see the composition of the 63% of voters supporting alternative sources and the 29% who favored fossil fuels. Again, it’s easy to see that a broad cross-section of registered voters support the development of alternative energy such as wind and solar over fossil fuels.

Of course, this is only one data point, and crucially, it’s not looking at willingness to “pay” for these technologies. But as I’ve said repeatedly on this blog, there are a wide range of policies that can bolster the support of alternative energy technologies that cost the government little to nothing – be they renewable or clean energy standards, a carbon price, improved permitting and interconnection policies, or well designed loan guarantees, among many options. Additionally, voter pressure will be critical in passing future energy legislation, and these types of survey demonstrate the strong support for alternative and renewable energy that can power our new clean energy economy.

Renewables continues to grow but tracking that growth hampered by EIA cuts

2011-05-05T13:37:17Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

Good unbiased data on the recent growth of renewables in the U.S. can be difficult to find. One helpful option is the Energy Information Administration (EIA), which puts out monthly generation figures for all energy technologies. Its most recent release included December 2010, giving us a chance to aggregate 2010 data, and compare back a few years. Generally, EIA is the most reliable source for this kind of data, and while they’ll usually do a few revisions, this shouldn’t affect the numbers below greatly. So in case useful, I've put together some data points and charts from EIA’s monthly energy review.

(It’s likely that at this point in the post, our comms director has thrown up his hands and given up on me ever blogging on something of interest to more than 14 energy nerds)

(and also, on a serious note, I would be remiss if I didn’t point out here that the EIA as an institution stands to suffer serious near-term damage from recent budget cuts imposed in DOE through the FY11 Continuing Resolution. You can get more info on the impacts here, here and here – and my broader frustration with the C.R. here – but suffice it to say, these cuts have a serious real world impact. Just to name a few examples, oil and gas traders and investors use EIA data in a range of analysis, including physical storage, reserves, energy demand, and pricing; policymakers rely on EIA for energy forecasts and trends and analysis of policy impacts; and energy researchers rely on crucial NEMS model runs. Many of these programs will be temporarily halted due to the $15 million in budget cuts to EIA, and that's a bad thing for our economy and the energy industry. And now back to the data…)

Among the highlights from EIA's data:

The growth of renewables, as measured by power generation, especially in relation to net U.S. power generation, is impressive. We’ve still got a loooong way to go before we can claim a transformation to a clean energy economy, but there’s a lot to be optimistic about, especially given that the energy sector isn’t typically prone to the kind of explosive growth, or overnight adoption of transformative technologies, that we see in other sectors
Wind power has been primarily responsible for the expanding renewables share. Solar has also seen impressive growth, but off a much smaller base.
Overall, there’s been a good deal of fuel switching from coal in the past few years, mostly to renewables (primarily wind and hydro) and natural gas.

Total non-hydro renewables (all renewables except hydro power) now amounts to 4% of net U.S. electricity generation - a four year doubling. This can be graphed a number of ways, but I find the year-over-year comparisons to be most useful in picking up the trends. The big variation month-to-month the past couple years is due to wind generation quirks (as wind gen tends to peak in Spring and Fall, but tails off during the Summer). Depending on the month, one can say that non-hydro renewables account for up to 5% of total generation, a significant improvement in just a few years. But for the full year, renewables provided 4.1% of total U.S. electricity generation in 2010.

Annual generation mix still fossil fuel dominated, but seeing fuel switching from coal to natural gas and renewables. Just as a reality check, it is still worth noting how much further we have to go. Renewables, even including hydro power, still represent a small fraction of total generation. The past 4 years have seen some fairly significant fuel switching from coal, but natural gas has taken a greater share than renewables. (and on a separate note, not shown here, but based on preliminary 2010 data, total generation levels appears to have recovered from its 4% drop from 2009, but are still 1% below 2007 levels).

Another way to look at this trend, is to compare the change in generation amounts by specific energy technology, both in percentage and actual terms. To some extent, choosing 2007 is an arbitrary decision (for example, 2006 would show an even greater jump in natural gas, hydro and nuclear, and slightly less coal switching) but the overall pattern holds going back for several years prior. However, its helpful to distinguish between actual generation amount (gigawatt hours or GWh), and growth rate - while wind and solar dominate from the perspective of the latter, natural gas has actually seen the most aggregate growth in generation since 2007.

Non-hydro renewables growth over the past 4 years primarily led by wind. Looking at aggregate growth of non-hydro renewables generation month to month over the past four years, aside from a few minor month-to-month deviations, wind is responsible for essentially all of the incremental growth in renewable generation we’ve seen since 2007. While solar has grown significantly, it's been off a small base, and geothermal, biomass and MSW/landfill gas generation has all stayed constant.

Wind, Natural Gas and Solar generation per month – the growth in wind has been impressive over the past four years, (seen below on a month to month basis). On an annualized basis – total wind generation in 2010 was responsible for 2.3% of all generation and was 60,000 GWh higher in 2010 than in 2007. This was second only to the growth in natural gas generation (which provided 85,000 GWh more generation in 2010 than in 2007). Solar growth has certainly been impressive, but even on its best month (and wind’s worst month), it only provides 3% of the power that wind does. I only add geothermal because, after 4 years of sameness, we may, finally, be seeing a bit of growth in generation from this important baseload renewable power source.

Green jobs in Arizona

2011-05-03T21:21:39Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

Nice story from E&E today (linked via the Times**) about what Phoenix (and other cities) are doing to draw in renewable energy companies, the jobs that the cities are gaining as a result, and even a hint of thawing in the local political climate.

Eleven solar manufacturers have located to the Phoenix metropolitan area in the last year, partly driven by a renewable-energy tax break Arizona recently passed. But they've also been lured by Arizona's aggressive courtship -- the combined efforts of officials and businessmen to outbid other states starving for jobs….

…The Greater Phoenix Economic Council (GPEC), a public-private consortium, is one of Arizona's salesmen. The group helped bring in the 11 plants that will provide 6,300 jobs and 20,000 indirect jobs….

…[Mike] Skaggs said the first race was when states set their renewable energy targets. The next game, he said, is wrangling for solar manufacturing and R&D, because these are key to dropping solar's cost. The region that does that will have a significant edge in the next round of electricity contracts. He called Arizona "quite aggressive" but said he felt Nevada has gotten its licks in, too. Last October, California-based Amonix started building a solar panel plant in Las Vegas. At full capacity, it should net 278 jobs and produce 150 megawatts a year….

…even the conservative-leaning state Legislature is working with Skaggs on new lures.

There’s also good local article covering the same topic from last month.

Of course, none of this is new or unique – cities and states have been forever battling each other for local development opportunities. And with the massive job losses in states like Arizona and Nevada, creating any new jobs are critical to the health and economic well-being of the state.

But it definitely provides another great example of the growing clean energy economy, and indicates a increasing acceptance among local government of the viability of the solar sector, and the tangible green jobs created by its growth

**sorry about taking one of your 20 free articles for the month

Final C.R. Could Be an Early Glimpse of a Complicated Clean Energy Landscape

2011-04-14T20:33:32Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

With the dust settling in the multi-month fiscal 2011 federal budget drama, now may be a good time to take stock of its expected impact on the renewables industry, and what this could mean for the future. Federal policy remains a prominent driver of growth in the U.S. renewables and energy efficiency sectors, and these past few months may have given us some insight into the future political battles that lie ahead.

To help guide us on this magical fiscal journey, we need to quickly review a few key documents – the compromise FY 11 Continuing Resolution, which provides funding for the remaining five or so months of this fiscal year, and the competing fiscal year 2012 budgets that will set the parameters for negotiations on federal spending next year and in the years to come (the Ryan FY12 Budget and the Obama FY12 Budget, and subsequent speeches). In doing so, we see that the budget compromise for this year spared most clean energy programs, but that the two sides remain far, far apart when it comes to next year’s funding.

Final FY11 Continuing Resolution: Perhaps this is just an unfortunate anchoring effect, but based on the cuts to clean energy and innovation spending originally passed by House Republicans, this wasn’t as bad as feared. This isn’t an endorsement by any stretch (Office of Energy Efficiency and Renewable Energy still saw a 6% reduction excluding earmarks from last year, and Energy Information Administration and Office of Electricity Delivery and Energy Reliability took it on the chin), but there were some bright spots. ARPA-E received $180 million, which will allow this new entity to build on its promising start, and the Office of Science wound up with most of its science and research funding restored. On loan guarantees, it seems a middle ground was reached, where most Sec. 1705 loans (given to innovative clean energy generation and manufacturing projects) will be able to move forward, with some additional subsidy cost funding provided to support a couple billion dollars more in 1705 loan guarantees, but that Sec. 1703 loan guarantee funding was reduced significantly. (an explanation, from prior to CR passage, of the importance of loan guarantees)

President Obama FY12 Budget: Released in February, the President’s budget recommendations for next year represent a welcome leap forward in funding for clean energy technology and stand in stark contrast to both the budget cuts for the remainder of this year and especially Paul Ryan’s approach outlined below. More recent remarks, and a new “Blueprint”, provide much more perspective on the Administration’s comprehensive energy strategy. Yesterday the President added further details to his original budget proposal, addressing health care, social security and defense spending, and highlighting $750 billion in discretionary spending cuts over the next 12 years, but with a promise to maintain strong investment in clean energy. In his original budget proposal, the President provided critical support for funding to a host of renewable energy and efficiency programs, on a longer-term trajectory. Among the highlights:

Compared to fiscal 2010 funding, annual funding would increase under this proposal anywhere from 55% - 233% for clean energy technology R&D programs such as solar (103%), biomass/biofuels (55%), wind (59%), geothermal (132%), vehicles (89%), building efficiency (136%) and industrial efficiency (233%)
Key innovation investments would similar be boosted. Under this budget ARPA-E would receive $550 million (compared to the $180 million in the recent FY11 CR), and Office of Science, a cornerstone of our domestic innovation infrastructure, would see a 10% increase. The budget request also includes new funds for three additional Energy Innovation Hubs (on energy storage, materials and smart grid tech)
Fossil energy R&D would be cut by a third and $4 billion in annual fossil fuel subsidies (amounting to over $40 billion in the long-run) would be repealed.

Rep. Paul Ryan FY12 Budget: as far as energy policy, the Ryan budget is like one of those bad reality TV shows where you can’t believe someone thought it a good idea to actually put this thing together (Bridalplasty I’m talking to you). CAP does a great job of parsing Ryan’s past statements, past votes and the budget document itself to provide some analysis. The challenge is that, since it is a budget outline, there are not a lot of details, and those policies that are detailed are really, really bad. In addition to endangering the environment and state economies by throwing drilling regulations out the window (“lifting moratoriums and bans on safe, environmentally responsible exploration for domestic energy supplies”), and rollback of EPA regulations that prevent harmful pollution and reduce greenhouse gas emissions (“scales back spending on government bureaucracies seeking to impose a job-destroying national energy tax”), Ryan also would apparently end federal support for a range of renewable technologies (at least this is what I take the following statements in Ryan’s energy section to mean: “The President has also stifled domestic energy production….The stimulus alone allocated $80 billion of taxpayers’ dollars specifically for politically favored renewable-energy interests”; “paring back spending in areas of duplication or non-core functions, such as applied and commercial research or development projects best left to the private sector”, “roll back federal intervention and expensive corporate-welfare funding directed to the president’s allied industries.”) These sentiments have also been expressed publicly by Ryan. Further, as far as actual funding, his budget appears to essentially zero out renewable energy and energy efficiency spending by 2014. In the actual figures on budget authority and outlays (two ways the government allocates funding), Ryan would reduce all energy spending by the government to $1 billion by 2014, 70% less than in the Obama budget. As fossil energy R&D and nuclear R&D spending alone currently account for well over $1 billion (both are in the 270 budget function), and have been strongly supported by Ryan in the past, energy efficiency and renewable energy would likely receive no funding in this budget, and instead fall into the category of what Ryan terms “welfare for energy companies” (which, somehow, doesn’t include fossil energy subsidies).

As to what all this means for the future – it’s difficult to say. The Obama administration continues to advocate strongly for clean technology and innovation funding, and public support for renewables remains in the 70%-80% range. The optimistic take is that a broad “renewables and innovation coalition” (however loosely defined) was strong enough to beat back a sizable threat to vital federal support for clean energy and science, and demonstrated the political clout necessary to defend itself in future battles.

There is another perspective that looks at the Ryan budget, and the earlier Republican Study Committee spending cuts, as examples of a government philosophy that assumes no federal role in energy markets, despite the many market inefficiencies, barriers and failures, and the many examples of useful government support in developing new industries. We may be about to enter into a many-month philosophical battle about the nature and value of government which will have far-reaching effects on clean energy policy (and through extension the U.S. clean energy industry).

Unfortunately, if the latter prediction is accurate, this could prove highly problematic, given the many critical clean energy policies on the table in the coming 18 months. The Treasury Cash Grant expires at the end of this year, and the production tax credit expires at the end of next year, both of which have proved incredibly important to the development of the wind and solar industries. While each of these policies could stand some refinement, the uncertainty leading up to this expiration, and the current lack of viable options will be damaging. These are tax-based incentives, and therefore not directly connected to the annual budgets described above. However, extension of these tax incentives will require funding allocations, which will involve many of the same arguments described above. (and on a sidenote, tax credits and deductions of all sorts will feature more prominently in the coming deficit debates)

Additionally, the application period for Sec. 1705 loan guarantees ends this year, and with the removal of funds from 1703 guarantees, it will be important to see if other federal financing mechanisms, such as the Clean Energy Deployment Administration (CEDA), emerge. Exacerbating everything is that nearly all of the tens of billions of Stimulus Act funding for R&D and deployment of innovative clean technologies) will have been spent by 2012, leaving a hole that private capital may not be ready yet to fill. Then of course, there’s the faint possibility of a clean energy standard, and a host of issues around transmission, siting and permitting.

Bottom line – the outcome of these policy debates, good or bad, will have a massive impact of the growth and sustainability of the U.S. renewable energy industry. Given its importance economically, environmentally, and on national security, we hope cooler, bi-partisan heads will advance the conversation in a positive fashion and the right policies will prevail.

New surveys show public support strengthening for renewable energy, weakening for nuclear

2011-03-25T16:33:17Z

Cai Steger, Energy Policy Analyst, New York, Center for Market Innovation

Some interesting new survey data has been released on American public attitudes towards different energy technologies in the wake of the crisis and tragedy in Japan. (actually survey data here, here and here). Generally, these polls show a limited change in the public mood, with a weakened support for nuclear power (although less concern about its overall safety) and continued strong support for renewable energy.

However, like Carmelo and the Knicks, the Bulls recent resurgence, and the new looks of the Celtics and Thunder, it’s a little premature to draw conclusions from such early data points (especially as we all know the road to the title inevitably ends in L.A.) but it’s worth keeping an eye on these surveys. A number of important renewable energy policies will be up for consideration in Congress in the next year or two (a federal clean energy standard, the Treasury cash grant, the production tax credit, loan guarantees and possibly a clean energy deployment administration, and tens of billions in funding for renewable energy and related innovation) and with the federal political dynamic being what it is, the opinion of Americans, especially voting Americans, could help to influence the outcome of these policy debates (apparently I’m in an optimistic place this morning)

(There’s also an important discussion also taking place among many stakeholders about the broader role of nuclear in a low carbon economy, and anticipated impacts on natural gas and renewables builds, but that’s a much longer post for another day)

Opinion is mixed on nuclear per a recent CBS News poll, with most Americans believing nuclear still safe, but no longer wanting them built (especially in their community).

The poll, taken following the start of the crisis at the Fukushima Daiichi nuclear plant in Japan, found that 50 percent of Americans disapprove of building new nuclear plants. That's an increase of 16 points since the question was last asked in 2008. Only 43 percent, meanwhile, approve of building more nuclear plants - a drop of 14 points from the 2008 poll. More than two in three Americans do say U.S. nuclear plants are generally safe, while just 22 percent say they are not safe. And 47 percent say the benefits of nuclear power outweigh the risks, compared to 38 percent who say they do not.

But Americans are clearly concerned about those risks. Sixty-five percent say they are at least somewhat concerned about a nuclear accident in the United States, including 31 percent who are very concerned. And 62 percent say they would oppose the construction of a nuclear plant in their community, compared to 35 percent who would support a new plant in their community

(for those who see the world in charts):

Via Politico, CNN has its own poll out, tracking nuclear opinion, but also helpfully (for this blog post) asking about preferences for renewable energy. The nuclear numbers here are very similar to the CBS poll (which shouldn’t be surprising, given that these are supposed to be surveys of the same population.) .

53 percent of Americans said they oppose the construction of new plants, up from 47 percent in a CNN poll conducted in March 2010. Forty-six percent said they support the construction of new plants, down from 50 percent in last year’s poll. Though a small majority of Americans are against the building of new nuclear plants, 57 percent said they support the domestic use of nuclear energy, while 42 percent said they are opposed to it…Most Americans have a “not in my backyard” attitude toward nuclear plants, with 60 percent of those surveyed saying they wouldn’t want one to be built in their own community, while 39 percent said it would be acceptable

(The question about willingness to pay more to reduce nuclear power could possibly be a proxy for the relative strength of these opinions)

Regarding renewable energy (I’m probably burying the lead here), CNN’s poll finds that solar and wind power remain extremely popular among Americans – 88% believe we should rely more on solar power for our energy needs and 83% support wind. Natural gas was the only other energy generation technology supported by a majority of Americans, drawing 70% support.

Pew Research returned similar views in their recent poll, finding that Americans are much more in favor of increased funding for renewable technologies (74%) than they are increasing nuclear power (39%), although interestingly offshore drilling, public transit and hybrid vehicle tax incentives all drew similar levels of majority support (around 57% - 61%)

All told – these are only just snapshots of public opinion at a specific point in time, but at the very least, they demonstrate the continued growth in acceptance of renewable energy, and, importantly, a continued willingness to fund investment in these technologies. Lets hope those in Congress are listening...