As Director for R&D of one of America’s leading environmental companies, I obviously have a bias on this topic, but in my view we are simply not serious about building a robust renewable energy industry in the United States. In 2009, the federal government provided $1.5 billion in tax credits to wind power developers. More than $1 billion went to firms headquartered in Europe.

Now, it doesn’t bother me that European firms are earning U.S. tax credits. They are clearly playing by the rules, and their investments are helping to create jobs here in the United States, just as was intended. What really bothers me is the lack of urgency on the part of U.S. policymakers in ensuring that America remains competitive in the renewable energy sector. Unlike the United States, Europe started down the path toward renewable energy in earnest many years ago. Over the past decade, European firms have acquired critical expertise in the renewables business and are now formidable competitors. They got a jump start in their home markets – UK, Spain, Portugal, France and Germany – and have exported this know-how to become THE major players in the U.S. market.

The United States has tremendous solar, geothermal and wind energy resources, we can harvest them through a combination of smart public policy and fierce entrepreneurialism. Yet for all of the political rhetoric in support of renewables, the fact remains that the United States has no price on greenhouse gases, no transmission superhighway to carry renewable energy to population centers, and no national renewable energy standard. With the proper economic signals in the marketplace, we can build a world class renewable energy industry in the United States. Right now, carbon is not priced, making fossil fuel generation look artificially cheaper than renewables. With a gradually escalating price on carbon that reflects the full social costs of burning fossil fuels, low-emissions fuel sources will find a level playing field with their high-carbon counterparts.

Until carbon is priced and renewables can deploy on a level playing field, we need a national renewable energy standard to build a bridge from our high-carbon electricity system to the low-carbon future. A renewable energy standard that requires power providers to get a certain percentage of their electricity from renewable sources will give the renewables industry certainty. In the electric power sector, we make capital decisions with a 30-year time horizon. We can’t spend billions of dollars to build a clean-energy economy without confidence that demand for low-carbon power will remain strong. Finally, we need federal regulators to play a larger role in positioning interstate transmission lines – just as they do with other critical national infrastructure such as railroads, interstate highways and natural gas pipelines – and in fairly allocating the cost. Without transmission, renewable energy cannot get from its remote generation locations to our country’s population centers. And without the right policies, we simply cannot develop the necessary transmission lines. In some parts of the country, there is an effort to make wind farmers pay the entire cost of new transmission lines, even though we would never make wheat farmers singlehandedly pay for the highways that carry food to market.

In its recent forecast for the U.S. energy sector, the Energy Information Administration predicted how the world will look in the year 2035 if we simply continue with the energy policies we have in place today: The amount of electricity generated from coal will remain above 40 percent, the amount generated from renewables will be stuck below 20 percent, and carbon dioxide emissions will rise by 9 percent. In other words, a “do nothing” energy policy virtually assures that we will forfeit renewable energy investment and the potential jobs and fail to make even a dent in our overall greenhouse gas emissions. The United States still has an opportunity to put a policy framework in place that will encourage the development of a vibrant domestic renewable energy industry. We all need to pick up our tools and get to work.

Talbot Clifton - Jan 2010