At this crossroads in history, the United States can either seize the opportunity to reinvent itself and secure a prosperous future, or allow an unproductive process of selfish bickering to lead us further down a dead-end street. We can apply our vaunted ingenuity and innovation to the renewable energy challenge, or watch our fortunes continue to slide while the rest of the world kicks our butts.
Nelder reminds us that in spite of considerable advances underway under President Obama, we still have quite a ways to go in terms of really achieving a "Green Economy" and a lot of the clean energy "Yes We Can!" promise that Obama talked about in his campaign:
It must greatly amuse the Chinese to watch the Greens and Browns in the U.S. waste their energy squabbling over who’s going to pay for the transition to a sustainable climate, starving the country of investment in the clean energy solutions of the future while China is busy taking over the global PV market and implementing policies that will soon take it far beyond the U.S. in meeting climate change and renewable energy goals.
Indeed, the U.S. is fighting itself at every turn, offering more incentives that will increase CO2 output than those that would curb it.
Last week, just days before President Obama would warn at the United Nations that the “irreversible catastrophe” of climate change must be avoided, the Environmental Law Institute issued a new report finding that U.S. subsidies to fossil fuels ($72 billion) were over two-and-a-half times as great as those it invests in renewables ($29 billion). Of the latter portion, traditional renewables received only $12 billion, while corn ethanol—a net energy loser—got $17 billion.
What does Nelder recommend as next steps?
If the U.S. were serious about making progress on climate change and renewable energy, it would put aside the jockeying of narrow-minded interest groups and implement long-term policies with proven records of success.
As I see it, the effective policy approaches are stable, transparent, long-term, and simple:
- Forget about cap-and-trade and RPS, and incentivize clean energy with a generous and long-lived national FiT modeled on successful programs elsewhere.
- Shift all subsidies for brown fuels to green fuels, with priority given to those with the highest net energy (geothermal, solar, and wind), instead of those with the best lobbies (corn ethanol).
- Level the playing field between rooftop and utility scale solar by removing net metering caps, allowing utility customers to put as much excess renewable energy onto the grid as they can generate.
- Tear down the barriers between states and utilities, and create a national market for renewable energy.
Above all, we should stop framing our decision-making around short-term cost arguments, and accept the fact that all of the energy solutions of the future will cost more than those of the past. The cost of fossil fuels will continue to rise because the best resources have already gone up in smoke, and what remains is progressively more expensive to produce. The cost of renewables will cost more in the short term, but fall as the technologies mature.
Besides, ample research has shown that in the long run—once the true costs of all fuels are recognized, with nothing externalized, and cost-benefit analyses are extended into multi-decade time frames—renewable energy wins hands-down over fossil fuels.
He leaves us with a question to ponder -- and an answer:
With which would you rather align yourself: a dirty, mature industry going into decline that still claims to need billions in public support; or a clean, new industry that’s growing at 40% per year, with no limit in sight, and a reasonable expectation of being able to get along without subsidies in 20 years or so?
Beyond renewable energy’s long-term benefits—a more resilient economy, jobs created indirectly, better public health, a reduced burden on the national coffers for imported oil (on the order of $400 billion for this year in the U.S.), and other indirect and intangible benefits—there is the straightforward imperative that we begin the urgent transformation toward true sustainability.
The short-term cost argument is tired, and we have already delayed too long. It is time we evaluated our choices in terms of the wealth and welfare of future generations, not just the personal net worth and power of today’s kings of industry.
Amen Mr. Nelder -- great post.
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