For renewable energy, the 2012 presidential race reveals the downside of being championed.
President Barack Obama channeled a historic amount of money into green energy in his first term and made it a centerpiece of his jobs platform. As a result, renewable energy is big target for those taking aim at Obama.
“Because the Obama White House has made renewable energy an important part of the focus, it has become important for the other side to beat it up,” said Arno Harris, CEO of Recurrent Energy and board chairman of the Solar Energy Industries Association.
The brawl is at times colorful with quips from both sides about powering cars with windmills – or maybe dogs – on their roofs. Romney’s jabbed that Obama thinks he can turn back the rising oceans. And ‘Solyndra’ has become the ‘Halliburton’ of this election: a single company name that one party uses to try to encapsulate all they see wrong with the other.
Jokes and hyperbole aside, how far apart are Romney and Obama on renewables?
“There is a real difference in policy,” said Andrew Holland, senior fellow for energy and climate at the American Security Project. “Romney, and now Paul Ryan [Romney's vice presidential running mate], are quite anti-renewable energy.”
Romney hasn’t abandoned renewable energy. But he’s also not pursuing it with the same “purposefulness,” according to Dan Berwick, director of policy and business development at Borrego Solar.
To Incentivize or not to Incentivize?
In his nomination acceptance at the Republican National Convention, Romney included renewables in the list of energy resources North America must take “full advantage of” to reach energy independence. However, Romney promotes few of the market incentives the industry now enjoys. He describes a more narrow federal role, one where funding goes to basic research.
Romney does push for removing regulatory barriers that make it hard to develop renewable energy projects – but would do the same for other forms of energy, as well.
Most striking is Romney’s opposition to the 2.2 cents/kWh wind production tax credit (PTC), an incentive with bipartisan support until now, according to the American Wind Energy Association (AWEA).
AWEA says the credit has helped spur the wind industry’s rapid growth. The US has 50 GW of wind power in operation, up from 10 GW in 2006, an expansion that relied on a relatively stable tax credit policy, according to AWEA. But with the federal credit set to expire at the end of this year, several wind manufacturers have already begun eliminating jobs. Navigant Consulting forecasts that the wind industry will lose 37,000 jobs by the end of the first quarter unless Congress votes to extend the credit.
Obama supports the wind PTC and is expected to continue to push other pro-renewable energy policies, as well, if he’s re-elected. His administration made green energy a key recipient of federal stimulus funds, and is credited, in part, for renewable energy’s expansion in recent years. (State policies also have played a role.)
Read additional AOL coverage of the PTC and the wind industry in the white paper ‘Wind Rush.’
The amount of monthly electric generation from renewables (not including hydroelectricity) grew 78.70% between 2008 and mid-2012, according the Sun Day Campaign, a non-profit research and educational organization, More specifically, solar expanded by 285.19%, wind by 171.72%, and geothermal by 13.53% while biomass fell by 0.56%.
Berwick says the growth is a result of “falling costs and government support,” which were interlinked. “It is a clear example of where targeted government support at the right time in the growth of an industry makes all the difference in the world,” he said.
But critics of Obama’s policies say renewables remain fuels of the future with less impact on today’s economic underpinnings than oil and gas. While renewables have grown at a fast clip, they still only provide 5.76% of the nation’s electricity, according to the Sun Day Campaign’s figures for the first half of 2012.
“I think Romney knows that there are some promising developments in renewable energy, but what’s ‘imaginary,’ or maybe just wishful thinking, is that we’re anywhere close to renewable energy production on a large enough scale as to make oil and gas irrelevant,” said Chris Faulkner, CEO, Dallas-based Breitling Oil and Gas.
If Romney wins and takes an anti-renewables stance, the influence on the industry is likely to be uneven. Wind faces the most immediate risk because of its expiring tax credit. Solar has its own 30% investment tax credit, but it doesn’t expire until 2016 because of an eight-year extension granted by the Bush administration.
Whatever happens on the federal level, state policies will continue to spur renewables. About three-fifths of the states now have renewable portfolio standards, which mandate a certain amount of supply from renewables. But it’s questionable if state programs – and a growing consumer demand for green energy – are enough to sustain the same rapid growth, especially with natural gas prices low. Renewables advocates point out that all energy resources, not just green energy, receive government supports, and they hope an elected Romney might sound a different note than a campaigning Romney. But for now, it’s duck and cover as the political barbs fly.