While both sides of the aisle in Congress agree the government has a role to play in the new US energy economy, disagreement is rampant over whether tax policy or grants are more effective and how to implement existing and proposed funding.
Business leaders for the most part claim that they want more certainty. While some support the idea of an energy-focused federal infrastructure bank, others are hoping that the existing federal government structure can support increased and targeted funding.
In an interview with Breaking Energy, Broadwind Energy CEO Peter Duprey laid out his concerns about continued federal regulatory uncertainty.
The Senate Committee on Energy and Natural Resources, one of the few bodies in Washington, DC that has made appreciable progress on energy issues in the current Congress, recently asked the Congressional Budget Office to evaluate legislation that would establish a new Clean Energy Deployment Administration within the Department of Energy.
For more on the Senate energy committee’s efforts to move the debate forward, see: Cage Match On Capital Hill: CES Is The Only Game In Town.
“This bill would expand the scope of federal financial assistance for clean energy projects relative to existing law,” the CBO says in its admirably restrained four-page evaluation, attached to this post and available for download. “CEDA would be authorized to provide direct loans, loan guarantees, letters of credit, insurance and other forms of credit enhancement for clean energy projects.”
The cost of implementing the bill would be $1.1 billion over the 2012-2016 period, but fees and the impact of pay-as-you-go legislation would limit overall costs, the CBO said.
How to fund clean energy development as the billions allocated by the American Recovery and Reinvestment Act, better known as the stimulus, run out has been a central question in the industry, which even as it begins to reach uneven profitability. Efforts to cut costs remain challenged by weak infrastructure, cheap natural gas and tight credit markets for non-traditional assets without government guarantees.
Whether the creation of an entirely new administration within the DOE at a time of deep divisions over appropriate size of the US government and its interaction with the economy remains uncertain, but the industry will be watching the outcome closely.