Cash and Consequences
Just in time for the upcoming presidential election, the rhetoric is (predictably) heating up. One ongoing target of pundits and politicians is renewable energy and its place in US energy landscape. The tide continues to ebb and flow on this subject, with support rising and retreating in response to economic conditions and natural catastrophes. The Deep Water Horizon calamity in the Gulf swung the pendulum away from fossil fuels and Japan’s ongoing struggle with its nuclear facilities after last year’s devastating quake have renewed concerns over nuclear power generation. All the while, ongoing unrest in the Middle East continues to highlight the fragile state of our dependency on foreign oil. On the other side of the spectrum, the Solyndra bankruptcy has provoked a lot of hand-wringing and second-guessing about the economic impact of the current Administration’s commitment to clean energy funding and investment.
Last month, Nathan Myhrvold, former chief strategist and chief technology officer at Microsoft, started a new round of arguments about federal investment in renewable energy. In a piece for Bloomberg news, he lays out the case that lack of renewable energy subsidies are not the problem, but rather, it’s the subsidies themselves that are holding back the US renewable energy industry. This is because, according to Myhrvold, subsidies reward inefficiency by encouraging upstarts and innovators to “cultivate dependency on government largess” while pushing companies to “rush to manufacture before the hard work of perfecting technology is done.”
The following week, a responding volley was shot off by the unlikely duo of former California Governor Arnold Schwarzenegger and US Energy Secretary Steven Chu. Both publicly announced their support for leveling the playing field for renewable energy so that new technologies can fairly compete with traditional power sources like oil and gas. By equalizing opportunity, they argue, the federal government can help American firms compete in a global market. As Schwarzenegger says in his op-ed piece for the Washington Post, “To bring true competition to the energy market, ensure our national security, and create jobs here rather than in China or elsewhere, we must level the playing field for renewable energies.”
And Chu declared during his presentation ,“The Role of Science, Technology, and Innovation in Solving the Energy Challenge”, at the 2011 Bloch Lecture, “Invented in America but made in China is not good enough. Invented in America, made in America has to be the way to go.”
In an opinion piece for the Washington Times, Paul Driessen, senior policy adviser for the Committee for a Constructive Tomorrow, argues that environmental regulation and renewable energy funding conspire to create an unfriendly business environment deadly to American economic recovery and job creation. He says renewable energy subsidies do not promote green energy, but instead result in “greenbacks” energy that “requires perpetual infusions of taxpayer money, confiscated from hardworking, productive sectors and given to companies that have proper political connections.” Driessen believes that it is not that oil and gas industries that benefit from cronyism, backroom deals, and unrelenting lobbyists, but actually green energy companies who “engage in crony capitalism” by “lapping up $1.5 billion in government red-ink subsidies and loan guarantees.”
Not surprisingly, Driessen—a conservative commentator and former lobbyist (his clients include Center for the Defense of Free Enterprise) who also authored the book: Eco-Imperialism: Green Power, Black Death—believes that the key to jumpstarting the US economy is to abandon renewable energy funding, environmental regulations, and GHG emissions in order to “reward and encourage companies that provide affordable, 24/7 energy to power virtually everything we make, grow, transport, and do.”
While Driessen admits that “unleashing America’s vast supplies of shale oil and shale gas, conventional petroleum, coal, and nuclear energy isn’t a magic potion,” he is adamant we expand domestic oil drilling. “We need American resources for an American recovery,” he concludes. “Slash the crippling regulations. Drill here in America. Produce affordable energy to create jobs and fix our economy. Do it now.”
I think we can all agree that blind ambition and tunnel vision on either side of the political or environmental spectrum never lead to innovation and prosperity. It is certainly reasonable to ask if we are managing our energy investments wisely and if it’s worth investigating whether or not too much government support is crippling rather than empowering the clean tech and renewable energy industries. But there’s a danger in tying energy policy to economic recovery and job creation. After all, it’s true that the Deep Horizon disaster was, in a sense, a job creator, but are we really better off if the kinds of “jobs” created by a deregulated energy landscape include clean up crews hired to descend upon the next environmental disaster?
Author's Bio: Elizabeth Cutright is the Editor of Distributed Energy magazine and Water Efficiency magazine
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