Obama Is Greentech's New Genie in a Bottle 13 comments
-
Font Size:
-
Print
- TweetThis
By Ucilia Wang
Barack Obama is the new Genie for the greentech industry.
The guy won't become president until Jan. 20, but he has already received plenty of wish lists from folks in the renewable energy, biofuel and auto industries.
It's normal for businesses to vie for Obama's attention before he starts working in the West Wing. It's particularly critical to get a head start when the economy is sinking and cash and loans to develop technologies and build factories are hard to find.
The wish lists have come with a tinge of desperation, though. Many in the greentech business see Obama as their advocate, and now they expect him to deliver money and policies that will get them through tough times.
Obama, however, appears to be listening. In his weekly address to the nation over the weekend, he said that a centerpiece of his campaign will be to create three million new jobs, with 80 percent of those jobs in the private sector. Many of those jobs will likely revolve around renovating public buildings for energy efficiency, which he said is another goal of his Presidency.
Obama also added that he wants to double the production of renewable energy, although he didn't put a time frame on it.
Obama will have to pull some nifty tricks to grant those wishes quickly. He might represent hope and a better time to come, but he's no magician. He has assembled some helpers with pro-green leanings, however (see Obama Names Energy and Environmental Leaders).
Here is a look at what greentech folks want from the new administration:
Solar: The Solar Energy Industries Association, along with its brethren in the wind, geothermal and hydropower industries, want cash instead of tax credits. They asked for the goodies less than two months after they won a hard-fought battle to get Congress to extend tax credits for building renewable energy power plants or producing cleaner energy (see Industry Groups Call for Changes to Federal Incentives).
The groups also want another $30 billion worth of incentives in 2009 for developing and building renewable energy projects. Expect to see a push on loan programs too. Although venture capitalists and other investors have poured millions into solar projects, building factories and solar farms requires millions in capital, which has become scarce.
Smart Grid: The Demand Response Smart Grid Coalition has 21 policy recommendations, including tax credits for companies that use so-called smart meters or devices and software to reduce power use (see Smart Grid Coalition Seeks Tax Breaks for Negawatts).
The coalition also wants a fund set up to finance the manufacturing and installing of advanced meters and other technologies for making it easier to manage the supply and demand of power over the grid.
Batteries: The National Alliance for Advanced Transportation Battery Cell Manufacture wants $1 to $2 billion over five years to accelerate the development of lithium-ion batteries for hybrid and all-electric cars (see Green Light post). The group, which includes 14 battery and chemical companies such as 3M, ActaCell and EnerSys, says government help is necessary to ensure the American car industry won't have to rely on the growing number and prowess of Asian battery makers.
Meanwhile, more than a dozen Japanese car and battery makers have banded together to work on setting international standards for lithium-ion batteries (see Japan, U.S. Strive to Set Car-Battery Standards).
Automakers: The cry for help came from the auto industry before the November election, and you can bet it will continue after Obama takes office.
Back in September, Congress approved a $25 billion program to help carmakers retool their plants to make more fuel-efficient cars. But that loan program wouldn't take place soon enough to rescue General Motors (GM) and Chrysler from bankruptcy. So President Bush agreed to use part of the $700 billion set aside for bailing out the financial industry for rescuing GM and Chrysler (see U.S. Automakers Get Federal Bailout). But there's no guarantee that the $17.4 billion worth of loans will be sufficient to prop up GM and Chrysler.
Biofuel: The Renewable Fuels Association is lobbying to include several ethanol-friendly provisions in legislation to boost the economy. The suggestions include setting up a $1 billion loan program for existing ethanol producers to stay in business. It also wants a $50 billion loan guarantee program for building refineries and related infrastructure.
To make sure demand for ethanol will grow substantially, the association wants a federal mandate that all carmakers receiving federal aid would make only cars that can run on a blend of up to 85 percent ethanol, starting with the 2010 models.
Biofuel makers, however, have had trouble even meeting the production requirements set under outgoing President George Bush. The United States will not be able to meet the mandate to use 36 billion gallons of biofuels by 2022, reported the U.S. Energy Information Administration in December.
A recent survey by investment firm ThinkEquity shows that cellulosic ethanol makers will likely miss federal targets by a weighty margin, at least in the near future. Instead of meeting the goals to produce 100 million gallons of cellulosic ethanol in the United States by 2010, the survey indicated that only 28.5 million gallons will be available in 2010.
The problem? Biofuel plants require inordinate amounts of capital, which is in short supply.
Related Articles
|
Find People on SA
-
The Seeking Alpha 100
See allThe top 100 stock
market authors
selected for publication
Seeking Alpha 100 » -
Fastest Climbers
Authors with the largest
increase in followers
in the last 7 days-
1
David Fry
-
2
Bill Gross
-
3
Philip Davis
-
4
Tyler Durden
-
5
TraderMark
Fastest Climbers » -
1
-
Top Commenters
Top commenters,See all
as ranked by their peers
Top Commenters » -
Top Instabloggers
The 100 most activeSee all
Instabloggers.
Top Instabloggers » -
Top StockTalkers
TopSee all
StockTalkers.
Top StockTalkers »
This article has 13 comments:
Doesn't that makes "subsidies" more akin to a bailout?
They should be told the same thing as the automakers... "Go find an economic model that works, and then we can talk." Stoking future inflation to unmanagable levels in the name of the uneconomic solar industry is of debatable intelligence. And mind you, I'm not anti-alternative energy. I just think we need fiscal responsibility not profligate and wanton spending on uneconomic industries.
Doesn't that makes "subsidies" more akin to a bailout?
They should be told the same thing as the automakers... "Go find an economic model that works, and then we can talk." Stoking future inflation to unmanagable levels in the name of the uneconomic solar industry is of debatable intelligence. And mind you, I'm not anti-alternative energy. I just think we need fiscal responsibility not profligate and wanton spending on uneconomic industries.
pdf.aiaa.org/preview/C...
www.researchandmarkets...
Beacon Power (BCON) is the primary player in this market.
> You people just don't get it. Alternative energy is the future. If
> America doesn't fix its energy situation, there is no hope. It is
> the country's number one point of vunerability, yet it can be our
> salvation.
This is what everyone said in 1980. Alternative energy has not progressed any further than it was in 1980. History repeats itself. As then, now that oil has dropped, alternative energy will fail. No one cares beyond today. Whatever is cheapest today will prevail.
BATTERIES:
I hope there is not much money going to battery development. We already have the next generation battery that is well suited for plug-in hybrid electric vehicles (PHEV), the LiFePO4 (Lithium Iron Phosphate) battery, also called LFP. It is a dramatic advancement in battery technology. It has only entered commercial production in the last 2 years. All we need is incentives to purchase PHEVs. Seems to me the companies lobbying for battery development money are the ones that missed out on this new battery technology.
A123 Systems is a private American company that is a leader in its development. I am watching for its IPO which has been delayed due to the credit crisis. I also like BYD of China (BYDDF.PK and 1211.HK) which makes batteries and autos. I just released a PHEV using their version of the LiFePO4 battery. Warren Buffet is an investor.
SOLAR:
Solar is another area that does not need money for basic research and development. The technology is already there. It just needs strong demand to achieve greater cell and manufacturing efficiencies to reach grid parity. I would like to see strong incentives to put solar panels on homes, and build solar farms.
This strong incentive could be a direct federal payment for 50% of the price of a solar system with the percentage dropping each year so people have an incentive to do it this year. Installing solar panels not only increases our energy independence (national security), and address global worming, but it makes people spend money they are sitting on (economic stimulus), and puts local US people to work installing those systems (help employment). Close to half the cost of a solar system is installation.
Note that though many home owners are struggling because of the economy, many are just sitting on their money, putting off home improvements, because the future is unknown. Installing solar panels may look like a smart home improvement because it cuts electric bills in that unknown future.
It takes more energy to make ( ethanol ) then you receive from it .
That alone does not make sence. It is a proven fact , when less corn goes on the market , more people will starve in poor countries. Whats wrong
with Natural Gas . You can put every car in the U.S. on NG , we have enough to last a 100 years. It is clean, it comes from us.
I would like a answer please. Thank you, Dale Glide
reduce the gov't job base and reduce the associated buildings. these unused buildings won't need energy efficiency improvement cost.
please begin to run gov't for TOTAL cost efficiency; like a well run business. give the tax payers a return on equity. please!
we need an effective cost management "GENIE", with wider scope than "energy", as important as that is to the nation.
The reason, in my opinion, for using corn for ethanol is the strong farm lobby, and the fact that the first state in the primaries is Iowa. It's a hands down (everyone with a non political brain agrees) bad idea to create ethanol from corn for autos. The net energy savings for corn-based ethanol is 20%. In other words, for every 10 gallons of ethanol produced, it takes the energy equivalent of 8 gallons of ethanol to produce that ethanol. And, it raises food prices. Dumb as dirt (sorry - I couldn’t resist).
I hope Obama spends more on basic research for the second generation of bio-fuels that use enzymes or bacteria to break down some type of fast-growing grass into ethanol or diesel. That’s when it will make sense - the energy efficiency will be much higher than 20%.