Obama Calls for Doubling Renewable Energy in Three Years

By Jeff St. John

President-elect Barack Obama on Thursday called for doubling the nation's renewable energy production over the next three years, setting a timeline to one green piece of his economic stimulus plan.

Obama also called for funding to modernize the nation's electricity grid and make 75 percent of all federal buildings and up to 2 million American homes more energy efficient.

"In the process, we will put Americans to work in new jobs that pay well and can't be outsourced – jobs building solar panels and wind turbines; constructing fuel-efficient cars and buildings; and developing the new energy technologies that will lead to even more jobs, more savings, and a cleaner, safer planet in the bargain," Obama said Thursday in a speech at George Mason University.

Obama has pledged three million new jobs with his stimulus plan, which also includes tax cuts, investment in computerizing medical records, modernizing schools and universities, repairing roads and bridges and expanding broadband access to rural towns.

As for measures to promote renewable energy and other green industries, Obama has yet to release further details of his plan, which could call for as much as $800 billion over two years in tax cuts and spending.

But he warned that without quick action by Congress, the country could see a years-long recession leading to double-digit unemployment and the loss of $1 trillion in economic activity.

How green Obama's plan may be has been the subject of much speculation. Michigan lawmakers have said the stimulus plan might include billions in funding for advanced vehicle and advanced battery research, The Detroit News has reported.

Obama also has previously called for instituting a national renewable portfolio standard that would require the nation to get 25 percent of its energy from renewable sources by 2025.

But that will take some doing, given that the country got only about 7 percent of its energy from renewables in 2006, according to the U.S. Department of Energy.

Of that 7 percent share, 90 percent comes from hydroelectric dams and biomass power generation projects. Wind power accounts for only 4 percent, and solar about 1 percent, making the two renewable energy resources responsible for less than one-half of one percent of the nation's power supply.

Obama's call to improve the energy efficiency of federal buildings and 2 million American homes fits in with one of the green priorities of Steven Chu, Obama's nominee for Energy Secretary (see Obama Names Energy and Environment Leaders and Obama Creates an Energy Policy Troika).

As director of the Lawrence Berkeley National Laboratory, Chu has been a long-time proponent of improving building energy efficiencies, as well as developing new renewable energy technologies.

Josh Becker, a partner at New Cycle Capital who has close ties to Washington, has said that Obama will probably make a big push on weatherization programs to retrofit low-income housing for energy efficiency.

Green industry groups have put forward long wish lists of what they'd like to see from the incoming Obama administration and Congress (see What the Green Industry Wants From Obama).

Solar, wind, biomass and hydroelectric power producers want Congress to provide cash payments in lieu of tax credits now available for building renewable energy power plants or producing cleaner energy (see Industry Groups Call for Changes to Federal Incentives).

And smart grid companies want federal grants for projects to modernize the nation's electricity grid, as well as 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).

Comments

[John Polomny:]

If it needs a subsidy to compete it is not viable. I have seen mandated renewable projects that cost consumers three and four times what coal or natural gas fired power costs. As soon as the subsidy runs out or the mandate expires the project is not competitive so the utility is in the position of having to lobby (bribe) the legislature to renew or extend the subsidy. Forcing consumers and business to pay high prices for uncompetitive power sources just puts us further behind other countries were these mandates do not exsist.

Jan 09 09:21 AM

[bosun.j:]

Exactly! Therefore we should rescind the Bankster bailout, get our taxpayer money back and allow the Banksters to become viable!

I don't recall hearing your demands for no subsidies when the Banksters had their hand out screaming and threatening like 2 yr olds!


On Jan 09 09:21 AM John Polomny wrote:

> If it needs a subsidy to compete it is not viable.

Jan 09 09:37 AM

[Duude:]

Many question the viability of an industry that will need a continuing stream of subsidies to survive. The Obama plan is to install a carbon cap and trade model to the economy thus leveling the playing field between carbon emitting industry and carbon free or low carbon emitting industry. It is also fully expected that we will be seeing a substantial increase in the gasoline tax. The Obama team has suggested that the U.S. needs to see gasoline priced much as it is in Europe. The extra tax revenues from carbon emitting industries will in theory be used to offset part of the much higher expense of inefficient solar, wind, and likely ethanol as well as paying for more energy research.
It would be fine with me if we could somehow break free of the Foreign oil grip on our economy. I hate shipping hundreds of billions to nations that fund terrorism. However, there are multiple flaws with this form of idealism.
First, we will all pay significantly more for all forms of energy.This will lower our standard of living and guarantee far more jobs than ever will be outsourced no matter what outsourcing fix the Obama administration comes up with. How can industry compete when a larger percent of their expense is allotted to energy?
The extra jobs created are in an otherwise nonviable industry. The cost isn't close to being competitive. It can only be competitive with large taxpayer funded subsidies and a higher government-imposed expense on industry. This is economic stupidity of the highest degree. Can we expect China and India to seek the same type of reform? Are they so stupid as to not take full advantage of an even bigger difference in productivity? Let us suppose that we can make a more substantial dent in our demand for foreign oil. What would happen if the largest consumer of foreign oil changes world demand? Prices sink. I suppose this wouldn't spell opportunity for China, India, and the rest of the emerging nations of the world. Where does this lead us? What proposal can we expect from this Congress? Trade tariffs and trade wars! Now we're really screwed. How could the Obamans be so idealistic as to throw all economic sense out the window?

Jan 09 11:51 AM

[John Polomny:]

Bosun for the record I am against all handouts, subsidies, and bailouts from government to industry or individual citizens. Please go to my blog for historical confirmation of this. You show serious defciency in logic. In your view If I am not for wasting money on the Democratic party's pet green energy programs then I most be for Bank bailouts? Wrong, I dont follow your line of thinking.

Duude you may be interested in the US World Report article I linked to on my blog that talks about a town of 187 in Alabama that has requested $300 million for the shovel ready green projects they have including a Renewable Energy Museum. The nonsense from government is just rhetoric and sophistry to show the rubes they "are doing something". If the Soviets could not centrally plan an economy how exactly is Obama going to do it?

Jan 09 01:42 PM

[Ferdinand E...:]

The leading academic energy economist in the world - my good self - says that cap-and-trade is wrong, and I have now been joined by the CEO of Number 1 on the Forbes 500 List, Exxon Mobile, so what about waking the towns and telling the people.

Jan 10 08:36 AM

[fireball:]

do you think obama will rest on the 7th day? the largest banks are some of the largest political donaters. they buy nice pieces of both parties. the uaw owns a large piece of obama and the democrats. the bailouts were bought and paid for by bribes long ago.
maybe obama should decare peace in the middle east.
think of the ratio of americans that called their congress critters to say no bailout. if the banksters had been allowed to die would several regional banks be stepping up? it seems logical to me but since the market is and has been a regulated-deregulated, mess of political favor and pay-off for decades who can guess? if the big 3 auto-clubs die would it make room for smaller innovaters to rise? anyone seen the new highly automated ford plant in brazil? wonder how the socialist workers party (oops i mean uaw) would react to auto automation?
let's throw a trillion at subsidising innefficient green energies that have the favor of politicians instead of letting the efficient rise to the top. it may not be a good plan but it is good enough for govt..
i must be cynical but i don't believe in saint algore, the 2nd coming of obama, or in the new gaia religion. i know i'm a heretic.
it looks like we will keep skipping down the merry path of keynes-folly at least in govt. policy. the genius of the pres.-elect seems to be to keep the authors of economic disaster in charge just re-shuffled a little bit.
meet the new boss, same as the old boss.
to avoid confusion. i am against all subsidies. govt. does a lousy job in business. why would we expect anything else from a bunch of lawyers.
good luck to all of you that are trying to make money trading and investing no matter your theories or political opinions. may you make lots of obscene profits.

Jan 10 09:25 AM

[fireball:]

almost forgot. of course larry flynt should get his bailout. at least he makes fun of all the jack-asses (both parties) in washington.

Jan 10 09:28 AM

[Crude Oil T...:]

This was masterful. The "big plan" is always to strip us in someway at the end of administration. This will go down in history as the biggest rip off of the American people. They have enjoyed it so much they will continue with it. This will be the winter of the ponzi scheme, the biggest being the bailout. Just wait until they shore up the social security program.

Jan 10 09:43 AM

[bosun.j:]

Perhaps you're missing my point and are confusing me for another. I'm glad to hear you are against all bailouts. I made no reference to democrats. I made no reference to green or any other project.

Perhaps you are inferring that because I gave you both barrels on the one aspect of your comment that I was slagging the whole comment. I often forget how tender Americans feelings are just under the surface of their Rambo exterior. My mistake.


On Jan 09 01:42 PM John Polomny wrote:

> Bosun for the record I am against all handouts, subsidies, and bailouts
> from government to industry or individual citizens. Please go to
> my blog for historical confirmation of this. You show serious defciency
> in logic. In your view If I am not for wasting money on the Democratic
> party's pet green energy programs then I most be for Bank bailouts?
> Wrong, I dont follow your line of thinking.
>
> Duude you may be interested in the US World Report article I linked
> to on my blog that talks about a town of 187 in Alabama that has
> requested $300 million for the shovel ready green projects they have
> including a Renewable Energy Museum. The nonsense from government
> is just rhetoric and sophistry to show the rubes they "are doing
> something". If the Soviets could not centrally plan an economy how
> exactly is Obama going to do it?

Jan 10 12:49 PM

[nakedjaybird:]

Polonomy - Once it's built, it's viable. Like a chicken, when it's hatched, the argument is over.

Solar will produce power forever once it's built - at basically zero cost.

Sunk costs will be forgotten and the free power worshiped, however variable it is (because we will solve that problem too!).

Jan 10 12:56 PM

[nakedjaybird:]

FE Banks - the head of EXxon-Mobile is married to foreign oil. That play is about over in the US.

A joyous day when we stop consumming just 10% per year of the crude we currently burn in ICE's in the US; THE WORLD WILL BE FLOODED IN OIL (AND/OR DRILL, DRILL, DRILL WILL CEASE!)

Jan 10 01:49 PM

[bill d:]

Seeing as most of the stimulus will probably be in infrastructure and 40% of the jobs will be for women - I can hardly wait to see all those short-shorts & hot sweaty t-shirts out there aworkin in them there ditches. Whoee.

Jan 10 02:23 PM

[nakedjaybird:]

bill d - ditches? They be building power transmission towers and electricfied ferry rails.

Jan 10 03:45 PM

[baird:]

You may have heard of Mill's infant industries idea IE that emerging technologies/industrie... often require initial startup funds/breaks in order to ultimately develop into viable entities. BTW how much subsidy do you think exists in our fossil fuel energy system?


On Jan 09 09:21 AM John Polomny wrote:

> If it needs a subsidy to compete it is not viable. I have seen mandated
> renewable projects that cost consumers three and four times what
> coal or natural gas fired power costs. As soon as the subsidy runs
> out or the mandate expires the project is not competitive so the
> utility is in the position of having to lobby (bribe) the legislature
> to renew or extend the subsidy. Forcing consumers and business to
> pay high prices for uncompetitive power sources just puts us further
> behind other countries were these mandates do not exsist.

Jan 10 06:45 PM

[nakedjaybird:]

Solar is going to be sold on the basis of reaping some of the savings. The financier/installer will get the rest of the savings. Both win. They both win because they are not greedy, each not wanting the whole pie. That model works from the individual homeowner installation to Government installed infrastructure providing the power.

The problem in-between is industry figuring they need to participate at levels which continue to provide them marketing expenses for stadiums, stadium boxes and seats; country club memberships; humongous pay packages and bonus's for doing the job they already get paid for (which should not exceed 20x the lowest paid employee); and golden parachutes, when they don't and should be replaced, period.

That be the case on Main Street as well as Wall Street (and it's crept into Government and Education and those paid on the tax dollar - the real capitalists burden).

Jan 10 07:03 PM

[devassocx:]

Double renewable energy in 3 years!
This will accomplish a negligible increase in total energy at a tremendous cost!

Those here with their 'free energy' schemes are living in a dream world.

Solar will produce power forever once it's built - at basically zero cost.
What nonsense!

All of this, including all the environmental fees now being placed on the
consumer will serve just to make Americans poorer.

It sure looks like too many people have partaken of the kool-aid.

Jan 10 09:50 PM

[John Polomny:]

Wrong. I actually work in the utility industry and I will give you an example. Several States have mandated biomass or renewable portfolio percentages to utility fleets. If I build a biomass plant because the state has mandated that the utlity buy the megawatts I produce even though the cost of those megawatts are three times the cost of coal fired or nat gas fired megawatts how is that viable. If the utility was not coerced by the state they would never purchase that power as it is to high cost and the plant would never have been built. Regardless the ratepayer ends up paying for this and it is just another reason to move a business to another state or country that does not have these costs. You do not seem to understand that government forces utility companies to buy the higher then market cost power these "renewable" projects produce. Without the state mandates they would never be built in the first place. You do not know what you are talking about.


On Jan 10 12:56 PM nakedjaybird wrote:

> Polonomy - Once it's built, it's viable. Like a chicken, when it's
> hatched, the argument is over.
>
> Solar will produce power forever once it's built - at basically zero
> cost.
>
> Sunk costs will be forgotten and the free power worshiped, however
> variable it is (because we will solve that problem too!).

Jan 11 01:48 PM