OBAMA, GORE OFFER THE NATION A NEW ENERGY OPPORTUNITY - WHY NOT?

Though there is no news of improvement on the national or international economic fronts, there is even more sobering news from climate change scientists about the state of our earth. A new, long-term forecast from the U.S. National Oceanic and Atmospheric Administration (NOAA) and scientific authorities from France and Switizerland that changes in the atmosphere now make drought and flooding irreversibly inevitable in this century. The only question remaining is how severe these will be.

Susan Solomon, senior scientist, NOAA: "I think you have to think about this stuff as more like nuclear waste than acid rain: The more we add, the worse off we'll be…The more time that we take to make decisions about carbon dioxide, the more irreversible climate change we'll be locked into."

In his testimony to the Senate Foreign Relations Committee on January 28, Al Gore essentially repeated what he has for 2 decades been trying to make the nation see.

Gore: “…as long as we continue to depend on dirty fossil fuels like coal and oil to meet our energy needs, and dump 70 million tons of global warming pollution into the thin shell of atmosphere surrounding our planet, we move closer and closer to several dangerous tipping points which scientists have repeatedly warned – again just yesterday – will threaten to make it impossible for us to avoid irretrievable destruction of the conditions that make human civilization possible on this planet…”

Excerpt from the Gore testimony. (click to enlarge) From FutureHD via YouTube.

Independence and self-reliance being essential ingredients in the American spirit, Americans do not ask anything more than opportunity and freedom in normal times but these are not normal times. The freefalling world economy and global climate change together comprise a challenge not for the individual or even for the nation but for the world community. In times like this, people look to their leaders.

President Barack Obama is working on an $800+ billion stimulus package designed both to reinvigorate the U.S. economy and renovate the way the U.S. uses energy. According to a recent report by FBR Capital Markets, ~1/3 of the $550 billion in direct spending will go to “green” purposes but only $8 billion will go to New Energy. Of $275 billion of the stimulus package tax credits, $16 billion will go to New Energy and “green” development. Yet the money is predicted to create 460,000 New Energy and Energy Efficiency jobs. As the President has envisioned, that’s quite a lot of value for the investment.

What is NOT bad news right now are the reports of the end to President Obama’s “post-partisan politics” accompanying news of the stimulus bill’s passage in the House of Representatives. These reports are entirely premature. The President’s effort to woo House Republicans was never expected to succeed. It was a demonstration of extraordinary bipartisanship aimed at drawing into deal-making the few moderate Republican Senators Mr. Obama needs to get his stimulus plan to a filibuster-busting 60 votes in the upper chamber. Watch John McCain (R-Ariz), Dick Lugar (R-Ind), Joe Lieberman (I-Conn) and the coterie of moderates around them.

click through to RePower America's plan to turn it all around

President Obama: “A new energy economy is going to be part of what creates the millions of new jobs that we need…That’s why my economic recovery plan is going to be focused on how can we make a series of down payments on things we should have done 10, 20, 30 years ago.”

The good news: Both houses of Congress have agreed to most of the spending measures the President and the New Energy industries proposed, including extending the wind’s production credit for 3 years and allowing most of the New Energies (wind, biomass, geothermal, hydropower, landfill gas) in on solar’s 30% investment tax credit.

The bad news: Though the leaders of the New Energy industries insist that transforming the tax credits into U.S. Department of Energy grants is essential to make the stimulus package effective, conservatives in the Senate are blocking this vital improvement for New Energy and Energy Efficiency programs.

Big energy installations like wind projects and solar power plants cost billions. Smaller, distributed generation, like rooftop solar, small wind and private geothermal projects, are big expenses for individuals. In both cases, tax credits are not useful without taxable income to offset. Grants will make New Energy possible where tax credits will not.

This is especially true since major sources of financing have disappeared. In the last 2 years, the solar energy industry has lost 15 of its 20 big funding sources, the wind industry has lost 8 of its 14 funding sources and banks are reluctant to finance individual energy projects.

Kevin Book, vice president for energy policy, oil, and alternative energy, FBR Capital Markets: “A couple of things in the House measure are going to alarm fiscal conservatives – and one of those is loan guarantees being replaced by explicit payments…If Congress approves this, it absolutely will have investors looking at this as a green light [for New Energy and Energy Efficiency projects]…”

Former Vice-President Gore urged the Senators he addressed to back the President’s stimulus package in his testimony to the Foreign Relations Committee.

Gore: “In order to repower our economy, restore American economic and moral leadership in the world and regain control of our destiny, we must take bold action now. The first step is already before us. I urge this Congress to quickly pass the entirety of President Obama’s Recovery package. The plan’s unprecedented and critical investments in four key areas – energy efficiency, renewables, a unified national energy grid and the move to clean cars – represent an important down payment and are long overdue. These crucial investments will create millions of new jobs and hasten our economic recovery – while strengthening our national security and beginning to solve the climate crisis. Quickly building our capacity to generate clean electricity will lay the groundwork for the next major step needed: placing a price on carbon…”

Next 10’s 2009 California Green Innovation Index verifies the potential of New Energy to move the economy. California’s impressive accomplishments in energy efficiencies have given it an energy intensity/energy productivity (the amount of energy required to generate a dollar of revenue) 68% better than the national average. This demonstrates it is possible to use energy better without impeding the economy.

California also created jobs in its “green” sector at 10 times the state’s economy-wide job growth, proving that building New Energy and emphasizing Energy Efficiency does indeed create jobs. The “green” jobs, the report indicated, were 20% manufacturing and were spread across the spectrum of “green” sub-sectors (advanced materials, transportation, air and environment, and green building).

Finally, the Next 10 report indicated California’s emphasis on New Energy and Energy Efficiency brought almost 60% of all U.S. venture capital investment into the state, another indication that they are good for the bottom line.

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Reports from the wind and solar industries this year also affirm the idea of New Energy as an economy-booster. Still a small part of the overall economy, the New Energies nevertheless continue to show enormous growth. Solar energy industry investment growth jumped 145% from 2004 to 2007. Sales of New Energy hardware doubled in the last 4 years. The wind industry added more than 8300 megawatts of capacity in 2008, more than 40% of new U.S. power generation. It also added 35,000 new jobs.

The New Energy industries anticipate a major impact from the economic downturn but expect to outperform the larger economy. Market maven Kiplinger Forecasts agrees. Kiplinger foresees big growth in (1) hydroelectric (dam) power generation, (2) hydrokinetic (wave, tide and current) power generation, and (3) solar panel manufacturing and installation (driven by innovative funding programs from utilities and municipalities).

Both Wall Street and Main Street have always agreed that the business of America is business. They have tended until recently to turn away from that nagging little matter of the environment, pushing it off on so-called “tree-huggers” and “do-gooders.” What the New Energy and Energy Efficiency sector has proved, in California and nationally, is there does not have to be a choice between the economy and the health of the earth.

Gore: “For years our efforts to address the growing climate crisis have been undermined by the idea that we must choose between our planet and our way of life; between our moral duty and our economic well being. These are false choices. In fact, the solutions to the climate crisis are the very same solutions that will address our economic and national security crises as well.”

Californians registered more than 100,000 alternative-fuel vehicles (hybrids, electric cars, CNG vehicles, etc.) in 2007, more than 2% of the state’s new cars. More than 20% of all U.S. hybrids were registered in the San Francisco, Los Angeles and Sacramento metro regions. Does that make Californians more socially conscious than other Americans? Maybe. Or maybe they’re just more serious about getting good gas mileage while driving to the beach. Either way, they cut their vehicle emissions and that’s the really important thing.

F. Noel Perry, founder, Next 10: "Imagine where the country could be if it were as efficient as California…"

Perry’s observation brings to mind the words of Senator Robert F. Kennedy that echo through history like a clarion call: “I dream things that never were and ask why not?”

Seems like what President Obama is asking a few Senators and the entire nation right now is “why not?”

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‘Green’ energy a tiny share of stimulus plan; Supporters see the plan's $24 billion on renewables as a first step toward a new energy economy.
Mark Clayton, January 27, 2009 (Christian Science Monitor)
and
California adding green jobs, leads nation in energy efficiency
Matt Nauman, January 26, 2009 (San Jose Mercury News)
and
Recession Isn't Hurting Some Alt Energy Movements; Hydropower, solar power and ocean-bed energy are gaining momentum.
Jim Ostroff, January 15, 2009 (Kiplinger Forecasts)
and
Statement to the Senate Foreign Relations Committee
Hon. Al Gore, January 28, 2009 (Committee Website)
and
Long Droughts, Rising Seas Predicted Despite Future CO2 Curbs
Juliet Eilperin, January 27, 2009 (Washington Post)

WHO
President Barack Obama; Former Vice-President/Nobel laureate/Academy Award-winner Al Gore; the U.S. Senate and House of Representatives; U.S. Department of Energy (DOE); American Wind Energy Association (AWEA); Solar Energy Industries Association (SEIA) (Rhone Resch, president); F. Noel Perry, former venture capitalist/founder, Next 10; Daniel Weiss, director of climate strategy, Center for American Progress; Doug Henton, chairman/CEO, Collaborative Economics

WHAT
Will Congress allot what the President needs to make the stimulus package effective enough to double New Energy capacity in 3 years? Can the U.S. match California’s accomplishments as reported in the 2009 California Green Innovation Index? Will these things be enough to lead the world in the fight against global climate change?

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WHEN
- 2005 to 2007: California grew its green jobs 10% to ~105,000 while the state job growth was 1%.
- 2007: New Energy was 7% of U.S. energy (petroleum 40%, coal 22%); of the New Energy, biomass was 53%, hydroelectric 36%, geothermal 5%, wind 5%, solar 1%.
- 2007: 9,000 California businesses had green jobs.
- 2008: Wind added 8358 megawatts for a total capacity of 25,107 megawatts. It added 35,000 employees for a total of 85,000 employees. It added $17 billion to the U.S. econonmy.
- 2008: $3.3 billion in venture investments in California New Energy/Energy Efficiency companies.
- The 2009 California Green Innovation Index ends in early 2007 so offers no insight into the impact of the economic downturn.

WHERE
- The House has approved the crucial changes in New Energy tax credits (transforming them into DOE-administered grants) while the Senate rejected the idea.
- California energy intensity/energy productivity (total gross domestic product produced per unit of energy): 68% higher than U.S. energy intensity. (California: $2.17 GDP/10,000 BTU; U.S.: $1.29 of GDP/10,000 BTU).
- 69% of Californians believe global warming is a serious threat to the state's economy
- 73% of Californians believe global warming is a serious threat to the state's quality of life.
- California got 57% of total U.S. capital New Energy/Energy Efficiency investment, 69% to energy-generation, 8% to transportation.
- California led the U.S. in patents issued for various solar, battery and wind-energy innovations.

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WHY
- Most of the stimulus package goes to temporary measures (tax cuts, emergency aid to the states, unemployment benefits extension, etc.). 1/3 of the $550 billion in direct spending is called “green” and $8 billion will go to New Energy. $16 billion of the $275 billion in tax credits will go to NewEnergy.
- There will be $13 billion to extend the production tax credit for wind 3 years.
Solar’s 30% investment tax credit was extended to wind, biomass, geothermal, hydropower, and landfill gas.
- There will be $8 billion in DOE loan guarantees for New Energy but may be prevented from going to proven technologies.
- Evidences of the economic downturn: (1) solar panel manufacturer OptiSolar laid off 300 workers this month, half its staff; (2) turbine-tower manufacturer D.M.I. Industries laid off 20% of its factory work force this month; (3) AWEA estimates 25-to-50% of planned projects won’t be built this year absent effective stimulus package support.
- Definition of “green: jobs: “rovide products and services leveraging renewable energy resources, reducing pollution, conserving energy and natural resources, and repurposing waste.”
- 2002 to 2007, California was the U.S. leader in patent registrations for green technologies (especially solar energy, fuel cells and batteries).
- Kiplinger’s forecasts of opportunities in New Energy: (1) hydroelectric power from dams on rivers and streams will increase by 50% over the next decade, to around 10% of all power and up to 20% by mid-century. (2) Ocean-bed generators show promise as well. They're likely to gear up over the next decade to feed power to cities within a few hundred miles of U.S. coasts. (3) Utilities such as Southern California Edison, Portland General Electric and Duke Energy are developing leasing and power purchase relationships with business owners for access to rooftops. It will spur the solar panel business, add enormous solar capacity and generate revenues from otherwise depreciating large assets, buildings. (4) Municipal funding programs for homeowners like those being pioneered in Berkeley, CA, and Boulder, CO, will ~make houses the same.

A lengthier excerpt from the Gore testimony. About 4 minutes in, there's a stunning visualization of the loss of permanent arctic ice. From StartLoving1 via YouTube.

QUOTES
- Rhone Resch, president, SEIA: “In order to achieve President Obama’s goal of doubling energy in three years, we will have to triple utilization of these tax credits…Without the tax-credit market, it’s going to be difficult to achieve that.”
- Daniel Weiss, director of climate strategy, Center for American Progress: “The stimulus package would turbocharge our efforts to use energy more efficiently and build more renewable electricity facilities…”
- Doug Henton, chairman/CEO, Collaborative Economics: "Some think of solar jobs as just installation or just R&D…It's along the whole value chain."
- F. Noel Perry, former venture capitalist/founder, Next 10: "Here we are in January of '09, and we're hitting a rough spot…The question in California is how will green jobs be affected by that? How will venture capital be affected? All I can say is I don't know."
- Kiplinger Forecasts: “There's plenty of action on the alternative energy front despite the considerable downdraft in most energy-related industries created by the severity of the recession.”
- Al Gore: “If Congress acts right away to pass President Obama's Recovery package and then takes decisive action this year to institute a cap-and-trade system for CO2 emissions – as many of our states and many other countries have already done – the United States will regain its credibility and enter the Copenhagen treaty talks with a renewed authority to lead the world in shaping a fair and effective treaty. And this treaty must be negotiated this year…Not next year. This year…A fair, effective and balanced treaty will put in place the global architecture that will place the world – at long last and in the nick of time – on a path toward solving the climate crisis and securing the future of human civilization…”