Archive for November 2011
We’ve seen it happen in the past when times get tough – politicians, desperate to keep funding for critical government programs, consider raiding existing set-asides for renewable energy.
Thus far programs have generally been protected – but how much longer will it last?
In early 2009 Connecticut almost did it. Facing a significant shortfall post the 2008 economic collapse then-Governor Rell was rebuffed in her attempt to grab an additional $26 million by raiding the state’s existing energy efficiency and renewable funding. But the message was loud and clear. We need money – how green do we need to be?
And California (the state with a long standing lead in renewable and efficiency incentives) last year watched as Proposition AB23 got considered and defeated – a bill attempting to repeal the state’s existing AB32 legislation (the Global Warming Act of 2006) which AB23 supporters said was costing too much money.
Like California, existing RPS funding in 30+ other states may be reconsidered as belts are tightened and voters choose between unemployment and healthcare benefits versus previously voter supported clean energy funding programs.
Specific green technology programs are susceptible as well. Yesterday a $1 billion multi-year carbon capture and storage program in the UK came under attack.
So in 2012, when government austerity programs become the norm, will less-green states have the intestinal fortitude to continue to protect their green energy programs?
As we watch Europe’s financial system teeter on the brink, many are preparing for the US’s own unwelcomed, but necessary austerity effort. Yet with yesterday’s deadlock by the Super Committee, we’re all left wondering if our elected leaders have been watching too much ESPN, detailing the NBA’s own failure to come to an agreement, after over two years of negotiations.
With this latest partisan gridlock in the face of a financial storm, its a fait accompli that we will see a December 31st expiration of the Section 1603 cleantech cash grant incentives. Solyndra alone has put cleantech supporting Democrats on their heels and become a “reckless government spending” lapel button on Republican sport coats. Rightly or not, large bookable losses from the DOE’s attempt to stimulate jobs make it harder for politicians to put Section 1603 in a cleantech jobs creation wrapper.
Which means the cleantech markets will need to rely only on tax credits, as opposed to grants, in order to weather the looming US austerity period, whenever our politicians decide its important enough to address.