Uncertain Times for Renewable Energy: The Congressional Tussle Over The Renewable Energy Act

While in last week's post, "The Sahara Forest Project: Oasis,or Mirage?" I chose to cover The Sahara Forest Project, a largely conceptual sustainable development project with political and environmental implications, this week I chose to focus attention on the current congressional
conflict over the bill H.R. 7060. This piece of legislation, also known as The Renewable Energy Act and Job Creation Tax Act of 2008, seeks to provide $17 billion for renewable energy industries, most notably concerning those involving solar and wind. While the bill does benefit the oil industry by providing tax credits for heavy oil refineries, it is a piece of legislation that is extremely beneficial and important to the sustainability of renewable energy industries. Most notably, it extends the existence of Investment Tax Credits, considered pivotal to the sustainability of the solar industry. Despite the positive contributions this bill provides, it is currently under debate by members of the House and Senate. The bill, covered by news website Bloomberg, passed by the Senate last week by a 93-2 vote margin. It was then passed by the House by a 257-166 vote margin. Significantly however, amendments were made and have thereby stalled the bill's progress (see linked graphic above).

After perusing the blogosphere, I came upon several reputable blogs detailing coverage of the bill that compelled me to respond to their posts. The first of these posts came from Gristmill, a well-regarded environmental news blog. The post, titled House vs. Senate, was written by Kate Sheppard, a D.C.-based political reporter that writes not only for Gristmill, but also for other well-known media outlets such as The Guardian and MSN. I wrote a comment on Ms. Sheppard's post, as I found it to be a well written account of not only the benefits outlined within Renewable Energy Act, but also the influential role interest groups play in passing legislation. Her apt usage of quotes from members of the House are also effective in providing understanding as to why there is considerable disagreement over certain elements concerning the bill. Another blog post I came upon was found on Matternetwork, a news and blog website which promotes and provides awareness for sustainable ideas and practices. The post, titled House Fully Funds Renewable Energy Act, Possibly Sinking It, was written by Susan Kraemer, a correspondent for Matternetwork. She has written numerous postings that have received a high volume of web hits. I commented on Ms. Kraemer's post because I found her critique of the bill's current status to be a bit more argumentative. Her exasperated account of the hurdles facing the passage of the bill reveal how bipartisan our politics can be, while furthermore revealing how imperative The Renewable Energy Act is for the sustaining the advancement of
renewable energy industries. Ms. Kraemer ends her post with an interesting and informative excerpt from House Speaker Nancy Pelosi's website (see linked graphic to the right).

Many, including myself, worry that the House and Senate will continue to fight over provisions of the bill, including most importantly whom will foot the bill. These delays, in tandem with our country’s current dismal economic outlook, make it look as though the bill will not pass before the end of the year, ringing a death Nell to companies involved in sustainable energy. While my commentary is available under the comments section of each blog, I have also provided them below.

"House vs. Senate"
Comment:

Thank you for your concise, yet informative coverage of the ongoing legislative battle to pass the Renewable Energy and Job Creation Tax Act of 2008. H.R. 7060 is a bill that I feel is of seminal importance to both our Nation's economy and security, as incentives for the growth of renewable energy can provide jobs and lessen our dependence on foreign oil. It is indeed frustrating that the bill passed through the Senate earlier last week but was then revised by the House. This is especially true since it was emphasized by the bill's proponents in the Senate that the bill pass without amendments. I agree with your conclusion that given this obvious roadblock, it is indeed unclear as to what the future holds for this bill. This is especially true given the nature of our economy's financial crisis.

The proposed $17 billion for the energy tax measure is a relatively small figure for spending when compared to the proposed $700 billion to resuscitate our failing financial institutions. The American economy is indeed in trouble, but there is a distinct possibility that providing funding for renewable energy industries would help prop up our economy. It was reported by Bloomberg correspondent Daniel Whitten that solar companies such as First solar Inc. and Suntech Power Holdings Co. would "create 441,000 permanent jobs and inject $232 billion in new spending into the economy by 2016." These are significant growth figures. We should be learning from the mistakes that brought us into our financial crisis. There must be greater emphasis on Green-tech and alternative energy companies within the American economy.

It is disappointing to see a piece of legislation with such promise look as though it may be shot down as a result of squabbling over who will bear the bill's cost. I find it disheartening that interest groups have such influence over matters imperative to both our economy and the environment. For instance, the objection to scaling back tax breaks for oil companies with foreign interests as a way to pay for renewable energy credits was obviously a reflection of House Republican's defense of their oil lobbyist's interests.

I hope that despite the focus on the proposal to spend $700 billion to bail out our financial institutions, the Senate and House can come to an agreement that will support and advance the renewable energy industry. If passing this legislation does not happen by the end of the year, the investment tax credits will expire, almost certainly crippling companies devoted to the advancement of renewable energies such as solar and wind.

"House Fully Funds Renewable Energy Act, Possibly Sinking it"
Comment:

I enjoyed your insight regarding the current status of the Renewable Energy Act, a piece of legislation that I find important to the support and advancement of the renewable energy industry. I agree with you that the amendment by the House may indeed cripple successful passing of the bill. As you intimated, it was a shrewd move by the Senate to combine the bill with aid for disaster victims affected by Hurricane Ike. Pragmatic decisions such as these provide for successful legislation. I feel that this was a diplomatic move emphasizing compromise, not a subversive tactic meant to strong-arm renewable energy legislation into being passed. However, members of the House evidently did not perceive it this way, as they extracted the two provisions into two separate bills. I believe that this was an unwise move, for packaging the funding this way would be a way in which both taxpayers could benefit from the Renewable Energy Act and citizens affected by the hurricane could receive aid.

Yet as you intimated, ultimately the struggle over passing the Renewable Energy Act may be irrelevant, as it is ultimately contingent on President Bush signing the bill into action. As you stated, he is not in favor of the Senate's request to fund the bill in a manner that would impact oil companies. I think that this is a travesty, considering that the bill only lessens subsidies for oil companies involved in overseas investment. This does not mean these companies would be taxed; rather, they simply would not benefit as much from their interests in foreign ventures. I feel that this is a small price to pay for the advancement and support of a growing renewable energy industry. In fact, to ensure long-term viability, energy companies heavily involved in oil should be looking to invest in renewable technologies as oil market instability continues and supply reportedly shrinks.

Failure to pass this bill would result in the expiration of Investment Tax Credits (ITCs), which provide incentive for investment in technologies such as solar, arguably the most successful renewable energy developed so far. If these were to expire, progress in this industry would be stifled. Many companies, including GE, have stated that their continued operations are largely contingent on the 8-year extension of ITCs provided by the Renewable Energy Act. These companies would then have to seek out other sources of funding, a gloomy prospect given our nation's current financial situation. Thus, government funding in the form of the Renewable Energy Act appears to be the most economically viable solution for the continued development of renewable energy industries- industries which possess tremendous growth potential and are thus vital to our nation's troubled economy.

The Sahara Forest Project: Oasis, Or Mirage?

As populations continue to increase and developing nations modernize, it has become accepted by many that humanity's current consumption patterns will continue to put a considerable strain on the world's available resources. Many forecast the date when resources will disappear entirely. Others have postulated ideas on how to mitigate this potential reality from occurring. While no one idea has been determined as the single answer for our civilization's continual growth and preservation, development of recent technologies gives us hope that environmental disaster can be averted. One idea considered for assuaging our resource needs is the concept of the "sustainable development." The idea of a structure that houses the ecological needs of humans in a self-contained environment has been discussed for years. While structures such as bio domes have been ultimately deemed economically inefficient, a recent announcement of a new structure may dissipate critiques of the effectiveness of sustainable developments as a viable solution to sustaining our resource consumption.

Earlier this month, a team of entrepreneurial innovators, planners and architects unveiled The Sahara Forest Project, depicted left. It is a considerable plan to transform the Sahara desert, one of the hottest places in the world. The project is a sizable undertaking, aiming to create a fertile, self-sustaining ecosystem by utilizing technologies that will provide water, energy, and ultimately food in one of the world's most desolate places. A variety of blogs and news sources covered the announcement, including Inhabitat and Treehugger. The Guardian, a well-known print and digital newspaper in the UK also featured an article covering the announcement.

The article examines how this project looks to make this seemingly impossible feat a reality. By utilizing two core technological concepts, Concentrated Solar Power and the Seawater Greenhouse, green technology correspondent Alok Jha writes that "the Sahara Forest project would marry huge greenhouses with concentrated solar power (CSP), which uses mirrors to focus the sun's rays and generate heat and electricity. The installations would turn deserts into lush patches of vegetation...and without the need to dig wells for fresh water." Thus, the project would be entirely self sustainable, as captured sunlight would continually power greenhouses that yielded electricity, water, and ultimately, food.

Another aim of The Sahara Project would be to produce a surplus of energy to help power other areas in the world, including parts of continental Europe. Leonora Oppenheim, a correspondent for sustainability blog Treehugger effectively outlines how the project would accomplish this. She writes that by combining and implementing both Concentrated Solar Power and Seawater Greenhouse, as much as 85% of solar energy could be collected, in comparison to a 25% yield by a conventional solar thermal power plant. The implications for this are enormous, as it could position Africa as the world's energy producer in the not too distant future.

Interestingly, the idea to make Africa a central energy provider to the world has already been envisioned by world leaders, manifested in a plan called DESERTEC. Developed and put forth by the Trans-Mediterranean Renewable Energy Cooperation (TREC), a group composed of European, Middle Eastern and African countries, DESERTEC is a plan attempting to provide Europe with at least 1/6th of its power needs by 2020. This looks to be a considerable undertaking, as the project will cost taxpayers hundreds of billions of dollars over the next 30 years. Still, as represented by the image to the right, a comparatively very small amount of land housing Concentrated Solar Panels in North Africa could power not only the European Union (EU) and Middle Easterners and North Africans (MENA), but also the entire world.

While on paper projects such as The Sahara Forest Project and DESERTEC look to be feasible and significantly positive contributors to the world economy, many weaknesses are attributable to both. A primary concern for projects such as these are their projected construction costs. Determining who will finance a venture such as The Sahara Forest Project will be problematic given not only the current financial climate, but who will principally benefit as well. Though the generation of potable water, vegetation and water would largely benefit African nations, these countries are presently ill equipped to finance such a technologically sophisticated venture. Local governments are having a considerably hard time feeding their citizens, relying at times on foreign aid. Still, the idea that The Sahara Forest Project could serve as a continental power plant could potentially attract fiscal consideration from European countries. I think that this is especially the case if European governments enact sufficient policy measures to encourage the importation of energy from Africa. Thus, if the project were to be realized, the onus would most likely be on European representatives to pay for the project in the short term, allowing African countries to reap the initial rewards, while benefiting in the long term by having a significant annexed energy source.

Furthermore, even if construction costs were realized, determining what body would act as principal controller of the project would be problematic. Eleven countries border the Sahara desert or semi-incorporate it into their lands, and cooperation amongst countries in this region has proven to be inconsistent. Furthermore, if the project were to involve European investment and supply power to European homes and industry, the governments of these countries would certainly want a say in matters of the project. This is because not only of financial interest, but also in matters of national security as well. Essentially having an external power plant outside of a country leaves them vulnerable to terrorist attacks and events out of their control, including inclement weather and civil strife.

Another fundamental issue concerning this project is a conceptual one. The Sahara Forest Project is touted as a sustainable development aimed at creating and maintaining electricity, water, and flora and fauna for the world's citizens. However, a fundamental problem with it is that it is really substituting one ecosystem for another. Implementing such a development usurps the naturally existing desert ecosystem in which plants and organisms live. While the Sahara desert is a harsh landscape for humans, it is nevertheless a naturally occurring biome on Earth. Thus, the realization of a project such as this imposes an alien, man-made ecosystem on an entirely natural one deemed sub-optimal for human civilization.

Despite issues associated with The Sahara Forest Project, I feel that it is conceptually an extremely compelling idea. As stated in an address by one of the team's founders Michael Paton at the 4th Annual Future of Science Conference, The Sahara Project is "a metaphor for any desert that formerly supported vegetation and could do so again, given sufficient water." Thus, if not actually implemented in Africa, the existence of the technology represents more than a step in the right direction for the promotion of sustainability. I would advocate that a project such as this be tried in a locale deemed safer for economic investment and under the control of a single country. This would be a reasonable response to the financial and control issues concerned with the project. In addressing the issue of the project being potentially invasive on an existing ecological system, I feel that in order to ensure the viability of both the human race and the Earth, sustainable practices must be implemented. In this case, the reward is much higher than the sacrifice. While certain organisms may be able to survive presently in the Sahara, it is more imperative that projects such as these are enacted to be evidence to the world of what positive change is possible to help the Earth and its inhabitants as a whole.