The solar power industry, along with other alternative energy advocates, have been actively promoting recent critical legislationat the federal and state level that is vital for the growth ofrenewable energy across the country. Historically, renewable oralternative energy-based companies have been heavily reliant ontemporary tax incentives or subsidies, but investors and foreigncompanies have been hesitant to make a serious commitment tobuild new facilities and fund research and development in the U.S.without approved permanent policy measures that essentially drive themarket to reaching specified standards for the conversion to cleanenergy power sources, including proper tax incentives to facilitate thetransition.
On June 24, representatives of Dow Corning, a leadingproducer of silicon-based materials used in solar energy technologies,and representatives of America’s top solar energy companies visitedWashington D.C. to request new federal policies to encourage the growthof a domestic solar energy industry that will promote economic growth,create jobs, and enable greenhouse gas emissions goals to be met.
Duringthe visit, Dow Corning and representatives from several of its leadingsolar technology customers met with key members of Congress and theObama Administration. A Four Point Policy Plan was presented focused onthe steps necessary for the adoption of solar energy technologies andsupport a robust renewable energy manufacturing sector in America. Theplan calls on Congress and the Obama Administration to:
1. Enact a widespread federal legislative and regulatory package, designed to encourage the rapid growth of a viable renewable energy industry and encourage consumer adoption.
2. Increase investments in research and development to support innovation in solar energy technologies.
3. Increase renewable energy-related education, training and job creation.
4. Establish the federal government, rather than states independently, as the leader in the utilization of clean energy technologies.
DowCorning, whose silicon-based materials are used in solar cellmanufacturing, solar module assembly and installation, was joined bynine of its customers representing the solar energy value chainincluding: Abengoa Solar, BP Solar, Kyocera, National SemiconductorCorporation, Sanyo, SCHOTT Solar, Solar Power Industries, SolarWorld,and Suniva. The solar industry has become increasingly more organizedand influential in leading the Green Revolution across the U.S., as solar has strong public support andhas become one of the most powerful voices among the clean energytechnology camps, which also encompass biofuels, wind, geothermal, andhydroelectric.
This solar industry lobbyist meeting inWashington appears to have been partly influential in the U.S. House ofRepresentative’s passing of the “American Clean Energy and Security Act of 2009(ACES)” on Friday, June 26. President Barack Obama obtained a majorvictory for his high-priority energy agenda in the passing of thislegislation geared towards reducing industrial pollution that hascontributed to global warming. The House approved this climate changebill, by only a heavily partisan vote of 219-212.
TheHouse-passed bill sponsored by Rep. Henry A. Waxman (D-CA), chairman ofthe Energy and Commerce Committee, and Chairman Edward J. Markey of theEnergy and Environment Subcommittee, requires that large U.S.companies, including utilities, oil refiners, manufacturers and others,reduce emissions of carbon dioxide and other gases associated withglobal warming by 17 percent by 2020 and 83 percent by 2050- withrespect to 2005 levels. At the heart of the bill is a "cap and trade"program designed to achieve the emissions reductions by industrysector. Under the plan, the government would issue a declining numberof pollution permits to companies, which could sell those permits toeach other as needed. It is expected that carbon regulationmonitoring and the credits themselves will manifest as a newsignificant source of capital and growth for companies involved in thisfield. In addition, the ACES bill will also aid the emerging trend of solar-powered manufacturing facilities for various productsin order to minimize carbon emissions. It is possible that the Senatewill develop its own similar bill, which would ultimately be mergedwith the House bill before ever reaching President Obama’s desk.
TheCongressional Budget Office estimated the overall increase in energyprice per person in America, which has been a point of contention anddebate for Republicans, would be $175 per year, which is reasonableconsidering the environmental and economic benefits of the billintended to create millions of clean energy jobs.The bill also has a provision that would place tariffs on imports fromcountries with high greenhouse gas emissions in order to lessen theimpact of potential outsourcing of companies to avoid the strictpollution regulations.
In another victory of late for the cleantech manufacturing industry,the U.S. Senate Energy and Natural Resources Committee passed energylegislation by a 15-8 vote that includes a renewable electricitystandard (RES) of 15% of all power generated in the U.S. annually by2021, allowing states to fulfill up to 4% of the requirement throughGreen, energy efficiency measures.
At the state level, Arizona Senate Bill 1403,which offers tax credits for solar equipment companies that buildplants in the state, passed in the House of Representatives by a marginof 39-12 on Friday, June 26- overshadowed by the cap and tradeACES bill passage at the federal level on the same day. TheArizona legislation, which has the support of numerous local businessesand solar firms, is pending to become law as Gov. Brewer evaluates thesolar incentives amidst the state budget crisis. The Greater PhoenixEconomic Council (GPEC), Arizona State University president MichaelCrow, Phoenix Mayor Phil Gordon, and Arizona Cardinals presidentMichael Bidwill are the main advocates of the solar incentives bill,noting it will help the state attract solar and renewable energyinvestments and jobs in lieu of Phoenix’s lackluster economy, which isranked in the second worst category formajor metropolitan areas. GPEC pushed for solar energy incentives andtax credits last year, but the program failed to gain final approvalfrom former governor Janet Napolitano and the AZ Legislature. Iffederal legislation promoting clean energy and cap and traderegulations are written into law, it will increase the potential windfall for Arizona,assuming the state is able to capitalize on the country’s conversion torenewable energy such as solar power. In April 2009, AZ Gov. Brewerspokesman Paul Senseman said the governor wanted to entice more solarenergy investments to the state, but the governor did not endorse thisbill at that time.
Even with these three recent legislativevictories for the renewable energy industry, including cap and trade,the transition will not happen overnight. Alarmists should not bedisgruntled as fossil fuels are not going away any time soon, as themeasures are essentially long-term commitments for a conversion towardsenergy independence, reducing global warming, and developing a cleanenergy infrastructure to help revitalize the American economy. Inaddition, one of the long-run benefits of this legislation will be lessreliance on the price of oil, as it peak price contributed to thesinking of the U.S. into its ongoing recession by making all products,that happen to be predominantly imported using oil- or gas-hungry transportation, more expensive.