As I mentioned on the National Journal’s Energy Blog, tax incentives are part of the solution but must be used withmany more and different policies if we expect to build a competitiverenewable energy industry in the U.S. that can compete with heavilysubsidized programs in China, Japan and India. The U.S. needs policyincentives that both pull deployment and demand and push domesticmanufacturing. That means we need federal incentives includingmanufacturing tax credits, grant programs for deployment, a federal renewable electricity standard with teeth and low cost financing for renewable energy.
Developing a strong and stable clean tech industry in the U.S. requires us toshift our thinking from one policy answer or the other to E. all of theabove.
We need to explore low pollution forms of natural gas andencourage the development of solar and wind farms through tax credits.We need to encourage our states to increase their own renewableelectricity standards while we wait for a national one. And we need toencourage policymakers, businesses and consumers to demand companies,products and policies that reduce our carbon footprint.
In themidst of a recession we may have to settle for B or C. But that doesn’tmean these policies aren’t a large part of the comprehensive solution.In the short-term extending the successful Treasury Grant Program and a manufacturing tax credit will do much to encourage the continuedgrowth of emerging clean technology. Likewise, increased federalprocurement of renewable energy will help lower clean energy costs. Butit also doesn’t mean we don’t need A and D – and likely the rest of thealphabet.