The Future of Renewable Energy Policy in the United States
By Bracken Hendricks and Benjamin Goldstein, Center for American Progress
On October 3, 2008, the 110th Congress finally passed the renewable energy tax package by attaching it to the Emergency Economic Stabilization Act of 2008 (the $700bn "bailout bill"). Despite the turmoil on Wall Street, U.S. clean energy and climate advocates breathed a collective sigh of relief when they finally saw these vital tax credits extended after an arduous journey that involved seven votes in the House of Representatives and 10 votes in the Senate.
Federal renewable energy policy in the United States has had a long and complex history. The struggle to pass the renewable energy tax package illustrated the diverse set of interests and actors that have battled over the government's role in supporting renewable energy ever since the creation of the Department of Energy in 1977. Unfortunately, with every political change in Washington came a new approach. Jimmy Carter installed the first solar panels on the White House roof in 1979, and Ronald Reagan took them down in 1986. In 1993, Bill Clinton initiated the Partnership for a New Generation of Vehicles, a collaboration between government laboratories, universities, and automakers to increase fuel efficiency through practical technologies. Then, in 2001, George W. Bush scrapped the PNGV in favor of his FreedomCAR initiative, which initially focused on the far-off technology of hydrogen fuel-cells before shifting more recently to plug-in electric vehicles. Even within the same administration, renewable and "clean" energy research and development suffered the ebb and flow of the political tides and budget considerations. These irregularities in federal renewable energy policy over the past 30 years have prevented precisely the kind of long-term consistency every new technology needs in its formative years.
External factors have played a role as well. During the eight years of the Clinton-Gore administration, world oil prices hovered around or even below $20 per barrel (in 2006 dollars), and global supply was stable, giving little incentive to develop alternative fuels. Also, coal and natural gas for electricity generation have been cheap, domestic, secure, and politically popular, despite emerging concerns over the evidence of their contribution to global warming.
Times have changed. Enormous volatility in the world oil markets, which saw a barrel of crude reach over $140 per barrel this past summer, has spurred a national frenzy to diversify our liquid fuel supply and wean the transportation sector off of oil. Prices for coal and natural gas have skyrocketed. Furthermore, the role of anthropogenic emissions in causing global warming is no longer disputed, and politicians, influential thought leaders, and the American public are all now calling for deep emissions cuts to mitigate the most serious consequences.
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