In the next two years — assuming Congress doesn’t act — the vast majority of federal support in place for clean energy in the U.S. will be gone.
As a well-researched but jaw-droppingly incomplete new report posted by the Brookings Institution points out, spending levels for deploying clean energy technologies aren’t being gradually phased out; the industry is getting pushed off a cliff wearing cement shoes.
For those of us who care about clean tech and don’t just want to buy it all from China, the central question is: What can possibly be done to maintain and indeed expand federal support for clean energy in an era where exploding federal deficits and debt have, unsurprisingly, come to dominate the political debate — an era where one political party has proposed cutting most every clean energy program sharply.
One of the most important insightful statements I’ve ever heard on this subject came, unsurprisingly, from Henry Waxman (D-CA), the Ranking Minority Member of the Energy and Commerce Committee, in his opening statement for an oversight hearing on “Solyndra and The DOE Loan Guarantee Program.” In rebutting the standard GOP attack on the argument that Solyndra “shows the folly of federal investments in solar and other clean energy technologies” and that “the government should not pick ‘winners’ and ‘losers’ in the energy marketplace,” Waxman explained:
This sounds superficially appealing, but there is a fundamental flaw in their logic. The majority of Republicans on this Committee deny that climate change is real. If you are a science denier, there is no reason for government to invest in clean energy.
That final sentence cuts through the fog of this debate like the Fresnel lens of a lighthouse lamp. For science deniers, clean energy is just another special interest, hardly different from, say, natural gas or, for them, even oil and coal.
The essential rationale for government action, as progressives and climate hawks know, is that we must start rapidly getting off of fossil fuels ASAP to preserve a livable climate — to maintain a carrying capacity anywhere near the projected mid-century population of this planet – by limiting warming to under 4°F. Indeed, we know that even if we miss that target, the shift is inevitable by midcentury, else we face warming far beyond 10°F globally — beyond 13-18°F over most of U.S.! – with multiple, simultaneous catastrophic consequences that are almost beyond imagining.
Put another way, the reason the government needs to act in the energy marketplace is that clean energy has huge benefits to the nation and public health that are not reflected in its relative cost to fossil fuels (See, for instance, Economics Stunner: “Oil and Coal-Fired Power Plants Have Air Pollution Damages Larger Than Their Value Added.” Natural Gas Damage Larger Than Its Value Added For Even Low CO2 Prices.)
That’s why the single most obvious government policy for federal support of clean energy — one that mainstream economists (and think tanks) across the political spectrum have embraced — is a price on carbon.
So you would think that a 64-page report on clean energy policy by leading think tanks would have a big focus on climate change and a carbon price, particularly a report titled “Beyond Boom and Bust: Putting Clean Tech on a Path to Subsidy Independence.” After all, the only true way to achieve subsidy independence is for the price of fossil fuels to reflect their actual harm to humans. Until that happens, subsidies would seem inevitable. Once a rising price happens, most clean energy advocates would be happy to start phasing out virtually all subsidies.
And yet this report has no mention whatsoever of the words “climate change” or “global warming.” Indeed, the word “pollution” never appears. The report offers no actual rationale for why the government should be in the clean energy business at all, other than a passing reference to the tens of thousands of jobs the sector has created. But, of course, oil and gas create jobs, too, albeit unsustainable ones.
Even more amazing, while the report devotes a full 20 pages to its policy recommendations section, “Putting Clean Tech on a Path to Subsidy Independence,” and offers some theoretically terrific ideas, it devotes not one single sentence to a carbon price. The phrase “carbon price” never appears.
It’s as if the whole notion of global warming and the cost of pollution and pricing carbon had been carefully scrubbed from the report. Yet those concepts represent a core rationale — if not the sine qua non — for writing a 64-page report on federal intervention in the energy marketplace to support clean energy.
No doubt purely coincidentally, here is the list of authors:
UPDATE: Obviously, the presence of the four Breakthrough Institute authors, including the two famous founders, will inevitably leave the impression with some that this is a BTI show. Originally, the Brookings website had this clarification: “Editor’s Note: Mark Muro is the lead contributor of the paper.” Now Brookings has updated its website to read “Mark Muro is one of the principal authors of the paper.”
No doubt the involvement of Brookings and WRI explains why, in a narrow sense, the report is excellent, with great charts and factoids on how President Obama sharply increased clean energy support in the recovery act, and how that is all set to disappear if Congress doesn’t act.
Whatever one thinks of the Breakthrough Institute, they have made clear they believe environmentalists are to blame for recent failures in energy policy, by talking too much about the climate and pushing policies built around carbon pricing. Their work inspired me to come up with a new term, “climate science ignorers.”
Since the new study offers not two words of explanation for why it ignores climate change or even why it fails to consider a carbon price, let’s look at how Shellenberger and Nordhaus make the case. In an October piece, they blame Australian greens for even passing a modest carbon price, and use that to then launch an attack on everyone, everywhere who supports a carbon price: