WASHINGTON — Today at the White House, President Obama announced the award of $2.3 billion in Recovery Act Advanced Energy Manufacturing Tax Credits for clean energy manufacturing projects across the United States. One hundred eighty three projects in 43 states will create tens of thousands of high quality clean energy jobs and the domestic manufacturing of advanced clean energy technologies including solar, wind and efficiency and energy management technologies.
As part of the Recovery Act, these tax credits are focused on putting Americans back to work by building a robust domestic manufacturing capacity to supply clean and renewable energy projects with American made parts and equipment. These credits are also an important step towards meeting the President’s goal of doubling the amount of renewable energy the country uses in the next three years with wind turbines and solar panels built right here in the United States.
“Building a robust clean energy sector is how we will create the jobs of the future,” said President Obama. “The Recovery Act awards I am announcing today will help close the clean energy gap that has grown between America and other nations while creating good jobs, reducing our carbon emissions and increasing our energy security.”
“By investing in innovative clean energy manufacturing projects like these, we are not only creating good jobs now, but helping lay a new foundation to keep America competitive in the 21st century economy,” said Vice President Biden. “This is what the Recovery Act is all about.”
“There is no greater priority for this Administration than getting Americans back to work,” said Treasury Secretary Tim Geithner. “The awards announced today, together with the more than $5 billion in private sector capital spurred by our investment, will drive significant growth in the renewable energy and clean technology manufacturing sectors, good jobs, an energized private sector marketplace and a leadership role for the U.S. in these crucial high-growth markets.”
“The world urgently needs to move toward clean energy technologies, and the United States has the opportunity to lead in this new industrial revolution,” said Secretary Chu. “Today’s awards will create new jobs and jumpstart the industries we need to both solve the energy problem and ensure America’s future competitiveness.”
This effort, along with other Recovery Act investments, will drive significant growth in the renewable energy and clean technology manufacturing sectors and give the United States the ability to lead globally in these markets. The investment tax credits, worth up to thirty percent of each planned project, will leverage private capital for a total investment of nearly $7.7 billion in high-tech manufacturing in the United States.
The projects announced today address the broad spectrum of manufacturing capabilities needed to support a robust clean energy economy. The projects were competitively selected through a rigorous merit review process and the companies chosen say they will create more than 17,000 jobs in some of the fastest growing parts of our economy.
Today’s announcement includes tax credits for numerous clean energy technologies and companies, including:
Smart Grid — Itron, Inc.’s OpenWay CENTRON meter is one of the first smart meters for the residential market providing built-in, two-way communications and a remote on/off switch which will give customers more choice and enable utilities to provide higher reliability at lower cost.
The expansion of manufacturing capacity in their facility in South Carolina will allow an annual production of four million meters. Itron estimates that one year’s production of the meters will be able to reduce electricity use by approximately 1.7 million MWh per year.
Building Efficiency and Energy Management — W.L. Gore & Associates, Inc. is producing an advanced membrane for high efficiency fuel cells for buildings and vehicles. The company’s products can help enable lower-cost fuel cells for use in electric vehicles or to power homes and businesses. They are also manufacturing an advanced turbine filter to improve the performance of gas turbines to produce greater outputs at lower cost and reduce greenhouse gas emissions.
Solar Energy — PPG Industries, Inc. will produce a double anti-reflective coating for glass to make solar cells more efficient. At their Louisiana facility, PPG will produce a special tire tread component that reduces rolling resistance and improves fuel economy. Before the solar industry had begun, PPG pioneered the first low-iron glass that has been used in solar cells and on countless solar installations over the past two decades. Today, this credit will help to expand the manufacture of one of the critical components of glass solar cells, the transparent conductive oxide (TCO) coatings of the glass, without which the cells cannot function.
Wind Energy — TPI Composites, Inc. is building a new manufacturing facility in Nebraska to produce next generation wind turbine blades. TPI says the facility will create over 200 new jobs and will have a capacity equivalent to supplying 265 turbines rated at 2.5 MW for a total electrical output of 663 MW TPI will also be expanding their existing manufacturing facility in Iowa to meet the anticipated increased demand for composite wind turbine blades. TPI’s composite materials made in both facilities are used to make lighter and stronger wind turbine blades and lighter and stronger (and more fuel efficient) vehicles.
While projects selected for this tax credit generally must be placed in service by 2014, approximately 30 percent of them will be completed in 2010.
As part of an innovative partnership between the Departments of Treasury and Energy, the two cabinet agencies worked together to develop, launch, and award the funds for this program in record time. The Advanced Energy Manufacturing Tax Credit authorized Treasury to provide developers with an investment tax credit of 30 percent for facilities that manufacture particular types of energy equipment. Qualifying manufacturers will produce solar, wind, and geothermal energy equipment; fuel cells, microturbines, and batteries; electric cars; electric grids to support the transmission of renewable energy; energy conservation technologies; and equipment that captures and sequesters carbon dioxide or reduces greenhouse gas emissions.
As advocates for clean energy and good jobs evaluate opportunities to advance their issues in 2010″”from a jobs bill that could include energy efficiency measures to a federal clean energy and climate bill””there is another oft-overlooked vehicle that advocates would be wise to consider.
This year, Congress will likely pass a national transportation bill””legislation that comes up only about once every six years””through which the nation could reduce harmful greenhouse gas emissions from the transportation sector and significantly curtail petroleum use, thereby reducing U.S. dependence on foreign oil. The transportation bill also could deliver major economic benefits, including millions of new construction, operations and manufacturing jobs””just what the doctor ordered to fix what’s ailing the U.S. economy.
“Transportation is the fastest growing sector in terms of greenhouse gas emissions,” said Jill Kubit, assistant director of the Cornell Global Labor Institute, which encourages labor unions to become actively engaged in climate policy. “But it’s often neglected in terms of the solutions side, so we feel a real need to engage unions and workers around this issue.”
The Global Labor Institute isn’t the only organization that is planning to engage groups in the upcoming transportation debate. The coalition Transportation for America was created in 2008 by Smart Growth America, Reconnecting America, and the Surface Transportation Policy Partnership. T4America, as the coalition is called, now counts some 400 organizations that support its agenda to create “a new national transportation program that will take America into the 21st century by building a modernized infrastructure and healthy communities where people can live, work and play.”
“It’s astonished and gratified us the range of organizations that have realized a connection to transportation,” said David Goldberg, communications director at T4America. He listed AARP as being a T4America member that is concerned that the U.S. transportation landscape is unfriendly to aging Americans; the American Public Health Association as a member that is troubled by the health impacts of pollution from the transportation sector and the lack of physical activity that has resulted from our transportation infrastructure; and PolicyLink as a member that wants to provide poor communities with access to high quality and affordable transportation options.
Groups like Environmental Defense Fund and Natural Resources Defense Council are also part of the T4America coalition because of their focus on climate change. “If you’re talking about climate change, transportation is about a third of the emissions, and you’re not going to be able to put all new vehicles that run on cleaner fuels out there in time to deal with the problem. Liquid fuel is going to be the fuel source for a lot longer, but part of what we need to do is not drive so much,” Goldberg said.
The transportation bill is so far-ranging that it touches many aspects of our lives. It addresses highways, bridges, highway safety, public transportation, railroads and high-speed rail, among other transportation issues. It includes the repair of existing transportation infrastructure as well as the financing of new highway and transit capacity. It targets metropolitan areas as well as rural areas. It regulates not only the movement of people, but also the movement of goods.
Groups that seek to reform of the transportation system also hope to address a wide diversity of issues through the transportation bill-climate change, health and safety, equity, smart growth and economic opportunity, among others. There is also a significant amount of money at stake, as well as the potential to create a large number of jobs. The last transportation bill was funded to the tune of $286 billion over six years; the current proposal by Minnesota Democrat James Oberstar, the chairman of the House Committee on Transportation and Infrastructure, would increase that amount to $500 billion over six years, including $50 billion for high-speed rail. Rep. Oberstar testified in July that the bill will “create or sustain approximately six million family-wage jobs.”
Many economists consider the transportation sector to be rife with job creation potential. A recent study by the Economic Policy Institute (Transportation Investments and the Labor Market) found that a $250 billion investment in the U.S. transportation system would create more than 2.8 million direct and indirect jobs. The study also looked at the quality of the jobs that would be created by transportation investments and found that they were more likely to be unionized and less likely to require a college degree.
“Across the board, it’s a pretty dense industry when it comes to unionization,” said Ed Wytkind, president of the Transportation Trades Department of the AFL-CIO. “This means you have higher wages, better benefits and better training. You probably have good quality health care, and you’re more likely to have a pension.”
Although Wytkind’s organization does not represent workers in transportation manufacturing, he is very interested in the potential for increased transportation investment to create not only construction and operations jobs, but also domestic manufacturing jobs. “Most of our manufacturers are buying components and intellectual property from overseas. This [transportation bill] is a great opportunity to look at the next generation of locomotives and passenger rail cars and buses and make sure they’re not only more energy efficient, but that they also support American jobs,” Wytkind said.
Currently, most U.S. transportation funding comes from the gasoline tax, which has not increased since 1993 and is not indexed to inflation. At 18.3 cents per gallon, the federal tax has lost 33 percent of its purchasing power over the last 15 years, according to Oberstar. If more funds are to be invested in transportation to create the jobs and other benefits for which many groups are advocating, the gasoline tax will need to be increased or a new and sustainable source of funding will need to be identified. However, with the economy still in a state of recession, most politicians are loath to support any tax increases. This is a key reason why the transportation bill, which expired in September 2009, has yet to be taken up by Congress and may not be seriously considered until fall 2010.
Funding is not the only challenge for those who seek changes in the U.S. transportation system to address environmental, public health, equity and other critical issues. Many groups still differ on their priorities. For example, while most groups support increased transportation investment, there are divisions as to whether public transportation should be on a more equal footing with highways. There are also divisions between organizations that support fix-it-first policies that prioritize repair and maintenance work on roads over new road and bridge construction, and those which argue that new road construction is needed to address traffic congestion and other problems.
These issues will be discussed and debated throughout 2010 as Congress deliberates the transportation and jobs bills. In December, the Obama administration proposed that the jobs bill include a $50 billion infrastructure investment to go mainly toward highways, transit, rail and aviation. The House jobs bill, which was passed on December 16, included approximately $37 billion in transportation investments.
To the extent that these investments create well-paying jobs and move the country toward a cleaner and more sustainable transportation system, they represent progress. But the transportation bill is still the 800 pound gorilla. As T4America’s Goldberg put it, “By all rights, this [transportation bill] ought to be the best opportunity in a generation to create a bold new vision for our national transportation policy.”
Efforts by California municipalities to end-run electric utilities for greener electricity and lower rates have yet to succeed and might soon face longer odds if investor-owned power companies have their way.
The appeal of so-called Community Choice Aggregations, or CCAs, comes from their low rates — as government entities, they do not need to make profits — and their high proportion of renewable energy. Their backers say CCAs are simpler to run than full utilities, which own distribution, metering and billing infrastructure.
But while the state has had a law since 2002 that allows and governs the formation of CCAs, none have come into existence, despite a dozen or so attempts. San Francisco is in the home stretch for a CCA, but the effort could be torpedoed in June by a utility-sponsored state ballot initiative.
The initiative, backed by Pacific Gas & Electric Co., would force communities to reach a two-thirds consensus in order to form a CCA and would require the same support for expanding municipal utilities (Greenwire, Aug. 24, 2009).
San Francisco’s Public Utilities Commission has been working on a CCA since 2004 and just last week closed the bidding by companies hoping to supply electricity. If the effort succeeds, 750,000 residents would be able to buy electricity directly from the city, rather than from PG&E, the state’s largest utility, which has 15 million customers.
The commission’s assistant general manager, Barbara Hale, said she was heartened to get five bids from electricity suppliers, which she says shows confidence in the program despite PG&E’s statewide initiative. If the initiative succeeds, city officials say, the CCA movement here would likely die.
“What PG&E is doing is completely contrarian to what the current theme of thinking is in California,” said City Supervisor Ross Mirkarimi, who introduced the 2007 legislation authorizing the city to buy power for its residents. “People are talking about instituting a constitutional convention, because we can’t get a budget passed because of the two-thirds requirement in Sacramento. PG&E’s doing just the opposite.”
Mirkarimi added, “PG&E knows they have unlimited funds of ratepayer and shareholder money to subsidize their fight to maintain their monopoly and their profit motive. Who wants to move forward always looking over your shoulder? We shouldn’t have to do that. We shouldn’t have to fear this.”
For its part, PG&E — which supported passage of A.B. 117, the law allowing CCAs in 2002 — says the law was poorly written and that its initiative would protect taxpayers.
“We have determined that A.B. 117 has serious flaws in that it does not require a vote by taxpayers before a local government incurs debt and spends public funds to enter the electricity business, and CCA promoters are relying on the automatic enrollment part of the statute to obtain large numbers of customers without the customers’ affirmative consent,” PG&E spokesman Andrew Souvall said.
“Being an energy provider is complex and risky. We believe that local residents should have a say in determining whether or not their local government takes on this risk.”
California CCA advocates say the push for community choice on electricity is part of a bid for expanded green power.
San Francisco intends to procure at least 51 percent renewable energy by 2017 — far above California’s target of 33 percent renewables by 2020 for all utilities. PG&E is currently at 14 percent and plans to reach 20 percent by 2012.
Here is how San Francisco officials see the program working: By aggregating, San Francisco would receive the funds for energy efficiency programs that PG&E currently collects. It would use the money — and its ability to generate revenue through tax-exempt bonds — to reduce the need for peak-use-only plants by increasing local generation. Of the 360 megawatts that it has issued a request for, 150 MW would be from a local wind farm and 107 MW would be from local, renewable distributed generation.
Paul Fenn, a former staffer for the Massachusetts Senate Energy Committee, is the founder of Local Power, a Bay Area company that primarily does research for governments looking to form CCAs, including the San Francisco government. He said CCAs are a unique blend of government thrift and private innovation, which has the potential to produce both low-cost and green energy.
“CCAs are uniquely positioned integrators,” Fenn said. “They don’t own power plants, so they don’t have liability on the old system. It’s hard to buy an electric car when you’ve already bought the gas car. But in this case, it’s not a car bought two years ago, but an infrastructure system built 100 years ago that has been used to leverage utilities’ growth many times. … The ideal provider would be a local government that doesn’t have conflicts like old power plants and transmission lines.”
India will go ahead with its plans to combat climate change without waiting for global finance as nations prepare for fresh talks after failing to agree on a binding global treaty at Copenhagen last month.
“We’ve got to do what we’ve got to do,” Jairam Ramesh, environment minister in the world’s fourth-biggest polluter from burning fossil fuels, said in an interview in New Delhi today. “I don’t see India’s climate change program being driven by international finance. International finance has its supportive role to play, it doesn’t have a lubricating or a catalytic or a start-up role.”
The Copenhagen Accord set a Jan. 31 deadline for rich nations to specify 2020 emission targets and poorer countries to state actions being taken to curb greenhouse gases. The agreement also pledges $100 billion a year by 2020 for developing countries to adapt and mitigate the effects of climate change.
India, along with the U.S., China and Brazil, was among the countries that declared plans in the Danish capital to slow emissions blamed by scientists for global warming.
The Paris-based World Organization for Animal Health plans to study the effects of meat output on climate change, Reuters reports.
Director-General Bernard Vallat appears to be treading carefully. “It’s a question that needs to be studied with a lot of distance,” he said at a press conference. “We want to make a modest and independent contribution.”
The United Nations’ Food and Agriculture Organization has found that the livestock sector is a major contributor of greenhouse gases due to methane emissions and forest clearing to create new pastures. Livestock accounts for 18 percent of global emissions, FAO estimated in 2006.