Solar Energy Again in the Spotlight in State of the Union: Old Theme with New Shoes?
Did you catch the State of the Union address last night? Hurray for renewable energy, but it is a speech that he could have given two years ago, pre-Solyndra. But a lot has happened in the last two years. In mild understatement, Obama conceded that, “Some technologies don’t pan out; some companies fail.” And some companies fail in a big way. Now the demise of Solyndra will be a big campaign issue, regardless of the merits of whether the federal government should have provided a loan guarantee to Solyndra. (Well, actually, that is not the problem, the problem is that the loan guarantee was subordinated to equity investors—not a good thing, especially when the company goes belly up.
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Many of us took heart in his seeming strong commitment to solar and other renewable energy: “But I will not walk away from the promise of clean energy. I will not cede the wind or solar or battery industry to China or Germany because we refuse to make the same commitment here.” Maybe he didn’t want to single out the Chinese, but last I looked, the solar panel industry in Germany has been decimated by the Chinese onslaught even worse than the Americans. The Germany share of the solar module business has dropped by an eye-popping 70 percent—now down to just 20%.
Obama revamped a theme that he rolled out almost two years ago, trying to strike a balance between promoting renewable energy while recognizing the reality that “traditional” sources of energy will have to be part of the U.S. voracious appetite for energy for some time to come. His message was muted by two disasters that all but derailed his message.
The Deepwater Horizon Disaster in April 2010 came at the particularly inopportune time when Obama had just announced his support for offshore drilling on March 30, 2010. Talk about bad timing?
Well, maybe not as bad as his belated support for nuclear energy. President Obama just two years ago in his State of the Union called for “building a new generation of safe, clean nuclear power plants in this country.” Oops. Fast forward to the Fukushima Dai-ichi nuclear plant disaster on March 11, 2011, and you don’t hear very much these days about clean nuclear power plants.
Last night, President Obama revisited this familiar theme, but in the light of the Solyndra demise, the Deepwater Horizon Disaster and the Japan Nuclear Plant Disaster. Taking a theme from his State of the Union two years ago, last night Obama proudly stated that “Over the last three years, we’ve opened millions of new acres for oil and gas exploration, and tonight, I’m directing my administration to open more than 75 percent of our potential offshore oil and gas resources. But with only 2 percent of the world’s oil reserves, oil isn’t enough. This country needs an all-out, all-of-the-above strategy that develops every available source of American energy. A strategy that’s cleaner, cheaper, and full of new jobs.”
Even with his support for oil and gas exploration, he was quick to add that “We’ve subsidized oil companies for a century. That’s long enough. It’s time to end the taxpayer giveaways to an industry that rarely has been more profitable, and double-down on a clean energy industry that never has been more promising. Pass clean energy tax credits. Create these jobs.” Don’t expect the oil companies to concede their subsidies any time soon—or to support President Obama’s reelection campaign.
This accommodation of fossil fuel is simply recognition that this country will be dependent on non-renewable sources of energy for decades to come. Whether Obama’s moderate energy vision will gain any traction in an election year is a matter of considerable dispute. We shouldn’t lose hope that some energy policy will emerge, but don’t count on much progress in this election year.