Election Fall-Out for Clean Technology

by Rona Fried

Lie, Smear, Obstruct, Win. That’s the new motto for American politics.

Add to that pompous ignorance and you know what we’re up against in the 2011 Congress. After eight long years of the Bush Administration, we had a very brief period of support for cleantech and renewable energy with the Obama Administration. Now, that "hope for change" is gone.

It’s bad news for science and the reality of climate change with climate deniers back in town. Bill Mayer joked on Real Time that Tea Partiers don’t "believe" in gravity. But it’s no joke.

We’re about to have the most pro-dirty energy Congress we’ve seen. Thanks to the Citizens United Supreme Court decision, Big Oil and Dirty Coal spent a fortune to swing this election, and they got what they paid for.

Renewable energy, clean technology, and the vital investments in education and research that underpin its spread are in jeopardy in the US. In fact, the new Republican majority will do their best to unwind all our environmental laws that protect our air and water and natural resources. Those laws put "undue burdens" on polluters – if we want jobs, we’ll have to get rid of them.

NRDC says: Powerful members of the new majority have signaled their intent to unshackle polluters from the Clean Air Act … strip wolves of their endangered species protection … industrialize the Arctic National Wildlife Refuge . . . slash budgets for clean energy programs … and hold hearings questioning the science behind global warming.

Remember Joe Barton (R-TX)? He’s the one that apologized to BP because the Obama Administration was charging them the full price for the Gulf oil spill. Well, he’ll probably chair the House Energy and Commerce Committee.

These people don’t compromise. Their only goal is to hoist President Obama from office and regain power in the Senate. They have no policy solutions to the multitude of problems our nation faces.

Their idea of an energy policy is oil drilling (watch out ANWR), clean coal, nuclear and natural gas, even as polling shows that 90% of Americans want more clean energy and 80% want higher gas mileage for cars (yes, they want to gut that too), as well as comprehensive efforts to protect our air and water. Most representatives who supported the House clean energy bill won their races.

Is there any Good News?

Nearly every Republican candidate for Senate rejects the sound, settled science that man-made carbon pollution is causing the Earth’s climate to change. Fortunately, voters rejected ‘flat earthers’ like Carly Fiorina, Christine O’Donnell, Sharron Angle and Ken Buck, choosing instead to return to Washington clean energy champions like Barbara Boxer, Harry Reid and Michael Bennet. Although we lost key environmental leaders like Senator Russ Feingold, voters elected new clean energy leaders to the Senate, such as Richard Blumenthal and Chris Coons.

California voters overwhelmingly repudiated big oil’s attempt to scrap the state’s landmark global warming law, AB32. The cleantech industry’s first all-out campaign prevailed against corporate interference and proved that voters want something done about climate change. In a state with the country’s third highest unemployment rate, voters think renewable energy creates jobs, not destroys them. The cleantech community raised three times the funds as did the polluters, which led to the resounding rejection of Proposition 23.

The victory lays the groundwork for clean energy advances in other states and eventually at the federal level as it represents the largest public referendum in history on clean energy and climate policy.

The victory is bittersweet, however, because voters passed Prop 23’s evil twin, Prop 26, which would de-fund AB32 along with all polluter fees that aren’t passed with a two-thirds majority vote. Read the NY Times article.

When the California Air Resources Board launches its cap-and-trade program in 2012, they are planning to give most of the permits away for free, against the advice of an expert panel and the EU’s experience in implementing their program. Oil refiners and other polluters lobbied the agency to auction only a "very small" number of permits when the program starts because of the same old line: it would impose unnecessary short-term costs.

What to Expect Going Forward

Much of the focus going forward will be pushing the Obama Administration and Congress to use the Clean Air Act to cut greenhouse gases and jump start investments in clean energy, and to support strong climate financing at the upcoming United Nations climate talks in Cancún.

Cap-and-Trade will have to be accomplished slowly and deliberately by cobbling together states and regions. Major environmental NGOs say their focus for 2011 will be on forming more state-led initiatives like the Western Climate Initiative.

Passage of California’s AB32 could pave the way for a cap-and-trade system that would cover most of the U.S. West and the largest Canadian provinces. Add to that the existing 10-state Regional Greenhouse Gas Initiative (RGGI) on the East coast, and a proposed Midwestern Greenhouse Gas Reduction Accord (MGGRA), and the majority of the U.S. would be covered.

On the federal level, Republicans will require it be their way or the highway. Democrats will have to give huge handouts for nuclear and fossil fuels in order to make any gains for renewable energy; that didn’t work in the last Congress, so it’s doubtful much headway will be made in the next. Rather, the administration will rely on the EPA, DOE and other relevant agencies to get the job done. Those agencies will be subject to very unfriendly congressional oversight as well as attempts to de-fund initiatives and block their work through the courts.

The immediate impact of the failure to pass energy legislation will be on the wind industry, whose cash grant program expires at the end of 2010. Solar has the most secure tax subsidy – its Investment Tax Credit is guaranteed through 2016. The wind industry is already suffering from a terrible year where new installations are down 72%. The lack of clear energy policy, lower electricity demand and low natural gas prices, make wind power a tough sell to utilities now.

The death of cap-and-trade is already having negative ramifications. The eight year old Chicago Climate Exchange, where companies have been voluntarily reducing greenhouse gas emissions and trading the credits they earned, is shutting down at the end of this year. Carbon prices on the Northeast carbon exchange (RGGI) are at their lowest level in two years.

A national Renewable Portfolio Standard (RPS) is also likely out the door along with cap-and-trade. Therefore, the 29 state RPSs will continue as the backbone for renewable energy expansion (if some new Republican Governors don’t ditch them). The DOE still has $25 billion to spend from the Recovery Act, and the Investment Tax Credit (ITC) stands for solar and fuel cells through 2016.

And speaking of Governors, it would be hard to replace the advocacy and enthusiasm of Michigan’s former governor, Jennifer Granholm. Republican Governor-Elect Rick Snyder expresses support for renewable energy jobs in his campaign literature, but we’ll see how that plays out.

In Ohio, Governor-elect John Kasich will be a stark contrast to ousted Governor Ted Strickland. Kasich has favored repealing the state’s RPS because it drives up utility bills and mandates intervention, but so far he’s retreated from that position. One of his first post-election statements was declaring the federally-funded rail line that would connect Ohio’s three largest cities dead.

Rep. James Oberstar (D-MN), a strong supporter of high speed rail, lost his seat. His proposed transportation reauthorization bill included a large increase in public transportation funding. Obviously, a Republican will now chair that committee.

Besides cap-and-trade and RPS, other programs likely on the chopping block are:

  • natural gas vehicle incentives
  • clean energy Manufacturer’s Tax Credit (MTC) worth $5 billion
  • DOE loan guarantees worth $35 billion
  • extension of tax credits for biodiesel and biomass (expires in 2010)
  • critical programs for wind and geothermal: Investment Tax Credit (ITC) cash grant program expires in 2011; Production Tax Credit (PTC) expires in 2013.

Anything related to clean energy and climate that carries a price tag will be anathema. There might be a good side to that – since the central Tea Party message is reducing government spending, there’s certainly a case for eliminating subsides for the oil industry, carbon capture and sequestration, and nuclear power (Good luck!) – a true waste of taxpayer money.

Areas where there’s some chance for common ground: a national renewable energy standard (RPS), energy efficiency standards and a clean energy bank which would give loans to renewable energy developers.

Even with these headwinds, cleantech will continue to grow in the US. Existing government incentives, decreasing costs, and inevitably rising fuel prices will continue driving it forward, as well as a motivated, increasing entrenched cleantech support base.

Here are some things you can do:

Tell the Senate to pass the DISCLOSE Act during the lame duck session. Prop 23 failed because of corporate disclosure.

Join the fight for a constitutional amendment to reverse the Citizens United decision by declaring that corporations do not have the legal rights of humans.

Demand the Department of Justice and Internal Revenue Service investigate Karl Rove’s political organizations which laundered millions of dollars in secret cash to change the outcome of elections.

Defend the EPA from castration by pro-coal interests in Congress. The EPA accomplished almost nothing during the Clinton years because the Gingrich-led Congress used the budget process to prohibit the agency from doing its work. This battle has already started.

Urge Democratic senators to do away with lifetime tenure for committee chairs and open up all chair positions to majority vote.

Tell Your Local Newspapers the Truth: Dirty Polluters Bought the 2010 Election

There’s no way to sugarcoat it: the elections are a depressing setback for the environment, human rights, workers’ rights, cultural diversity and our natural faith in a caring, just society. The divided Congress won’t move much legislation, but the House will use its access to committees, hearings, subpoenas and the media to whip up a bleating, endless attack on clean air, clean water, healthy ecosystems and the rights of other species to simply live.

The White House, already timid in the face of opposition and endlessly seeking bipartisan compromises, will want to tack to the right. And that’s where the amazing power of the U.S. legal system and vibrant grassroots activism will win the day. I hope.


Rona Fried, Ph.D. is CEO of SustainableBusiness.com.

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