Energy policy: oh, fer dumb

It's not often we agree with Thomas Friedman, but today's column addresses the boneheadedness of the barriers to a sound energy policy with remarkable clarity.  In Dumb as We Wanna Be, the New York Times columnist writes:

It is great to see that we finally have some national unity on energy policy. Unfortunately, the unifying idea is so ridiculous, so unworthy of the people aspiring to lead our nation, it takes your breath away. Hillary Clinton has decided to line up with John McCain in pushing to suspend the federal excise tax on gasoline, 18.4 cents a gallon, for this summer’s travel season. This is not an energy policy. This is money laundering: we borrow money from China and ship it to Saudi Arabia and take a little cut for ourselves as it goes through our gas tanks. What a way to build our country.

What alternative does Friedman suggest?  Sanity.

What we get instead:

Few Americans know it, but for almost a year now, Congress has been bickering over whether and how to renew the investment tax credit to stimulate investment in solar energy and the production tax credit to encourage investment in wind energy. The bickering has been so poisonous that when Congress passed the 2007 energy bill last December, it failed to extend any stimulus for wind and solar energy production. Oil and gas kept all their credits, but those for wind and solar have been left to expire this December. I am not making this up. At a time when we should be throwing everything into clean power innovation, we are squabbling over pennies.

These credits are critical because they ensure that if oil prices slip back down again — which often happens — investments in wind and solar would still be profitable. That’s how you launch a new energy technology and help it achieve scale, so it can compete without subsidies.

The Democrats wanted the wind and solar credits to be paid for by taking away tax credits from the oil industry. President Bush said he would veto that. Neither side would back down, and Mr. Bush — showing not one iota of leadership — refused to get all the adults together in a room and work out a compromise. Stalemate. Meanwhile, Germany has a 20-year solar incentive program; Japan 12 years. Ours, at best, run two years.

As we've pointed out before, Congressman Walz champions the production tax credit, while the NRCC has played the tax credit for cheap laughs. The endorsed GOP candidate? Let Minnesota's wind industry get becalmed by the free market--while he doesn't mention dropping subsidies and tax breaks for the oil and nuclear power industries.

And this in a state that's the nation's third largest wind energy producer.

Friedman continues:

“It’s a disaster,” says Michael Polsky, founder of Invenergy, one of the biggest wind-power developers in America. “Wind is a very capital-intensive industry, and financial institutions are not ready to take ‘Congressional risk.’ They say if you don’t get the [production tax credit] we will not lend you the money to buy more turbines and build projects.”

Once more, we post the graph illustrating what the absence of the production tax credit means. In human terms, it means those students training at Minnesota West may not keep their jobs, regardless of the beauty of the vision their camera captured one morning as the fog lifted off the prairie.

The tradition Minnesotan expression for this sort of stupidity is "Oh, fer dumb."  A native of Minnesota, Friedman translates "Oh, fer dumb" into standard policy English:

The McCain-Clinton proposal is a reminder to me that the biggest energy crisis we have in our country today is the energy to be serious — the energy to do big things in a sustained, focused and intelligent way. We are in the midst of a national political brownout.

Fer dumb.

Comments

[Tom Gray]

Well said! And thanks for including our chart showing what happens when the tax credit is allowed to lapse.

Regards,
Thomas O. Gray
American Wind Energy Association
www.powerofwind.org
www.awea.org

Ollie says: I love that chart--says it all at a glance

[MinnesotaCentral]

FYI : DOE's National Renewable Technology Laboratory in Golden, Colo.has just issued a report that concludes wind energy could generate 20 percent of the nation's electricity by 2030, about the same share now produced by nuclear reactors.

"The report indicates that we can do this nationally for less than half a cent per kilowatt hour if we have the vision," said Andrew Karsner, the Energy Department's assistant secretary for efficiency and renewable energy.

Wind energy today accounts for only about 1 percent of the nation's electricity, although the industry has been on a growth binge with a 45 percent jump in production last year.
If wind energy's share of power production grows to 20 percent, natural gas consumption is expected to decline by 11 percent and coal consumption by 18 percent in 2030, said the report. As a result carbon dioxide emissions linked to global warming would be reduced by 825 million metric tons a year.