By D. A. Barber
In his “State-of-the-Union” address presented to Congress on January 24, 2012, U.S. President Barack Obama called for an "all-of-the-above" energy policy stressing the need to develop both traditional (natural gas and “clean” coal) and renewable energy sources within the United States. One pledge he made caught the attention of many renewable energy supporters: A promise to issue permits for 10 gigawatts of renewable generation capacity - enough to power 3 million homes - from projects on public lands located mostly in the western states by the end of 2012. He also pledged to accelerate the U.S. Navy’s acquisition of an additional 1GW of renewable energy capacity in addition to what the U.S. military has already committed to.
Details of President Obama’s new renewable energy policy were later published on the White House website. But even before the State-of-the-Union speech, the U.S. government had already identified 17 “Solar Energy Zones” in the six Western states for development despite the high-profile taxpayer losses when solar panel maker Solyndra went bankrupt and defaulted on a half-billion dollar federal loan.
President Obama’s Energy Blueprint
In his State-of-the-Union address, President Obama laid out a “Blueprint for an America Built to Last,” underscoring his commitment to an “all-of-the-above” approach that develops every available source of American energy. The Blueprint was later published on the Whitehouse website, including President Obama’s “Blueprint to Make the Most of America’s Energy Resources.”
The President’s Blueprint calls on Congress to set “a national goal of moving toward clean sources of electricity by setting a standard for utility companies, so that by 2035, 80 percent of the nation’s electricity will come from clean sources.”
Other details of President Obama’s “Blueprint to Make the Most of America’s Energy Resources” include doubling the share of electricity from clean energy sources by 2035. According to the Blueprint, “The centerpiece of this strategy is a Clean Energy Standard, or ‘CES’ - a flexible approach that harnesses American ingenuity and innovation, and channels it toward a clean energy future. By creating a market here at home for innovative clean energy technologies, we will unleash the ingenuity of our entrepreneurs and ensure that America leads the world in clean energy.”
Renew Clean Energy Incentives
President Obama also called on Congress to renew and extend a number of clean energy incentives that been proven successful and he considers crucial to the continued growth of the domestic clean energy sector. This include targeted tax incentives for clean energy manufacturing, which could create up to 100,000 jobs, and the Production Tax Credit to support investment in the deployment of solar energy technologies.
“I will not cede the wind or solar or battery industry to China or Germany because we refuse to make the same commitment here. We have subsidized oil companies for a century,” President Obama said during his speech. “That's long enough. It's time to end the taxpayer giveaways to an industry that's rarely been more profitable, and double-down on a clean energy industry that's never been more promising. Pass clean energy tax credits and create these jobs.”
One tax break, which expired at the end of 2011, allowed companies to get 30 percent of the cost of new projects back as a cash grant once construction was completed. Without the cash grant program, a company can still take the 30 percent credit, but must spread the benefit over a period of years. Solar companies say that program was effective because it encouraged a broader range of private investors. The cash-grant program, known as the 1603 program, had awarded $1.76 billion for more than 22,000 solar projects, according to the Treasury Department. A report by EuPD Research notes that a one-year extension of the 1603 tax-grant program would also create an additional 37,000 solar industry jobs in the U.S.
U.S.“Solar Zones” in the Western States
Prior to the January speech by President Obama, the U.S. Department of Interior Secretary Ken Salazar announced in October 2011 that the government had targeted 445 square miles of Bureau of Land Management (BLM) lands (part of the U.S. Department of the Interior) at five sites in Nevada, four in Colorado, three in Utah, two each in California and Arizona, and one in New Mexico (which has since been dropped) as “Solar Energy Zones” that are considered ideal for development of large, utility-scale solar projects on public lands that could generate thousands of megawatts of electricity. The BLM oversees 258 million surface acres of land throughout the U.S.
"Only lands with excellent solar resources, suitable slope, proximity to roads and transmission lines or designated corridors, and containing at least 2,000 acres of BLM-administered public lands were considered for solar energy study areas," the BLM said in a statement.
The current “Solar Zones” comprise 285,000 acres, down from about 677,000 acres originally targeted in December, of targeted land the government feels has the highest potential for solar development with the fewest environmental conflicts. The BLM also proposes to open an additional 20 million acres of public land to future solar development. Designation of these new Solar Energy Zone lands are in addition to the 13 large-scale solar projects already under construction in the western states and the 125 projects for which applications are currently on file for some 685,000 acres of public lands. The government expects to approve as many as 14 this year.
There are 11 million acres of public lands in the California Desert and much of that area had already received approval of several solar projects in October 2011: California has more than half the total Solar Zone acreage, with 153,627 acres.
Conclusions
Solar is growing quickly in the United States. According to the Solar Energy Industries Association, more solar was installed in the third quarter of 2011 than in all of 2009 combined. But there is little enthusiasm for solar subsidies in Washington, especially during an election year. Concerns about the U.S. deficit have made U.S. lawmakers skeptical about any new tax breaks for solar businesses particularly in the wake of taxpayer losses of more than half a billion dollars when solar module-maker Solyndra went bankrupt and defaulted on a half-billion dollar federal loan. This is despite the fact that Solyndra was financed under the now-expired 2009 stimulus package that provided government loan guarantees for clean-energy projects.
Acknowledging that in an election year U.S. lawmakers are not likely to move forward with clean energy credits due to expire at the end of this year, President Obama promised to do what he can with “executive orders” to push energy production.
“The differences in this chamber may be too deep right now to pass a comprehensive plan to fight climate change. But there's no reason why Congress shouldn't at least set a clean energy standard that creates a market for innovation,” said President Obama during his State-of-the-Union speech.
Nevertheless, President Obama does not need Congress to open public lands for clean-energy to private investments or to continue to spur the U.S. Department of Defense - the world's largest consumer of energy – to use photovoltaic solar arrays at their military bases.