Solar Moving Forward Despite Low Subsidies

Despite relatively low subsidies, especially in comparison to the subsidies awarded to other energy sources, solar has been making it’s way as a valuable source of energy .

Incentives Graph

Graph Used From Baker Report and Think Progress .

The federal government provides incentives for every major energy production market and they exist to bridge the “chasm” between early adopters (about 16%) of a certain market and the majority adopters (about 84%). Crossing the chasm doesn’t necessarily mean all companies in the industry succeed, but that the industry itself succeeds. To get from initial adoption to full scale implementation, federal incentives support new energy resources on average for 30 years, including market control for oil, pipeline availability for natural gas, and dams for hydropower. Incentives provide economies of scale in a long term scenario that offer stability during the adoption process with gradual reductions in incentives as the industry matures.

Solar is at the chasm where continued government incentives are critical in assisting the jump between adoption phases. As it is, incentives for solar have been small compared to fossil fuels, according to a report by the Baker Center, “federal investment in solar technologies has been modest in a long-term histroical context relative to other energy technologies”. But, the incentives solar has received have really aided the industry. The growth of solar over the past two years has come with the federal investment tax credit and state renewable energy standards set in place. In addition to the decreasing PV prices, there’s been a 77% growth in the last 5 years.

This growth is spurring innovation, which in itself stimulates growth. Growth means more opportunity for jobs–the Baker Report estimating between 200,000 and 430,000 direct, indirect, and induced jobs coming from the solar industry by 2020. There are already 100,000 Americans working in the solar industry. To top it off, solar provides more jobs per megawatt hour than any other energy industry.

Solar has huge potential in the U.S. Rooftop solar alone could provide 20% of America’s energy needs, which would help decrease impacts of price and supply vulnerabilities from fossil fuel supplies. Solar could be an important addition to the American energy portfolio, but continuing incentives will be a crucial factor in perpetuating this.

Incentives are used to move an industry up the adoption curve. Solar has come this far despite relatively low subsidies; imagine what it could accomplish if the federal government channeled incentives usually given to the fossil fuel industry into solar.

Renewable Energy Fact Sheet

It’s fairly easy to make renewable energy look like a pipe dream, and misguided attacks on clean energy is doing just that: making renewables look too costly, too sporadic; not merited because it’s not competitive with fossil fuels, or that it won’t create jobs.

These petty strikes against the renewable energy industry don’t even remotely mesh with what we know is true about clean energy, and Think Progress recently published an article pointing out what you really need to know about the value of renewable energy.

1. Clean energy is competitive with other types of energy: Renewable energy is affordable now. Not tomorrow, not next year. Now. Even with the price of natural gas being inordinately low, these cheap prices are unsustainable, like any nonrenewable resource,  supplies will dwindle, and prices will rise. But renewable is staying competitive: with the help of bigger turbines, and increased reliability, some wind developers are signing power-purchase agreements in the 3 cents a kilowatt-hour range, which is far cheaper than any other new power source. The same industry maturity is occurring in solar with California solar developers signing contracts for power costing less than that of a natural gas plant.

2. Clean energy creates more jobs than fossil fuels: Renewable energy job creation outstrips fossil fuels 3 to 1. Not only does the renewable energy sector create more jobs, they create better jobs: twice as many medium to high credentialed jobs are being created in the clean energy economy with wages being about 13% higher, and almost half of these jobs employ workers with less than a four year college degree. Aside from these facts, the clean energy industry is actually growing by a rate of 8.3% which is more than can be said about the overall economy.

3. Clean energy improves grid reliability: Yes, it’s true that if the wind isn’t blowing or the sun isn’t shining then power isn’t going to be generated. But, that doesn’t mean that renewable energy isn’t a viable option for large scale power production. For instance, predictability of wind power would be easier to manage if there was more of it and energy could be delivered without interruption to the grid. Any additional costs for backup generation would be small (less than 10%) and would have little to no effect on consumer power costs.

4. Fossil Fuels have gotten 75 times more subsidies than clean energy: From 1994-2009 the fossil fuel industry received $446.96 billion in subsidies where as in that same time frame renewable energy received $5.93 billion. A study showed that in the early years of the fossil fuel industry, oil and gas producers received federal subsidies making up one half of a percent of the budget. This amount may seem small, but compare that with the one tenth of a percent of federal spending that’s used for renewables. If more subsidies were dedicated to renewable energy instead of the fossil fuel industry, clean energy would become even more cost effective than it is now.

Renewable energy could be an engine for economic growth and a pathway into a sustainable future, but false information that undervalues its potential could really set up road blocks. It’s important to realize the merit behind renewable energy, not only is it affordable and cost effective, but we can make it reliable on a large scale while creating jobs and with more investments from the federal government, we can more forward into a clean energy future.

Can Renewable Energy Win Despite Disadvantages?

It’s definitely a difficult climate for renewable energy these days. Renewable energy is at a competitive disadvantage in comparison to the oil, and coal industries who receive billions of dollars a year. Receiving less than one percent–one tenth of a percent to be exact–of funding, federal support for renewables is the lowest it has ever been.

Federal support and investment is crucial to renewable energy success. If the government cut through the inequalities between renewable and fossil fuel funding, we could achieve a nation who gained not only energy independence, but make significant strides to helping the environment. California has been doing its best to forge a path with renewable energy–as it is 1/4 of solar jobs are in California–but the nation can’t make progress in creating healthy competition in the energy sector without some subsidies or incentives.

Thankfully, renewable energy might have a new friend, the EPA certainly does: the US Army.

Be all you can be, Army of one, with your net-zero and sustainability goals. If anyone can succeed in achieving zero water, waste, and energy goals it is most certainly you, as you have now partnered with the EPA in order to gain the most cutting edge technology, and development.

In all seriousness, the Army employing renewable energy, even having net-zero goals, could be a great boost for not only the renewable energy sector, but the environment as a whole. A governmental institution taking measurable steps towards achieving energy efficiency could–well, not set the bar high–but at least set the bar for the rest of the government. The Army has a plan to install 300 megawatts of solar on military housing in the next five years–the Army needs power, why not get it from a source that doesn’t cost an arm and a leg?–and where veterans can be hired to complete said installations.

With fluctuating gas prices, and oil back in the $100 dollar range, some predict the US will be a net importer by 2030. According to the International Energy Agenc, by 2035, the price of coal is expected to rise 65 percent. Instead of sinking federal funds into these dwindling fossil fuel supplies, solar–and renewable energy as a whole–is a viable alternative that should be not only considered, but implemented before we start importing all of our oil, or the price of coal has skyrocketed.

Renewable energy is at a competitive disadvantage right now because the government won’t level the playing field with fossil fuels in terms of funding or incentives, but that doesn’t mean it still can’t come out on top. With the US Army creating some semblance of a bar that other government entities could reach towards, and rising costs of not only oil but coal, renewables may be able to sidle their way to the front for the win.