We Need to Reward Clean Energy
Though the first modern solar cell was invented in the United States during the 1950s, Germany now boasts 55 percent of the world’s installed solar capacity.
I learned how this reversal happened during a Congressional fact-finding trip to Germany in February. When I was in Silicon Saxony touring a chip manufacturing plant, I asked the company’s chief if he knew any solar-cell experts.
He walked me across the street, where I was able to spend two hours at one of the most successful solar-cell manufacturing companies in Europe. Not only did I see firsthand the amazing process of turning sunlight into electricity, I also received a tutorial on the policy that catapulted Germany into the lead in solar energy.
Germans call it a feed-in tariff. Others, like me, call it a performance-based incentive policy. No matter what you call it, this policy works just like a production tax credit in that clean-energy generators are rewarded for the electricity they produce. It guarantees interconnection to the grid, and through long-term power-purchasing contracts, clean-energy entrepreneurs are paid technology-specific, profitable rates for the power they produce.
This approach creates the perfect complement to state (or federal) renewable-electricity standards by supporting a broad range of available renewable-energy technologies. Ultimately, PBI policies work because they deliver the long-term investment security that any banker on this green earth will say is sorely lacking in today’s U.S. clean-energy market.
The Stern Review, the European Commission and the International Energy Agency all have concluded that PBI policies are the most efficient and cost-effective means of increasing adoption of clean-energy technologies. It’s happened with solar power in Germany, where renewable energy in the nation’s electricity mix has increased from 6 percent to 14 percent, exceeding a 2010 target three years ahead of schedule. In fact, Germany operates more wind generation, more solar installations and more biogas plants than any other nation.
With the increase in development and use of green technologies, PBI policies create new jobs. Germany’s law is credited with adding more than 140,000 jobs to the nation’s economy in just over five years.
Beyond Germany, PBI policies have been implemented worldwide, in 40 other countries, provinces and states, including Ontario, France and Spain. Now it’s time to adopt one in the United States as part of a NewApollo Project, aimed at marshalling national resources to do for clean energy what we did for space under President John F. Kennedy’s original Apollo project in the 1960s.
Entrepreneurs are ready to launch a rocket of clean-energy innovation in this country. After all, Americans are the most prolific inventors and problem-solvers in world history. From automobiles to airplanes, microwave ovens to microchips, Americans have remained on the leading edge of technology. And that’s true when it comes to the clean-energy sector.
These American geniuses just need Congress to create the regulatory and economic framework that will allow the green sector to take off. Just like there won’t be one silver-bullet technology to solve global warming, there won’t be a silver-bullet policy solution either. It will take a variety of approaches.
In December, Congress started the countdown to a clean-energy revolution with passage of an energy bill that included auto- efficiency standards, a renewable-fuels standard and improvements in home and appliance efficiency.
Since then, both chambers have advanced the countdown by approving energy-tax packages to extend and expand existing incentives for consumers and energy producers. We also have taken steps toward establishing a U.S. cap on greenhouse gas emissions.
Based on success in Germany, a PBI policy should be included in any comprehensive strategy aimed at launching a NewApollo Project for clean energy. That’s why I will introduce the Clean Energy Buy-Back Act in the House this month.
My bill may be the first PBI policy proposal before Congress, but these policies are not completely new to the United States. In fact, Michigan, Illinois, Minnesota, Rhode Island, Hawaii and California already are considering the adoption of PBI policies. And my home state of Washington has a similar, but narrower law on the books to promote solar photovoltaics.
To reap the impressive clean-energy technology adoption rates and economic growth seen in Germany, we need a national standard that provides real investment security for U.S. clean-energy industries. A federal PBI policy is a proven tool that can meet the energy challenges that we face at the pace, scope and scale that Americans are demanding. More than 70 businesses, investors and associations from 24 states agree; they signed a letter in support of a federal PBI policy earlier this year.
I hope my colleagues will join this growing movement aimed at giving American inventors and businesses the tools they need to launch a clean-energy revolution that will help tame global warming, reinvigorate our economy and wean our nation off fossil fuels from unstable foreign regimes.
The countdown has started. When the revolution takes off, Germany will have a fierce competitor when it comes to world pre- eminence in solar capacity and other clean-energy technologies.
Rep. Jay Inslee (D-Wash.) is a member of the Energy and Commerce Committee and the Energy Independence and Global Warming Committee. Last fall, he co-authored a book on the green revolution, called “Apollo’s Fire: Igniting America’s Clean Energy Economy.”