Renewable Energy Industry Shows Surprising Clout

 

 

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Toward the end of September last year, in the midst of Ohio's heated gubernatorial campaign, Republican candidate John Kasich gave an interview to the Dayton Daily News in which he raised the possibility that as governor he might try to axe the state's mandate that electric utilities expand their renewable-energy portfolios. 

"It will drive up utility bills because we don't have (energy from renewable sources) ready and have to buy it somewhere else," he explained. "I don't like that and you can't mandate invention." 

In a state that relies on coal for 90 percent of its power — and whose attention in the campaign was focused on hard economic times, not the complexities of energy policy - this seemed like an unexceptional comment from a conservative Republican. But it turned out to be quite a shock to many in the state's growing renewable energy industry. 

Ohio's "renewable portfolio standard," which originated in the Republican-led state Senate in 2008, requires that 25 percent of Ohio's energy come from renewable sources by 2025, and that half of that renewable portion be created in-state. Its passage — along with grants from a state program known as the Ohio Advanced Energy Fund — essentially jump-started an alternative energy industry in the state. 

Already, the impact is visible across Ohio. Farmers, homeowners and small companies put up solar panels and wind turbines; several large-scale renewable projects, including a 12-megawatt solar field in northern Ohio and planning for a 50-megawatt field in the southeast, got underway; wind companies moved ahead with plans for five new wind farms around the state and five turbines in Lake Erie; hundreds of companies either started up or got involved in the manufacturing supply chain for renewable energy; the city of Toledo emerged as a hub for research and manufacturing of thin-film solar cells. 

"Folks looking to invest in the renewable energy sector have choices across the country and within the Midwest," says Nolan Moser, director of energy and clean air programs at the Ohio Environmental Council. "One of the reasons these companies have chosen Ohio has been this policy." 

So two things happened after Kasich's comments appeared. His opponent, incumbent Democratic Governor Ted Strickland, began traveling around the state with renewable-energy businessmen, hammering Kasich as a threat to clean-energy jobs. And Kasich himself heard from entrepreneurs and others, many of them Republicans, alarmed by his statement. 

"Folks in that industry when those comments came out were very vocal, and they encouraged their customers to be vocal as well," says Chris Montgomery, a lawyer in Columbus who helps run an association of energy firms, Ohio Advanced Energy. "He was receiving comments not just from solar and wind developers, but also word from farmers and businesses and others who've benefited from some of these renewable energy projects." 

Within days, Kasich's campaign was letting it be known that he actually had no intention of repealing the state's renewable energy standard. "He supports increasing renewable generation in Ohio in a way that expands our energy choices," his spokesman said. 

No one expects Ohio to emerge as a green-energy colossus after Kasich, who went on to win the race, takes office on January 10. As one newspaper reporter in the state says, "You've got quite a bit of loud resistance to the idea that we can do anything aside from using the carbon molecule to create energy." But the fact that a conservative Republican backed so quickly away from angering the renewables industry says a great deal about the politics of state energy policy at the moment — and not just in Ohio. 

Carbon not the concern

With cap-and-trade off the table in Washington, and with 29 states either run by or about to be run by Republican governors, the prospects for legislation aimed explicitly at reducing greenhouse-gas emissions are not bright, at least in the near term. Shifting to cleaner forms of energy, however, is another matter. It's just that saving the environment won't be the driving thrust. Creating jobs will. 

"The opportunities to grow new industries in business are relatively rare right now, and the clean-energy economy's got a lot going for it from an economic development viewpoint," says Seth Kaplan, of the Conservation Law Foundation. "There's the number of jobs, but also the breadth: from university researchers doing basic research into the next generation of LEDs, thin-film solar or wind-turbine designs, to the blue-collar jobs, which are hard to come by these days. So Republican governors are trying to figure out how to position themselves between two poles: ideological opposition to anything with 'climate' on the label, and the economic development opportunity presented by the clean-energy economy." 

So it is that New Jersey's Governor Chris Christie, under pressure from conservatives, began saying in November that he was "skeptical" about climate change — yet has shown no inclination to withdraw his state from the Northeast's Regional Greenhouse Gas Initiative and remains a strong backer of developing offshore wind power. Some of the most concerted wind-energy development in the country has occurred in Texas — and especially in the Republican strongholds of West Texas — thanks to policies enacted under the leadership of Republican Governor Rick Perry. Sam Brownback, who is moving from the U.S. Senate to the Kansas governor's mansion, opposed federal cap-and-trade legislation in the Senate but joined with Democratic senators in September to back creating a national renewable energy standard for power plants. 

"Sam is very much on record as wanting Kansas to be a national leader on wind, he's been active on how to facilitate new transmission, he's been committed to bioenergy," says Nancy Jackson, who chairs the Climate and Energy Project, an effort to persuade Kansans to embrace renewable energy and energy efficiency. "I feel really good about how this administration will line up on energy issues." 

In Iowa, both incoming Republican Governor Terry Branstad and the speaker-designate of the state House, Kraig Paulsen, said after the election that in the interest of saving money, they intended to shutter the Iowa Power Fund, one of outgoing Democratic Governor Chet Culver's signature initiatives. The fund has allocated some $52 million for basic research and actual development of renewable-energy projects around the state, including the much-watched Project Liberty in Emmetsburg, a "biorefinery" turning corn and cellulose into ethanol. 

"We've shown that for every public-sector dollar, we can leverage five or 10 from the private sector," says Culver. "This is a critical investment that we need to continue to make in the future — Iowa is literally becoming the renewable-energy capital of the United States." 

Republicans did not seem convinced, at least not at first. But last week, Branstad suggested that the fund might continue as part of the Partnership for Economic Progress, a new joint public-private economic development project he plans to create. He asked his designee as director of the Partnership to integrate the Power Fund into his new enterprise. 

Gaining momentum

It's hard to escape the sense that politically, renewable energy and energy efficiency are approaching a tipping point in many states. "We do not pretend to have the same sway in the governor's mansion or the general assembly as the investor-owned utilities," says Ohio Advanced Energy's Chris Montgomery, speaking of his own state but in terms that could apply to most others. "But we do have much more momentum and much more legitimacy than the industry did just a handful of years ago — there's a track record of real jobs being created and a manufacturing industry that's growing, and there's no doubt that people are paying more attention." 

An instructive example took place last year in Arizona, which has become a national center of solar-energy research and development. There, the renewable portfolio standard was set by the Arizona Corporation Commission, which is independent of both the legislature and the governor — and which set a relatively modest goal of 15 percent renewables by 2025, but with a high requirement for "distributed" — rooftop solar — production. 

When a group of conservative Republicans in the legislature tried to strip the ACC of its ability to set the standards, the solar industry showed up in force to kill that initiative. "You had everyone from electricians and plumbers to traditional solar installers to [global solar giant] Suntech turn out," says Kristin Mayes, the outgoing chair of the ACC. "It proved the point that Republican states will not retrench on renewables." 

One of the leading forces for reining in the anti-renewable initiative was Republican Governor Jan Brewer, who withdrew her state from the cap-and-trade portion of the Western Climate Initiative but has been a steadfast backer of both renewable-energy development and energy efficiency. The politics of it go beyond jobs and economic development. The Lawrence Berkeley Laboratory, in a study for the ACC, recently estimated that the state's stringent efficiency standard will eventually save ratepayers some $5 billion, largely because the progress the state has seen will allow utilities to put off building any new baseload generating capacity — from coal or nuclear plants, for instance — until 2030. "Those are real savings for consumers," says Mayes. "This is not pie-in-the-sky stuff." 

Indeed, Kansas' Climate and Energy Project has shown that renewable energy and efficiency can, in fact, appeal to conservative voters and politicians. A survey conducted by Republican pollster Whit Ayres found broad support for the state's renewable electricity standard based on concerns about national security, economic development, and self-sufficiency. "We've made the case from the beginning that renewable electricity and efficiency are conservative," says CEP's Nancy Jackson. 

"They're about using Kansas resources to their utmost and not wasting," Jackson continues. "To be honest, I think there's a real opportunity to get actions that will reduce emissions under (Brownback's) administration, because we have a (Republican) governor, House and Senate that are fully aligned, and if this governor decides to do something, it will occur."

 
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