From: Issue 38
Obama’s Clean Energy Report Card
Joe Romm and Stephen Lacey from the Center for American Progress review the President's clean energy record
Grading President Obama on his clean energy policies is no easy task. Ask a conservative, and they’ll say Obama has invested far too much in the industry. Ask a progressive concerned about climate, and they’ll tell you he’s done far too little.
Outside of those lenses, it’s important to keep in mind that this Administration has done more to lay the groundwork for a clean energy revolution than any other president in history. However, a number of major factors have dragged Obama’s grades down. Some of them are a direct result of the Administration’s actions and others are just market realities.
Clean Energy Deployment: B-
The still-sluggish economy has made development of energy projects very challenging, even in fast-growing clean energy. Yet the president’s stimulus package, which created the Loan Guarantee Program and the Treasury Grant Program, has kept project deployment levels relatively high during extraordinarily bad economic times.
When the financial crisis struck, tax credits for the industry became much more difficult to monetize. That’s because the number of financial players with enough profits (i.e., tax appetite) to take advantage of tax credits dropped precipitously. As a result, the Administration created a grant program that allowed developers to take a cash payment through the Treasury equal to 30 per cent of a project’s cost. This incentive enabled a range of new banks and financiers to partner with developers, thus keeping project development rates steady.
Through the Loan Guarantee Program, which has leveraged more than $35 billion in private dollars, the Department of Energy has enabled some extremely important first-of-a-kind projects and manufacturing facilities in the United States. Among them are the largest wind farm, the country’s first cellulosic ethanol plant and some of the largest solar projects in the world. This program has also spurred development of numerous advanced battery and electric vehicle manufacturing plants.
Unfortunately, the lack of transparency in the loan guarantee process has attracted sharp criticism and turned a few recent failures – Solyndra being the highest profile example – into a political nightmare, even though a certain degree of failure is inevitable and expected with such a program.
At the same time, the Administration has balked at extending the single most important stimulus program for clean energy, the Treasury Grant Program, which expired at the end of 2011. In all, Obama has done a lot to elevate the industry, but many in the industry are concerned that he’s shifting focus at the wrong time.
Clean Energy Job Creation: B
Grade Job creation is a very sensitive issue, due to the political controversy around the 2009 stimulus package, so it’s important to set the record straight. To say the stimulus was a failure is simplistic and incorrect. The non-partisan Congressional Budget Office found that through the first quarter of 2011 the stimulus created between 1.6 million and 4.6 million jobs and reduced unemployment by between 0.6 and 1.8 percentage points. It also allowed the clean energy industry to grow by 8.3 per cent between 2008 and 2009, adding thousands of needed construction jobs. The recent green jobs report from the Brookings Institution described it as a period of “explosive” growth.
And those jobs are diverse. There are now 100,000 jobs in the U.S. solar industry, according to the Solar Foundation’s Solar Census. There are 661,000 green jobs in the design and construction industry, according to McGraw Hill. And the Administration’s energy efficiency weatherization program hired 25,000 people between April and June of 2011 alone.