So Much for Energy Independence

While the United States continues to destroy its economic position by conforming the nation’s public policy to the short term profit motives of the fossil fuel and nuclear industries, Abu Dhabi within the United Arab Emirates is decisively and strategically moving to accelerate development of renewable technology by, in large part, using expertise from our own university system. The idea is to create a “world-class research and development hub for new energy technologies” with a live laboratory. The project is called the Masdar Initiative. Masdar will be a newly built model city based on sustainable, zero-carbon design with a population of 50,000. Massachusetts Institute of Technology will support the new Masdar Institute of Science and Technology and have a satellite campus on site. The project is expected to cost $22 billion and take eight years to build. Stanford is also receiving research money to the tune of $25 million. American ingenuity is now up for sale to the highest bidder.

Thanks to influence peddling by the fossil fuel, nuclear and utility industries in Congress and at state legislatures, the US could soon be adding renewable and other advanced zero-carbon technology imports to oil imports from the Middle East. So much for energy independence!

Prior to the oil embargo of 1973, the prevailing wisdom among economists that economic growth and growth in energy demand went hand in hand. But the contrary proved to be true. In response to the embargo, the US government began to push and support energy efficiency measures. As a result, renewed economic growth in the mid-1970s was achieved without growth in energy demand. What have we done with that knowledge and the vast advantages of energy efficiency investments? We have, by and large, squandered them along with the opportunity to create millions of jobs.

At one time, the United States was at the pinnacle of wind turbine technology and was the largest producer of solar photovoltaic cells in the world. What have we done with those advantages? We have squandered them along with the opportunity to create millions of jobs.

Instead of pursuing an energy policy path that would bring enormous wealth to our country, vastly improve environmental quality and public health, and address global warming in an economically fruitful way, we have sacrificed jobs, our health and the environment on behalf of the fossil fuel and nuclear industries. That’s not all. Once proud American prowess with respect to technological achievement that is already waning could soon, because of our own negligence, be easily trumped again by the very region we seek energy independence from - the Middle East.

As an example of the dominant position of the fossil fuel and nuclear industries in the energy policy mix, we have and continue to put our public resources (taxpayer dollars) in the wrong places with respect to energy technology. In terms of energy incentives that range from R&D to subsidies to direct assistance over the last 50 years, an analysis by Management Information Services, Inc. conducted in 2007 estimated that fossil fuels and commercial nuclear, both very mature industries, received 83% of the incentives. Solar, wind and biomass received only 5.1% combined.

The last eight years has been equally dismal. From 2002 to 2007, GAO estimates in a 2007 study reviewing federal electricity subsidies that R&D funding for nuclear programs grew 59%. Indeed, nuclear programs received the largest share of government R&D funding during that time period. Fossil fuels received the most “electricity-related” tax expenditures. Meanwhile, President Bush was taking shots at energy efficiency and renewable energy programs throughout his presidency, leaving funding at mediocre levels and periodically cutting funding. The Congress and the President supported an energy bill in 2005 that rewarded the usual suspects (coal, oil, nuclear) with $25 billion in support compared to just $6.4 billion for renewables. Energy efficiency, our cheapest and most economically powerful energy resource, remains a mere stepchild in the energy incentive mix. Although there has been pushback recently against oil subsidies due to excessive profits (as if excessive profits within the oil industry is somehow outside the norm), Obama appointees are beginning to talk out of both sides of their mouths as well, promising public investments in ‘clean coal’ technology and nuclear power. This is hardly a change in direction.

Sources:

Bezdek, R.H. and Wendling, R.M. (2007) ‘A half century of US federal government energy incentives: value, distribution, and policy implications’, Int. J. Global Energy Issues, Vol. 27, No. 1, pp. 42-60.

“Federal Electricity Subsidies: Information on Research Funding, Tax Expenditures, and Other Activities That Support Electricity Production”, GAO (GAO-08-12), October 2007.

Elisabeth Rosenthal, “Gulf Oil States Seeking a Lead in Clean Energy”, New York Times, January 13, 2009.

Arjun Makhijani, Carbon-Free and Nuclear-Free: A Roadmap for U.S. Energy Policy. RDR Books and IEER Press, 2007.

Daniel J. Weiss, Nick Kong, “Renewable Energy Subterfuge: Bush’s Sleight of Hand”, Center for American Progress, March 4, 2008.

www.masdar.ae/madarinitiative/