AWS Truepower CEO Bruce Bailey: Why the U.S. Needs a National Renewable Energy Policy

Why does the United States need a national energy policy favorable to renewables like wind and solar?

Because without one, it’s nearly impossible to establish a long-term market for wind farms and solar farms and other renewable energy technologies. We’ve had short-term production tax credits, but they come and go. When a credit for wind energy is on the verge of expiring, for example, development in that sector stops until there’s confidence that the tax credits will be extended. The uncertainty discourages investment.

Some states, like California early on and more recently Colorado and many others, have taken the lead by adopting far-reaching renewable energy mandates and tax incentives to encourage economic growth. But we still need a comprehensive federal policy to send the strongest possible signal that the United States is behind renewable energy and willing to push it.

Given the lack of a federal policy, how realistic is President Obama’s goal of producing 80 percent of electricity in the U.S. by 2035?

It’s hard to say, but a federal program would certainly help. Countries that do have a federal energy plan supporting renewables have seen double digit penetrations of wind, for example. Denmark generates around 20 percent of its electricity from wind. Germany is in double digits with wind and solar. And China is forging ahead with large scale wind and solar plants. Germany and Denmark are much smaller than the United States, of course, and there are other important differences in our political structure and culture. But there are examples out there of countries that have used a strong national policy to take the lead in renewable energy.

So why doesn’t the U.S. have a national energy policy that supports renewables?

Both parties support renewables, so there’s lots of common ground. But most of the legislation concerning renewable energy that’s been proposed has been attached to bigger picture issues like cap and trade, oil exploration in Alaska, and other controversial issues that tend to be show stoppers.

Renewable energy is attached to those bills to make them seem more attractive and to get them passed, but the controversial stuff ends up derailing the attractive renewable energy proposals. And, of course, other issues like the economic crisis, health care, and immigration reform have gotten in the way. People want renewable energy, but they’re often confused by its upfront costs and uncertain about its true benefits.

What sort of renewable federal renewable energy policy would you like to see?

I’d like to see a policy that recognizes that renewable energy technologies need the same type of government support that our current power generating sources received during their early years. Many people don’t understand or have forgotten that, for the most part, our energy infrastructure was driven by federal mandates to build power plants and transmission lines. And oil companies have enjoyed generous government support for many decades. Now wind and solar come along needing the same government boost, but the game has changed.

Today, the private sector builds and controls power generation. The trajectory has gone from the government investing in energy for the public good to agreeing that we need renewables but allowing the market to dictate how, if at all, they’re going to happen. So renewables are expected to struggle to gain a foothold without federal support by competing with coal, oil, and natural gas–industries that have received and continue to enjoy substantial federal incentives. It’s a very uneven playing field, and federal policy supporting renewable energy could do a lot to level it.