With the 2012 election over and President Barack Obama's re-election secured, U.S.-based renewable energy producers are already looking ahead to what they expect will be four more years of continued support for their endeavors.
A Collective Sigh of Relief
According to Ed Feo, co-founder of USRG Renewable Finance (USRGRF), last night’s Obama win brings “a continuation of policies that are favorable to renewables.” Feo also sees one of the chief issues at hand, the impending expiration of the wind energy Production Tax Credit on December 31, as one that will likely receive robust support as a consequence of the election results. “I think the Obama administration will push for that,” Feo said.
Feo isn’t the only one who’s perceiving Obama’s victory as a new breath of life for a group of industries whose futures may have seemed in question during certain points throughout the 2012 election season. For Scott Sklar, President of The Stella Group, the Obama re-election has “significant and consequential positive impact on growth and development of the U.S. energy efficiency and renewable energy industries.”
“The President has made clean energy one of the top three planks of his administration,” Sklar said in a press release issued today. “The President has supported extension of the wind energy production tax credit, whereas his opponent opposed that extension and called green jobs ‘fantasy’.” Sklar also predicts double-digit growth in the overall renewable energy market as a result of continued procurement for energy efficiency on the part of federal and state governments, and points to this year’s REN21 Renewables Global Status Report, which announced $282 billion of global private sector investment in 2012, as evidence of massive worldwide interest in renewables.
Industry Experts Convey Renewed Hope
Rhone Resch, CEO of the Solar Energy Industries Association (SEIA), shares Sklar’s optimism and calls Obama “a tremendous supporter of solar energy.” Resch foresees a continuation of support for solar power from the Obama administration, which he says has been greatly instrumental in the industry’s job growth. “Today, the solar industry employs more than 119,000 Americans at 5,600 companies, mostly small businesses, across all 50 states – this is more than double the number of Americans working in solar in 2009,” Resch said in a press release published today.
Resch added that since Obama’s election in 2008, “the amount of solar powering homes, businesses, and military bases has grown by 400 percent – from 1,100 megawatts in 2008 to more than 5,700 megawatts today. The Administration enacted a policy allowing solar installations for the first time on public lands and set a goal to permit 10 gigawatts of additional renewable energy projects on public lands by the end of 2012, which has been a great driver of this growth.” Resch also cited figures that show U.S. solar power installations in 2012 will be “another year of record growth” for the solar industry.
Noting support from both sides of the political aisle, Denise Bode, CEO of the American Wind Energy Association (AWEA) who recently reported 2012 was the strongest year on record for the U.S. wind industry, pointed to last night’s re-elections of House representatives Dave Reichert (R-WA), Steve King (R-IA), Tom Latham (R-IA), and senator Dean Heller (R-NV) as positive steps for the wind industry. All four have offered support of wind energy initiatives and may be critical players to ensuring the extension of the PTC. “We saw in the election results that Americans overwhelmingly approve of wind energy, and they vote for politicians who support it,” said Bode.
Addressing certain hurdles that still stand in the way of the wind energy PTC’s extension, including a lack of engagement among leadership in the House of Representatives and suggestions that the PTC may only be extended if an agreement to eventually phase out the tax credit is reached, Bode said, “Wind energy won’t need a tax credit forever.” Bode added that “if the Production Tax Credit for wind expires, wind will be the only energy source without federal tax support, and that would be bad public policy.” Still, Bode and the AWEA remain optimistic that Obama’s re-election will provide the necessary leadership to ensure continued governmental support.
Linda Church-Ciocci, Executive Director for the National Hydropower Association (NHA), said that while the hydropower industry has been “highly supported by both parties for some time,” certain gains have been made possible during the last four years that may otherwise not have been possible without the appointment of Steven Chu, Obama’s United States Secretary of Energy. “Secretary Chu understands the value of hydro,” Chuch-Ciocci said. “That has been a very important development with this administration.”
Meanwhile in biofuels, experts are predicting that the Obama administration will likely double its efforts with respect to the Renewable Fuel Standard (RFS), which was signed into law by George W. Bush in 2005 and later revisited by Obama. Calls to rid the U.S. of its dependence on foreign oil has caused rapid growth in the biofuels industry, accounting for a 182 percent growth in ethanol and biodiesel production between 2006 and 2011, according to Biofuels Digest.
'We've Got More Work To Do'
In echo of Obama’s words during his victory speech in Chicago last night — where the President told supporters, “We’ve got more work to do” — Feo indicated that although gains are being made, there are still more to be made in support of renewable energy initiatives. “We have to expand financing tools, which are available to other sectors — such as Master Limited Partnerships — to include renewable energy,” Feo said.
In addition, Feo stressed the need to incentivize investment in renewables through the extension and continued support of tax credit regimes like the PTC and the Investment Tax Credit (ITC) — the latter of which is scheduled to see a significant drop in percentage return at the end of 2016. “I think the Obama administration will push to extend it or to have some continued level of support,” Feo said.
Perhaps as a sign that it’s not just the renewable energy sector that's taking Obama seriously on his intent to further the pursuit of more clean energy initiatives, coal stocks took a steep plunge on Wednesday following the election results. This news comes as no surprise to those aware of Obama’s plans to bring more stringent regulations to oil and coal producers in his second term, including new EPA-enforced limits on carbon dioxide emissions for coal-fueled power plants, and even tighter restrictions on mercury and sulfur dioxide, which are expected to cause a sharp rise in the cost of burning coal.
Editor’s Note: This article will be updated as more renewable energy companies offer response and reaction to the 2012 election results.
Lead image: Spirit of America via Shutterstock
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