OPINION: RE Budget Slash Wrong Direction for U.S.

Here is a Political Opinion by Mr. Scott Sklar, President of the Stella Group – a strategic marketing firm for the distributed power industry, on why cutting the R&D budgets for Renewable Energy would be a bad move for the United States.

The Bush Administration released their FY’2002 federal budget and clean energy programs were slashed and burned. Only biomass RD&D programs were spared due to the personal intervention of Senate Agriculture Committee Chairman Richard Lugar (R-IN).. The three solar R&D line items (photovoltaics, concentrated solar power, solar buildings) that totaled $86 million are now being recommended to be cut to $43 million for FY’2002. While photovoltaics and solar buildings are receiving recommended 50 percent cuts, Concentrating Solar Power R&D was cut nearly 90 percent. It was also shocking to learn about the 40 percent proposed FY’2002 budget cuts in the Department of Energy’s research and development programs for geothermal, wind and even hydrogen research – the core United States renewable energy programs. This action clearly deviates from the President’s commitments during the election as well as public statements that America is facing an energy crises and we need to speed our electricity generation options. The Energy Secretary has made public statements that the cuts were made because the renewable energy programs have not performed. Yet, the progress on renewable energy has been unequivocally successful – where geothermal energy provides 1800 megawatts nationally and could economically provide a few hundred near-term megawatts in California. Wind energy already generates over 2000 megawatts in the US and could provide another 500 megawatts in CA. Concentrating solar power provides 350 megawatts in CA and the industry has recently attracted over $80 million in private investment and plans to deploy 200 megawatts in CA and the western region, solar buildings has leveraged several national homebuilders to now offer integrated solar water heating, photovoltaics and high-value energy efficiency with Shea Homes recent offering 200 solar homes in CA and several other large-tract builders and modular home manufacturers following suit – with the potential to save or generate 1,000 megawatts in CA. And photovoltaics which has attracted a few hundred million dollars of private sector investment in the last few years, has built over 15 manufacturing facilities in the U.S. whose costs have dropped by 30 percent during the same time period. All these industries have had double digit growth well above 20 percent per year. It is incredulous that with these clear gains in the market, price, and leveraging private capital — and at a time when many Americans are experiencing price shocks and rolling brownouts — The Administration would propose this action. These technologies offer individual consumers, businesses and communities the tools to resolve or lessen these deficiencies caused by government and the marketplace themselves — without reliance on government or big energy businesses to resolve it for them. The government should not foreclose that option. While the Department of Energy programs’ proposed budget cuts were 4 percent overall, the proposed gutting of the core renewable energy R&D programs by nearly 50 percent is not only poor public policy – but just plain wrong! Hopefully, the bipartisan Renewable Energy & Energy Efficiency Caucuses in the House and Senate will bring their own imprint on the budget this Spring. Note: This policy article has been prepared by Scott Sklar, President of The Stella Group, Ltd., a strategic marketing firm for the distributed power industry founded in 1995. Scott Sklar President The Stella Group, Ltd. 733 15th Street, NW – Suite 700 Washington, D.C. 20005

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