US Needs To Act Quickly To Develop Renewable Energy

The devastating oil spill in the Gulf of Mexico dramatically raises the stakes in confronting the challenges we face in balancing America’s energy needs with protecting its precious natural resources.

In his recent address to the nation, President Obama made a compelling case for passing a comprehensive energy bill that would reduce the nation’s dependence on oil, noting that the spill is, “the most painful and powerful reminder that the time to embrace a clean energy future is now.”

It is unfortunate that it takes an environmental disaster to refocus national attention on the need to significantly diversify America’s energy base.

The question for the United States is how to best address such energy issues while at the same time developing its economy.

The President’s goal of establishing a national renewable electricity standard of 20 percent by 2020 rightly puts the country on the correct course, and Congress should pass energy legislation before the November elections to help put the country on that path.   

Our company, Solar Trust of America, is committed to building utility-scale concentrated solar thermal power plants to provide clean sources of energy to the nation that will help meet that mandate. We are developing several utility-scale solar plants, including three in California that will commence construction in 2010.  Once construction is complete, they will have capacities of nearly 1,700 megawatts and are expected to create approximately 1,800 construction jobs and another 200 permanent jobs.

Solar energy is ideally suited to meet America’s future energy needs. But, the federal government must continue to do its part to scale-up the industry. One of those ways is by expediting loan guarantee applications for renewable energy projects, particularly those involving solar plants.

Congress enacted the Department of Energy’s Loan Guarantee Program to help deploy clean energy technologies across the United States, but, unfortunately, the program has yet to spur the rapid deployment of them. Since its inception in 2005, the program has only granted conditional guarantees to thirteen projects, only four of which have been solar energy.  Of the four solar power projects two were announced on July 2, 2010.  It has taken years for some projects to advance through the process. 

And while those two recent announcements indicate that the pace of awarding conditional guarantees is starting to pick up, of the $84.8 billion available in the programs, only about 17 percent of it has been conditionally awarded. “Fast-track” procedures must be implemented by the federal agencies involved to help expedite the disbursement of such guarantees. It is crucial that companies who have applied for such loans receive a commitment from DOE soon, as construction of many of those projects must start before the end of this year in order to meet both the requirements of the American Recovery and Reinvestment Act and the deadlines of signed Power Purchase Agreements.

Often, a national crisis serves as a wake-up call to rally the public to a level that demands unprecedented action by its elected officials. President Obama made it clear that the nation’s top priorities are to stop the damaging flow of oil into the Gulf, continue the clean-up efforts necessary to protect its beautiful beaches and waterways and assist the coastal communities and their economies impacted by this crisis.

Equally important, though, is his call for bold actions that will spur the development of renewable energy and related projects that will create high paying jobs and stimulate domestic manufacturing. If programs such as the federal loan guarantee are not streamlined and significantly expedited, the nation runs the risk of not realizing the employment, economic, technological, and environmental benefits of large-scale renewable energy.

Uwe T. Schmidt is chairman and CEO of Solar Trust of America, LLC, a position he has held since founding the company in August 2009. Mr. Schmidt brings more than 30 years of diversified experience in the global energy, steel, industrial plant construction, structured trade finance and commodities trading industries to his role as CEO to one of the world’s leading solar thermal energy companies.

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