Obama set on new energy economy
TEXT OF INTERVIEW
Steve Chiotakis: Barack Obama has promised to make alternative energy a leading priority of his presidency, pledging to invest billions of dollars into non-polluting technologies and infrastructure, creating 2.5 million jobs in the process.
Joining me now is Sam Eaton from Marketplace's Sustainability Desk. Sam, this is obviously a big plan for the president-elect.
Sam Eaton: What it really boils down to -- and this is what Obama, how Obama is framing this -- is short-term versus long-term thinking. And this is why you see Obama talking about this new energy economy from a jobs' perspective. You can actually invest in this on a federal level, stimulate jobs and prepare for a time when oil prices may go back up again. One other thing is you have to remember that cheap oil is also really bad for a lot of the players in the oil industry as well. We have all of these domestic reserves of oil that are a lot more costly then, say, drilling in Saudi Arabia. So if we don't do anything now, we may end up with more dependence on these foreign sources of oil, just because drilling domestically would be a lot more expensive.
Chiotakis: So Sam, we've got this double whammy going on right now -- not only are oil prices low, but we've got this credit crunch that's affecting how much money is out there to invest.
Eaton: Yeah, and invest in renewable energy projects. T. Boone Pickens's plan has suffered major setbacks, as he's lost incredible amounts of money through his investment firm, and is drastically scaling back what was supposed to be the largest wind farm in the world in Texas. So what we could see is an interesting development where you have a change in the players here, from the T. Boone Pickens to potentially oil companies and utilities building these large renewable energy arrays. The key here is the renewable energy tax credit that was recently passed in Congress, and unfortunately to tax advantage of that, you actually have to have profits that you can write down through this tax credit. Oil companies are still profitable, utilities are still profitable, so they could actually make some gains from getting into that action.
Chiotakis: And it sounds like they're underscoring, obviously, the cost-competitiveness of these renewable energy sources. How important is that, and how do you make that happen?
Eaton: It's incredibly important, and tough right now when natural gas prices have dropped considerably, they aren't cost-competitive right now. But this is really a policy question, Steve -- you actually compare the actual environmental cost of burning and using fossil fuels versus, you know, getting your energy from the sun and renewable sources. A lot of people would say that would level the playing field, and you would suddenly make these renewable energy sources much more cost-competitive, even today.
Chiotakis: Marketplace's Sam Eaton joining us. Sam, thanks.