Will Congress block the Michael Phelps of American energy?
All federal leaders these days like to give lip service to a secure and sustainable energy future for our country. But unless they renew a version of the renewables Production Tax Credit (PTC) over the next couple months, I call greenwash.
Renewable electricity is like the Michael Phelps of our energy system. While coal, natural gas and nuclear grow at rates between 0 and 6.5% per year, wind and solar regularly clock speeds of 35-45% growth! Some may claim that this quick growth will moderate and is all due to the small base they are growing from. But these last couple of years pose a serious challenge to that assertion. Solar continues to be a small contributor to the energy pie providing less than .2% of US electricity. However, many analysts predict its cost is about to drop more than 30% over the next two and a half years due largely to a catch-up in the supply of modules’ key feedstock, polysilicon. If that happens, solar can quickly accelerate its rise toward the ranks of major energy sources.
Wind is already beginning to join the club due to the last few years of phenomenal growth. The American Wind Energy Association (AWEA) just announced that the US overtook Germany as the largest wind power producer in the world during the second quarter. Even though its nameplate capacity is currently lower than Germany’s (though may not be by the end of this year), the greater strength of our wind means that our turbines generate more electricity. I thought it would be tough for wind to follow its record-breaking growth of 2007 when its capacity shot up 5.24 GW or 45%. But this year, the current list of 9 GW waiting to be installed on top of the 2.7 GW installed during the first half of the year makes AWEA project another 45% growth (or ~7.5 GW!) is about to take place. After being a miniscule player for years, wind has now unseated oil as the fifth-largest source of US electricity and will pass 1.5% by the end of the year. This is an astonishing feat, moving us close to the time when we will be able to call on clean power to provide all of our new energy demand.
That is, as long as we don’t block our Olympic hopeful from its potential. A crucial ingredient to wind’s successful rise has been the federal PTC of ~2 cents per kWh. There were three years during this decade when the PTC was not renewed, resulting in a 73-93% drop in installations from the previous year. If federal leaders turn their back on wind power and other renewables at a time when our country needs its jobs and its energy more than ever, then they are failing us and the planet. If they decide to lower the PTC now that wind is more competitive with other sources of electricity, that is understandable. But to not renew it would be to abandon one of our key tools to mitigate the energy and climate challenges ahead. Congress (including Presidential candidates), will you step up?
We’re here to help you navigate this changed world and economy.
Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.
In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.
Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.
You make our
Support nonprofit news you love with a gift today.