Mixture of Sun and Clouds for Obama’s Second Term
It’s a new day -- and the first one of President Obama’s second term. And while his inaugural address was not intended to draft public policy it was meant to provide the nation a blueprint of what issues he feels deserve attention.
To that end, he clearly stated that dealing with climate change would be a priority and that the development of renewable energy would be one means by which to achieve that aim. During the fall campaign, the president devoted sparse time to such issues that had become hugely contentious. Now, though, with a second term locked up, he is showing renewed signs of confidence.
“We will respond to the threat of climate change, knowing that the failure to do so would betray our children and future generations,” Obama said on Monday. “Some may still deny the overwhelming judgement of science, but one can avoid the impact of raging fires, crippling drought, and more powerful storms.”
Last year was the hottest ever recorded in this country. Droughts and wildfires dominated the news over the summer. But it was Hurricane Sandy that pounded the East Coast just before the November election that still resonates. In 2011, 14 major weather events occurred with each costing at least $1 billion.
The president came to office in January 2009 perhaps a bit wide-eyed. His party dominated both congressional chambers, allowing the House to pass a cap-and-trade bill. But that measure would never be able to get the 60 votes necessary to survive a filibuster in the Senate. And then the Democrats lost control of the House in 2010.
Obama did, though, spearhead the passage of greater fuel efficiency standards for cars and trucks. Still, his goal going forward is more ambitious and involves not just the reduction of greenhouse gases but also those tied to acid rain, soot and mercury. Here, the president has two choices: Using the regulatory levers or winning congressional approval, or some combination of the two.
During his first term, the president allowed his opposition to define clean energy as a dirty term -- fuel sources that could not compete in open markets without government subsidies and without regulatory favors. The failure of solar maker Solyndra, which lost $535 million in federal loans, crystalized that view.
Now, however, the president has stopped playing defense, although he realizes that the pursuit of a New Energy Economy will be long and difficult. It’s especially true when the legacy fuels have had decades-long help that have given them the inside track on power and transportation markets, he has said.
“We cannot cede to other nations the technology that will power new jobs and new industries -- we must claim its promise,” the president said during his address.
One way to reach this vision is to increase the amount of federal research and development funds that go into developing cleaner fuels and new technologies. This country now invest $3 to $4 billion annually in “innovation,” says Michael Shellenberger, president of the Breakthrough Institute, an environmental think tank based in Oakland, Calif. He says that this amount ought to be $30 billion a year, given that energy is such a massive segment of the American economy.
That’s money that would not just be plowed into varying stages of wind and solar development but also in nuclear power and carbon capture and sequestration, he adds. Consider that the federal government played an integral part in creating “hydraulic fracturing” that is used to extract shale gas from rocks that lay deep underground. Without such a public-private partnership, the shale gas would still be dormant and coal would continue to dominate utility markets.
“Addressing climate change is urgent,” says Shellenberger. “Energy transitions take a long time and we need to get started.”
The political realities are such that legislative action would fail. The president’s opponents are concerned that climate change is the result of naturally occurring weather cycles and that providing subsidies to green energy is both unfair and wasteful. Wind and solar are uncompetitive, they add, not because they are young and untried; rather, it is because they are intermittent and expensive, requiring a base-load fuel such as coal or natural gas to back them up.
Obama is therefore left to depend on further regulatory action and on the allocation of federal funds to develop promising technologies. Most -- but not all -- of the regulatory levers have been pulled, leaving the administration to carry out the rules that have previously been enacted. Common ground exists, however, as both the president and Congress have been pushing promising technologies, and they will continue to provide funding not just to green energy but also to the fossil fuels.
EnergyBiz Insider has been awarded the Gold for Original Web Commentary presented by the American Society of Business Press Editors. The column is also the Winner of the 2011 Online Column category awarded by Media Industry News, MIN. Ken Silverstein has been honored as one of MIN’s Most Intriguing People in Media.