The Country With the Cheapest Clean Energy Will Win the Economic Competition of the Future: Obama


photo: White House

President Obama was in Elkhart, Indiana yesterday talking with residents of that area—a place where unemployment has gone from 4.7% at the end of 2007 to 15% currently, with many people laid off from the area’s RV plants. After giving a speech which hit many familiar points on the economy and what can be done to get it back on track, Obama took questions from the audience.

One of them was from Bill Keith of Sunrise Solar (a company whose products have featured on TreeHugger on at least once occasion):Keith asked about how renewable energy incentives will be improved (among some other points...apologies to Mr Keith for abbreviating them). President Obama responded,

Well, let me -- three things that we can do, just very specific and we can do them quickly, and then there's a fourth thing that we can do that will take a little bit more time.

Number one is that we need to pass a renewable energy standard. (Applause.) And what that does is, just as for people who aren't sort of experts in the field, it's pretty simple. What it says is -- to the various utilities, it says, you need to get 15 percent or 20 percent of your energy from renewable sources. And once you set that benchmark, then what happens is, is that people who are producing renewable energy -- solar or wind or hydrothermal -- what they're able to do then is count on a pretty solid market that they're going to be able to sell their energy to. And that means investors, then, will say, you know what, this is actually a pretty good thing for us to invest in. And over time what that means is, is that more and more people invest in renewable energy, which means that technology gets better, the research and development improves, and you start growing that sector. So a renewable energy standard is very important. That's point number one.

Point number two is we should be providing tax credits and loan guarantees to renewable energy. There are some in place currently that have -- are on the verge of lapsing, and we have to act much more forcefully in terms of making sure that those are in place. That's the second thing.

The third thing that we should be doing is working with utilities all across America, including here in Indiana, to do what some utilities are already doing in California. And this is a really smart thing. What they do is, the utility is able to make money not just on how much energy it sells, but it's also able to make money on how much energy its customers save.

So you can structure how they charge your electricity bill so that if you started installing a solar panel, that you would actually, as you point out, be able to sell some of that energy back when you're not using it. You get to put some money in your pocket, and the utilities are rewarded for encouraging you to do that. Right now they don't have enough incentive to do it because they're making money the more energy you use, whereas what we want to do is make -- give them incentives so that they are constantly telling you how you can save energy.

The fourth thing -- and this is the thing that's going to take a little bit longer -- is we've got to improve basic science, research and development. When it comes to solar, when it comes to wind, the price has gone down, but generally speaking it's still a little more expensive than fossil fuels: coal, natural gas, and so forth. So we've got to improve the technology, and that's why I want to make sure that we're investing some money every year in the development of new energy technologies that will drive those costs down over the long term.

The country that figures out how to make cheaper energy that's also clean, that country is going to win the economic competition of the future. (Applause.) And I want that to be the United States of America. That's one of my commitments as President of the United States. (Applause.)

Full text of the President’s speech, as well as audience questions is available: White House Blog
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Tags: Barack Obama | Economics | Energy | Renewable Energy