Green Energy Dollars

Green Energy Dollars

by Deb Powers

China is making renewable energy a major priority, swearing to increase the nation's renewable energy capability to 20 gigawatts in the next two years. India has committed to growing its renewable energy capacity to 20,000 megawatts by 2020. South Korea plans to invest 2% of GDP annually in increasing renewable energy capacity. In the U.S., a substantial portion of the $700 billion stimulus package will be spent on increasing green energy capability, and the Waxman-Markey bill is meant to encourage investment in developing renewable energy resources. The UK recently announced their financial commitment to producing energy from wind, waves and sunlight, raising an outcry from the British commerce community to back nuclear power instead of "unreliable" wind and water. And in Africa, a collection of European countries have committed to investing in creating Desertec, a solar installation in the Sahara that could provide energy for the entire world.

Green Energy for Green Jobs

Most of these energy initiatives are focusing as much on the "green energy jobs" and the potential for green energy to lift the world out of the economic slump caused by the worldwide financial crisis. Many of the programs are announced in terms of the number of jobs that they'll bring to an area. In the UK, a project in the southwest is expected to create 1,000 jobs for Cornwall. All over the U.S., local investors are touting wind, solar and hydro installations as job creators. U.S. president Barack Obama has made it clear that the nation that leads in creating renewable energy will lead the world economically. China, Japan, India, Russia, Germany, the UK and South Korea are all pressing ahead to make hay while the sun shines.

But even as many countries throw money at the problem in the hopes of creating new jobs and new streams of income, critics are wondering how much effect all that cash will actually have. The concerns focus more on the fact that the money is aimed more at building plants than at actually delivering and using renewable energy produced by them.

Green Energy Green Waste

In India, an anonymous solar power executive told the Washington Post that the government doesn't give sufficient support to actually generate solar power for domestic use. As a result, Indian producers export 75% of the photo-voltaic cells and solar panels they produce to Europe. A representative of Greenpeace India points out that the government gives incentives for building energy plants, not for producing energy, so entrepreneurs make quick bucks by building green energy plants, reap the tax benefits, then disappear, leaving behind plants that produce nothing.

China is facing similar problems. An unidentified Chinese government official complained that the government incentives reward low quality equipment and components, and that while the government is focused on building in quantity, quality suffers. Wind towers break down, and there is nothing budgeted for maintenance.

Green Economy History - Tale of Boom and Bankruptcy

California could serve as a cautionary tale for any government trying to boost an economy on the back of green energy development. In a thought-provoking look at green energy since the Carter years, Joshua Green traces the history of green energy initiatives in California after the Carter years.

Adherents of clean energy usually explain its evolution in terms of technological advancements. But a better way to see the full picture is through the lens of bankruptcy. The corporate histories of the major manufacturers of clean technology—companies like Vestas, GE, and BrightSource—are littered with bankruptcies, sometimes several in succession, and most can trace their lineage to a specific act (or inaction) of government.

Joshua Green, The Elusive Green Economy

Green's article is a sobering look at how the whole green economy could go bust if those in the government don't look to the past and avoid the funding mistakes made then. We need to look beyond incentives for development and building, and figure out how to reward sustained production and use. Likewise, when we talk about green jobs created, we need to look beyond jobs in design, development and construction and look toward sustainable jobs in actual energy production. If we don't, all of the efforts toward creating a green economy will fall far short of the potential they hold.

Read more about renewable energy economy

• Guardian UK:  Green energy investments overtake fossil fuels
• Washington Post: India sets goal to harness renewable energy
• Washington Post: Asian nations could outpace U.S. in clean energy
•  Environmental Leader: Solar power generation to double by 2010
• The Atlantic: The Elusive Green Economy