You are here

us policy

Subsidy Reform to Power U.S. Clean Tech

Clean tech in the United States has been on the rise in recent years— even through the recession and other challenges. Increasing wind power, falling solar costs, expanding electric vehicle markets, government stimulus and other investments have built a global clean tech sector that topped $263 billion last year.

In the first quarter of 2012, however, global clean energy investment dropped to its lowest level since 2008. Good news stories are being replaced with headlines about closing factories, bankruptcies, and cancelled projects. Clean tech appears to be at a crucial inflection point.

Electricity Markets Increasingly Favor Alternatives to Coal

This piece originally appeared in the National Journal Energy and Environment Experts Blog.

The U.S. electric power system is gradually shifting toward cleaner forms of generation. One sign of this transition is the declining use of coal for electric power production. In 2011, coal dropped to its lowest level of power generation in more than a decade, according to the U.S. government’s independent Energy Information Administration (EIA). In fact, the EIA recently reported that coal’s share of U.S. electric power generation fell below 40% for the last two months of 2011, the lowest level since 1978.

To understand the cause of this decline, it is important to examine the underlying market forces. Doing so provides important context for recent coal plant retirement announcements, particularly given that some companies have attributed retirements to EPA rules that are still years away from going into force. For example, FirstEnergy Corp. announced in late January 2012 that it would retire several of its smaller coal-fired power plants, explaining that the decision was “based on the U.S. Environmental Protection Agency Mercury and Air Toxics Standards (MATS), which were recently finalized, and other environmental regulations.” FirstEnergy, however, had previously cited a range of reasons for its decision to reduce operations at many of its smaller coal plants.

EPA: Insurance for a Cleaner Future

This piece originally appeared in the National Journal Energy and Environment Experts Blog.

EPA’s newly proposed standards are an important step toward addressing the threat of unmitigated carbon pollution in altering the climate. EPA’s action will ensure that power suppliers consider greenhouse gas emissions before building any future power plants. Moreover, this lays the groundwork for future U.S. policies and action to address climate change.

The proposed standards set an emissions standard of 1,000 pounds of carbon dioxide per Megawatt-hour— slightly more carbon intensive than combined cycle natural gas plants built today. New coal units could comply with the regulations by committing to capture and store a portion of their carbon dioxide emissions or, where feasible, by using waste heat through combined heat and power systems.

Bringing Ecosystem Markets to Scale in the Southern United States

For the most part, Ecosystem Markets still linger in the early stages of development. There is much more theoretical work to be done to set up environmental credit markets, including carbon offsets and payments for watershed services. But more pilot projects can also help these markets evolve and show how they might work in the real world.

Development pressures in the U.S. South often mean that forests are worth more cut down than left standing. In the U.S. South alone, the U.S. Forest Service estimates that suburban encroachment will convert approximately 31 million acres (approximately 14 percent of 2010 southern forest area) of southern forests to development between 1992 and 2040.

Leading the Renewal of American Manufacturing: Ohio’s Combined Heat and Power Program

On March 9, 2012, the Ohio Public Utility Commission hosted a workshop for the Pilot Program on Combined Heat and Power, which it has launched in partnership with the U.S. Department of Energy (DOE). The workshop convened industrial companies, energy experts, and state-level policymakers to discuss the role of Combined Heat and Power (CHP) technology in complying with upcoming federal Boiler MACT (Maximum Achievable Control Technology) standards. The CHP pilot program in Ohio is an important precedent that recognizes the potential for U.S. industry to raise its energy productivity while improving the health of workers and surrounding communities.

Payments for Watershed Services: Pilot Projects for Watershed Protection

Forested watersheds of the southern United States provide numerous services to the region. At no cost, they purify water, control flooding and erosion, and provide places for people to relax and have fun. Yet despite their value, many watersheds are under threat from development and poor land management.

“Payments for Watershed Services” (PWS) programs are one strategy to keep watersheds healthy. Through a PWS program, landowners receive financial incentives to conserve, sustainably manage, and/or restore watersheds to yield the kinds of benefits described above.

A New Snapshot of Energy Use in Midwest Manufacturing

Policymakers at all levels of government are focusing on getting the economy moving again. Recent economic news suggests that the manufacturing sector, which has struggled in recent decades and lost 30% of its workforce between 2000 and 2010, is leading the U.S. out of recession.

By including industrial energy efficiency as a core component of economic development strategies, policymakers can help ensure that today’s capital investments in infrastructure and industry leave U.S. manufacturers better positioned to compete in the 21st century.

Pages

Stay Connected

Sign up for our newsletters

Get the latest commentary, upcoming events, publications, maps and data. Sign up for the biweekly WRI Digest.