Editorial: To succeed, green energy needs predictable politics
Job losses, both real and potential, at SolarWorld Industries and Clipper Windpower show the perils of the renewable energy market.
The two were green titans in the Tri-Counties, employing hundreds of people each. SolarWord shuttered its manufacturing operations in Camarillo and moved them to Oregon, while Carpinteria-based Clipper struggled along until it was purchased, and now disposed of, by United Technologies Corp.
In both cases, government policy loomed large. SolarWorld argued that it, along with other U.S. panel makers, suffered at the hands of illegal product dumping by the Chinese, whose government pumped $30 billion in subsidies into the industry. They won a victory this week when the Obama administration levied a retroactive tariff against the Chinese makers.
Wind has enjoyed no such luck. United Technologies’ top brass hinted they expected the Obama administration to go all-in on wind the way it did with solar. When it didn’t, the defense-industrial giant’s gamble on Clipper fizzled.
To the supporters of renewable energy, the story sounds all too familiar. A technology verges on the edge of the mainstream. But then wavering government support and a sudden drop in the price of fossil fuel, caused in this case by a fracking and natural gas boom, craters the effort and sours investors.
We believe private-sector investors can do the job of developing renewable energy. Those investors will happily risk their capital in exchange for a potential return — if they can reasonably estimate the risks. When policy support vacillates between various forms of renewable energy, they can’t. So they return to fossil fuels, whose generous perks and subsidies have been relatively constant for a century or more.
Note to Uncle Sam: Don’t make politics yet another risk factor in renewable energy investment. Set a policy and stick to it.