In an interview last week, newly appointed Energy Secretary Steven Chu summed up the challenges of growing carbon emissions and shrinking access to cheap fossil fuels quite succinctly. “We essentially need a second Industrial Revolution that can generate lots of energy cleanly, cheaply, and sustainably.”
While Chu’s team is primed to tackle some hurdles to alternative energy innovation, such as shifting investment priorities towards renewables research and development, and improving the nation’s electricity grid to match up new sources of energy—like solar and wind—with areas of high demand, the largest barrier to the large-scale deployment of renewables remains stubbornly in the way.
Right now, renewable energy is just more expensive than fossil fuel energy.
Without removing the barriers to market, Chu’s second Industrial Revolution doesn’t stand a chance. But establishing a price for carbon essentially corrects a market failure that has allowed us to externalize the true cost of using fossil fuels. And a price for carbon could be on its way. Representative Henry Waxman (D-Ca), chairman of the House Energy and Commerce Committee, has committed Congress to action, declaring that a comprehensive climate and energy policy will be ready by Memorial Day.
Questions loom over what the plan will include. Certainly, it will build upon the previous Senate proposals for cap-and-trade legislation. Yet a federal cap-and-trade program itself has major hurdles to overcome, including issues of cost, emissions allocations, offsets, international competition and more.
More uncertain are the measures that will more explicitly address energy sources, such as the establishment of incentives to promote a smart grid, a $1 billion fund to promote carbon capture and storage, a low carbon fuel standard, and a national renewable energy portfolio. Beyond carbon pricing, many of these strategies would help to push renewables into the market. But how can we ensure that the right, and not just the cheapest, renewable energy sources are developed?
Congress has reached the finish line on their first major challenge of the year, passing the $838 billion stimulus plan, and has done fairly well at upholding the integrity of the green ambitions for the plan of the Obama administration. But in a few months time, the would-be architects of Chu’s energy revolution may look back on this merely as spring training. Needless to say, as plans unfold, we will be keeping a close eye on the score and the stats.
For a sneak peek at the some of the ones to watch, check out the Environmental Defense Fund’s Operation: Climate Vote.