THE WHITE HOUSE NEW ENERGY MEMO

Solar, Wind Companies Predict Projects Will Slow If U.S. Eliminates Grants
Jim Snyder and Jim Efstathiou, Jr., November 4, 2010 (Bloomberg News)

"Solar, wind, geothermal and biomass power companies predict a slowdown in renewable-energy projects if Congress fails to extend a [Treasury Department grant program that has awarded more than $5.4 billion to 1,387 renewable-energy projects by letting solar, wind and renewable projects that would be eligible for production and investment tax credits instead seek a one-time grant covering 30 percent of costs] during its post-election session.

"The American Wind Energy Association, the Solar Energy Industries Association, the Biomass Power Association and the Geothermal Energy Association sent letters on Nov. 2 to lawmakers, pressing to extend the program that expires next month. The groups are acting before Republicans take control of the House next year after campaigning on a pledge to lower the federal deficit."

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"The industry organizations said the credits, which are part of the stimulus package, saved or created tens of thousands of U.S. jobs…[A White House memo, written by National Economic Council Director Lawrence Summers, special adviser on energy and environment Carol Browner, and Vice President Joe Biden’s chief of staff, Ron Klain, recommended that President Barack Obama ask Congress to redirect $2.5 billion in loan guarantee funds to extend the grants because they have been more effective] in promoting renewable energy…

"Letting the grants expire will lead to a “significant slowdown in the renewable-energy industries, resulting in the loss of jobs and further transfer of clean-energy leadership to other countries,” the groups wrote to congressional leaders…Legislation to extend the grants has been introduced in Congress and may be tied to the debate over extending tax breaks enacted during the Bush administration, which are to end this year…"

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"The renewable-energy groups cited a Lawrence Berkeley National Laboratory study from 2009 that found the grant program saved more than 55,000 jobs in the wind-energy industry…The Solar Foundation…reported 93,000 employees in the industry, double the number estimated for 2009. The groups credited the grants for the increase…The Treasury grants were added to the stimulus program at the behest of renewable-energy companies that said investment tax credits were failing to entice investors during the recession.

"The White House memo said 2009 was the best year for the wind industry. Developers installed 10,000 megawatts of power that year. The Lawrence Berkley report said one-third of that capacity wouldn’t have been built without the grants…U.S. wind-energy growth…[is now at] the slowest pace of growth since 2007…Renewable-energy companies also may have a more difficult time next year seeking support for the program when Republicans control the House…[S]ubsidies for renewable projects will face greater scrutiny…"