State Of The Union Address Calls For Comprehensive Energy Approach

SI Staff
Written by Jessica Lillian
on January 25, 2012 No Comments
Categories : Policy Watch

Although President Barack Obama's Jan. 24 State of the Union address contained only a singular mention of solar energy, he reiterated his commitment to expanding clean energy project development in the U.S. and ending subsidies to fossil-fuel companies.

‘We've subsidized oil companies for a century,’ Obama said. ‘That's long enough. It's time to end the taxpayer giveaways to an industry that rarely has been more profitable, and double down on a clean energy industry that never has been more promising. Pass clean energy tax credits.’

In a follow-up proposal posted online by the White House, Obama specifically called for a temporary extension of the Advanced Energy Manufacturing Tax Credit as part of a broader manufacturing tax-reform proposal. This $5 billion investment would drive nearly $20 billion in domestic clean energy manufacturing, the White House said. The tax credit was previously oversubscribed more than three times over.

During his address, acknowledging that Congress' partisan divide may prevent broad action on climate change, the president nonetheless urged Congress to set a national clean energy standard. However, he made no mention of the 80% by 2035 clean energy standard that he introduced in last year's State of the Union.

Much of Obama's energy-independence discussion centered on increased exploration of domestic oil and natural-gas resources, as he advocated for the ‘all of the above’ energy approach that has been frequently espoused by more-conservative policymakers. He noted that the same public-private partnerships used in the natural-gas sector may also be applicable to renewable energy investment.

‘Some technologies don't pan out; some companies fail,’ Obama added, making what may be interpreted as a reference to failed PV module manufacturer Solyndra. The company and its U.S. Department of Energy loan guarantee have been a source of continuing political controversy for the Obama administration.

‘But I will not walk away from the promise of clean energy,’ he continued. ‘I will not cede the wind or solar or battery industry to China or Germany because we refuse to make the same commitment here.’

‘The president is right,’ said Rhone Resch, president and CEO of the Solar Energy Industries Association (SEIA), in a statement. ‘We need to create jobs, grow our economy and increase American competitiveness.’ He noted that the U.S. solar sector, totaling more than 5,600 companies, now employs more than 100,000 U.S. workers – twice the number in 2009.

Global competitiveness in clean energy – and beyond – also requires an increased emphasis on ensuring fair trade policies, Obama said. To that end, a newly created Trade Enforcement unit will investigate cases of unfair trading practices.

‘I will not stand by when our competitors don't play by the rules,’ he stated. ‘We've brought trade cases against China at nearly twice the rate as the last administration, and it's made a difference. It's not fair when foreign manufacturers have a leg up on ours only because they're heavily subsidized.’

Given these comments, the possibility of an administrative settlement in SolarWorld's ongoing anti-dumping complaint and countervailing-duty petition against China is unlikely, according to a research note from Jefferies & Co. Analysts called this development a ‘negative for Chinese solar companies.’

Finally, Obama called for ‘the development of clean energy on enough public land to power 3 million homes,’ as well as a partnership with the Department of Defense to purchase significant amounts of renewable energy capacity. The amount of solar energy that may be included in those initiatives has not yet been announced.

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