Renewable Energy Lessons for the U.S.

My interest in alternative energy technologies was sparked by an eye-opening trip to India with my family nearly seven years ago. At first, I was just upset about having to sit in 110 degree heat without air conditioning because the power was out (the local utility had instituted a program of “load shedding,” whereby it intentionally shut off power to certain districts and neighborhoods over the course of the day in order to curb skyrocketing electricity demand). However, over the past several years, as I see such problems grow worse via my annual summer trips to India, I have begun to develop a more nuanced understanding of the relationship between energy availability and economic development in one of the world’s fastest growing economies. I quickly realized that gasoline in India is several times more expensive than gasoline in the United States, so that it is often the biggest obstacle to owning a car. State governments in India schedule power cuts everyday in an effort to conserve limited fossil fuel supplies. The price of electricity is so high that energy conservation is not the product of a guilty social conscience, but a necessity to keep the utility bills manageable. And this paltry list of symptoms is just the tip of the iceberg in regards to the malaise that is pervasive in India’s energy industry.

But there is some good news. If you look at the energy policies of nations around the world, you will notice that even though countries differ dramatically in their approaches to energy policy, there seems to be one idea that many (albeit in differing degrees) have subscribed to: diversifying their energy supply portfolios to include more than just traditional fossil fuels like oil and gas. Countries around the world, including India, have finally begun to make progress in finding solutions to the energy crisis that has become a very palpable obstacle to economic growth.

They understand that as fossil fuel resources are depleted and energy prices subsequently rise; as the prospect of global climate change threatens land use patterns, strains the adequacy of our food production capabilities, and places a disproportionate adaptation burden on the populations of developing countries; as an ever increasing global population and burgeoning middle class demand cheaper  and more abundant energy supplies, it will become ever more critical that we develop a viable long-term solution to the current energy crisis. Though perceptions of scientific uncertainty plague discussions of climate change, estimates of future fossil reserves are highly variable, and the entire debate regarding energy policy has become radically polarized, one thing is certain: The laws of supply and demand ensure that fossil fuel based energy will continue to get more expensive in years to come. Hence, regardless of whether the public reaches consensus on climate change theories, basic economics urges immediate global action in regards to energy supply, if for no other reason than to keep energy prices down (nobody likes paying $4 for a gallon of gas). Luckily, as technological improvements decrease the expense of alternative energy technologies, bringing them closer to cost parity with traditional fossil fuels, many of the aforementioned problems could be mitigated in the long-term by increasing the penetration of resources like wind, solar, biomass, geothermal, and nuclear.

Because other nations have already made significant strides towards implementing policies that benefit technology development, manufacturing, and demand creation for clean energy, there exists great potential for the United States to learn from and adapt such policies for domestic implementation. Germany’s feed in tariff has quickly catalyzed (though, admittedly, with its fair share of difficulties) the solar and wind industry so that renewables now supply almost 10 percent of Germany’s energy needs and Germany has the world’s highest installed capacity of solar. The United Kingdom has an aggressive policy portfolio in place that uses a mix of energy taxes, feed in tariffs, and renewable energy credits to help the country meet not only its domestic renewable energy and energy efficiency targets, but also the European Union mandates. India has instituted an innovative energy efficiency credit trading scheme, and is working diligently to improve its somewhat overambitious and confusing portfolio of renewable energy policies. Brazil, thanks to its unparalleled hydro and sugarcane resource, meets almost 90 percent of its energy needs with renewables and is especially leading the way in affordable biofuels development. And even South Korea–a relative newcomer in the renewable energy race–is pushing hard to establish a Renewable Portfolio Standard and a cap and trade program within the next five years.

Despite seeing the positive strides taken by other countries, the United States has been uncharacteristically slow to follow suit. In recent years, China has moved past the United States in total installed wind capacity, while Germany leads the world in solar. While we can, and should, applaud the efforts made by these countries, their rapid growth poses a potential problem for the United States. If we don’t regain the lead in the clean energy arena, rather than being a boon for domestic manufacturing and a solution to our over-dependence on foreign fuels, renewable energy technologies will become another foreign obligation that will strain budgets and require massive international military engagements exactly like the ones we bemoan today.

Originally published by The Crimson

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