Election politics portend painful cutbacks.
Whether it deserves it or not, the solar energy industry can’t count on continued government largess, thanks in part to the Solyndra mess. But in the end, Solyndra’s demise might be exactly what the industry needs to wean itself off heavy subsidies and become a mainstream resource.
Customers won’t join the team unless utilities make it worthwhile.
Are utilities ready to really engage customers, and get them to care about more than just whether the beer stays cold? Or will we turn our focus away from customers, because we don’t know how to engage them — or how to convert engagement into value?
Many utilities have trimmed their capital spending in the face of economic weakness and regulatory uncertainty. At the same time, strong energy sales have boosted cash flow and profits. Backed by regulated returns and clear resource plans, the industry should step up infrastructure investments. Are we ready to lead America out of economic malaise?
Does slow and steady still win the race?
When a capital-intensive industry enters an asset-building cycle, many companies will operate in the red for a few years or more. That’s not necessarily a bad thing, as cap-ex investments represent growth for shareholders. The devil is in the details, however, and companies facing a large slug of environmental compliance investments might produce disappointing returns over the next few years.
A senator’s crusade limits America’s options.
Oklahoma Sen. James Inhofe has made it his mission to block environmental regulations, especially greenhouse gas constraints. His most recent attack targets John Bryson, former Edison International CEO and Pres. Barack Obama’s nominee for Commerce Secretary. But rather than protecting economic interests, as Inhofe purportedly aims to do, his actions have added to the ongoing policy chaos that frustrates clean coal development.
Weighing green energy’s costs and benefits.
Policies aimed at promoting one good thing can diminish a better thing, for a net loss to the overall public welfare. Raising prices to promote renewables, for example, makes electricity less affordable and hurts the economy. But artificially low prices can themselves create social ills — by preserving an unsustainable status quo.
Telecom-style revolution is beyond our reach.
In the information age, big growth doesn’t come from putting steel in the ground; it comes from innovating and creating value. But if electricity customers care only about reliability and price, how can utilities create real value that didn’t exist before?
Only the fittest solutions survive in America’s policy wilderness.
All things being equal, momentous events like the Fukushima nuclear disaster and the Arab spring would bring fundamental changes in U.S. energy policy. But things aren’t equal, and they never will be under America’s democratic and capitalistic process. Frustrating? Maybe, but it’s the only way to ensure our decisions are based on sound economic and environmental principles.
Life, death and nuclear fallout.
Because we can’t define the consequences of nuclear accidents — and because radioactivity is invisible and undetectable without a Geiger counter — nuclear power’s risks are like shadowy monsters of unknown proportions, inspiring irrational fear. But that’s no excuse for complacency. Learning the lessons of Fukushima-Daiichi requires first acknowledging that we might have overestimated our ability to manage nuclear risks.
Utility-scale projects suffer growing pains.
Anyone who’s been watching the solar power industry for more than a few years can’t help but be impressed by the recent explosion of large-scale projects. It seems akin to the rapid scale-up of wind in the late 1990s and early 2000s—when megawatt-scale turbines became standard-issue, and the definition of a “large” wind farm changed from a capacity of 20 MW to something more like 200 MW.