Nine companies, consortia, or joint ventures are planning approximately 12 new nuclear power plants in the United States. How do the business challenges they face differ from the challenges faced...
A Beautiful Mess
Only the fittest solutions survive in America’s policy wilderness.
developing wind power a national priority? And if so, what’s our strategy for pursuing that priority?
The inconvenient truth is that we don’t have a national energy strategy, and we never have.
Virtually every time Congress enacts energy legislation, it basically continues the country’s longstanding grab-bag policy of encouraging efficiency and domestic resource growth. Congress extends tax incentives and grants to stimulate investments in wind power and other energy options. But the federal government has never attempted to devise and implement a long-term energy plan.
The closest we get to truly strategic policy is something like the Nuclear Waste Policy Act , which nationalized the responsibility for managing spent fuel from commercial reactors—a policy that can be described as a $10 billion failure (see “ Spent-Fuel Fedcorp ”). Or we get the FutureGen project, a white elephant that was born and died under the Bush administration, and now has been resurrected to demonstrate carbon capture and storage technologies that serve no commercial purpose in the absence of greenhouse gas regulation—which, incidentally, would be the most comprehensive national energy strategy we’ve ever had, if it weren’t a political dead letter.
Aside from such dubious legislative efforts, the closest we get to actual strategic, national policy goals are bully pulpit pronouncements, like those in President Obama’s recent state-of-the-union address, where he called for “80 percent of America’s electricity” to come from “clean energy sources” by the year 2035.
To be sure, such pronouncements tell us something about the administration’s priorities, as well as things like FERC’s demand-response compensation rule, which analyst Constantine Gonatas calls “covert policy” (see “ A Buyer’s Market ”). But priorities like this are in danger of being reversed when the political winds shift, as they always do. As such, they don’t represent strategy; they represent political ping pong.
What Would China Do?
The fact is, we don’t do energy strategy in this country. The whole idea of a national energy plan seems to conflict with our capitalist, pluralistic ideals. In short, it’s un-American.
By contrast, when China’s leaders decide the country needs a certain number of wind farms—or nuclear, coal or hydro plants for that matter—they set a goal, forge a plan, and make it so. That’s how China builds coal-fired power plants at the pace of two or three a week. And that’s how China overtook the United States in total installed wind capacity within the space of a few years (see “ Green Transition ,” Fig. 1) .
But while this central planning might be faster and easier than America’s laissez-faire approach, it’s also less democratic, largely disregarding the rights of local citizens who might not want a power plant in their backyards.
Arguably that might be a reasonable price to pay for getting steel in the ground efficiently and cost-effectively. But China is learning the hard way just how inefficient and ineffective central planning can be. In 2009, Beijing raised its 2020 wind power target from 40 GW to 60 GW, and delegated authority to local officials to approve projects smaller than 50 MW. The