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What should the country do to prevent the green technology bubble from bursting?
- Categories:Industry Information
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- Time of issue:2012-04-25 16:36
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(Summary description)We have all witnessed such a change: the US federal government has spent billions of dollars to vigorously promote renewable energy and green technology, and after a few years, once the political focus shifts and the market turns, these projects are ignored and left to their own feet. Self-destruct.
What should the country do to prevent the green technology bubble from bursting?
(Summary description)We have all witnessed such a change: the US federal government has spent billions of dollars to vigorously promote renewable energy and green technology, and after a few years, once the political focus shifts and the market turns, these projects are ignored and left to their own feet. Self-destruct.
- Categories:Industry Information
- Author:
- Origin:
- Time of issue:2012-04-25 16:36
- Views:
Information
We have all witnessed such a change: the US federal government has spent billions of dollars to vigorously promote renewable energy and green technology, and after a few years, once the political focus shifts and the market turns, these projects are ignored and left to their own feet. Self-destruct.
Now, history repeats itself again.
Last Wednesday, a report jointly released by three think tanks, the Breakthrough Institute, the Brookings Institution and the World Resources Institute, showed that as the The key subsidies issued for the development of green technologies such as power plants and electric vehicles have expired. By 2014, the federal government's investment in green technologies will drop from a high of US$44.3 billion in 2009 to US$11 billion.
"In the absence of major and timely energy policy reforms, the recent boom in the clean technology industry that the United States has experienced may usher in difficulties," the authors of the report "Beyond Boom and Bust" (Beyond Boom and Bust) He wrote, “Several industries may face more bankruptcies, mergers, and market shrinking in the future.” This report studied 92 federal green high-tech policies and projects.
The report also stated that the positive side is that the federal government can use this opportunity to completely reform the way in which clean energy is promoted, making policy support and the technologies it funded more sustainable.
But there is a big problem: Nearly 70% of federal green high-tech projects and expenditures are temporary, which will inevitably lead to a boom and bust cycle: Initially, investors flocked for incentive funds and tax incentives. Once the policy expires , Then immediately stepped aside.
For example, a production tax credit for the wind power industry has experienced three invalidations and seven extensions since it became effective in 1992 (decisions are often made at the last minute). At the end of 2012, this policy will expire again. Some analysts predict that the installed capacity of wind power in the United States will drop from 8-10.5 MW in 2012 to 1.5-2 MW in 2013, and this will also lead to the entire Loss of employment in the industry.
"Most of the US policy support for clean energy technology has always been unstable and temporary, and the fate of policy expiration or total limit is engraved in the project from the beginning." The authors wrote in the report.
The report pointed out that, to make matters worse, the focus is on making wind farms, solar power plants and other renewable? ? Instead of promoting the development of innovative technologies, energy facilities are connected to the grid for power generation, so that they can eventually meet market demand without relying on subsidies.
"Unfortunately, today's clean technology deployment policies are usually similar to agricultural support policies, that is, providing uniform production subsidies to any clean energy, rather than providing steady technological progress like the strict military procurement policy, and ultimately bringing The massive popularization of radios, chips, jet engines, gas turbines, lasers, and computers," said the authors.
They wrote that the solution is to establish independent projects to avoid political farce like Solyndra, while focusing on long-term strategy. The report advocates the establishment of a "Clean Energy Deployment Administration" "using private financing to support clean energy entrepreneurs through various investment, credit, and insurance tools, and accelerate the commercialization of the most innovative advanced energy technology companies." ."
The goal is to avoid permanent subsidy programs, like those enjoyed by large oil companies, and to invest more resources in research and development. Of the US$150 billion planned for green high-tech projects from 2009 to 2014, only 28.1 billion yuan was allocated to R&D projects.
“The expiration and extension of policies continue to repeat itself. This normalized approach is no longer sustainable,” the report concluded. “However, it is not beneficial for the country to stop the issuance of clean technology subsidies immediately. Supporting development is cost-competitive and feasible. The large-scale application of a new combination of clean energy technologies can create significant opportunities for enhancing U.S. energy security, exporting new technology products, and improving public health."
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