Analyzing the global and national trends in renewable energy over the last decade, one sees tremendous growth, expansion and new markets opening up around the globe, particularly in Asia. Countries like China and India have burgeoning economies, and massive populations that will not be able to sustain themselves solely on energy derived from fossil fuels. Understanding this, governments of both countries are pouring sizable investments into renewable energy sources such as wind and solar power.
Additionally, due to cheap labor and infrastructure costs, subsidized government loans and government incentives companies in India and China see huge financial opportunities in developing renewable energy technologies and selling them on the global market at a very low cost. Thanks to Chinese manufacturers who flooded the global market with their cheap solar panels, the price for solar panels around the word dropped by almost 50%, making solar equipment alot more affordable and accessible to consumers everywhere, including the US.
Numbers speak for themselves: already in 2009, in terms of total investment in renewable energy China has overtaken US, and in 2011, it attracted more investment than any other country in the word ($52.2 billion). Similarly, in 2011, India experienced the fastest growing rate of any renewables market, with a 62% increase in capital funding. This explosive growth is Solar power in Asia, is not limited to just China and India though.
US government support for US renewable energy industry wavers
SEIA – US Solar industry is under attack (video):
President Obama has been an avid supporter of the domestic renewable energy industry, and during his term the industry has enjoyed unprecedented growth and development. In 2011 alone, the government has allotted $15 billion in subsidies to renewables industry In recent months Obama has been pushing Congress to suspend 2.5 billion annually allocated to the fossil fuel industry and redirect the funds into clean energy investments. However, this motion did not pass in the Republican controlled House of Representatives, who have a vested interest in subsidizing the fossil fuel industry and continuously oppose investments into clean energy initiatives.
The last two years have been rocky for the US solar industry. Despite many generous government subsidies, increasing competition from Asian counterparts and falling global demand with cheap solar panels, have caused many US solar manufacturers to go bankrupt, leading to factory close-outs and worker lay-offs. These events in a struggling economy have made policy makers very weary of further subsidizing the industry with precious tax payer dollars that seem to have better purpose in other venues. It is highly likely that the subsidies that are due to expire in 2013 will not be renewed, leaving many clean energy companies to fend for themselves in the highly competitive global market, going up against heavily subsidized companies from India and China.
US Presidential election hurting the reputation of domestic renewable energy industry
China and India take the lead in renewable energy investments
The upcoming Presidential election has turned the issue of clean energy and government subsidies into a highly polarizing political issue. Amid growing discontent with the sluggish economy, ballooning national debt , high unemployment rate, Obama and his administration have been blamed for wasteful spending on renewable energy, which has not lived up its golden promises of stimulating the economy and creating more jobs. At every opportunity, Republicans point to numerous bankruptcies amidst domestic solar manufacturers, including the already infamous Solyndra (and Uni-Solar) bankruptcy, which has become the poster child for Obama’s failure to appropriately allocate precious funds. Republican presidential candidate, Mitt Romney, has gone as far as accusing the president of not only wasteful spending, but also cronyism at the expense of American citizens. While Obama continues to stand strong and voices his support and pledges government commitment to clean energy investment if he will remain for the next term, the overall political climate in the US is not in favor of renewable energy.
Media bias against US renewable energy
Major media outlets in the US have not been helping in shaping a positive view of the renewable energy industry in the US. While green tech and clean energy publications and blogs remain very hopeful about the future of the industry, objectively discussing successes as well as challenges, their effect on the general public is minimal, as for the most part these outlets are preaching to the choir. On the other hand, the general public who either has no information at all, or very limited information about the renewable energy industry, is being fed a rather grim perspective that is in no way helpful to the industry’s long term growth and development. Authoritative media outlets such as New York Times, CNN, NBC , Washington Post and many others are full of stories detailing all the bankruptcies in the solar industry, the Solyndra scandal is making headlines in most major publications, the US tariffs war against Chinese solar manufacturers is a popular story that again talks about the struggling US manufacturers who need government help, etc. There is very little information about the benefits of renewable energy, the marvelous technological developments, the tremendous growth that the industry has experienced. Reading this information, the average American citizen will be highly unlikely to actively push for policy changes in favor of the renewable energy, and in worst case scenario will view investment and support of the industry as a waste of his hard-earned tax dollars.
The problem with this picture is that while we in the US may be having political fights over the viability of renewable energy, and curtailing government support, the reality is that serious economic powers, such as India and China, that sooner or later US will have to contend with ,are actively investing into renewable energy. Do we really want to be in the position where we will have to play catch up to these nations at best, and at worst become dependent on them for our renewable energy needs?
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