Clean-Energy Corporate Leverage

Now that many multi-national corporations have made a commitment to get into the clean energy business, they may be able to have some leverage over government programs and subsidies. This could be reminiscent of the leverage Big Oil has held over government subsidies. If the government doesn't cooperate, then they use their leverage. That is, they just take there business elsewhere, to a country which will give them the subsidies they want to develop clean energy technologies.

Below is a story of what GE is doing now to lobby congress to renew the Clean-Energy credits.


September 12, 2008, 2:25 pm
Industry to Congress: Renew the Expiring Clean-Energy Credits

Posted by Keith Johnson

The U.S. Congress may be “out of gas” when it comes to drafting an energy policy, as the Washington Post edit page moans, but General Electric’s John Krinicki doesn’t mind giving legislators a push.



He only had to battle giants, not the Senate (Wikipedia)

The head of GE Energy, the conglomerate’s unit that makes everything from wind turbines to nuclear reactors, flew down to Washington again today to plead with senators to extend tax credits for renewable energy. The credits, still crucial to making clean energy competitive, are set to expire at the end of the year, despite at least eight tries so far to renew them. That threatens to slam the brakes on two gangbuster years for American wind and solar power.

“I’m prepared to come down every week to say the same thing,” he told us. “If the production tax credit expires in the U.S., the wind industry will collapse. As the clock ticks, you put jobs at risk.”

Mr. Krinicki’s testimony is part of a broader Senate look today at America’s energy future. Among the heavyweights also on parade: Rick Waggoner, CEO of General Motors; Marvin Odum, the president of Shell Oil; Gary Cohn, co-president of Goldman Sachs; Dan Yergin of Cambridge Energy Research Associates; and Dan Reicher, Google’s clean-energy guru.

Mr. Krinicki thinks his clean-energy arguments will find a more receptive audience in the Senate than when he made identical pleas more than a year ago. The real problem isn’t support for clean energy per se, he says, but the messy politics that makes it tough to renew the credits.

And he says the beauty of jumpstarting clean-tech with the tax credits is that it doesn’t require inventing a whole new energy policy—just renewing an existing one.

So what happens if Congress doesn’t renew clean-energy subsidies?

“If the U.S.government is not going to be reliable and predictable [on clean-energy policy], we’ll go to Germany and China,” he says, pointing to countries that have long-term, aggressive plans in place to promote clean energy. China could pass the U.S. next year to become the second-biggest wind-power country, after Germany.

Mr. Krinicki’s GE boss Jeff Immelt said something similar earlier this year, threatening to sell clean-tech equipment to countries like Turkey if the U.S. doesn’t fix its “hellish” energy policy. Still, foreign companies are still flocking to the U.S. market—GE rival Siemens just announced it will build a new wind-turbine factory in the U.S., even with the subsidy question still up in the air.

Will this Congress renew the tax credits at the buzzer? Or have two years of world-beating renewable-energy growth taken away any sense of urgency?

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