(Alternative energy – continued from Part 1)
As we said at the start, alternative energy has never had an easy path.
As summer wound down, gasoline prices began dropping, eroding public awareness of the need to conserve energy. Then, in the fall, came the wave of seismic mortgage/investment/credit rumbles that shook the American economy, ended John McCain’s presidential hopes, and flattened hundreds of thousands of Americans’ retirement plans and a still-growing number of jobs, too.
The combination of sinking oil prices and our deepening economic crisis threatens to sidetrack many promising alternative-energy plans.
“Emerging technology and other long-range investments are often the first to suffer when the economy turns,” Frank Felder, director of the Center for Energy, Economic & Environmental Policy at Rutgers University, told New Jersey Herald News reporter Scott Fallon for his Nov 26 story Renewable energy hitting a snag.
“If it’s harder to get capital, then those [green] projects won’t be a priority for either business or consumers,” Felder said. Executives at Garden State Offshore Energy told Fallon they would probably have a hard time securing the $1.1 billion needed to build New Jersey’s first 96 wind turbines, as environmental studies and regulatory hurdles will push off a huge capital expenditure by 18 months.
“Hopefully by then the credit markets will be in better shape,” said Paul Rosengren, a spokesman for Newark-based Public Service Enterprise Group, a partner in Garden State Offshore Energy. “It would probably inhibit us if we were in the construction phase today.”
With the success of alternative energy industries and jobs tied to government subsidies and tax breaks, the industry’s future may be particularly cloudy in New Jersey where state revenues recently fell behind in all three major funding sources – income taxes, business taxes and property taxes.
The state was forced last July to freeze its hiring, provide early-retirement incentives to trim its workforce and eliminate numerous funding projects to balance its 2008 fiscal-year budget. Next year looks even worse, with Corzine predicting a $4 billion deficit and others claiming it may be far worse.
Blue States New Jersey and Pennsylvania have been counting on President-elect Barack Obama to provide the help they’ll need to sustain their renewable-energy-stimulation programs. They can expect a sympathetic reception from the incoming president who, during his campaign, promoted the notion that a $150 billion investment in energy efficiency–everything from wind turbines to a “smart” electrical grid–would not only help to ween America off foreign oil but also would create five million new jobs to boost the economy.
But where will the $150 billion come from? In recent weeks, as the nation’s economic crisis appears to have deepened, the federal government has been called upon to bankroll the bale-outs of everything from Wall Street investment firms to mortgage banks, to American auto manufacturers.
And critics already are questioning whether Obama’s projected new energy job creation figures are supportable (Does green energy add 5 million jobs?)
Decisions made by the president and Congress in the early months of 2009 will be crucial. They’ll set the course for the next four years and may determine whether the story of renewable energy will be one of opportunities simply delayed or again denied.
MORE:
New Jersey leaders foresee job growth in fields of ‘green’
Can Obama’s Stimulus Plan Spur Green Jobs in the U.S.?
Gas Pains: Cheap Natural Gas Is Great–Except for Clean Energy
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