The rollout of the Green New Deal will hit some roadblocks. But its overarching theme is that the nation should go totally green by 2030 to avert the irreversible effects of climate change. It‚Äôs the latest volley in the war of energy ideas ‚ÄĒ one that must ultimately address jobs, the economy and cost.
President Obama‚Äôs New Energy Economy is just a prelude to this concept. In 2008, modern energy technologies had promise but they remained nascent and required public support to get them into the game. Wind and solar energy are now major players as a result ‚ÄĒ bipartisan efforts that have become economic drivers across America. Indeed, wind and solar energies are becoming cost-competitive in their own right and only need battery storage to change the entire electricity paradigm.
But Obama‚Äôs stimulus was just Phase One. Phase Two sets out to speed up the current green wave by investing more in wind and solar technologies, electric-vehicles, energy efficiency, public transportation and smart grids that make more room for green electrons. The projects, meanwhile, would go into at-risk communities as well as those that are now dependent on coal.
‚ÄúIf we lay the groundwork now, we can build toward post-Trump enactment of a new economic vision — a federal Green New Deal that mirrors the policy victories we‚Äôre starting to see at the state level,‚ÄĚ says the Sierra Club. ‚ÄúA nationwide ‚Äėdeal‚Äô that wields the economic levers of government ‚Ä¶ to train workers and help communities to build climate-resilient roads, remove lead from drinking water, and expand our clean-energy grid.‚ÄĚ
Given the name of the endeavor, one can‚Äôt help but harken back to when the New Deal was created in the 1930s ‚ÄĒ a proposition that seeks to provide safety nets to Americans in times of personal crisis. Along those lines, the Green New Deal is a concept that could undoubtedly evolve and be shaped to conform to the times.
But it must first become politically viable. And right now, that‚Äôs not possible for a number of reasons: the U.S. president is a climate skeptic while the U.S. Senate is controlled by members who are dubious of the cost. According to the American Action Forum, the proposal would likely require at least $1 trillion in new regulatory costs.
‚ÄúWhile largely nebulous,‚ÄĚ the American Action Forum says, ‚Äúthe plan generally calls for the federal government to make large investments, impose strict mandates, and establish new guarantees…,” all to help the United States achieve major reductions in greenhouse gas emissions, improve the economy and provide jobs to dislocated communities.¬†¬†
Cost of Inaction
The Green New Deal is not an ‚Äúabstract‚ÄĚ idea. Globally economies are trending toward cleaner energies ‚ÄĒ efforts initiated by public demands, improved technologies and forward-thinking policies: The sponsors are compelled to accelerate the pace ‚ÄĒ to not just help impoverished communities but to also prevent environmental catastrophe.
Think this wild-eyed? Think again. Wind costs have fallen by 67% since 2009 while utility-scale solar has dropped by 86% since that time, according to the financial adviser,¬†Lazard.¬†Prudence has been a virtue. But what green energy skeptics have learned is that the public incentives and the overall economics are adding up ‚ÄĒ progress that will only go forward, given that prices continue to fall while the quality continues to improve.
‚ÄúPeople have opinions about the economics of green energy investments based on a set of facts that are five years old,‚ÄĚ says Trip Miller, managing partner at Gullane Capital Partners, in an interview. ‚ÄúAnd if you extrapolate out, we will get to the point where these energy forms just need battery technologies before they become pervasive.‚ÄĚ Batteries store electrons and then insert them on to the grid when needed ‚ÄĒ a technology that is also getting better and cheaper.
It‚Äôs not theoretical, adds Austin Vincent, an analyst with the same firm. Utilities such as Berkshire Hathaway, Xcel Energy and NextEra are betting heavily on wind and solar. The demand is so great, he says, that U.S.-based First Solar has a backlog of 11,000 megawatts. If a Green New Deal passes, he adds that the utility-scale solar panel maker would become a global powerhouse, fulfilling energy needs in the United States and abroad.
Getting to 100% renewable energy levels is a hard task under the best of circumstances. Step one, though, is to bring down the cost of energy storage. Once advanced batteries can be produced in sufficient quantities, the cost of manufacturing them will fall. Prices, in fact, are dropping because companies like Tesla Inc. have been investing billions into production facilities.
‚ÄúUltimately, we see this as a national change in how electricity is generated and consumed,‚ÄĚ says James Mandel, an analyst with the Rocky Mountain Institute, in a prior talk with this writer. ‚ÄúIt will be cleaner and distributed. The time frame changes, however, based on location. In some places with access to cheap and reliable electricity, the transition will be slower. But coal costs are increasing while green energy costs are continuing to decline. We feel good about this evolution.‚ÄĚ
The Green New Deal is not radical idea ‚ÄĒ just one that aims to accelerate an existing trend. While the wheels of the free market are already in motion, such forces may be too slow to stave off the ill-effects of global warming. It is a question now of cost ‚ÄĒ one that the ‚Äėdeal‚Äôs‚Äô supporters have answered by saying the ‚Äúcost of inaction‚ÄĚ is even greater.