At the height of oil prices and in the middle of the presidential election a little over a year ago, T. Boone Pickens, a Texas Oilman, unveiled his plan to ween America off of foreign oil by transitioning to natural gas and wind energy. One year later in the midst of a global recession that has the whole alternative energy industry struggling to get off the ground, Pickens has shelved his plan to build the U.S.’ largest wind energy farm in Pampa, TX, but he hasn’t given up the cause.
Citing the ongoing credit crunch and falling natural gas prices, Pickens and his alternative energy company, Mesa Power, were unable to get the funding to build the transmission lines needed to connect the wind farm to the electricity grid. Despite this Picken’s is still bullish on wind as Mesa is looking for other project to use the $2 billion lot of wind turbines that were already on order for the Pampa project. In an interview with ABC’s Chris Cuomo, Pickens acknowledges that the recession has hurt the transition but claims his $60 million media campaign has helped advance alternative energy a great deal citing the legislation before congress.
The question remains, in this recession, where is the money going to come from? In an article in the Washington Post on Saturday, they reported that Bluewater Wind has had great success winning offshore wind leases and forging agreements to sell their energy, yet their funding fell through as…
“[I]ts parent company, Australian investment firm Babcock & Brown, has buckled under the weight of the global economic downturn and is selling off its assets to reduce debt.”
Bluewater, President Peter Mandelstam isn’t giving up either.
“I’ve been in business long enough to understand that sometimes companies fail,” Mandelstam said. “I’m not disappointed, it’s simply business. One meets a new challenge, and one overcomes it. I’ve raised capital before, and I’m raising capital again.”
Many in the industry are waiting anxiously for legislation to come down from capital hill. While the debate is contentious there’s still a lot of optimism among clean energy advocates inside the beltway. One thing is certain, however, there’s a lot of uncertainty in the alternative energy market at the moment.
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As important as alternative energy technologies are at this point in our history, it seems reasonable for the government to get involved. Instead of loan guarantees to automakers so they can build more inefficient cars that further our dependence on foreign sources of energy, how about a loan for Mesa to prove out the wind energy industry? The Carter Administration had a couple of examples of this – the Synfuels Corporation being one of them.
Aah yes, Carter’s famous “Malaise Speech.”
In terms of government investment spurring innovation and development of renewables, I’m all for it. But wasn’t the Synfuels Corp. a big disaster? (Not to mention the fact that it was/is an incredibly environmentally destructive fuel).
I think people like the idea of ownership and that’s why creating demand for cleanly produced energy needs to be given more thought and serious consideration. The example of a feed-in tariff is the first thing I think off the top of my head, but there are other examples that would immediately create growth in the sagging renewables energy. Politically, however, feed-ins are a tall order, to say the least.
I’m not comfortable with this idea of creating demand for cleaner energy. Yes, what energy we do produce we should produce in a cleaner way. But I worry that all this talk of producing clean energy is simply increasing the supply. Meanwhile, the idea of a clean energy utopia does not help dampen demand. I want alternative energy too, but not if it really adds up to more energy. It would be nice if new transmission lines were not in corporate hands like Pickens’ to begin with. Electricity is a public service – exactly the kind of thing government should be managing for the common good.
I agree, creating more supply does little to curb demand. But an advance in one should not be made at the expense of another. There is no reason we can’t create demand for small-scale distributed renewables and develop systems to reduce total demand.
Good points. There’s a lot that could be learned from that administration. Reminds me of this article on Twilight Earth today.