In the Clean Energy Poker Stakes, Obama Goes All-in
President Obama's "all-in" energy strategy might hasten America's continuing decline in the race to lead the world's clean energy market
During his State of the Union Address last week, President Obama urged Congress to stimulate the renewable energy sector and pass clean energy tax credits, saying, "I will not cede the wind or solar or battery industry to China or Germany because we refuse to make the same commitment here."
The president was referring to the decline in clean energy investments that the United States has experienced since losing the top spot to China in 2008. The United States has continued its steady decline, slipping to the third spot in 2010 as Germany surged to grab second place in what has become a three-horse race. China solidified its first-place rank in clean energy, attracting a record USD 54.4 billion in clean energy investments in 2010, followed by Germany, which doubled such investments to USD 41.2 billion, and the United States, which slipped to third place with USD 34 billion. Together, the three nations represent over half of the G-20 total of USD 113.4 billion.
MOVE OVER WIND, LET'S FRACK FOR GAS
In his address, Obama described the new energy policy as an "all-out, all-in, all-of-the-above strategy that develops every available source of American energy." Pitching the initiative at a United Parcel Service facility in Las Vegas last week, the president said that the United States has natural gas reserves that, if exploited, could power the country for a century. "We are the Saudi Arabia of natural gas," he said.
In an election year, Obama's "all-in" policy aims to appeal to a wider segment of the population; conservative and centrist voters are more willing to promote the growth of the nation's dirty fuel industries. Some Congressional Republicans even stand to make personal financial gains from the controversial Keystone XL pipeline. But part of America's decline in clean energy investment is tied to the massive subsidizing of the fossil fuel sector, and in particular the nation's increasing focus on the development of natural gas. "Low prices for natural gas, especially in the United States, undercut wind energy's competitive pricing with other fossil fuels," according to the 2010 Pew Charitable Trusts report, "Who's Winning the Clean Energy Race."
PLAYING DIRTY: HOW CLEAN IS NATURAL GAS?
And while Obama characterized natural gas as an energy source that was "relatively carbon-clean," environmentalists have been quite successful in convincing the public that extracting it through the process of hydraulic fracturing, or "hydrofracking" as it's commonly called, is a very dangerous process, with anti-fracking demonstrations being held across the country, including outside the White House. In June of last year, the French Senate voted to outlaw fracking, making France the first country to do so.
"Advocates for natural gas routinely assert that it produces 50 percent less greenhouse gases than coal and is a significant step toward a greener energy future," writes Abrahm Lustgarden on ProPublica. "But those assumptions are based on emissions from the tailpipe or smokestack and don't account for the methane and other pollution emitted when gas is extracted and piped to power plants and other customers." In 2006, for example, shallow groundwater was found to be contaminated with hydrocarbon compounds that were released by a gas well surrounded by a rural housing development in Clark County, Wyoming.
Just as Washington continues to subsidize the development dirty fuel, it may also hasten the nation's slide in renewable energy investment. Obama should also consider the fact that an "all-in" strategy is essentially a big gamble, and he's not just gambling with money, but with the environment. In poker, "all-in" means betting all your chips on the cards you're holding. If you don't have the strongest hand, you lose everything. For the communities living above the nation's natural gas deposits, those stakes are most likely too high. As Kenny Rogers famously sang, "You got to know when to hold 'em, know when to fold 'em."
Chart created with data from Investing in Clean Power. Pew Charitable Trusts. March 29, 2011.
Obama, Barack. State of the Union Address 2012. January 24, 2012.
Schoenmann, Joe. "Obama: 'We are the Saudi Arabia of natural gas'." Las Vegas Sun. January 29, 2012.
Pew Environment Trusts. Who's Winning the Clean Energy Race? G-20 Investment Powering Forward, 2010 Edition. March 29, 2011.
LeMonde with AFP. "Gaz de schiste: le Parlement interdit l'utilisation de la fracturation hydraulique." June 30, 2011.
Lustgarten, Abrahm. "Climate Benefits of Natural Gas May Be Overstated." ProPublica.org. January 25, 2012.
Brown, Valerie J. "Industry issues: Putting the Heat on Gas." Environmental Health Perspectives. February 2007.