08/25/2014 08:50 am ET | Updated Oct 25, 2014

Solar Could Grow Faster if We Had a Functioning Federal Government

It is obvious that the United States federal government is struggling to perform basic governance functions and, as I wrote earlier this summer, it is incapable of leading the transition to a renewable economy. Nevertheless, one of the key elements of that transition, the adoption of solar power, is well underway in the U.S. According to a new report by John Rogers and Laura Wisland, published by the Union of Concerned Scientists:

Solar is undergoing widespread and rapid growth in the
United States... The amount of solar PV installed in the United States
grew by 485 percent from 2010 to 2013...Solar accounted for an average of 16 percent of electricity capacity installed annually in the United States from 2011 to 2013, and almost 30 percent in 2013.

They note that the price of solar systems has dropped by over 50% since 2007, and that as local government permitting processes become streamlined and as financing options grow, household solar installations are becoming more feasible.

There are a variety of obstacles to more rapid adoption of solar power. Federal, state and local tax treatment of solar varies by jurisdiction. Incentives are unpredictably phased in and phased out. The absence of smart grid technology and feed-in tariffs makes it difficult to integrate home excess solar power into the grid; utilities know how to send you energy, but they don't know how to take it back.

What is needed is a well thought through, comprehensive renewable energy program with national standards, serious funding for research and development, and clear, predictable incentives for adoption of solar power and other renewable energy technologies. This is far from realistic under the Obama White House and the Tea Party-influenced congress. The president is pursuing a meaningless "all-of-the-above" energy non-strategy and will not push renewables too hard, and the congress does not believe that government has a role to play in promoting renewable energy development and use.

One good piece of news about declining solar energy costs is that the time it will take to amortize a solar installation is coming down. If energy savings fund the cost of a solar array and the amount being saved is growing, the risk of investment is being reduced. Solar installations will pay off faster, even under current conditions. Fortunately, if you invest in today's technology and the payback period is ten years or so, you run little risk of wasting your money.

While the overall contribution of solar energy to national energy use is quite low, the potential of solar energy is quite high. For a few days this past summer, Germany generated over 50% of its electricity from solar energy. In the U.S., it will take a long time for solar energy to reach Germany's levels. While our pace might be called "slow, but increasing rapidly," Europe and China are moving quickly to add solar energy to their power mix. In this country we see similar movement in California. These examples provide an indication of how rapidly renewable energy can be adopted when government policy provides the push that is needed.

The United States presents both enormous potential and persistent problems in pushing solar energy. The potential is in our research universities and creative, entrepreneurial culture. The computer and smart phone industry was built on a partnership between government-funded basic research and creative use of off-the-shelf technology by companies like Apple, IBM, Dell, HP and Microsoft. Research funded by the Defense Department, NOAA, NASA, and the National Science Foundation has built enormous capacity in university-based research institutions. When coupled with our government's national laboratories and the applied research undertaken by the private sector, we have benefited from a nearly continuous stream of new technologies and new products generated by new industries. As I often argue, that same drive needs to be applied to renewable energy technology. If mobilized effectively, we have the potential to generate transformative technologies in renewable energy.

Unfortunately, we suffer from the persistent problem of our pay-to-play politics. The fossil fuel industry is not blind to the threat that renewable energy poses to their core business. At risk are billions of dollars invested in the technology and infrastructure of fossil fuel extraction, transport and use. At the very moment we need a determined national policy to promote renewable energy, the elected officials who might lead such an effort are in an endless competition for more and more campaign cash. Instead of investing in new solar technologies, fossil fuel companies are investing in politicians who will vote to inhibit the development of these technologies. So far they are succeeding. The "all-of-the-above" energy non-strategy is an example of the fossil fuel industry's success. It is not yet politically feasible for an American president to take a position to aggressively push for the replacement of fossil fuels. The best we could get is an argument to develop every form of energy possible. Apparently, the hope is that somehow, enough alternative energy will make it through the mix to enable renewables to take hold.

American leadership would surely speed the transition to a renewable economy. But America's absence will not prevent that transition. There will eventually be an Apple-Google-Microsoft-Amazon-like company selling us household solar energy technologies. Note that Apple, Amazon, Google and Microsoft are all American companies that went global in the world economy. The energy technology companies of the future may be home grown or they may come out of Europe, Latin America, or Asia. The need for low-cost and reliable energy is only going to grow. The planet's need for a less destructive form of energy supply is urgent and is also growing. Engineers and businesspeople all over the world see the demand and are working to figure out a way to generate supply. In a global economy, the old line fossil fuel companies will not be able to prevent the diffusion of new technology once it is developed. Ask Kodak what happens to companies that do not change their strategies to reflect emerging technologies.

I should note that I am not in favor of taxing fossil fuels and having government raise the price of energy, but rather support increased funding in the research and development of alternative forms of energy. I also support using the tax and regulatory system to encourage the installation of available renewable energy technology. While of course the government could stop subsidizing fossil fuels, I consider that more of an artifact of a bygone age than a major impediment to the transition to renewable energy. The goal is to lower the price and convenience of renewables and make fossil fuels irrelevant.

In order of priority I think the U.S. Federal government should pursue an energy policy with these elements:
  1. Massive funding for research on the basic science and applied engineering of solar cells and battery technology. Significant but lesser amounts of funding should be allocated to other safe forms of energy generation and storage.
  2. Tax credits and regulations to require increased energy efficiency in buildings, appliances and transportation.
  3. Tax credits and regulations to encourage the installation of solar, wind, geothermal and similar forms of energy. Higher credits should be provided when current levels of fossil fuel use are reduced.
  4. A federal grant-in-aid program similar to the highway trust fund to help localities build smart grids, integrated into a national system. The funding for the program would come from a new federal tax on electricity. Feed-in tariffs would be required of state utility commissions in order to receive smart-grid grants.

I am certain there are other policies that can be pursued--these are just the ones I think would be most useful. As Rogers and Wisland found, solar power is on the rise in the U.S. even in the face of indifference from the federal government. Their piece reports overwhelming public support for solar energy and highlights the potential for increased adoption of current technology.

I agree that it is a good idea to push the technology we have, but strongly believe that what we have now is not good enough. The original cellphones were the size of a loaf of bread and look a little silly in retrospect. My hope is that the solar cells of the future will make rooftop arrays look quaint. We need to invest money and brainpower in the search for a transformative energy technology. I think the most rapid path to develop that technology requires the U.S. federal government--but it can be done without it. Even a slow boat can eventually reach the shore.