Clean Technology Transition (Photos – en.wikipedia.org & flickr, mattwalker69).
Can Trump Really Stop The Clean Technology Transition?
By Ethan Elkind
Michael Barnard at Clean Technica is bullish on global climate action, despite the Trump electoral college win last week:
There are multiple reasons for this, but it comes down to inertia and isolationism. International and internal US agreements are hard to unwind, often bipartisan, and won’t be focus areas. The economics of wind and solar are transforming generation globally. Electric vehicles have multiple value propositions besides climate change. The rest of the world and especially China aren’t going to stop, they’ll just pull ahead of the USA. And a military that stays home doesn’t burn nearly as much diesel and aviation fuel. There’s no reason to cheer for a Trump presidency if you care about the climate and the global economic impacts of climate change, but there’s less reason for gloom than most would think.
He also makes a similar argument that I made last week, that a likely economic downturn caused by Trump policies could slow emissions.
I’m less optimistic than Barnard about what Trump will do to the Paris accord, but his point about clean technologies is an important one. Have these technologies, like renewables and electric vehicles, reached the economic tipping point to be viable even without federal tax credits and other support?
I’m reading mixed things. Utility Dive reports on the optimistic case:
‘Our industry will be fine,’ Sunnova CEO John Berger told Utility Dive. Sunnova is one of the leading national rooftop solar providers. ‘Business models will change and the companies that can’t deliver a better service at a better price won’t make it.’
Losing its 30% federal investment tax credit (ITC) might even provoke constructive change, Berger said. ‘But with or without the ITC, this industry will thrive and that is because we are quickly driving down the cost of solar and solar components and now the cost of batteries is coming down as fast.’
And yet Greentech Media forecasts some major retrenching in the renewable industry, if Trump and his congressional allies kill federal support:
The tax credit was expected to support 25 gigawatts of additional solar installations — a 54 percent increase that amounted to $40 billion in new investment through 2020. By the time the ITC falls to 10 percent in 2020, GTM Research expects the industry to be adding 20 gigawatts of new capacity yearly. By comparison, 6 gigawatts of natural-gas power plant capacity were added in 2015.
Reversing those figures provides a rough estimate of what might happen to solar if the tax credit is cut. Installations could fall by roughly half.
As for electric vehicles, the tax credits will help determine if new models like the 238-mile range Chevy Bolt, to be released next year, will sell for $37K or $29K — a very big difference for most consumers. But at some point they are scheduled to be phased out anyway, so it could just be a short-term setback to the industry, particularly with California’s strong policies on zero-emission vehicles.
And of course, we don’t really know what Trump and congress will do. We know many Republicans favor renewables, but we also know that a revision of the tax code in general could be in the works. And the last time that happened in 1986, renewable tax credits disappeared. They’ll need to save money somewhere to pay for their tax cuts for upper-income earners.
So it will be a wait-and-see situation, but it’s cause for states like California to start thinking immediately about backup support at the state level, such as through fees on polluters to cover clean tech support. As on many issues related to this election, it’s time to gear for the worst.
Ethan Elkind directs the climate program at UC Berkeley Law, with a joint appointment at UCLA Law. His areas of focus include land use, transportation, electric vehicles, energy storage, and renewable energy, and his book “Railtown: The Fight for the Los Angeles Metro Rail System and the Future of the City” was published by the University of California Press in 2014. This article was originally published on ethanelkind.com.
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