When given lemons, make lemonade – so the old saying goes. The current global economic meltdown is causing a great deal of pain, but it’s also providing an opportunity not seen since World War II.
There’s now the space to make fundamental changes to financial systems to prevent such a reoccurrence and beyond that, to addressing issues such as climate change and energy; allowing the USA’s President-elect Barack Obama to put his green credentials to work.
Obama is in the final stages of tweaking his economic stimulus plan which could contain a great deal of good news for not only the American but also the global renewable energy sector; by increasing the availability of finance and providing additional incentives.
The Washington Post has reported the Obama camp is seriously considering including as much as USD$25 billion in energy tax credits.
The package under consideration includes a two-year, USD$8.6 billion extension of production tax credits for renewable energy, which could particularly benefit wind power projects. Also on the table is a proposal from the wind and solar industry allowing those credits to be refundable or to offset outstanding tax liability.This would benefit many financial firms that have provided capital for renewable energy projects in the past but currently aren’t showing any taxable income and therefore can’t use the credits.
The stimulus package may also include a National Clean Energy Lending Authority to extend low-interest loans or loan guarantees to renewable energy projects. The goal of the lending authority will be to mobilise private capital.
According to economist Peter Dawson, while Obama realises oil will continue to be the primary energy source for the foreseeable future, he believes that sources such as renewable energy need to displace oil in the U.S. for economic, national security, and environmental reason as soon as possible.
