Why are renewable energy projects failing to receive the same degree of support from the financial community and the government that nuclear does?
Renewable projects fail to recieve the same degree of support from the financial community and the government than Nuclear for multiple reasons. Much like fossil energy, nuclear energy is an established sector in energy production by companies who hold polical relationships with policy makers who allot funds, tax breaks, and other allowances. Companies with financial support from the federal and/or state government are considered more credible and attractive to other non government finance providers which allow them to grow their projects/businesses overall. Renewable energy projects get less financing because they aren’t being done by the large companies like Shell, BP, and Exxon who have political relationships allowing them to monoplize the energy production industry in general.
What niche opportunities do you see for entrepreneurs in the global development of renewable energy sources?
In recent years the growth in public awareness of energy efficiency through use of renewable resources will definitely open an array of entrepreneurial developments worldwide. As mentioned in my previous post, I could see the expansion of solar panels across the US and a growth in that arena if a company finds a method to create and sell these panels at a lower expense to the customer. People want solar panels so the demand is there, but creating a panel that is affordable to the masses is yet to be done and that could be a dramatic game changer in the electrical home heating/lighting sector.
This article from the National Academy of Engineering sites some of the obstacles in regard: http://www.engineeringchallenges.org/cms/8996/9082.aspx
Hello Again Christine! It’s great to “see” you again as well! I will be honest that due to previous research in other courses and my job, I’m a bit more versed on incentives relative to fossil fuels over nuclear energy so you’ll have to bear with me as well :).
The most recent and largest energy bill of our time was the Energy Policy Act of 2005 (EPAct). It was passed by the Bush Administration including a plethora of incentives largely in favor to oil and gas industries, secondly to nuclear, and least to renewables. Research post implementation confirms that reasoning behind the allotments unveil moral and economic conflict with the passing of EPAct given repetitive negative effects against human health and the environment.
The Bush Administration was (and the current Obama Administration still is) influenced by the Oil/Gas production industry. Most campaigns for political representatives are supported in majority by CEO’s from oil/gas companies such as BP and Shell across Executive and Congressional Offices [1]. Not to mention both President Bush and Vice President Cheney were previous oil executives themselves and maintained personal relationships with those in the field. EPAct was passed with so many loopholes in favor of the oil, gas, and nuclear industries with specific support toward hydraulic fracturing (fracking) that those who oppose it often referred to the bill and/or it’s incentives as the “Cheney Bill” or the “Halliburton Loopholes”. White house reports even confirm secret meetings with oil executives when the regulation was being written – mind you it was written by a committee lead/coordinated by Cheney.
I won’t go too much deeper into this because I can go on for pages (lol) but just to give you some references: Incentives included over $2.9 billion in R&D subsidies for Nuclear; Public Citizen[2] summarizes this very well.
Subtitle C, Section 322 contains a specific escape clause for fracking. The loopholes allow evasion of Comprehensive Environmental Response, Compensation, and Liability Act; Resource Conservation and Recovery Act; Safe Drinking Water Act (SDWA); Clean Water Act; Clean Air Act; National Environmental Policy Act; and the Toxic Release Inventory under the Emergency Planning and Community Right-to-Know Act [3]. Incentives also include tax breaks of over $3 billion for oil, gas, and nuclear production. [4]
In recent years, damaging media has influenced the public shifting more support (both political and non) toward renewables now that we’ve seen a series of negative events caused by the production of non-renewables (oil spills, water contamination, deaths, explosions, air pollution, etc) with one large depiction being the BP Oil Spill.
I know this was a lot (maybe too much) information HOWEVER if you want to discuss more, pleaseee feel free. This is truly only a very small snapshot of it all. 🙂
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1. http://www.politico.com/news/stories/0510/36783.html
2. http://www.citizen.org/documents/NuclearEnergyBillFinal.pdf
3. http://www.nytimes.com/interactive/2011/03/03/us/20110303-natural-gas-timeline.html?_r=0
4.http://www.epa.gov/statelocalclimate/documents/pdf/4_20_06_EPACT_Tax_incentives_Prindle.pdf
Hello Dominique,
You are completely correct that there are many political relationships which allow the government to be in favor of nuclear power. Additionally, I believe it has to do with emissions as well. Other renewable resources still give off emissions, while nuclear power gives off little or no greenhouse gas. This could help slow climate change. This has to be another reason the government is favoring nuclear power. I also see solar power growing in the United States. Furthermore, I really enjoyed reading your post. Here is a link to my post if you are interested in reading it: http://engr312.dutton.psu.edu/2014/09/05/lesson-2-bethany-steiner/
Hi Dominique. Nice to “see” you in one of my classes again! This assignment has really caused me to dig into incentives and subsidies, so bear with me. Would you elaborate a bit about how political relationships garner financial support for fossil-fuel and nuclear energy producers? I think I understand scenarios like the Production Tax Credit, and I understand government loan guarantees, but what else am I missing? I am just curious as to what else nuclear energy developers have at their disposal. In Oregon, for example, our RPS recognizes wind, solar, small hydro and other renewables, but nuclear does not count toward the standard. So, regardless of the interest in nuclear development or the low-emissions factor, developers would not be interested in pursuing development in Oregon. I just don’t see the support for nuclear, yet it would help us meet the Obama Administration’s goals for sure. Thanks for your post. It really got me thinking!