Renewable Energy

ACORE's Michael Eckhart says renewables ready to compete with nuclear, clean coal

With the European Union and United States agreeing to hold a meeting next year to discuss energy efficiency and the implementation of renewables, how much of an effect will wind, solar, water, geothermal and biomass have on the United States' future energy policy? During today's OnPoint, Michael Eckhart, president of the American Council on Renewable Energy, discusses legislation he believes is necessary to move renewables to the mainstream. Eckhart talks incentives, consumer education, a federal RPS and moving away from an oil-based economy.


Monica Trauzzi: Welcome to OnPoint. I'm Monica Trauzzi. Joining me today is Mike Eckhart, president of the American Council on Renewable Energy. Mike, thanks for coming on the show.

Mike Eckhart: Thanks for having me.

Monica Trauzzi: Mike, ACORE just released its joint outlook on renewable energy in America and it paints a positive picture of where the U.S. could be in terms of renewable energy use. What's at the core of your findings in this report?

Mike Eckhart: It's long been a question, what can renewables do for this country? How big can it be? And a lot of people honestly believe it can't do the job. We're small and always will be. Well, that's not true. And what we tried to do with this report is begin to dispel that belief. That renewable energy really can power this country. And we've shown that with wind, solar, geothermal, ocean and the biofuels, with electricity and fuels, that we can really provided a substantial fraction of the nation's energy.

Monica Trauzzi: But with those different forms of energy that you just mentioned there are technological factors that come into play, technological hurdles that have to be overcome. How much more needs to be done as far as R&D in order to have major implementation of these technologies?

Mike Eckhart: Well, let's compare it to other technologies. Let's compare it to automobiles. Over the last hundred years automobiles have emerged. You can imagine what the Model T was and what the cars were in the '50s and now here in the 2000s. Where we are with renewable energy technologies is about halfway through the development life. We're where cars were in the '50s. They work, they're economic and they can really be useful, but they're going to be way better in the future.

Monica Trauzzi: So should we be focusing on any one of these more than the others? I mean there are many different ideas that you're proposing here.

Mike Eckhart: There's three big markets for renewables. One is general power generation, just generating electricity. And there we've got huge opportunities with wind power, solar energy, geothermal, biomass and hydro. We've got distributed energy, that's the energy we might do in our home or on a commercial building. And there we're integrating energy efficiency with solar energy, things like that. And then there's the whole transportation of fuel sector where we're coming on with biofuels, ethanol and biodiesel. So it's all of these together.

Monica Trauzzi: There's a lot of talk about nuclear energy and how much of a role that will play in our energy future. Would you consider nuclear a good counterpart to renewables?

Mike Eckhart: Well, I really don't comment that much on nuclear because that's not our field. We work in renewable energy and they're fighting as hard for their option as we are for ours. And they have features and benefits that have some merit, and let them fight for it. We're in the marketplace trying to make renewable energy win.

Monica Trauzzi: And clean coal? Do you see that as a positive?

Mike Eckhart: Well, same thing. The coal business has a very endangered future considering the CO2 emissions and the pollution and the mercury and all of the emissions and environmental destruction associated with coal. But we're not anti-coal. We're pro renewables. And so I would just like to say let them compete in the marketplace. We intend to beat them in the marketplace. We think we're better. And let's have it out in the market.

Monica Trauzzi: So what kind of action do you want to be seeing from Congress right now in order to move things along to a point where renewables are at the forefront and may become mainstream?

Mike Eckhart: Well, there's two levels of dealing with public policy. One is sort of tactical and lobbying and what law we need next to go to the next step. The other is the larger, longer-term whole envelope of policy in order to scale up to a substantial level, that's the kind of area that ACORE works in. And what we need for that is a serious commitment to renewables to say let's let this win. A long-term commitment, so that Wall Street can invest in confidence in these long-term projects. And then we need stability. We need no reversal of thinking. We don't need innovational policy; we need commitment, stability and long-term vision.

Monica Trauzzi: So is there specific legislation that you're lobbying for?

Mike Eckhart: Not that we are. We have about a dozen trade associations representing each of the technologies. And each of them are lobbying for specific provisions in law that affect those technologies. There's several overarching, all renewable energy policy concepts, and we tend to work in that. But right now we're moving forward with each of the technologies, and each industry has its own group.

Monica Trauzzi: And as far as setting a renewable portfolio standard, how important is that?

Mike Eckhart: Symbolically it's everything. Will the country commit to something? We don't argue one case versus another on exactly what the portfolio standard should say. Certainly the nation needs a goal. The goal that we like is 25 percent of the energy of the country by renewable energy by the year 2025. There's a number of campaigns from the Energy Future Coalition that has a 25 by '25 campaign. That's very consistent with the Apollo Alliance and their campaign for jobs in renewable energy. It's very consistent, or at least not inconsistent shall we say, with the Union of Concerned Scientists call for a 20 percent renewable portfolio standard by 2020. It's not inconsistent with the American Solar Energy Society's analysis that just came out looking to see if renewables can deliver on the climate challenge, and their key year was 2030, and as much as 30 percent of our energy could come from renewables. So in that whole space of 20 percent by 2020, 25 percent by 2025, 30 percent by 2030, you get a sense of how big this can be. And we have several analyses, all point to the same answer.

Monica Trauzzi: How much of the future success of renewables is dependent on the incentives that the government gives to companies and also to private people?

Mike Eckhart: Well, what we're trying to do is readjust the monetization, if I can say that, of the benefits of renewable energy. In other words, what are the benefits of generating energy without polluting? And how to we value that? Because the value is to the public at large, it doesn't come into the equation when we pay our electric bill or buy gas at the gas pump. We have no way of paying for clean energy versus dirty energy or energy that doesn't create a climate risk versus that that does. So we need to create mechanisms to get around those problems in the market where we can't really pay for the benefit that we're getting. And that's what we work on. I'd rather call them the benefits, paying for the benefits, rather than subsidies and incentives. That's what we call them in law, but in effect what we're trying to do is pay for the benefit and make an adjustment in the marketplace. It's a temporary solution. In the longer term we have to come up with permanent ways to pay for these benefits.

Monica Trauzzi: We're really talking about a complete shift here from our current way of thinking and living to a new way using renewables. Do you think that Americans are going to buy into these technologies? How much education needs to happen?

Mike Eckhart: We're saying, and I just was writing this up this morning, that we think that it's the Board of Directors lecturing the CEOs of the companies that are moving this thing forward. But I can assure you that every CEO in this country, or most of them, have children that are teenagers or in college and they're coming home and saying, "Mom or Dad, what are you doing with your company? What's going on here? You're polluting." The next generation, in college today and in their 20s, are completely sold on this. There is no selling needed. They're there. The question is can my generation catch up with our kids and act fast enough to do what they want? Because after all we're talking about the life and the world that they're going to live in affected by what we're doing today. So we ought to have them in mind. And they're coming home telling us what they want right now. I think that's the driving force moving us ahead today.

Monica Trauzzi: But with companies like Exxon Mobil reporting record profits how do you convince people and investors that stepping away from this oil economy will be economically sound?

Mike Eckhart: What's wrong with what's going on is not that Exxon Mobil makes a profit. What's wrong is that they're not investing it in something better. That's what's wrong. And I think that Congress ought to do something about that. That if we are subject to world oil markets and companies know how to work that system to create profits they should be investing in something better than where we're coming from, because we can't go forward in society on oil and gas and coal the way we have been in the past. And if they're not helping us with those profits then I think we are to take them and invest it for them.

Monica Trauzzi: The report says that Americans need energy at predictable costs. Will there be room for price manipulation though in rising energy costs once these renewable technologies become mainstream? Aren't these businesses just going to be businesses like all others, they're going to be moneymakers?

Mike Eckhart: Well, that's the nature of the U.S. economy. Renewable energy is not in some corner where the economy does it work. We're in the same space. We have to attract investors. There has to be return on equity. There has to be repayment of debt. We're talking about attracting and deploying and using capital to change our infrastructure to a cleaner way of living. And so, yes, absolutely, we have to live with the same rules of the marketplace as everybody else.

Monica Trauzzi: On a global level, recently we heard that the U.S. and E.U. will be meeting next year to discuss renewables. Talk about that.

Mike Eckhart: It's just being announced yesterday, at the E.U.-U.S. summit, that the U.S. has committed to host, in March of 2008, a world meeting, a ministerial level world meeting on renewable energy, not whether to do it, but how to move forward with renewable energy and share experiences between governments about what works. And also meet with energy and finance and the civil society nonprofit groups to plan how to make this thing really work in the U.S. and around the world. It's going to be a fabulous meeting. President Bush is committed to it. Secretary Rice is going to host it. They've committed on a worldwide basis that they're going to do it and we're looking forward to it.

Monica Trauzzi: All right. We'll end it right there. Thanks for coming on the show.

Mike Eckhart: Thanks Monica.

Monica Trauzzi: This is OnPoint. I'm Monica Trauzzi. Thanks for watching.

[End of Audio]



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