Big Green has been filling its scrapbook with reports of global conferences, movie star catharses as to global warming’s meaning, and clean tech investment reports shooting the moon. Big Green seeks to combat The Dark Force -- hydrocarbon fuel -- Big Black -- which simultaneously has the temerity to be rising in price in America, soaking our atmosphere with heat absorbing carbon emissions, and lobbying fiercely for market position. So, like every righteous movement before it in history, Big Green -- frustrated by lack of progress -- has turned to governmental power to overcome its adversaries.

It is not surprising to find Herman Scheer, a leading philosopher of the renewable energy movement saying:

Those favoring a strict neoliberal economic ideology will argue that the state should not interfere in markets, yet history shows that the market has hardly ever functioned without the state . . . for democratic countries, governments subsidizing renewables and alternatives could reflect the desires of many of that nation’s constituents.

Nor should we be surprised, however, to find this principle utilized and stood on its head by proponents of Big Blue: demand for nuclear power is on the increase. More than $200 billion will be spent by 2030 on harnessing the atom for energy output. By 2050 India expects to have 25% of its energy provided by nuclear power. And the resurgence of nuclear energy is being not merely theorized but emerging in a proposed new wave of plants licensed by the NRC, the NRC promising an expedited licensing period, and utility sponsors financially abetted by a loan guarantee program that was part of the last Energy Act and which may be enlarged by future legislation. “A Second Act for Nuclear Power” trumpets the Wall Street Journal. No less than the former EPA head Christie Todd Whitman has been pressed into service by the nuclear industry’s multi-million dollar public relations campaign. No less than the author of last year’s bestselling book, Freakonomics, mocks the China Syndrome fears of nuclear cores falling through the Earth. Even leading environmental groups, their eyes squarely fixed on greenhouse gas issues (rather perhaps than on the global safety ball) have begun to note the emissionless, lower volume impact which nukes can have.

 Dismayed by this development, Big Green loyalists have reverted immediately to their historic role: that of protectors of the Earth against marauders of the environment. Once again, and not without reason, the anti-nuclear arguments are being assembled and updated for the 21st century: security against sabotage and terrorism, lack of stringent nuclear industry oversight, nuclear waste risks, dangers exacerbated by the effect of cost overruns. And finally, as it was at the beginning of the green movement, an appeal to the “big tent” theory of global warming control: “prudence dictates that we pursue many options to reduce global warming,” states a Union of Concerned Scientists spokesman, “as part of that effort, nuclear power research should continue, but with a focus on enhancing safety security and waste disposal.” Mollifying the incipient beast with spurious pluralism: “look, everyone can play, let’s all be friends,” doesn’t work that well in the hardball energy game.

But there are other issues with which Big Green must deal with Big Blue. Popular moods and governmental trends are fickle forces in a capital-driven democracy. If renewables are to have a sustained place at the table there are ultimately two hard realities they must face: economic competitiveness and institutional regulation. Pandora’s Box of government interventionism in the name of global warming control has been opened -- but the emerging whirlwind can be colored green or blue, depending on which side prevails.

Renewables can only be cheap and large enough to fit the electric utility industry regulatory framework if they offer up, in addition to distributed energy, big concentrated power, abetted by energy storage, which can serve utility baseload purposes. AEP, the nation’s largest user of coal (as well as payor of mega-fines), certainly doesn’t think the concentrated solar scenario will work today. As its chairman says with reference to solar energy: “Is the land there? Yes. Is it practical now? I don’t think so.” Nevertheless some utilities, like PGE and FP&L are, to fill part of their baseload requirements, beginning to look toward larger scale solar utility companies that Silicon Valley Venture Capitalists have backed. Whether concentrated solar power (CSP) will achieve the magic figure of $10 per kilowatt hour is still problematic -- but at least it is focused on the issue which will make Big Green sized growth of more sustainable dimensions than photovoltaics can obtain. Doing so helps to overcome the observation which John O’Donnell, the solar zealot driving CSP developer Austra has articulated, “a lot of people in the environmental community can’t count.” Diffused, variable sourced energy streams just can’t stand up to Big Blue; they barely can make their voices heard over Big Bad Old Black.

But willingness to come to terms with economics is not enough. The reality for renewables is that they must find favor with the utility industry which still forms the spine of this our Central Station Nation. Utilities are not, as environmentalists may sometimes cast them, inherently evil polluters in pursuit of profit. But they are decidedly tropistic toward least-cost solutions to power supply (which includes, for them, their sunk infrastructure costs). That tropism can be tweaked by imposition of extra costs for internalized externalities, like cap and trade, or by mandatory standards. But economic evolution certainly seems more likely to occur best when there is an alignment of manmade laws and the applicable principles of economics. That would be the case, if a regulatory system in the US were focused on giving utilities the ability to be indifferent to being producers or consumers of power; to recover costs and have adequate rate recovery when they are renewable producers; to be able to entertain distributed generation renewables options with prospects of economically effecting and/or recovering transmission costs; and to contemplate being rewarded as “prudent” if they do so as well as being concerned with being slapped on the wrist if they do not. Big Blue seems to be sneaking up on Big Green because its characteristics were once perceived to be -- and some credibility is being restored that they may again be for the regulated utility industry -- consistent with this model. Global warming reduction through Big Blue use really may be for the Big U the modern day rationalization for an otherwise potentially preferable centralized supply solution.

And so Big Green would be advised to focus on its tie-in to this regulatory model, whether through utilities or providers to them -- through technology, cost reduction, or appropriate ratemaking structures. It is only through the equation of the regulated marketplace, not the abstract calculus of regulatory costs and benefits, that Big Green can ultimately sustain its current position in the sun. One thing US energy history confirms: never underestimate the “Big U” factor in shaping the ultimate profile of events.

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