US renewable energy output could soar with right policies: report

Washington (Platts)--1May2007

US renewable energy groups Tuesday said green power could provide 635 GW
of new capacity within 20 years, and that ethanol and biodiesel could displace
as much as 40% of gasoline supply by 2030 if Congress sets the right policies.

The findings, contained in a new report released by the organizations,
comes just before the Democratic-controlled Congress begins writing a new
energy policy.

"A fundamental problem with the development and deployment of renewable
technologies has been the uncertainty of government policy," groups
representing the biomass, cogeneration, geothermal, hydropower, solar, wind
and renewable fuels industries said in "Joint Outlook on Renewable Energy in
America."

"Support for both research-push and market-pull policies has been
constrained by short-term commitments, which are destabilizing to industrial
growth. If renewable energy is to be developed to its full potential, decades
of underinvestment in energy research and dissemination must end," the report
said.

The report called on policymakers to act with "resolve and decisiveness,"
and highlights economic, environmental and reliability and security of using
more renewable energy. The groups said long-term tax credits to spur renewable
energy growth and an "accelerated national" research to "scale up" production
are among the things needed for their companies to capture 25% of the energy
market by 2025.

The 635 GW is equal to half of today's US generating capacity. The study
said wind energy could provide the bulk, or 248 GW, by 2025 followed by solar
energy at 164 GW, biomass and geothermal energy at 100 GW each, and hydropower
and ocean energy contributing as much as 23 GW.

"Many renewable technologies were developed in the US, but lost essential
support," the report said. "Now, our inconsistent policies threaten to
sacrifice tremendous opportunities for economic development and export. If
America wishes to lead in the development of today's most promising energy
sources, our country must provide the essential policy environment for private
sector investment and growth of renewable energy in our domestic market."

But in addition to the "essential policy environment" it advocates, the
report noted there are other obstacles and "significant uncertainties" that
could cloud renewable energy's future, including a potential shortage of
electricity transmission capacity, the uncertainty of oil prices, climate
change action, whether technology "breakthroughs" come, and policies and
opportunities abroad.

--Mike Schmidt, mike_schmidt@platts.com