Energy Subcommittee Emphasizes Role of Continued Federal Support for Energy Technologies
(Washington, DC) - On Wednesday, the House Committee on Science, Space, and Technology’s Subcommittee on Energy held a hearing titled “Federal Financial Support for Energy Technologies: Assessing Costs and Benefits.” The purpose of the hearing was to receive testimony regarding various forms of Federal financial support for the development and production of fuels and energy technologies, including tax incentives, loan guarantees, and direct spending on research, development, demonstration and commercialization activities. Testifying before the Subcommittee were Dr. Terry Dinan, Senior Analyst from the Congressional Budget Office; Ms. Mary Hutzler, Distinguished Senior Fellow from the Institute for Energy Research; and Mr. Malcolm Woolf, Senior Vice President for Policy & Government Affairs at Advanced Energy Economy.
Emphasizing the vital role Federal investments plays in supporting innovative emerging technologies, Ranking Member Eric Swalwell (D-CA) said in his opening statement, “The people that drive innovation in our economy – from the National Laboratory and university scientists who push the frontiers of knowledge, to the venture capitalists who put their money on new concepts, to the industrial firms that scale-up manufacturing and infrastructure – all know that government has always played a critical role in making the U.S. the most dominant economy in the world. In fact, our oil, gas, coal and nuclear sectors are a direct result of that. It is time that we get serious about picking more winners and doing whatever it takes, from basic and applied research all the way to innovative financing and tax instruments, to ensure that the U.S. has cleaner, more sustainable, and more affordable energy for generations to come.”
Mr. Woolf shared the perspective of the Ranking Member when responding to Member questions, “The investment decisions we are making today, are going to be the plants that are operating in 30 or 40 years. It is not at all surprising that we are investing in innovation in technologies where we don’t yet have significant production, rather than the mature technologies that are already producing. I would not expect a correlation between where our investment dollars for innovation go and where our existing production goes. If this nation begins to invest in offshore wind technologies, we would be building a supply chain for offshore wind, so that we can manufacture it in the United States. [As additional projects in wind technology move forward] we will be building that U.S. capacity.”
The Federal government has a long history of taking on technical and financial risk that the private sector cannot absorb on its own, and of supporting emerging technologies and resources that yield long term benefits for the country. The results can be seen in the modern oil, gas, nuclear and coal industries. However, champions of these industries commonly assert that shifting public investment to emerging renewable and efficiency-related technologies is irrational, and thus must be politically-driven, since these new technologies do not yet represent market share comparable to the established industries.
Ranking Member Swalwell highlighted this point, “Until our policies start to address the numerous market failures that new concepts face, and reevaluate them on a regular basis, we will not lay the groundwork for a truly competitive energy marketplace in the U.S. These difficulties are only exacerbated when we in Washington politicize energy in a manner that does not reflect either market realities or societal good. As we see the tired arguments over industrial policy reemerge, we would benefit from looking at the lengths our global competitors are willing to go to capture market share, as well as the past efforts we have made in picking the energy ‘winners’ we have today. But, bickering over who gets to pick winners and losers simply misses the point.”
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