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Weekly Trend: How Will Renewable Energy Fare in the New Congress?

Peter Lougee

Energy Columnist, 1776

Globally, the United States does not fare well in energy efficiency. After all, it ranks 13th out of the top 16 nations, only edging out Russia, Brazil and Mexico.

More importantly, however, the top-ranked nation in terms of energy efficiency is Germany, and the challenges faced by its policy of energiewende can offer a lot of inspiration to the United States in terms of how to frame future energy efficiency policies.

Breaking Energy reports that energiewende is Germany’s national policy to transition “nearly 100 percent” of its power grid to renewably energy by 2050. To accomplish this goal, Germany has turned to a complex cooperative venture formed by its federated states and six key government ministries, two of which hold primary, if overlapping, responsibility for improved energy efficiency throughout the country.

This tangle of local and federal government institutions certainly poses political and bureaucratic challenges as each German state does not necessarily have the interests of the others at heart, but Germany has been a “hallmark of electric grid reliability” and energiewende has been in effect since 2010. Part of this success is due to a commitment to good governance, and due to members of disparate political parties embracing the national policy, even if they don’t always work closely together to implement it.

This, then, brings us back to the United States, a country that’s no stranger to political deadlock or politicized government agencies. Yet, despite what common political thought may say, the issue of solar energy is not as dichotomous as party affiliation. A recent survey from the Pew Research Center found that 73 percent of Americans—and 58 percent of Republicans—support the development of alternative energy sources. As Fortune writes in their interview with Vivent Solar’s CEO, what solar energy has come to represent is a case of “capitalists making environmentalists happy” as a result of business incentives such as tax credits that exist for the solar industry.

Indeed, Institutional Investor reports that much of the “increased uptake” in solar energy support and consumptions “stems from lower pricing” as result of such business incentives. It is primarily these incentives, in the form of key proposals such as the extension of the energy investment tax credit, that will be closely watched in the new Congress, but which business-friendly Republicans have tended to favor in the past.

Although the official policies of Germany and the United States are wholly different in that there is no national-level policy to transition to renewable energy, the alliance between left- and right-leaning activists, entrepreneurs and politicians may prove to have similar results for the industry. In either case, domestic politics are always such that an initiative that holds such public and growing support will be on the radars of many members of Congress and state governments before long. When that occurs, it will be important to remember the necessity of good governance and implementation schemes isolated from political headwinds, even as Germany struggles with those same problems today.

Peter Lougee

Energy Columnist, 1776

Peter is a Washington, D.C.-based freelance writer with a Master's Degree in Public Policy from American University. In addition to startups, Peter likes coffee, books and whiskey.