With the possible exception of Barack Obama's puppy-anticipating daughters, no one is more eagerly awaiting the incoming Administration than the leaders of the renewable-energy industries. President-elect Obama campaigned on the promise to spend $150 billion over the next 10 years to support alternative energy, like wind and solar, as well as the green jobs that the sector has the potential to create. At California Gov. Arnold Schwarzenegger's climate summit on Nov. 18, Obama, in taped remarks, reaffirmed that he would hold fast to those campaign promises, starting with mandatory caps on greenhouse gas emissions. "This is a crucial step forward," says Linda Church Ciocci, the executive director of the National Hydropower Association.
The problem is, it won't be enough. As ambitious as Obama's campaign promises were — at least compared to his predecessor's — the future state of global energy will demand government policies with a much longer reach, according to alternative-energy leaders. The International Energy Agency's (IEA) annual World Energy Outlook, released Nov. 12, projects that global energy demand will increase by 45% between 2006 and 2030 — and that $26 trillion in power-supply investments will be necessary simply to meet those needs. Barring radical changes in our energy policy — beyond what Obama has pledged — greenhouse gas emissions will rise 45% by 2030, and extreme global warming would be virtually unavoidable.
See TIME's special report on the environment.The risks of unabated climate change are frightening: A detailed new study from the University of California, Berkeley, predicts that severe warming could cost California alone up to $50 billion annually, due chiefly to weather damage. "We have to have the foresight to avoid this crash," says David Roland-Holst, a professor of economics at Berkeley and the author of the report. The question is: Do Obama — and other world leaders — possess that foresight?
In a press conference last week the leaders of the solar, wind, geothermal and hydropower industries called on Obama and the incoming Congress to look ahead. First, energy leaders asked Obama to immediately adjust the alternative-energy production credit to provide green investors with a cash rebate, rather than a tax reduction. With the economy tanking, simple tax credits — which Congress renewed in October and without which the renewable-energy industry would not survive — aren't the lure they once were for companies looking to invest in new energy projects.
Other items on the renewables industry's wish list: a national renewable-energy portfolio standard, which would require a certain percentage of U.S. electricity to come from alternative sources. (More than 20 states already have similar standards, but a national one would be tricky, given that utility regulation in the U.S. is localized.) Green energy leaders would also like to see an executive order that would greatly expand the federal government's procurement of renewable energy — a smart idea, easily doable — plus a major initiative to update and smarten the nation's aging, overworked electrical grid. That last item is a necessity, if the country has any hope of scaling up alternatives. A report published Nov. 10 by the North American Electric Reliability Corporation found that without drastic investment in a better grid, scaling up intermittent renewables like wind and solar could lead to frequent blackouts. And there's no better way to turn people off of renewable energy than to periodically plunge them into TV-less darkness.
"[The grid] is the single largest long-term issue facing wind and other renewables," says Randall Swisher, the executive director of the American Wind Energy Association. "We can't solve the climate challenge without the green electricity superhighways that we are calling for."
Indeed, pumping money into the renewable-energy sector while neglecting the antique electrical grid is like building a fleet of cars without laying down roads, but it's far from clear that the government is ready for that kind of investment. In any case, the grid is just one in a very long line of energy priorities that will need to be addressed over the coming decades, as the IEA's report makes clear. Take oil consumption, which the IEA predicts will rise from 86 million barrels a day to 106 million barrels by 2030 (one of the main reasons why the days of triple-digit oil prices will return soon enough). Production at many top oilfields is declining slowly, but that drop-off will accelerate over time. Just to make up for that decline, we'll need to add 45 million barrels a day of capacity by 2030 — roughly four times the current capacity of Saudi Arabia.
That's going to cost roughly $1 trillion a year for all energy investments. And if we want to increase the share of renewables — and control the growth of greenhouse gas emissions — we'll need to spend an additional $9.3 trillion, if we're aiming to stay below the 2 degree C warming max recommended by the Intergovernmental Panel on Climate Change. (Of course, an increasing number of scientists argue that we need to avoid even that level of warming.) "We would need concerted action from all major emitters," said Nabuo Tanaka, the head of the IEA.
Environmentalists point out that many actions to reduce greenhouse gas emissions — like improving energy efficiency — can pay for themselves with long-term savings. But the sheer size of the figures involved point to the need for intelligent policymaking now, before we install hundreds of new coal power plants or begin ripping up the Rocky Mountains for oil shale.
That's why renewables-industry leaders say Obama's first priority has to be energy. If we get this wrong now, we'll put ourselves in an enormous hole — and the consequences, as the Berkeley study makes clear, are pretty scary themselves. "It's like guiding a supertanker to avoid a distant collision," says Roland-Holst. It's time for all hands on deck.