The Stimulus Package For Cleantech Dummies

economic-stimulus

Mr. Obama finally signed the $787 billion stimulus. Ok, great. Well now what? Here’s an easy to understand list of how the stimulus is going to affect the cleantech industry. We’ll be focusing on the $43 billion for energy and the $111 billion for infrastructure and science.
Smart Grid & Transmission Lines: Almost $13 billion will be going towards electric grid and transmission line modernizations. The Smart Grid, as opposed to the current electric grid, will dramatically improve the efficiency by which power supply is managed. Who benefits? The largest beneficiaries will be utilities, smart meter manufacturers, and energy management software developers. I don’t think anyone could have put it more straight forward than El Presidente at the stimulus signing ceremony. Obama explained:

Today, the electricity we use is carried along a grid of lines and wires that dates back to Thomas Edison –- a grid that can’t support the demands of clean energy. This means we’re using 19th and 20th century technologies to battle 21st century problems like climate change and energy security. It also means that places like North Dakota can produce a lot of wind energy, but can’t deliver it to communities that want it, leading to a gap between how much clean energy we are using and how much we could be using. The investment we are making today will create a newer, smarter electric grid that will allow for the broader use of alternative energy.

Clean Energy Government Grants: The government will cover up to 30% of startup costs, if projects are started within the next 2 years. Who benefits?: Tons of solar, wind, geothermal and other renewable energy projects have been ready to go for a while, but delayed due to lack of funding. Clean energy developers rejoice with such promising aide.
Transportation: $17.7 billion is going towards public transportation and rail, along with $400 million to encourage the use of plug-in hybrids. Who benefits? We need public transit, especially here in LA. Supposedly some of that 17.7 is going towards the infamous LA-to-Vegas train that’s been talked about for who knows how long.
Tax Credit Extensions: The stimulus extends production tax credits for wind, geothermal, biomass, and hydropower three additional years, to 2012. Who benefits? All companies within those sector’s will benefit from the extensions.
Clean Energy Manufacturing Tax Credits: The Government’s put up near $2 billion in tax credit for companies manufacturing components for renewable energy production. Who benefits? I assume the majority of this money will go towards companies producing wind turbines, advanced batteries technologies, and possibly polysilicon (that is if the oversupply everyone’s predicting doesn’t come).
Clean Energy Homes: $2 billion will go towards tax credits for energy efficient insulation and appliance improvement over the next 10 years. Most importantly, government spending on weatherization upgrades has been raised from $500 million to $5 billion per year for low to middle class American homes (who qualifies depends on the state). Who benefits? This will benefit millions of people’s energy bills. One of the largest contributors to the efficiency problem is wasted heat from building’s who’s windows and insulation aren’t up to par. The US Department of Energy estimates that every $1 invested in weatherization brings back $2.68 in energy and non-energy benefits.
Let the GREAT experiment Begin!!! -Dr. Tobias Funke