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CEO GRAHAM RICHARD RESPONDS TO PRESIDENT OBAMA'S PROPOSED ENERGY SECURITY TRUST

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Advanced Energy Economy CEO Graham Richard commented today on the release of more details around President Obama’s proposed energy security trust, which would provide $2 billion over 10 years for advanced energy research:

“We applaud the president for supporting development of advanced energy technologies,” said Richard. “AEE believes that federal resources should drive innovation and commercialization of new energy technologies rather than subsidize mature technologies. We look forward to working with the Administration and Congress on efforts to stimulate the development of secure, clean and affordable energy sources."

In testimony this week before the U.S. House of Representatives Subcommittee on Energy Science, Space and Technology, AEE senior vice president for policy and government affairs Malcolm Woolf called on Congress to utilize a core set of principles to reorient federal financial support to more effectively encourage private sector innovation and promote a secure, clean and affordable energy future. Under these principles, federal support for energy would: 

·        Be targeted, limiting federal funds to where innovation is needed to build a more secure, clean and affordable energy future. Federal energy programs should only be provided where there is an essential public purpose. Rather than providing permanent support to mature technologies that already have significant market penetration, the federal government’s role should be limited to driving innovation and commercializing the next generation of technologies, products and services that promise public benefits.

·       Sunset or automatically update provisions when market-based objectives are achieved. No company or technology should be entitled to permanent subsidies or investments. When left in place too long, tax incentives distort price and market signals and ultimately create barriers to entry for new technologies. Therefore, such incentives should remain in place only long enough to achieve a measurable, market-based objective that represents a point at which emerging technologies have reached sufficient maturity that they should stand on their own.

·       Provide stability and certainty for businesses and investors. Businesses and investors need certainty to make the investments and set the plans necessary to grow. Rules that change frequently or unpredictably are disruptive to markets and harmful to the businesses, investors, and consumers participating in them.

·       Be technology neutral to support all forms of advanced technology. Many of today’s energy policies were written by Congress with one sector in mind, even favoring a single technology. Such an approach distorts market signals and puts the weight of Congress behind investment decisions. This is inefficient and imposes unnecessary risk to taxpayers. 

Read the AEE press release here; Mr. Woolf’s full testimony is available here