February 10, 2008
New York Times Editorial
Opposition to new coal-fired power plants built without new technology — that is, without the capacity to capture greenhouse gas emissions — is rising on both Wall Street and Main Street. Citizen opposition has led companies to cancel some high-profile projects, including a proposed plant near the Florida Everglades. Pressure from environmental organizations has persuaded major banks to begin weighing the risks of global warming when deciding whether to finance new plants.
This is good news. Coal-fired power plants are big contributors to global warming. In the United States alone, they generate half the country's electricity and nearly a third of its emissions. Meanwhile, scientists have left no doubt that the world has just a few years to make deep cuts in emissions or begin to suffer the worst consequences of rising temperatures. This means that scientists will have to figure out a way to capture carbon dioxide from coal plants, or coal will have to be replaced with cleaner fuels.
Given that task, the failure — by both the Bush administration and Congress — to encourage alternative sources of power is distressing. Bowing to veto threats from the White House, Congress stripped from an otherwise admirable energy bill two important provisions on alternative fuels.
One would have required states to generate an increasing share of their power from renewable sources like wind and solar energy. The other would have rolled back about $12 billion in wholly unnecessary tax breaks for the oil industry and used the proceeds to develop cleaner fuels and new energy technologies.
There is a way that Congress can quickly begin to make amends. That is to extend important tax breaks for alternative energy sources that are set to expire at the end of this year. These incentives have been critically important to the development of wind and solar power; wind power has become increasingly cost-competitive with natural gas, although not yet with coal. Investors are unlikely to pump much new money into clean power unless they are sure the credits will be available next year. The American Wind Energy Association has already detected a drop in new capital spending.
As we have said before, the surest and probably the only way to encourage meaningful and swift commercial development of cleaner fuels and energy sources is to put a stiff price on carbon emissions. That, in turn, would inspire — indeed require — industry to invest heavily in energy efficiency and low-carbon fuels.
But until Congress sets such a price, through a carbon tax or a cap-and-trade program — and it is a long way from doing so — every effort should be made to encourage the development of alternative energy sources. The first step is to extend the tax credits for alternative sources like wind and solar power.