Environment finds a place in Obama's economic package
US President Barack Obama signed the US $787.2 billion stimulus package on February 19 to rescue the country from economic turmoil. During the signing ceremony, he carefully chose a backdrop of solar installations to send out a clear signal: his administration is serious about environment and climate change.
The stimulus package will save or create 3.5 million jobs over the next two years and a sizeable chunk will be green-collar jobs, said Obama while signing the American recovery and reinvest-ment act of 2009, dubbed stimulus act.
Environmentalists have hailed the package, but cautiously.
Despite opposition from green advocates in Congress, the stimulus package includes US $3.4 billion for carbon capture and sequestration (ccs) programmes. Scientists say ccs is a potentially risky technology to mitigate greenhouse gas (ghg) emissions. Draft details say "the funding (for ccs) will be used to get valuable information necessary to reduce the amount of CO2 emitted into the atmosphere from industrial facilities and fossil fuel power plants". But most likely the final decision on how the fund is spent will fall to energy secretary Steven Chu, who recently advocated the use of coal and ccs technology.
Environmentalists also do not like the fact that there is no carbon tax on fossil fuels such as coal. They have criticized a huge package of US $27.5 billion for highway projects. "New highways mean more cars, more development and more ghg emissions," said Michael Replogle of Environmental Defense Fund, a US-based environmental advocacy group. "It's not the kind of investment we need now, when we have to reduce ghg emissions," Replogle said. Administrative officials defend the provision saying the projects are important to spend the fund quickly and kickstart the economy.
Along with new jobs, improving the country's infrastructure and helping struggling states to put their economy back on track, the stimulus package offers over US $71 billion for green initiatives--from energy conservation and efficiency to mass transit to environmental cleanup--and US $20 billion for green tax incentives (see box).
Investment in energy efficiency measures alone can create over 100,000 jobs over the next two years and reduce CO2 emissions by nearly 200 million tonnes, estimates the Alliance to Save Energy, a US-based coalition of industrial, technological and energy bodies.
This has created a buzz among companies working on alternative energy and green building material. According to the US Solar Energy Industries Association, the package will create 67,000 jobs in the solar sector in 2009 and another 52,000 jobs by 2010. "The plan will catapult the US to be the world's largest solar market by the end of 2010," said Suvi Sharma, chief executive of Solaris, a US-based solar cell manufacturer.
The package offers US $5 billion for "weatherization assistance", meant to improve energy efficiency of buildings of low-income families. According to Serious Material, a US-based manufacturer of green building products, this will create 375,000 jobs, while preventing emission of 9.7 million tonnes of ghg. The act stipulates investing a significant amount in modernizing the electricity grid using smart grid technology for efficient transmission and for advanced (polymer electrolyte) batteries, required for next generation of battery powered vehicles, and related components.
The act also modifies and expands the tax credit for owners of energy efficient homes and facilities.
The total package for green measures, about US $91 billion, is just under 12 per cent of the total stimulus package. This falls short of the benchmark set in a report led by Nicholas Stern, former chief economist of the World Bank, which says green measures should account for 20 per cent of global economic recovery plans. It also fails to meet the UN target of one per cent of the gdp.
Still many, including Obama, are optimistic. As noted by former US vice president and environmentalist Al Gore, the multibillion-dollar stimulus plan is a first step to moving the US away from fossil fuels and reaching an international treaty on climate change in Copenhagen later this year.