Investment Bankers and George Bush - Heros of the Environmental and Cleantech Movement?

Pop quiz.  Looking forward 10 years, if you had to choose between two groups - Group 1: Investment bankers and GWB or Group 2: The NRDC and WWF - to guess which group’s actions will have had bigger positive impact on the course of environmental policy, cleantech and green living over that time - which group would you choose?  If you chose Group 2 - then you obviously don’t know a trick question when you see one.

I am dead serious…  this is not hyperbole.  I believe that when we look back 10 years from now we will see that the actions of the Bush Administration and Investment Bankers peddling mortgage backed securitized junk will have done more to help the cause of the green movement than armies of advocates, lawyers, non-profiteers, and career environmentalists have been able to do in decades of earnest, often unappreciated, toil in the name of the greater good.

That the result of Group 1’s actions in this instance were entirely unintentional side-effects of other more self-serving goals totally unrelated to the environment is irrelevant - results are what count.  And without these guys its highly unlikely that we would have the perfect storm of conditions that exist today allowing the fundemental systemic changes necessary for things such as alternative energy and other cleantech technologies to take root.

Ok, so what am I really talking about?  Well, if the bankers and Bush’s administration hadn’t hosed up the economy so badly (which at the core was a consumer driven growth cycle fueled by the housing boom that led to the financial crisis which has now bloomed into a larger economic crisis) - then its really unlikely that there would be either the political will or the economic imperitive at the state level necessary to pull off stuff like this:

Told that state utility regulators are wary of Congress’ plans to railroad through new interstate transmission lines, Sen. Reid said “Whatever we pass at the federal level trumps all that.”

That marks Washington’s second shot across the bow of state authorities in as many weeks. The stimulus package included provisions that would condition federal money to states re-writing their utility laws to favor energy efficiency.

Basically, the stimulus package is going to be used as a stick to force electrical regulatory policy - at least with regard to certain environmental provisions - out of the realm of state regulators and into the realm of federal regulators.  Consider for a moment the following, really blurry, chart (warning .pdf):

What is clear… well would be clear if you could read it… is that the amount of sun that falls on a state is pretty much inconsequential to determining solar penetration.  That’s right - New Jersey, that renowned oasis of sunshine - a state which is smaller than several counties in Texas, and has about 1/5 of the population of Texas and Florida combined, has more than double the amount of solar installed than those two states and 38 others cumulatively.  Utility regulation, which occurs at the state level, has a huge impact on solar penetration.  States with good incentives and interconnect tarrifs - called net metering - far outperform more populous states without. 

While incentives are nice, the key here are the net metering rules - the rules at which consumers are able to offset their nighttime electrical usage with excess power generated during the day.  Without reasonable net metering rules the payback on solar - even with incentives - doesn’t make sense because there is no customer for that consumer generated electricity.  Florida, for instance doesn’t allow for net metering at all… and as a result solar penetration in the “Sunshine State” is negligible. 

Federal laws evening the rules of interconnection, and loosening the stranglehold that entrenched monopoly utilities have on state regulators, and that create reasonable net metering rules across the country will go a long way to spurring solar deployment under penetrated regions of the country - including some with the most potential to generate solar energy due to their sunny climate.  And the beneficiaries can thank GWB and those mortgage backed securities bankers for the change.