SOTU reaffirms Obama’s stance on solar, offers little new, say analysts
During 2012’s State of the Union address, Obama didn’t push too hard for more renewable energy, but he didn’t step away from it either. His remarks regarding solar and clean energy showed that he still supports the technologies and wants Congress to do more about it, but places the ball in the legislative body’s court and embraced natural gas and offshore oil.
This was perhaps in an effort to placate Republicans as Obama heads into a tough reelection year, facing a split Congress.
“Versus prior speeches, the President talked less of cleantech and more about natural gas, perhaps de-politicizing cleantech and neutralizing Republican rhetoric against renewables,” Jefferies and Company, Inc. Equity Analyst Jesse Pichel wrote in a research note.
GTM Research Managing Director Shayle Kann didn’t hear anything new in Obama’s speech.
“I like hearing him say: ‘We will not back down from clean energy.’ That says a lot considering how bad it’s been bashed,” Kann said.
To possibly calm Republicans as he seeks reelection, Obama acknowledged the jobs potential of natural gas and offshore oil. But he pointed out that the U.S. has extended subsidies to fossil fuels for about 100 years, and that has helped develop the natural gas industry, particularly fracking, according to Pichel.
“The President finally defended the DOE loan guarantee to Solyndra, calling into question 100 years of subsidy to the fossil fuel industry, and calling for a doubling down of a clean energy industry in the U.S. that will not cede to China or Germany because the country refuses to make the same commitment,” he said.
“The President also called for a clean energy standard, which is great but difficult to pass,” Kann said.
In an attempt to lessen opposition to such a standard, Obama downplayed the role of climate change behind such a bill, instead likening such legislation’s effects to stimulating energy innovation.
Pichel also was pessimistic on such legislation.
“Climate change legislation is unlikely, but a call to increase energy standards and requirement for DOD spending on clean technology will make the government the largest buyer of green energy,” he said.
While a clean energy standard could impact solar in the country, Kann said something else could have a bigger impact.
“A bigger thing we could do is extend 1603 [Treasury Cash Grants] retroactively, or effective immediately,” he said.
Whether that will happen remains to be seen.