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Rising Solar Prices Threaten the Industry

One of the most disturbing things about the solar industry, the rising star of cleantech, has been its recent rising prices. According to the SolarBuzz.com survey, module prices are up close to 7% in the US this last year, after years of falling.

The main culprits according to most solar watchers are a combination of:

  • High demand driven in large part by the US state and German subsidy programs
  • Tight supply on module capacity
  • Tight supply on silicon capacity

The first issue here is that rising solar module prices threaten the viability of the industry, at a time when it is gaining momentum and trying to reach critical mass. Worse, almost every manufacturer of solar modules is increasing capacity trying to take advantage of the industry growth. As a result, we think the industry may be in for a rude awakening if that capacity increase begins to outstrip demand, or if key subsidy programs underpinning growth falter for political reasons.

The businesses most at risk are the young technology developers, who are spending significant equity dollars on technology development and building to a critical manufacturing and sales base. These are the businesses that the VC community is funding at a tremendous rate. These aren’t businesses that are throwing off tremendous amounts of cashflow to weather a storm.
One concern, if the market does turn down, the major Japanese, European, and oil company solar manufacturers are likely to lower prices to keep their factories full, and really hurt the smaller businesses. Keep in mind, if you launched a solar business 5-10 years ago, reaching a 20 MW plant would put you in the top 20 manufacturers. With that same launch today, looking ahead five years to when your technology is commercialized, you will have to hit perhaps 50-100 MW of capacity to be an elite player. That’s a big difference that I don’t think the investment community has understood yet.

Dawnbreaker Conference Recap

I just returned from the Dawnbreaker technology commercialization conference. The conference is supported by the DOE, and is one of the oldest cleantech technology forums around.
Dawnbreaker had over 50 companies and 100+ strategics in attendance, and a number of very interesting technologies.
Among the more interesting in energy technology:
Alzeta Corporation was there showing a very interesting high efficiency burner. www.alzeta.com

A little company called InvenTek was showing off a unique battery structure, it was a ribbon Li-ion battery with a pancake coil design that exhibits very high power density. www.inventekcorp.com

CeraMem was showing off a restart of a very interesting technology in ceramic membranes for water purification. www.ceramem.com

Renewable Energy and Big Business

A new report from a group with a horrifically unwieldy name — the Renewable Energy Policy Network for the 21st Century (REN21) — indicates a record level of investment in renewable energy worldwide.

REN21 Report “Renewables 2005: A Global Status Report”

The lead author of the report Eric Montinot claims that “Renewable energy has become big business.” What am I missing here? Why do I find it difficult to agree with this assessment?

True, there are a lot of big corporations with a non-trivial involvement in renewables: BP, Shell, GE, FPL, ADM, and so on. And, there is no doubt that the renewable sector is growing rapidly and has grown tremendously from its earliest days. But, it strikes me that claiming renewables as “big business” is hype, premature at best. For the above firms, renewables represent a significant growth opportunity and an excellent PR position, but don’t represent a very large portion of their core business. Furthermore, there’s still an awful lot of “mom-and-pop” in the renewables sector, and an awful lot of green idealism or green policy rather than green money driving activity in renewables.

In any event, what does it really mean anyway for renewables to be “big business”? If it means being like Dell or Wal-Mart — improving the economics and delivery of products/services so that more customers purchase them because they represent truly valuable offers — then that (in my opinion) would be a good thing for the advancement of renewables. If “big business” means being like the average U.S. oil company, utility or auto manufacturer, those are the last role models I would like to see for the renewable energy sector.

A Rant on ExxonMobil

ExxonMobil was the subject of a none-too-flattering profile recently in USA Today, which documented the company’s long-standing opposition to investing in renewable energy technology development:

USA Today Article

Subsequent to running the article, letters to the USA Today editors indicated at least some citizen outrage at ExxonMobil for their shortsighted view. No doubt as a response to this, ExxonMobil late last week was running full-page color ads in local newspapers, touting statistics on how much the company invests annually in new (albeit conventional) energy resource and technology development.

For those who dislike ExxonMobil’s anti-renewables stance as much as I do, I suggest an alternative tactic to writing angry letters to editors: stop buying gasoline from ExxonMobil stations. Whenever possible, I buy gasoline from either BP or Shell stations, because of these corporations’ more progressive position and demonstrated commitment to building businesses in renewables. As a fallback position, I buy from Chevron or ConocoPhillips stations, as the parent companies are at least investing in new alternative energy R&D. ExxonMobil stations, for me, are a last resort.

Maybe if millions of people stopped buying ExxonMobil branded gasoline, the corporate honchos in Texas might take notice. It will be interesting to see if ExxonMobil’s philosophy against renewables changes after the year-end retirement of Chairman/CEO Lee Raymond. Mr. Raymond has long had what seems to be an almost personal animosity against renewables. As a leading candidate for being the poster child for the anti-renewable camp, his is a face (below) that I will not regret seeing move off of the energy stage.

Renewable Energy’s Investment Hockey Stick

Global investments in renewable energy seem to be growing faster than any of us thought. If current trends continue, we’ll soon be seeing the hockey-stick-shaped growth curves that have become iconic shorthand in technology sectors for hyper-paced growth.

According to a report released today (Download – PDF) by the Renewable Energy Policy Network for the 21st Century, or REN21, global investment in renewable energy set a new record of $30 billion in 2004. That’s a far, far bigger number than others have projected, such as the Cleantech Venture Network, which just ten days ago projected that investments in clean technology — a broader category than just renewable energy — would total $10 billion between 2005 and 2009.

(My firm, Clean Edge, projected earlier this year that markets for just three technologies — solar photovoltaics (PV), wind power, and fuel cells — would grow to $15 billion annually by 2014, but that measures purchases of these technologies, not investments in them.)

REN21 is remarkable not just for its large numbers. The report has an impressive pedigree: REN21 was sponsored by the German Federal Ministry for Economic Cooperation and Development and the German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety. Formally established in Copenhagen in June, REN21 is now supported by a steering committee of 11 governments, 5 intergovernmental organizations, 5 nongovernmental organizations, and several regional, local, and private organizations.

The report is one of the most thorough accountings I’ve seen of the state of renewables worldwide. According to its findings:

Renewable energy supplies 17 percent of the world’s primary energy, counting traditional biomass, large hydropower, and “new” renewables (small hydro, modern biomass, wind, solar, geothermal, and biofuels). Traditional biomass, primarily for cooking and heating, represents about 9 percent and is growing slowly or even declining in some regions as biomass is used more efficiently or replaced by more modern energy forms. Large hydropower is slightly less than 6 percent and growing slowly, primarily in developing countries. New renewables are 2 percent and growing very rapidly in developed countries and in some developing countries.

The fastest growing energy technology in the world has been grid-connected solar PV, with total existing capacity increasing from 0.16 gigawatts (GW) at the start of 2000 to 1.8 GW by the end of 2004, for a 60 percent average annual growth rate during the five-year period.

During the same period, other renewable energy technologies grew rapidly as well, says REN21:

  • wind power: 28 percent
  • biodiesel: 25 percent
  • solar hot water/heating: 17 percent
  • off-grid solar PV: 17 percent
  • geothermal heat capacity: 13 percent
  • ethanol: 11 percent

These compare with annual growth rates of fossil fuel-based electric power capacity of typically 3-4 percent (higher in some developing countries), a 2 percent annual growth rate for large hydropower, and a 1.6 percent annual growth rate for nuclear capacity during the three-year period 2000-2002.

Renewable energy investments now come from a highly diverse range of public and private sources, says the report, “aided by technology standardization and growing acceptance and familiarity by financiers at all scales, from commercial finance of hundred-million-dollar wind farms to household-scale micro-financing.” One recent investment trend is that large commercial banks and stodgy energy utilities are starting to notice renewable energy investment opportunities.

Examples of large banks that are “mainstreaming” renewable energy investments are HypoVereins Bank, Fortis, Dexia, Citigroup, ANZ Bank, Royal Bank of Canada, and Triodos Bank, all of which are very active in financing renewable energy. Investments by traditional utility companies, which historically as a group have been slow to consider renewables investments, are also becoming more “mainstreamed.” Examples of utilities active in renewable energy include Electricité de France, Florida Power and Light (USA), Scottish Power, and Endesa (Spain).

All told, it’s an upbeat and encouraging assessment that renewable energy around the world is being embraced by an audience far more important than environmentalists, technologists, or even high-ranking government leaders: the big-bucks investors capable of growing the kinds of large-scale, sustainable markets we’ll need to create a renewable-energy future.

Ford is pushing Ethanol

Ford Motor Company recently announced a partnership to push new fueling stations for its ethanol-ready fleet of 1 million vehicles. Ford Ethanol Article. The actual fuel is E85, a blend of 85% ethanol, 15% gasoline.

I view this as a major win for cleantech. The future for clean fuels is not hydrogen, electric, or gasoline electric hybrids, but likely some liquid fuel blend running in hybrid configurations. And hopefully with a Plug-in hybrid options. These vehicles can run on gasoline, allowing us to deal with the fuel infrastructure problem in an incremental way.

Think plug-in hybrids running on a switchable fuel mix of ethanol and gasoline. That would not only slaughter emissions, and dramatically increase fuel efficieny, but allow our transportation sector to cheaply and easily fuel switch between fuel sources as diverse as grain ethanol, crude oil, natural gas (if GTL ever occurs in a big way), syncrudes, as well as electricity sources: coal, natural gas, hydro and wind.

That is a very viable plan to solve our energy independence problem. In contrast, additional drilling in ANWR and supporting OPEC is only a short term solution.

EDF is Going Public

The French government has announced plans to spin-off 15% of Electricité de France, one of the largest utilities in the world, to the public markets.

As IPOs go, this is going to be a big one. With over US$50 Bil in revenues, EDF is larger than American heavyweights Duke and AEP combined. As these types of companis typically trade at a bit better than 1x revenues, this could be a massive $7-$10 Billion IPO. IPO Article.

The question for investors is how well a sleepy state owned utility can compete in the EU electric industry for the next 50 years.

$450 Bil Phantom Bid to Acquire ExxonMobil

I couldn’t resist reporting on this one. A little one man Chinese investment company registered in New Zealand announced a takeover bid for ExxonMobil at at 25% premium to its current shareprice.

Article on Takeover. The company is called King Win Laurel International Ltd, is basically a guy in his house, and previously made offers for Telstra and the New Zealand Yum Brands franchisee. Those were rebuffed too.
You see these tenders every once in a while, often times they are part of larger investment scams. One typical scam (which this does not appear to be), is to issue a microtender for a small number of shares at below the current share price, and try to get gullible investors to sell into it. Others are just straight-up hoaxes. Article on Telstra Offer.

Competition Is Our Friend

I have long been an advocate of true, effective deregulation of the electricity industry. Of course, when typically uttered in the context of the power sector, the word “deregulation” conjures up images of the California experience of the 1998-2002 era — which was an abomination involving government intervention against market forces at many levels, and thus should not be termed “deregulation” by any thoughtful observer.

Instead, there are several examples of much more workable approaches to electricity deregulation — such as Texas and PJM — that should be examined when weighing the possibility of competition in the power sector. The consulting firm CERA has just recently issued a report assessing the U.S. deregulation experience, and generally concludes that the pros outweigh the cons.

CERA Press Release on Deregulation Study

As CERA’s Lawrence Makovich pointed out in announcing the report: “The expectation embodied in the conventional wisdom — that for deregulatino to be considered a success, power prices in nominal terms should have decreased continuously over the period under consideration — is inappropriate. Power prices needed to fluctuate in order to convey the appropriate signal for economic efficiency.”

Not only do I wholeheartedly agree with this statement, I contend that when considered more broadly, it has significant implications for those of us with environmental interests. Power prices need to fluctuate by time in order to provide clear price signals that enable consumers to capture the true economic value offered by on-peak renewables (most notably, solar) and demand-altering measures. When true economics are masked by regulation or badly-botched deregulation, many environmentally-beneficial energy technologies are hobbled.

Of course, competitive forces in electricity would also work better if subsidies on conventional energy were eliminated (as argued in a previous posting), and if externality costs imposed by energy production/use (most notably, CO2 emissions) were fully and appropriately captured into energy prices. But, one step at a time. Let’s get energy market structures and rules right first, and we can tackle those issues subsequently.

Energy’s Dirty Little Secret

Opponents of renewable energy are quick to point out with disdain that renewable energy sources wouldn’t be viable without subsidies.

As one who tends to hate subsidies because of their tendency to create perverse market distortions, as well as their spurious on-again/off-again nature (e.g., wind PTC circa 1999-2004), I am sympathetic to arguments that employ a dislike of subsidies.

But, what bothers me even more than subsidies is hypocracy and disingenuousness. And, those who rant against renewable subsidies are guilty as charged.

The dirty little secret in the energy industry is how vastly subsidized conventional forms of energy are. I recall estimates from the late 1990’s suggesting that the U.S. subsidizes fossil fuel to the tune of about $30 billion per year, through various mechanisms but mainly relating to military activities/presence in the Middle East whose costs do not get reflected in energy prices. In case you missed it, these estimates were from the late 1990’s; if they were accurate, the magnitude of fossil fuel energy subsidies must surely be higher now.

Another way of considering the subsidy issue is to examine Federal R&D spending on energy, as CRS has done. By their reckoning, between 1948 and 1998, the U.S. government spent $74 billion on nuclear programs, $31 billion on fossil programs, and $15 billion on renewables. In other words, R&D funding on more mature energy forms outweighed R&D spending on immature renewables technologies by a factor of 7 to 1. By another measure indicating the tilt against renewable energy — federal tax breaks between 1998-2003 — fossil energy received $10.2 billion, nuclear $1.5 billion, and renewables $0.4 billion.

This last estimate was provided by Alexandra Teitz (Minority Counsel, Committee on Government Reform, U.S. House of Representatives) last week in her presentation to the monthly ABA Renewable Energy teleconference, provocatively titled:

“Renewable Energy in the Energy Policy Act: Business As Usual = Failure”.

One can argue about how to properly quantify the estimates, but the directional implication is without doubt: conventional energy forms receive gluttonous quantities of subsidies. Could someone explain to me why fossil energy interests, who have had a century to build a solid market position, should receive any government subsidies at all? Anyone at the Cato Institute listening?

I would be delighted if the subsidies on renewable energy were removed, if the subsidies on conventional energy were also removed. Let’s play on a fair playing field. I argue that would be a far better situation for those of us who care about energy security and the environment.

Until then, as much as I dislike subsidies of all forms, and think that undue reliance on them is a danger for renewable energy industries, I would seriously prefer those who rail loudly against renewable energy subsidies to simply shut up and get wise to the facts. Or better yet, to turn their venom to all energy subsidies, not just those accruing to renewables.

Making the Grid "Smart"

The realization that America’s electricity infrastructure is shakier than a palm tree during a hurricane hits us every few years, when some blackout or rolling brownout reminds us of our electro-vulnerability.

But to truly understand what we’re up against, it’s important to step back for a moment to see just how vast — and how vulnerable — our electricity infrastructure is:

The North American electric power industry comprises more than 3,000 electric utilities, 2,000 independent power producers, and hundreds of related organizations. Together, they serve 120 million residential customers, 16 million commercial customers, and 700,000 industrial customers. With about $275 billion in annual sales, the industry is one of the continent’s largest – 30% larger than the automobile industry and 100% larger than telecommunications.

North American utilities own assets with a book value of nearly $1 trillion, roughly 70% in power plants and 30% in the grid. The continent has 700,000 miles of high-voltage transmission lines, owned by about 200 different organizations and valued at more than $160 billion. It has about 5 million miles of medium-voltage distribution lines and 22,000 substations, owned by more than 3,200 organizations and valued at $140 billion. The North American electric power industry will purchase more than $20 billion in grid infrastructure equipment in 2005, nearly one quarter of the worldwide total of $81 billion.

That analysis comes from a report released today: “The Emerging Smart Grid” (Download – PDF), produced by the Redmond, Wash.-based Center for Smart Energy. According to the report, as much as $45 billion is up for grabs by new advanced technologies for modernizing the electric power infrastructure.

The idea of the smart grid is to make the existing grid work more efficiently — so much more, in fact, that it could reduce the need for additional power plants, or for costly redundant systems designed to work “just in case” of peak demand. That’s the vision of a growing corps of researchers and companies working on grid optimization, a term that describes a wide range of information technologies that better understand and analyze exactly what’s going on in a complex energy system on a minute-by-minute basis, then optimize the system in a way that’s cost-effective.

This isn’t entirely news. Wired magazine published a seminal piece on The Energy Web in 2001. My company, Clean Edge, suggested in its Clean Energy Trends 2003 report that “optimizing the grid” would soon propel both investors and innovators to grab onto a multi-billion-dollar opportunity. But the CSE report takes that view to a much deeper level. For starters, it offers the seven key characteristics of a modern, optimized grid:

  • Self-healing. A grid able to rapidly detect, analyze, respond and restore from perturbations.
  • Empower and incorporate the consumer. The ability to incorporate consumer equipment and behavior in the design and operation of the grid.
  • Tolerant of attack. A grid that mitigates and stands resilient to physical and cyber security attacks.
  • Provides power quality needed by 21st century users. A grid that provides a quality of power consistent with consumer and industry needs.
  • Accommodates a wide variety of generation options. A grid that accommodates a wide variety of local and regional generation technologies (including green power).
  • Fully enables maturing electricity markets. Allows competitive markets for those who want them.
  • Optimizes assets. A grid that uses IT and monitoring to continually optimize its capital assets while minimizing operations and maintenance costs.

    Several factors are driving the need for a “smart grid.” For example, deferred maintenance that can no longer be ignored is mandating billions in upgrades. Regulatory changes mandate still more new hardware and software.

    Still another driver is the substitution of “bits” for “iron” — using smart systems to delay or reduce the need for expensive capital assets:

    Smart technologies can reduce the need for power plants, power lines, and substations. To name just four examples:

  • Demand response programs that shave peak loads, reducing the need for expensive (and polluting) peaking power plants
  • Sensors and meters that show exactly where power is being used, so utilities can expand only where needed and when needed
  • Electronics and control software that monitor power fl ows in real time, to run existing lines much closer to capacity without compromising reliability
  • Sensors and software to remotely monitor expensive equipment to know when it really needs to be replaced
  • According to studies by PNNL, the Rand Corporation and others, the savings from measures like these could be $50-100 billion over the next 20 years.

    Skyrocketing prices for oil and natural gas are bringing a new sense of urgency to all energy issues, including the grid, and this report represents a call to action to consumer groups, trade associations, utilities, scientists, and environmental organizations, among others. As we continue to electrify everything, and increasingly feed in electricity from countless solar, wind, and other distributed installations — and do it in a 24/7 world — the needs for a sturdier, smarter grid will grow daily. And our failure to upgrade our electricity infrastructure could threaten our economic — not to mention our national — security.

    As we noted in our 2003 report, “Given that the cleanest energy plant is the one that you don’t have to build, grid-optimization represents the ultimate clean-energy play.”

  • Oil Prices Still Falling?

    Crude oil futures dipped lower this week, just below $60/barrel. MSN article. That’s now down 15% off of the hurricane induced high.

    US inventories, both crude and gasoline, are up by several measures. Apparently the market’s previous concerns over US production glitches following Katrina and Rita were at least somewhat overstated, especially given emergency supply increases in the interim and adjusting demand.

    I have read a few reports suggesting that consumers are finally feeling the bite, and demand is adjusting to the higher price regimes. I’ve been waiting for this to happen. As always, demand forecasting is the tough one.

    Would the Million Solar Roofs bill save California money?

    SB-1, California’s hot topic million solar roofs bill, lost out last month. A definite setback to the solar industry here. I’m personally in favor of the solar roof bill, but some of the analysis around it was a little odd.

    A couple of months ago a solar company called Akeena, put out a whitepaper saying that if California adopted the Million Solar Roofs Bill that it could save over $6 Billion over and above the costs of the $ Bil subsidy. Akeena WhitePaper.

    They were quoting $9 Billion in benefits for $3 Billion in incentive costs over 10 years. They estimated total system costs at roughly $7/watt, and projected declining subsidies.

    Most of the “savings” was projected from $7 Bil avoided cost of building new infrastructure, both generation and T&D, with smaller amounts $0.5 Bil from emissions reduction and $1.5 Bil from new jobs and taxes. The amounts were calculated over a 10 year basis. The main driver is that avoided cost for new generation and T&D.

    What I didn’t understand at first was that the report calculated the benefit of the full avoided cost for new generation and T&D capacity that we would skip by adding 3,000 MW of solar capacity, but the cost side of the equation only seemed to include the subsidy, or STATE’s portion of the total solar bill. Each company or homeowner that put in a system would pay thousands of dollars more in costs as well. When you include that in the equation, the numbers don’t look so good, and probably show a small net gain at best, and more likely a net loss, over 10 years.

    It seemed to me the analysis only included half the cost, while adding all the benefits.

    The reality check is simple, the payback for a homeowner putting in one new solar system is 25 years with no subsidy, 16 with the state’s subsidy, by the report’s own analysis. So it’s really hard to believe analysis saying that if we subsidize putting in 1 million homes, instead of one, then we as the state can get 3x our money back in 10 years. The answer: we can’t, not if we include ALL the costs.

    This all said, I still the like the million solar roofs idea. California is a green state and should be at the forefront of alternative energy. We’ve put our money where our mouth is before when it comes to the environment, and we can again, but I like to know how much I’m paying.

    Take on the Energy Storage Conference – San Francisco

    I have spent the last couple of days at the EESAT 2005 Conference in San Francisco, hosted by the Electrical Storage Association with Sandia Labs and the DOE. The forum was focused mainly on large scale storages schemes. It was a long running well run forum, done every two years, 150+ attendance. Frankly, about the presentations themselves, I was disappointed. Very few of the discussions were down to earth where I could relate. I listened to a lot of discussion of the importance of electrical storage to the region, but the discussion was very academic, heavy on the study side, very light on either the technology or products coming to market. And the policy discussion lacked a sense of the reality of what economics were going to be.

    A few of the flow battery folks were there: VRB Power and ZBB (an Australian company, I was surprised to learn), as well as other perennial battery developers, Electro Energy some of the flywheel companies: Vicon, Pentadyne, Active Power, Boeing, Beacon. and EPRI and the State of California was well represented, as well as lot of academics, consultants, and a few global firms scouting progress or talking up a pilot they were involved in. There were also a number of papers on concepts like compressed air storage, which have been around for years with no takers.

    I felt I was watching the CHP discussion of 5 years ago all over again, except it was on storage. A lot of teams chasing a market that is unlikely to materialize in the way or of the size they are expecting. The bright spots included a realization that integration was the key, but there was very little sense of near term products or projects being brought to market.

    The most interesting discussion I thought was by a Japanese firm I had not heard of called Power Systems Co. (Very little of their English language website is finished.) I am not sure why they were giving a paper at this particular conference, but the engineer who presented said they had built a $25 mm plant to manufacture a next generation of supercapacitors, that they termed NanoCaps, product name ECaSS, and were selling an earlier generation now in Japan. Frankly, they were the only credible presentation I saw on a near term commercial business.

    Noticeably absent or in short supply across the board were investors, customers, buyers, or other people with non-R&D based budgets. So that’s either opportunity, or perhaps just symptomatic of the state of large scale electrical storage today.

    Project Finance for Renewables

    Structured energy project finance has been relatively commonplace in supporting the development of new energy facilities over the past 20 years. Central to the concept of project finance is disaggregating risk and parceling it out to specific parties who can accept that risk. As a result, project finance works great for the 30th or 40th deal of the exact same type, but it is typically very hard to use project finance approaches for funding the development of facilities using innovative technologies or commercial arrangements.

    Accordingly, project finance has historically been somewhat problematic for renewable energy interests to procure. Financiers central to structuring the deal were either unfamiliar or uncomfortable with the risks posed by renewable energy technologies, most of which have not been in commercial operation for decades. This lack of project finance capacity has thus been a major barrier to the widespread deployment of otherwise viable renewable energy technologies in commercial-scale projects.

    The good news is that project finance capacity is increasingly opening its doors to renewable energy opportunities. Financial professionals with deep knowledge of the true abilities of renewable energy are finally beginning to amass capital to deploy in sponsoring the development of renewable energy projects. The recent announcement of the $80 million bankroll behind US Renewables Group is but one indicator of the growth in this pivotal capacity for the future growth of renewables.

    Other boutique project financiers specializing in renewable energy opportunities are also emerging, and others will continue to form to capitalize on the rapid growth potential virtually uniquely offered by the renewable energy sector. We will know that renewable technologies and projects are truly mainstream when the big banks like Citi and JPMorgan lead the honor rolls of renewable energy project financiers. With the purchase of Zilkha Renewable Energy by Goldman Sachs earlier this year providing an immense boost to the credibility of renewables on Wall Street, these days cannot be long from now.

    Is Bush Still Weakening the Clean Air Act?

    Is the Bush Administration continuing to weaken our environmental regulations?
    By and large the US has been getting cleaner and more environmentally friendly on a per unit basis for the past 30 years. This is a good thing, though we still have a long way to go.
    I think that the future of power in the US includes a significant combination of coal generation (today still 55% of our electric power). Most electric power people would agree these days. So clean coal policies and clean coal technologies are very hot topics for me.
    The electric utility industry understandably has concerns about the economic impact on its power plants from new and increased regulation and requirements. I have no desire to see our power prices jump overnight and put the brakes on the economy.
    But it really bothers me to see a weakening enforcement of laws already on the books. I want to see measured increases in emissions restrictions year after year across the board. No major jumps, and no backwards steps. That way technology and capital planning can go hand in hand, and the industry can build a culture of long-term improvement. The biggest problem for industry in my mind is not increases in restrictions, but not knowing when and how much those increases will be. Or worse, believing that it can reduce the effect of restrictions currently in the rulebook. That only promotes industry lobbying to game the system.
    Does the Bush Administration understand this fact? Check out one article suggesting it does not, or post a comment if you disagree.