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61–528 2010

BLOWING IN THE WIND: RENEWABLE ENERGY 

AS THE ANSWER TO AN ECONOMY ADRIFT 

HEARING 

BEFORE THE

SELECT COMMITTEE ON 

ENERGY INDEPENDENCE 

AND GLOBAL WARMING 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED TENTH CONGRESS 

SECOND SESSION 

MARCH 6, 2008 

Serial No. 110–27 

( 

Printed for the use of the Select Committee on 

Energy Independence and Global Warming 

globalwarming.house.gov 


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SELECT COMMITTEE ON ENERGY INDEPENDENCE 

AND GLOBAL WARMING 

EDWARD J. MARKEY, Massachusetts, Chairman 

EARL BLUMENAUER, Oregon 

JAY INSLEE, Washington 

JOHN B. LARSON, Connecticut 

HILDA L. SOLIS, California 

STEPHANIE HERSETH SANDLIN, 

South Dakota 

EMANUEL CLEAVER, Missouri 

JOHN J. HALL, New York 

JERRY MCNERNEY, California 

F. JAMES SENSENBRENNER, JR., 

Wisconsin, Ranking Member 

JOHN B. SHADEGG, Arizona 

GREG WALDEN, Oregon 

CANDICE S. MILLER, Michigan 

JOHN SULLIVAN, Oklahoma 

MARSHA BLACKBURN, Tennessee 

PROFESSIONAL STAFF

DAVID MOULTON, Staff Director 

ALIYA BRODSKY, Chief Clerk 

THOMAS WEIMER, Minority Staff Director 

JONATHAN PHILLIPS, Professional Staff 


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C O N T E N T S 

Page 

Hon. Edward J. Markey, a Representative in Congress from the Commonwealth of Massachusetts, opening statement .................................................... 1 

Hon. F. James Sensenbrenner, Jr., a Representative in Congress from the 

State of Wisconsin, opening statement .............................................................. 5 

Hon. Earl Blumenauer, a Representative in Congress from the State of Oregon, opening statement ...................................................................................... 6 

Hon. John Shadegg, a Representative in Congress from the State of Arizona, 

opening statement ................................................................................................ 6 

Hon. Hilda Solis, a Representative in Congress from the State of California, 

opening statement ................................................................................................ 8 

Hon. Emanuel Cleaver II, a Representative in Congress from the State of 

Oregon, opening statement ................................................................................. 8 

Prepared Statement ......................................................................................... 10 

Hon. Eliot Engel, a Representative in Congress from the State of New York, 

opening statement ................................................................................................ 11 

WITNESSES

Vic Abate, Vice President, Renewable Energy, General Electric ......................... 11 

Written Testimony ............................................................................................ 14 

Answers to submitted questions ...................................................................... 86 

Blair Swezey, Senior Director, Solar Markets and Public Policy, Applied Materials .................................................................................................................... 22 

Written Testimony ............................................................................................ 25 

Answers to submitted questions ...................................................................... 96 

Bill Unger, Partner Emeritus, Mayfield Fund, Environmental Entrepreneurs 

(E2) ........................................................................................................................ 37

Written Testimony ............................................................................................ 39 

Barbara D. Lockwood, P.E., Manager, Renewable Energy, Arizona Public 

Service Company .................................................................................................. 55 

Written Testimony ............................................................................................ 57 

Answers to submitted questions ...................................................................... 99 

Bianca Jagger, Chair, The World Future Council ................................................ 64 

Written Testimony ............................................................................................ 67 

Tom Buis, President, National Farmers Union .................................................... 72 

Written Testimony ............................................................................................ 74 


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BLOWING IN THE WIND: RENEWABLE ENERGY AS THE ANSWER TO AN ECONOMY 

ADRIFT 

THURSDAY, MARCH 6, 2008 

HOUSE OF REPRESENTATIVES, 

SELECT COMMITTEE ON ENERGY INDEPENDENCE

AND GLOBAL WARMING, 

Washington, DC. 

The committee met, pursuant to notice, at 9:43 a.m., in Room 

2175, Rayburn House Office Building, Hon. Edward Markey (chairman of the committee) presiding. 

Present: Representatives Markey, Blumenauer, Inslee, Larson, 

Solis, Herseth Sandlin, Cleaver, Hall, McNerney, Sensenbrenner, 

Shadegg, Walden, Sullivan, Blackburn and Miller. 

Also Present: Representative Eliot Engel of New York. 

The CHAIRMAN. This hearing of the Select Committee on Energy 

Independence and Global Warming is called to order. Yesterday, 

President Bush addressed the Washington International Renewable Energy Conference to once again say that the United States 

has to get off oil. But this administration’s rhetoric does not match 

the reality that it is continuing to defend Big Oil at the expense 

of American consumers, our economy and the planet. 

After nearly eight years of this administration’s backwards energy policy, the oil companies now have us over a barrel. Today, 

after OPEC refused to answer President Bush’s plea to open the 

spigots, oil prices broke yet another all-time record, rising above 

$105 per barrel, up from $30 a barrel when President Bush took 

office. And consumers are paying the price at the pump. Gas prices 

have now reached a nationwide average of $3.18, more than doubling since the President took office. The prospect of $4 gas may 

be news to the President, but it is not news to the American people, who are being tipped upside down every time they fill up. 

Skyrocketing energy prices are also hurting the U.S. economy. 

The Department of Labor reported that the economy lost 17,000 

jobs in January, the first monthly decline in four years. 

But we have a new driver of economic growth and job creation 

waiting to be unleashed. We are on the cusp of a renewable energy 

revolution. Last year, we led the world by installing 5,244 megawatts of new wind power, roughly 30 percent of all new electricity 

generation installed in the United States. Solar photovoltaic installation also grew by more than 80 percent in 2007. 

Transitioning to a green economy has the potential to create 

hundreds of thousands of green jobs, generating economic opporVerDate Mar 15 2010 01:51 Nov 09, 2010 Jkt 061528 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 E:\HR\OC\A528.XXX A528

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tunity everywhere from the hearts of our cities to the heartland of 

our country. An analysis by the Clean Tech Venture Network estimated that as many as 500,000 new green jobs could be created by 

2010. But the tax incentives that have driven this growth of renewable energy are poised to expire once again. 

In recent years when these tax incentives have been allowed to 

lapse, the impact has been dramatic. For example, new wind installation dropped between 77 and 93 percent each of the three times 

that the production tax credit expired since 2000. If we do not provide certainty to investors by extending these tax incentives early 

this year, we are likely to see the recent growth of renewable energy grind to a halt. 

Our economy and our planet cannot afford it. If the tax credits for solar and wind expire this year, it will lead to an estimated $19 

billion in lost investments, and 116,000 lost job opportunities 

through 2009. 

Last week, the House passed legislation that would repeal unnecessary tax breaks for the largest oil companies and use those funds 

to extend those vital tax incentives for wind, solar and other renewable technologies. But rather than join the overwhelming bipartisan majority supporting this bill that would begin to restore the 

long-term health of our economy and our planet, the Bush administration is continuing to stand with Big Oil in opposition. 

In April of 2005, President Bush said, quote, ‘‘with 55 dollar a 

barrel oil, we don’t need incentives for oil and gas companies to explore.’’ Well, now, with that price nearly double, our economy on 

the brink of recession and our planet’s thermometer rising, it is 

time for this administration to finally back up its rhetoric and support incentives for wind and other renewables that will reduce 

global warming pollution, not make it worse; create jobs rather 

than hurt consumers; and turn our economy green rather than 

push it deeper into the red. 

And now I would like to turn and recognize the Ranking Member 

of the Select Committee, the gentleman from Wisconsin, Mr. Sensenbrenner. 

[The prepared statement of Mr. Markey follows:] 


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Mr. SENSENBRENNER. Thank you very much, Mr. Chairman. As 

I’ve said many times, promoting and advancing technology must be 

a key part of any global warming or energy security policy, and I 

am pleased that the chairman has scheduled this hearing today on 

renewable energy technology. This week people came to Washington from all over the world to talk about renewable energy. 

President Bush addressed the Washington International Renewable Energy Conference yesterday, not to mention the scores of 

other government and business leaders who were here to examine 

the future of worldwide renewable energy production. The reason 

that everybody’s talking about renewable energy production is because its future role is a vital part of the world’s economy. 

Traditional fossil fuels are and will remain a key source of worldwide energy production, but just like a strong investment portfolio 

that includes a diverse group of stocks and bonds, future energy 

portfolios should include a diverse array of energy technologies, including fossil fuels, renewable energy and nuclear power. On that 

point I am happy that the chairman has also scheduled a hearing 

for next week on nuclear energy technology. Nuclear power is safe, 

clean and produces no greenhouse gases. It, too, must be part of 

a diverse energy portfolio. 

But diversity is the key. When it comes to energy security or environment protection, different energy technologies work better in 

different places. Each has its benefits and each has its drawbacks. 

For example, wind energy is a promising source of clean, renewable 

power. But the wind doesn’t blow consistently and some areas are 

better for wind power than others. 

As Interior Secretary Dirk Kempthorne noted at the conference 

yesterday, wind farms can hurt bird populations, some of which are 

already under stress. The Audubon Society has noted that the average population of common birds has declined 70 percent since 

1967. So placing wind farms in places that will harm bird operations, bird populations, does not advance the cause of renewable 

energy, Secretary Kempthorne said, and I agree. 

In the right places, wind farms will be a great source of renewable energy, but the shoe doesn’t fit every footprint. Likewise, solar 

power is a great resource but mostly in areas where large tracts 

of land are available for use and the sun shines consistently. These 

should be just two options in a diverse energy portfolio. 

The Energy Information Administration recently reported to the 

Senate its projections for future energy production, and the use of 

renewables in the U.S. will nearly double by 2030. But even then, 

renewable energy won’t produce as much electricity as nuclear 

power currently does. The nuclear power only accounts for about 20 

percent of the nation’s electricity production. That’s why maintaining diverse energy resources is a top priority. 

By focusing on energy technologies like renewables and nuclear, 

combined with energy efficiency, the U.S. can meet many of the 

principles I believe are vital for any global warming policy. These 

technologies can help produce verifiable environmental benefits, 

and development of these technologies can help create jobs and improve the economy, which everybody agrees is a good thing. 


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I thank the witnesses for coming to enlighten us about the status 

of these technologies. I look forward to hearing more about them 

and yield back the balance of my time. 

The CHAIRMAN. The gentleman’s time has expired. The chair recognizes the gentleman from Oregon, Mr. Blumenauer. 

Mr. BLUMENAUER. Thank you, Mr. Chairman. In 319 days, the 

United States will begin a new era where we will, no matter who 

is elected president—Mr. McCain, Ms. Clinton, Mr. Obama—we 

will have a Federal Government that is no longer resisting working 

with the rest of the world on issues of climate change and global 

warming, and there’s strong signals that we will be moving more 

aggressively into a carbon-constrained economy. 

There are those that talk about the future. I think our witnesses 

here today will demonstrate that that era is here now, in terms of 

not just the promise of renewable energy but its practice. And I 

had a chance to review some of the testimony. I’m familiar with 

some of what’s going on. I think this is an important statement 

about where we are. 

It is interesting that the era is here. The Federal Government 

needs to catch up. The Federal Government can learn from some 

of our witnesses about how to be a more sophisticated customer for 

energy. The Federal Government, as the largest consumer of energy in the world, has an opportunity to change dramatically, not 

just our carbon footprint, but bring many of these things to scale. 

We need to have a broad policy framework like a renewable portfolio standard that would help accelerate this in a way that enhances the market. 

Last but not least, we need to realign our massive array of tax 

subsidies. The production tax credit you’ve referenced will be extended this year. It’s outrageous that it has taken this long, and 

it is not something that is done on a multiyear basis rather than 

guessing year to year. We clearly do not need to give as much of 

a subsidy to the large oil companies that have found a way to make 

a profit, but there are some industries and technologies that are 

here today where a little bit of federal assistance could make a big 

difference with a fraction of that money. 

I look forward to the hearing and appreciate your arraying it in 

this way. 

The CHAIRMAN. I thank the gentleman. The gentleman’s time 

has expired. The chair recognizes the gentleman from Arizona, Mr. 

Shadegg. 

Mr. SHADEGG. Mr. Chairman, thank you very much for holding 

this hearing. I would like to start by welcoming a very important 

witness here today, Ms. Barbara Lockwood, who is the manager of 

Renewable Energy at Arizona Public Service Company. Barbara is 

here to talk about a new project that I’m very proud of that Arizona Public Service Company has just announced. It is the construction of the largest solar power plant in the world in my home 

state of Arizona. Barbara, thank you for being here. 

I can’t pass up this opportunity to tout the advertising campaign 

that is making Arizonans aware of this project. They take a weatherman—he’s not a real weatherman—put him on camera and say, 

you know, here’s the forecast for the next three days. Sunny, hot. 

Sunny, sunny, sunny, hot. Next week it’ll be sunny, hot, sunny, 


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sunny, hot. And in June, it will be sunny, hot, sunny. If you’re getting married in August, however, it’ll rain. He pauses and says, no, 

just kidding. It’ll be sunny and hot. 

The Arizona people are embracing that campaign, and I am very 

excited about this project. I want to compliment Arizona Public 

Service. Obviously, technology is a part of the path forward. Solar 

energy needs to be a part of the path forward. And Arizona is emblematic of this entire issue, because in Arizona we have tremendous growth. The state is the second fastest growing in the nation. 

The city in which I live and represent is one of the fastest growing 

in the nation, and I am thrilled that we are moving forward both 

with technology in every area, but also particularly with technology 

in renewables. 

In that vein, I’d like to point out something that has become at 

least a little bit of a trademark of my own, Mr. Chairman. I know 

yours is brilliantly funny opening statements. You may recall that 

years ago we did a hearing on renewables in the Commerce Committee, and I brought in the hydrologic cycle. And I want to point 

out, I took it out of a third grade text or a fifth grade text. 

We were discussing at that time the issue of renewable energy, 

and in that particular piece of legislation, hydro was not considered 

renewable energy. And so I brought—I went to one of my staffers 

whose wife taught grade school, and I said does she happen to have 

a copy of the hydrologic cycle in a textbook? And they said, sure. 

Let’s see if we can find one. And they found this one. And of course 

it shows, you know, rain evaporating up out of the ocean, coming 

into the clouds, the clouds move over the land and then come back 

down. 

I would argue that we need to focus on the fact that hydropower 

needs to be an important part of this entire discussion. It is one 

of the single most efficient forms of renewable energy. Ninety percent of the available energy from a hydro power plant can be converted into electricity. It is emissions free, Mr. Chairman, so it addresses the issue of a carbon footprint. And I would urge my colleagues here as they look at renewable energy to focus on that. 

There are new possibilities of in-stream flow. In the old days 

when we thought about hydropower we thought about you have to 

build a dam and put a turbine in the dam and then let the water 

out of the dam, and there are environmental consequences. We’ve 

actually gotten better since then. We can now do in-stream flow. 

I just want to conclude with one fact. Today in Arizona, Glen 

Canyon Dam is producing one-third less power than it is capable 

of because of environmental damage downstream. That is the 

equivalent of two coal or natural gas-powered plants and their carbon footprint. If we were more innovative, if we used technology to 

a greater degree, we could create a second downstream—downstream, a second dam, operate that solely for environmental purposes, operate Glen Canyon Dam for hydroelectricity purposes, and 

eliminate the need for those two coal-fired plants. 

I thank you, Mr. Chairman. I regrettably have another hearing 

that I’ll have to attend and will miss part of this hearing, but I 

commend you for holding it. And, again, I commend Arizona Public 

Service Ms. Lockwood for her testimony. 


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The CHAIRMAN. The gentleman’s time has expired. The chair recognizes the gentlelady from California, Ms. Solis. 

Ms. SOLIS. Thank you, Mr. Chairman, and thank the witnesses 

for being here this morning as well. I, too, have another conflicting 

hearing that I’ll have to leave to attend to. But I just wanted to 

touch on the economic crisis that we’re facing across the country, 

but particularly in areas like mine. 

We just heard from the Department of Labor in their recent reports that we’ve lost about 17,000 jobs in January. In my district, 

in East Los Angeles and Southern California, unemployment has 

reached above 7.2 percent, and we still don’t have an accurate figure for a lot of our youth that have also been unemployed. 

We’ve seen high levels of poverty, homelessness, and the last 

thing that people want to talk about is going to the gasoline station 

and having to fill up and putting in more than $50 to fill up half 

a tank. The prices there are outrageous, above $3.60 per gallon. 

A recent report that we know in the American Solar Energy Society estimated back in 2006 that renewable energy and the energy 

sector generated, however, 8.5 million jobs, nearly a trillion dollars 

in revenue to the United States. And jobs in these sectors, as we 

know, provide livable wages, above the minimum wage, and in 

many cases will not be outsourced. They will be jobs that can stay 

here on our shores. 

In this time of economic turbulence, it’s important that we support those sectors of our economy that are providing that incentive. 

And I’m proud that last week the House passed the Renewable Energy and Energy Conservation Tax Act. I heard personally from 

many of our medium and small-sized businesses in Los Angeles at 

a recent event I held at the East LA Skill Center where we’re finding that individuals are getting involved in training segments of 

our society that would otherwise not have an opportunity to get involved in placement and development of solar panels. 

And there were many people there as businesses that were 

pleading with me, ‘‘Congresswoman, when is the Federal Government going to provide relief so we can provide the kinds of funds, 

the capital investment so that we can prolong these kinds of jobs?’’ 

My answer to them is I will do whatever I can as a part of—a 

Member of Congress here and that serves on this committee, but 

also ask them to also talk to our President and to the other side 

of the aisle. Because indeed, this is something that affects all of us. 

I look forward to hearing from you. I know that we have a lot 

to do. Green collar jobs is an area that I’ve been working on. The 

President did sign a bill that would allow for $125 billion to be 

spent to create at least at a minimum 3 million jobs. Again, those 

jobs are very important to us. Help us. Let’s step up to the plate. 

And I look forward to hearing from each and every one of you. 

Thank you. 

The CHAIRMAN. The gentlelady’s time has expired. The chair recognizes the gentleman from Missouri, Mr. Cleaver. 

Mr. CLEAVER. Thank you, Mr. Chairman, and thank you for the 

hearing. I would like to express appreciation to our august panel 

today. Let me apologize in advance. I’m going to be running in and 

out. I’m on the Financial Services Committee, which is right 


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around the corner, and it starts at ten, so I’ll be shuttling in between. 

But I appreciate your presence here and I appreciate the fact 

that we are dealing with this energy, renewable energies issue, and 

the need to create green jobs. As the Federal Government becomes 

more and more sensitive, and I think Mr. Blumenauer is absolutely 

right—it doesn’t matter who the president is. We’re going to move 

deeper necessarily into the world that is becoming green-conscious. 

And we are going to need to create green jobs. 

The committee I’m on, which also deals with housing and oversight for the Department of Housing and Urban Development, we 

are now requiring that all new HUD housing contain or be built 

with architects—by architects who create green houses. And I 

think you’re going to see more and more legislation containing components that will require the greening of however we are spending 

our federal dollars. And so if we’re going to do that, it seems to me 

that we need to create people who can handle those jobs, people 

who can put in solar panels. 

I live in a city, one of the largest cities geographically in the 

country, 322 square miles with more circumferential highways 

than any other city per capita in the United States. We have one 

E–85 service station in that large area. And I’m told I drive an E– 

85 car that we are going to have a shortage of mechanics, for example, who can work on hybrids and E–85 vehicles. And so we are 

going to move into this new era, and unless we make preparations 

now, we’re not going to have the workers who are going to be able 

to do the jobs to sustain the era we’re trying to create. 

And so, hopefully, you will be able to help provide us with some 

direction today that we might be able to use as we further sensitize 

Congress and the nation on the necessary changes that we’ve got 

to make as a nation. 

I yield back the balance of my time. 

[The prepared statement of Mr. Cleaver follows:] 


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The CHAIRMAN. Great. The gentleman’s time has expired, and all 

time for opening statements by members of the Select Committee 

has expired, but we see that we have a guest here, Eliot Engel, a 

congressman from New York, and would the gentleman like to be 

recognized? 

Mr. ENGEL. Yes. Thank you. Thank you very much, Mr. Chairman. I’ll be very brief. And thank you for letting me participate. 

And this is obviously very important. I look forward to hearing all 

the witnesses this morning, especially my friend Bianca Jagger, 

chair of the World Future Council. Bianca has fought for many 

years for human rights as a human rights activist, and in many 

ways, we’re talking about human rights. Because if we do what 

we’re supposed to do with renewable energy, it’s certainly a win for 

everybody. 

I was looking at the notes that were passed out, Mr. Chairman, 

and one of the things that caught my eye is renewable energy 

tends to have higher construction and maintenance cost and lower 

or zero fuel cost, while fossil energy has the reverse cost structure. 

As a result, renewable energy technologies lead to a higher number 

of jobs per unit of energy generated compared to conventional fossil 

fuels. The construction, manufacturing, installation, operation and 

maintenance jobs produced by a megawatt of photovoltaic solar, for 

example, is 7 to 11 times greater than the number of jobs generated by an equivalent amount of coal or gas-generated electricity. 

So we’re talking about clean air. We’re talking about helping with 

global warming, and we’re talking about creating new jobs and 

driving economic growth. It’s certainly in my opinion the direction 

that our country should go in. We ignore global warming obviously 

at our own peril, and I believe that tax incentives for renewable energy is certainly the way to go. And I’m glad, as Ms. Solis said, 

that last week we passed a bill giving tax incentives, Renewable 

Energy and the Energy Tax Act. I really believe only government 

can drive this, and that’s why this hearing this morning is so important. 

So I thank you for letting me participate, and I am eagerly 

awaiting the testimony of our witnesses. Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you, and we welcome you, sir, to this 

hearing. And that completes the opening statements. 

We’ll now turn to our very distinguished witnesses, and our first 

one is Mr. Vic Abate, who is the Vice President for Renewable Energy from General Electric. This has been an incredible growth 

story. We’re looking forward to hearing more about it. You have 

five minutes, Mr. Abate, whenever you are ready. 

STATEMENT OF VIC ABATE, VICE PRESIDENT, RENEWABLE 

ENERGY, GENERAL ELECTRIC 

Mr. ABATE. Thank you, Mr. Chairman and members of the committee. I appreciate this opportunity to testify on renewable energy, 

the economy, its potential to stimulate investment and job creation, 

and the critical importance of government policy in realizing this 

potential. 

GE Energy is a power generation technology leader with more 

than 100 years of industry experience. Our global team consists of 


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36,000 employees. We operate in over 700 sites and in more than 

100 countries. Our power generation business is a diverse portfolio 

consisting of thermal, gasification, nuclear and renewable energy 

technologies such as wind, solar and biomass. 

With energy demand increasing dramatically and growing worldwide pressure to address greenhouse gas emissions, GE believes 

firmly that renewable energy must become an integral part of the 

21st century energy mix. Supportive government policy has enabled the U.S. to become the global leader in new wind power installations. Last year the U.S. added over 5,000 megawatts, over 25 

percent of the world’s total wind power, and that’s up from 55 

megawatts a decade ago, so tremendous growth. 

The U.S. installed over 45 percent—the installed base grew over 

45 percent and now totals 16.8 gigawatts in 34 states and accounts 

for over 1 percent of the nation’s electricity supply and powers over 

4.5 million homes from this resource. Wind power accounted for 30 

percent of all nameplate generation capacity added in the United 

States last year, second only to natural gas, and the U.S. is on pace 

to surpass Germany and become the nation with the largest installed base of wind power by the end of 2009. 

The growth in wind energy is creating real economic energy security and environment benefits. According to the American Wind 

Energy Association, last year the industry spurred $9 billion in investment and created more than 50,000 new jobs. Much of this job 

growth has occurred in areas that have been hardest hit by manufacturing job losses. The installed base for wind power also displaces 3 percent of the natural gas consumption and avoids the 

emissions of 28 million tons of carbon dioxide from traditional 

power plants, the equivalent of taking 6 million cars off the road. 

Policy-driven growth of the wind industry in the U.S. has helped 

GE expand its wind business revenues from less than $1 billion in 

2004 to more than $6 billion this year. Over 8,000 of GE’s 1.5 

megawatt wind turbines have been installed worldwide, a number 

expected to exceed 10,000 by the end of this year. 

Since entering the wind industry in 2002, GE has invested over 

$700 million in technology, increasing its wind turbine production 

six-fold and tripled its U.S. wind turbine assembly sites. We’ve expanded capacity from about 10 wind turbines per week to making 

13 a day, and we’ve grown renewable energy jobs at GE to more 

than 2,700. 

GE has also tripled the number of its suppliers, who now account 

for in excess of 2,000 U.S. jobs and cover 15 states. We see significant future job creation potential from wind energy and estimate 

that sustaining the growth rate we’ve seen over the past five years 

for the next five would triple the size of the industry and of the 

associated jobs. 

To realize the potential for wind power we must meet three challenges: Technology, supply chain and policy. The cost of wind electricity has dropped 80 percent over the past 20 years, and GE’s 

technology investments in efficiency, reliability and grid integration 

will continue to improve the competitiveness of wind power. GE is 

also driving supplier quality in wind industry through its Lean 

Manufacturing and Six Sigma processes. 


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The most critical challenge facing the U.S. wind industry is policy uncertainty. Long-term stable, predictable incentives reward innovation and enable technology manufactures and suppliers to invest and expand capacity to keep up with the growing demand. The 

current growth of the U.S. wind market is underpinned by the repeated extensions in 2005 and 2006 of the federal production tax 

credit that’s set to expire at the end of 2008. Expiration of the tax 

credit would have a devastating impact on the domestic wind industry. Prior expirations at the end of 1999, 2001 and 2003 reduced 

wind power installations in the following year by 73 to 93 percent. 

A report estimates that failure to extend the credit this year would 

cause a 90 percent drop in wind installations, resulting in $11.5 

billion lost investment and 76,000 job opportunities in 17 states in 

2009 alone. Jobs that might have been created in the United States 

could shift instead to overseas areas like Europe and China, which 

are strengthening their wind policies. 

In summary, GE believes that the United States is well positioned to benefit from the growth of the renewable energy industry. 

However, continued growth of this industry is dependent on stable, 

predictable policy. We urge the U.S. Congress to act immediately 

and extend the exiting production tax credit for wind energy. 

Thank you for this opportunity to present this testimony, and I 

look forward to your questions. 

[The prepared statement of Mr. Vic Abate follows:] 


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The CHAIRMAN. Thank you, Mr. Abate, very much. 

Our second witness is the Senior Director for Solar Markets and 

Public Policy for Applied Materials, Mr. Blair Swezey. Whenever 

you’re ready, sir, please begin. 

STATEMENT OF BLAIR SWEZEY, SENIOR DIRECTOR, SOLAR 

MARKETS AND PUBLIC POLICY, APPLIED MATERIALS 

Mr. SWEZEY. Thank you, Mr. Chairman, and members of the 

committee. 

The CHAIRMAN. Could you turn on your microphone, please? 

Mr. SWEZEY. Oh, I’m sorry. Thank you, Mr. Chairman, and members of the committee, for providing us with the opportunity to testify today. We are very pleased to present our corporate perspective 

on the potential of the solar industry to create domestic jobs while 

at the same time providing an important solution to some of our 

most pressing energy and environment needs. 

Applied Materials is a Fortune 500 company headquartered in 

Silicon Valley that employs approximately 14,500 workers worldwide, including nearly 8,000 here in the United States, with additional production facilities—I’m sorry. Our primary manufacturing 

facilities are in Austin, Texas, with additional facilities in Germany 

and Israel. We sell more than 80 percent of our products outside 

the United States, making us an important positive contributor to 

the U.S. balance of trade. 

We recently celebrated our 40th year as a company and have a 

proud heritage of providing productivity-enhancing nanomanufacturing tools and equipment to the semiconductor and flat-panel display industries. We have now extended this technology and manufacturing expertise to providing the tools for production of solar 

electric photovoltaic or PV modules. 

We see considerable growth potential in the rapidly expanding 

solar market. Our technology and production scale helped reduce 

the cost of transistors by a factor of 20 million between 1974 and 

today. Similarly, the price of flat panel displays has dropped by a 

factor of 20 in the past decade. 

We fully expect to have the same impact on driving cost reductions for PV panel production by a factor of two to three, which will 

put solar electricity prices on par with grid power prices for large 

areas of the world. The key is getting to large-scale manufacturing 

by creating large markets. 

The sheer magnitude of our energy supply challenges—meeting 

continued global demand growth while assuring economic prosperity, domestic energy security, and environmental quality—dictates that we accelerate the development of all available energy resource options. The question is not one of renewable resource availability, but of the economics of deploying the technologies to exploit 

these resources and how rapidly industry can ramp up the manufacturing capacity to produce the technologies. 

First to economics. Electricity generation from photovoltaics is 

currently anywhere from two to three times more expensive than 

electricity generation from conventional sources. Nevertheless, 

global PV production has been growing at a rapid clip, rising at a 

rate of more than 40 percent per year over the past decade. This 


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growth is a direct result of governmental policies that have been 

established here in the United States and around the globe. 

In the U.S., the Energy Policy Act of 2005 established a 30 percent investment tax credit, or ITC, for residential solar installations and raised the existing business energy ITC from 10 percent 

to 30 percent. A reduction in the credit would absolutely send the 

wrong signal to the investment community that is so critical in providing the capital for solar industry expansion. And so we commend the House of Representatives for its recent action in passing 

H.R. 5351, which includes extension of these tax credits and other 

important changes. 

The other key element is domestic jobs and economic development. The solar industry creates manufacturing jobs with labor 

that is readily transferrable from other manufacturing industries. 

The United States is already a base for solar panel manufacturers 

and dozens of new startup operations. Applied Materials itself now 

employs about 900 employees in its Energy and Environmental Solutions group, which is just two-and-a-half years old. 

While overall U.S. manufacturing job numbers continue to decline, renewable energy industries offer a whole new generation of 

manufacturing job potential. However, the fact that companies develop the technology here in the United States does not guarantee 

that they will also locate the production here in the United States. 

Achieving the job creation potential of the solar industry depends 

on continuing policy support to build the market. 

The Solar Energy Industries Association, of which Applied Materials is a member, estimates that extending the current set of federal solar tax credits will create 55,000 new jobs in the solar industry and more than $45 billion in economic investment. Conversely, 

a recent study by Navigant Consulting estimated that failure to extend the credits will cost the country nearly 40,000 jobs and more 

than $8 billion of investment just through 2009. 

Industry will locate where production conditions are most favorable, and manufacturers are also likely to invest and locate close 

to where viable end markets exist. However, companies need to see 

a clear market growth pathway to commit the substantial resources needed to ramp production capacity and output. 

Unfortunately, in the case of PV manufacturing, many U.S. companies are increasingly looking abroad to expand their production, 

in part because of the uncertainty over future policy support. 

Speaking from our own corporate experience, 100 percent of our 

solar factory orders have come from outside the United States. So 

while our domestic business is advancing, the opportunity for a 

much larger U.S. industry platform is idle. 

In summary, the PV industry is currently transitioning from one 

of component assembly operations to large scale manufacturing, 

which will dramatically increase the scale and throughput of PV 

module production in coming years. Solar photovoltaics is following 

a well documented pattern of cost decline, and with new technology 

approaches, is poised to create an accelerated cost reduction path. 

With our abundance of solar and other renewable energy resources, 

we are presented with the opportunity to manufacture our way toward domestic energy security and sustainability. 


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As a nation, we need to seize this opportunity. Applied Materials 

will do its part to make America competitive in this important and 

growing industry, and we stand ready to work with policymakers 

to develop a sound policy framework that will enable us and other 

innovative U.S. companies to lead the way. 

This concludes my prepared remarks, and I look forward to your 

questions. Thank you again for the opportunity to speak before you 

today. 

[The prepared statement of Mr. Blair Swezey follows:] 


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The CHAIRMAN. Thank you Mr. Swezey. 

Our next witness is Mr. Bill Unger from the Mayfield Fund, and 

he is here representing Environmental Entrepreneurs. We welcome 

you, sir. 

STATEMENT OF BILL UNGER, PARTNER EMERITUS, MAYFIELD 

FUND, ENVIRONMENTAL ENTREPRENEURS (E2) 

Mr. UNGER. Thank you. I’m a Partner Emeritus at Mayfield 

Fund. We’re a venture partnership. 

The CHAIRMAN. Could you move that microphone up a little bit 

closer, please. 

Mr. UNGER. Okay. I’m part of a venture partnership that’s invested in technology companies since 1970. I’m also a member of 

Environmental Entrepreneurs, which is an organization, a volunteer organization of 800 members across 25 states who believe that 

good environmental policy is good economic policy. 

I’d like to thank the chairman and members of this committee 

and the House for their work in passing the Renewable Energy and 

Energy Conservation Tax Act. The extension of these incentives 

that provides an even playing field for all technologies is vital for 

our nation. We also hope that the Senate and the President will 

cooperate and pass this into law. It’s a critical step to solving our 

urgent and intimately related problems of dependence on foreign 

energy, our economic growth and climate change. 

For example, today, each ten gallon fill-up at the pump has been calculated as adding an additional $2.10 to as much as $11 per gallon when the full cost of the tax incentives, the $50 billion cost for 

protecting shipping lanes of oil, and health and environmental 

costs are fully loaded. And this is exclusive of the cost of the war. 

We add these dollars to our debt or pay in other ways to the tune 

of an additional $20 to $100 per tankful that is not evident at that 

particular point. Also, since the Energy Policy Act of 2005 was 

passed, which granted $6 billion of incentives to the oil industry, 

the oil industry has spent $112 billion repurchasing their shares on 

the open market. We would like to see a more even playing field. 

I appreciate this opportunity to discuss with you the benefits of 

investment in clean tech jobs, economic growth and an improved 

environment. The need to address climate change is immediate. Because of the magnitude of this challenge, this new industrial revolution, properly addressed, could create more jobs, more economic 

prosperity, more personal investor, corporate and public servant 

satisfaction than has ever been seen for any number of the exciting 

technological innovations of the past. 

The venture industry is proud of its role in job creation and 

bringing new technologies to market. In 2006, venture-backed companies provided 10.4 million U.S. jobs, and these companies had 

revenues of $2.3 trillion, and we are excited about Cleantech. The 

analysis it sounds like most of you are familiar with from UC 

Berkeley concludes, ‘‘the renewable energy sector generates more 

jobs whether it’s measured on per megawatt of power installed per 

unit of energy produced, or per dollar of investment than the fossilfuel-based energy sector.’’ E2 estimates U.S. cleantech investment 

by 2010 will be $14 billion to $19 billion and will create an additional 400,000 to 600,000 jobs. 


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This is a big opportunity. How does it start? Often with the 

wealth of technologies generated at our own national laboratories 

and our universities. These are national resources. Really they’re 

our treasures. DARPA and NIH play a crucial role nurturing technology development until the venture industry, which invests in 

product development, becomes interested. Our tax dollars paid for 

much of the pioneering work in solar and wind technology at our 

national labs. Much of the basic work for the hybrid engines on the 

road today was done at Stanford University, yet we are not the 

leaders in these fields. Germany, Denmark, Taiwan and Japan 

seized these opportunities and are prospering. 

Since the energy crisis of the ’70s, federal energy research spending is down significantly. And is this important? The market caps 

of Ford and General Motors are $13 billion each, and they’re encouraging their employees to find other work. Toyota has a $176 

billion market cap, and they have record employment. With an 

even playing field in terms of policy and federally funded R& D in 

a variety of technologies, we can regain market leadership. The 

semiconductor industry in the 1980s regained world leadership 

from exactly this kind of public-private partnership. 

There’s a high degree of technical knowledge spillover from the 

semiconductor and software industries to cleantech. Many of the 

entrepreneurs from these fields are now entering the cleantech industry. Their experience is an unmatched resource in the world. So 

this is a great story. Cleantech investors love it. In 2006, $2.9 billion was invested in cleantech, 76 percent increase over the previous year. Cleantech is now the third largest venture investment 

segment. The barriers that keep cleantech from growing fast 

enough to head off the climate crisis are inconsistent policy, longterm subsidies for conventional industries and trade barriers. 

These have to be corrected. 

A mandatory, comprehensive national cap on greenhouse gas 

emissions, a national renewable energy standard and increased 

R&D funding are necessary. But these measures should not preempt states from going even further if they so choose. The Manhattan Project, the Marshall Plan, the space program, Roosevelt’s 

rural electrification program and Eisenhower’s interstate highway 

system are all examples of strong and visionary federal leadership. 

And unlike the Apollo program and the Manhattan Project, we can 

do this with existing technologies. We need to be the people the 

world have been waiting for. We need to be the people our children 

will say made the right decisions to give their children a safer, 

healthier and more prosperous place to live. 

I look forward to your questions. 

[The prepared statement of Mr. Bill Unger follows:] 


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The CHAIRMAN. Great. We thank you, sir, very much. Our next 

witness is Ms. Barbara Lockwood, who is the manager of Renewable Energy for the Arizona Public Service Company. Welcome. 

STATEMENT OF BARBARA D. LOCKWOOD, P.E., MANAGER, 

RENEWABLE ENERGY, ARIZONA PUBLIC SERVICE COMPANY 

Ms. LOCKWOOD. Thank you. Mr. Chairman and members of the 

committee, thank you for the opportunity to provide APS’s perspective on the economic benefits of renewable energy. As Congressman 

Shadegg mentioned, Arizona is the second fastest growing state in 

the country, growing at three times the national average. APS has 

more than a million customers who at their peak consume over 

7,000 megawatts of electricity. And that electricity demand is growing at a rate of hundreds of megawatts each and every year. 

In Arizona, our most abundant renewable resource is sunshine. 

And APS is looking for ways to put the sun to work providing electricity. APS is committed to making Arizona the solar capital of the 

world. 

The focus of my comments today are on a particular type of solar 

technology called concentrating solar power, or CSP, which is different than the photovoltaic systems or solar panels that you typically hear about. APS recently announced the Solana Generating 

Station. Solana is a 280 megawatt solar power plant to be located 

just outside of Phoenix, Arizona. APS has signed a long-term contract with Abengoa Solar, the project developer and owner, for all 

of the electricity generated by this plant. 

If operating today, Solana would be the largest solar power plant 

in the world. The plant will use nearly three square miles of 

parabolic trough mirrors, and operating at full capacity, the plant 

will provide enough electricity for 70,000 homes. One of the most 

important aspects of this technology is its ability to capture and 

store energy for later use. By using large insulated tanks filled 

with molten salt, heat captured during the day can be stored and 

used to produce electricity when the sun is no longer shining. 

The value of this can’t be underestimated. Because it can provide 

energy even after the sun has set, this technology provides the 

maximum value, and it also provides reliability for APS and its 

customers. Solana also provides significant economic benefits to the 

state of Arizona. The Solana Generating Station will provide 1,500 

construction jobs and 85 permanent operations jobs. But that’s not 

the total economic impact. All totaled, Solana will result in over a 

billion dollars in economic development for the state of Arizona. 

Today the single biggest obstacle to the success of Solana is the 

potential expiration of the 30 percent federal investment tax credit. 

Without this tax credit, Solana is simply not affordable today. I 

also need to be clear that a one or two-year extension of the ITC 

is not sufficient. While it might not be preferable, it is usually acceptable for small scale solar projects and for wind projects. But 

large scale solar is different. It takes about three to four years to 

permit and construct a plant like Solana, and we can’t begin building it until we know when it’s finished it’s going to be eligible for 

the 30 percent investment tax credit. If a long-term extension of 

the investment tax credit is not granted, Solana will not be built. 


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If the ITC is extended for a sufficient period of time, there will 

be many more plants like Solana in Arizona and in the desert 

Southwest developed in the next five to ten years. If not, the industry will lose its momentum and no large scale solar plants will be 

built. The future of large scale solar depends on getting those first 

few plants into operation. 

Thank you, Mr. Chairman and members of the committee for the 

opportunity to share this information with you. 

[The prepared statement of Ms. Barbara D. Lockwood follows:] 


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The CHAIRMAN. Thank you, Ms. Lockwood, very much. Our next 

witness is Ms. Bianca Jagger, who is the Chair of the World Future 

Council. Welcome. Could you move the microphone up a little bit 

closer and turn it on. 

STATEMENT OF BIANCA JAGGER, CHAIR, THE WORLD FUTURE 

COUNCIL 

Ms. JAGGER. Thank you, Mr. Chairman, and thank you for organizing this very important hearing. It is an honor and a privilege 

to be here. I have heard some very important testimony about renewable energy and what has been done in the United States. Perhaps I’d like to talk about the threat of global climate disaster that 

is no longer out for debate, and therefore, renewable energy becomes a must and not just a question mark. The majority of scientists are in agreement. 

Governments have previously been reluctant to accept this reality. However, notwithstanding all this sobering information, the 

agreements reached in Bali were extremely weak and inadequate. 

And as you know, the role that the United States played in Bali 

was not the most encouraging. 

Climate change is the defining challenge of our age. How to meet 

that challenge while dealing with the already devastating consequences of floods, droughts and rising temperatures remain the 

great unanswered question, and the time to answer is running out. 

In its final report, the United Nations Intergovernmental Panel on 

Climate Change stated that the world must reverse the growth of 

greenhouse gas emissions by 2015 to avert a global climate disaster. If there is no action before 2012, that’s too late, said 

Rajendra Pachauri, who headed the panel, which shared the Nobel 

Peace Prize in October with former U.S. President Al Gore. What 

we do in the next two to three years will depend and will determine our future. 

But what should we do? I used to believe that reduced energy 

consumption was an important first step, accompanied by research 

and investment into energy efficiency and renewable energy 

sources. I used to believe that it would be enough to encourage 

more localized lifestyle, reducing the need for overburdened, polluting transport networks. But after reading the most recent scientific findings, I have come to realize that even if we begin each 

of these practices in earnest tomorrow, it is simply not enough. 

The time has come to expose the myth that we can avert climate 

catastrophe by small measures and sticky plaster measures. In the 

recent assessment by the highly respected climate scientist James 

Hansen of the NASA Goddard Institute for Space Studies, he suggested that the IPCC report, itself alarming reading, might even be 

‘‘absurdly optimistic.’’ 

For example, the often-touted ‘‘safe’’ figure of 3.6 degrees Fahrenheit increase in average global temperatures is in fact not safe 

at all. We have already experienced a rise of 1.31 Fahrenheit in average global temperatures. A rise of 3.6 Fahrenheit is three times 

that. Agreeing to a 3.6 Fahrenheit target does not avoid the possibility of catastrophe. On top of this, the apparently bold target of 

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Hansen estimates sea level rises of 4 to 5 meters this century 

due to melting ice in Greenland and Antarctica. He describes how 

the IPCC report fails to take geological records into account and ignores the so-called ‘‘albedo flip’’ property of water: ‘‘The ‘albedo flip’ 

property of ice/water provides a powerful trigger mechanism . . . a 

climate forcing that ‘flips’ the albedo of a sufficient portion of an 

ice sheet can spark a cataclysm.’’ 

Hansen is telling us that the poles do not melt in a linear fashion, but rather in bursts, and that if the globe warms up just a few 

degrees, it might be enough to trigger a catastrophic ice sheet collapse. Such a collapse would not only drown most of the world’s 

centers of population, but would itself fuel further climate change, 

since less ice means less heat reflected back into space. 

‘‘The Earth’s climate is remarkably sensitive to global forcings. 

Positive and ‘amplifying’ feedbacks predominate. This allows the 

entire planet to be whipsawed between climate states. Recent 

greenhouse gas emissions place the Earth perilously close to dramatic climate change that could run out of control.’’ 

‘‘If we go beyond the point where human intervention can no 

longer stabilize the system, then we precipitate unstoppable runaway climate change. That will set in motion a major extinction 

event comparable to the five other extinction crises that the Earth 

has previously experienced.’’ 

This clearly demonstrates what the World Future Council, the 

organization I chair, is advocating. If we are serious about averting 

climate change catastrophe, we must think in revolutionary terms, 

and transform our way of life, restoring rather than destroying life 

on Earth. We must embark upon a global renewable energy revolution. If we are to achieve the necessary carbon reduction by 2020, 

we must replace our carbon-driven economy with a renewable energy economy. There is no time to debate half-measures any longer. 

The period in which they may have been effective has long been 

passed. 

We have experienced an industrial revolution. We have experienced a technological revolution. It will take a global renewable energy revolution, similar in scale and consequence to those two, to 

avert catastrophe. As Hermann Scheer, a member of the German 

Bundestag and the World Future Council, said, ‘‘This cannot be 

achieved with the method of ‘talk globally—postpone nationally,’ 

but only with the method of ‘think globally—act locally, regionally 

and nationally.’ ’’ 

The beginning of this movement may already be underway. Some 

nations have begun to act, even finding great financial opportunities along the way. In Germany, pushes toward energy efficiency 

and renewable energy sources are spurring the economy. By 2020, 

every building must meet high levels of energy efficiency. The 

Feed-In tariffs legislation, which guarantees a preferential price for 

energy produced, will create 250,000 jobs. 

The CHAIRMAN. Ms. Jagger, could you please summarize the 

statement? 

Ms. JAGGER. Sure. It will be crucially important for the United 

States, perhaps led by individual states, to adopt Feed-In tariffs as 

a significant way by which to accelerate the introduction of renewable energy. The U.S. cannot continue to rely on powering its cities, 


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its industries, its farms and its transport systems, by energy resources for which there is ever greater global competition. 

Thank you very much, Mr. Chairman. 

[The prepared statement of Ms. Bianca Jagger follows:] 


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The CHAIRMAN. Great. Thank you, Ms. Jagger, very much. 

And our final witness is Mr. Tom Buis, who is the President of 

the National Farmers Union. Welcome, sir. 

STATEMENT OF TOM BUIS, PRESIDENT, 

NATIONAL FARMERS UNION 

Mr. BUIS. Thank you, Mr. Chairman and members of the committee. I am President of the National Farmers Union. We’re 106 

years old and represent a quarter million family farms and ranches 

around the country. 

We’re here to say to you, Mr. Chairman, and the members of the 

committee that rural America is ready, willing and able to do its 

part to help our nation solve probably our biggest economic, national security and environment challenge that we’ve ever faced. 

We have some experience in renewable energy over the past three 

decades after the first oil embargo in the early ’70s. A lot of people 

started talking about renewable energy and what we could do. 

We started out with a product called ‘‘gasohol.’’ It wasn’t very efficient both economically or energy-wise, but it took about 30 years 

worth of investment in technology in the industry, mostly by farmers, mostly by local people. And we really didn’t cross that threshold until the Federal Government stepped in with a renewable fuel 

standard, with a mandate which gave us certainty for a marketplace. 

We would hope that the same would happen in all types of renewable energy. We think a renewable portfolio standard is past 

due. Last year, we did a study on the potential benefits to rural 

America and our nation if you adopted a 20 percent renewable 

portfolio standard for renewable electricity generation. And the production of electricity from wind alone would result in about a half 

a billion dollars in payments to farmers in leases. Production electricity from renewable biomass would result in about $25 billion to 

farmers growing these new crops, and $43.5 to $66 billion in capital would be invested in these new clean energy facilities in rural 

America. 

The types of projects developed also play a critical role. A NREL 

study compared the benefits of local ownership versus outside ownership and found that locally owned wind projects generate 2.5 

times more jobs and 3.1 times more rural economic benefits than 

those with outside ownership. Our policy strongly encourages that 

any federal policies should provide incentives and foster the development of locally owned projects. 

Unfortunately, tapping rural America’s clean energy potential is 

not likely to occur without the support of governmental policies. 

Community-based wind energy projects face additional hurdles because of limited capital access. It’s becoming increasingly difficult 

to produce wind generators and associated equipment for community wind projects due to the size of those projects and a shift towards large-scale development processes, not just in the cost but 

also in the infrastructure and access to the grid. 

Moreover, because the PTC can only be used against passive income, many community-based projects are not able to fully utilize 

this provision. Most interested parties in these community projects 

are farmers and local citizens that own the land with the potential 


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for wind development yet do not have sufficient levels of passive income necessary to utilize the tax break. We believe it is critical for 

the federal policy to continue to foster the development of renewable electricity projects. We support the extension of the PTC. We 

would hope that it would be a longer term so we would get the 

market certainty and investment in the technology that’s necessary. 

Thank you, Mr. Chairman. I would be glad to answer any questions. 

[The prepared statement of Mr. Tom Buis follows:] 


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The CHAIRMAN. Great. Thank you very much. All time for statements by the witnesses has expired, so now we’ll turn to the question and answer period. The chair will recognize himself. 

Mr. Abate, you said how many new megawatts were installed for 

wind in 2007? 

Mr. ABATE. In the United States, 5,244. 

The CHAIRMAN. Five thousand, two hundred and forty-four. And 

that represented 30 percent of all new electricity installed in the 

country last year? 

Mr. ABATE. All new nameplate capacity 30 percent, correct. Second to only natural gas. 

The CHAIRMAN. Natural gas what was percent? 

Mr. ABATE. It was first—I believe it was about half. 

The CHAIRMAN. About 50 percent? 

Mr. ABATE. Yes. 

The CHAIRMAN. And I think it was about 10 percent was coal? 

Mr. ABATE. Yes. 

The CHAIRMAN. And the rest came from all other sources. So 

what would you predict would happen in 2008, this year, if the production tax credit is extended? 

Mr. ABATE. Well, in—that’s a good question. And when you look 

at our view, we can see the next couple of years. The market is 

long on turbines right now with the full confidence that the production tax credit will be extended. The pro formas for these investors 

all have that in them. So in 2008, our production capacity, if you 

take what that’s scaling to and doubling it, it will be between 7 and 

8 gigawatts. 

The CHAIRMAN. Seven and eight thousand new megawatts? 

Mr. ABATE. Yes. 

The CHAIRMAN. On top of only 5,200 this year? 

Mr. ABATE. Right. 

The CHAIRMAN. So what would it project out to then for 2009? 

In other words, what’s the projection in terms of new wind power? 

Mr. ABATE. If you just take our order book and what we’re seeing 

as far as demand in the market, with a stable policy, by 2010, this 

country could be well over 10 gigawatts. 

The CHAIRMAN. Ten thousand megawatts every year being produced? 

Mr. ABATE. Yes. 

The CHAIRMAN. And how many new nuclear power megawatts 

will come online this year in the United States, do you know? 

Mr. ABATE. None. 

The CHAIRMAN. How many next year, do you know? 

Mr. ABATE. The same. 

The CHAIRMAN. How many in 2010, do you know? 

Mr. ABATE. For some time it’ll be zero. 

The CHAIRMAN. Zero. 

Mr. ABATE. And the reason is capacity, to be able to pull that off 

and the investment and the long-term cycle of that technology. 

The CHAIRMAN. So in other words, if there’s 10,000 new 

megawatts every year for 2010, 11, 12, 13, 14, 15, and it could actually get larger, huh? So there could be 100,000 new megawatts 

of wind installed in the United States before the first 1,000 

megawatts of nuclear power comes online? 


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Mr. ABATE. That’s a reasonable assessment, yes. 

The CHAIRMAN. Mr. Unger, do you think that’s a reasonable assessment? 

Mr. UNGER. You know, the market—— 

The CHAIRMAN. Could you move in and turn on the microphone, 

please? 

Mr. UNGER [continuing]. Sorry. I think the market will speak to 

that. One of the things that I look at is who is going to finance 

these projects? Public markets, investment bankers and the like 

are very willing to fund wind projects, very willing to fund geothermal projects, willing to find biomass projects. It doesn’t appear 

to be an appetite today to fund nuclear projects. The French are 

building I think the most advanced nuclear technology plant in the 

world today. It’s $2 billion and it’s already years behind schedule. 

So it’s quite a bit of uncertainty in the construction cost before they 

can even come online, and the generating costs, which are higher 

than that of wind, certainly don’t include what we do with the 

waste. So it creates uncertainty which investors are unhappy 

about. 

And as he says, if we have certainty about tax credits, then we 

have certainty about tying up our money. Venture capitalists tie up 

their money for ten years. And we’d like to have that kind of certainty. 

The CHAIRMAN. So you’re saying that you agree with Mr. Abate’s 

projection for how rapidly this is going to increase in the wind sector? 

Mr. UNGER. Oh, completely. Completely. 

The CHAIRMAN. Or is he even being conservative? 

Mr. UNGER. He may be being conservative. The nice thing about 

wind and solar is that, you know, we were having this conversation 

before—some states are blessed with a lot of sun. Some are blessed 

with a lot of wind. You can scale these plants. But the kind of commercial plants we’re talking about here are very, very large. But 

in rural America where there’s, you know, fewer access to generation lines and the like, you can also have smaller plants like this, 

which create a lot of local jobs around local economies. It’s very difficult to do that with very large coal-fired or nuclear-fired plants. 

The CHAIRMAN. And Ms. Lockwood, what do you think is the potential in Arizona for solar power by 2015? How many megawatts 

do you think you can be producing? 

Ms. LOCKWOOD. Mr. Chairman, I believe with a long-term extension of the ITC, you could see well over 1,000 megawatts of largescale solar built in Arizona alone by 2015, probably even more than 

that. 

The CHAIRMAN. Probably even more than that? 

Ms. LOCKWOOD. Mm-hmm. 

The CHAIRMAN. And, again, this is all before the first nuclear 

power plant comes online after 25 years. So that’s pretty big news 

in terms of what is happening out in the marketplace with an extension of the production tax credit for renewable energy. 

And at this point my time has expired. I’ll turn and recognize the 

gentleman from Wisconsin. 

Mr. SENSENBRENNER. Thank you very much, Mr. Chairman. 

We’ve been on kind of a perpetual debate on tax credit extenders. 


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The Ways and Means Committee doesn’t want to make any of 

these things permanent, which I believe is a mistake. But that 

frankly is the way it is. 

We may end up getting to the business of prioritizing tax extenders to get something through the Senate. I’d like to ask each of you 

that’s kind of in the business which two tax extenders would you 

prioritize as being the top two? And I would throw in the R&D tax 

credit as well in terms of incentivizing new technologies, so put 

that on the table. So let’s start with you, Mr. Abate. 

Mr. ABATE. Yeah. I think full value production tax credit would 

be number one for as long as that can work and get it through. And 

as I had said, because of the pro formas that our customers have 

counted on, that’s what’s in their model. So anything different than 

that would be a disruption, in our view. 

Second is investment tax credit for some of the large capital 

projects. You know, wind is more of a production-based. The investment tax credit would be number two. 

Mr. SENSENBRENNER. Okay. Mr. Swezey. 

Mr. SWEZEY. Congressman, I’ll go back to your original statement 

that I believe sincerely that we need a diverse portfolio of energy 

resources. 

Mr. SENSENBRENNER. I’m asking for priorities. I know you want 

it all. We might not be able to give it to all. 

Mr. SWEZEY. From my company’s perspective, we’re very interested in extension of the solar credit, long-term extension to give 

security to the predictability—— 

Mr. SENSENBRENNER. And what’s number two? 

Mr. SWEZEY [continuing]. And we’re very interested in the R&D 

tax credit as well, because we have—— 

Mr. SENSENBRENNER. Okay. Mr. Unger. 

Mr. SWEZEY [continuing]. A very large R&D function at our company. 

Mr. SENSENBRENNER. Mr. Unger. 

Mr. UNGER. I think we would be looking for tax credits that 

would not select one industry over the other. We are specifically 

looking for a playing field that will allow a variety of solutions to 

compete. 

Mr. SENSENBRENNER. Okay. Number one and number two. 

Mr. UNGER. So if any of the tax credits exclude others, then I 

think we’re trying to play economic policy. So R&D across the 

board would be good. You know, production tax credits across all 

technologies, not to consider one technology over the other. 

Mr. SENSENBRENNER. Okay. Thank you. Ms. Lockwood. 

Ms. LOCKWOOD. Congressman Sensenbrenner, our first priority 

would be long-term extension of the investment tax credit because 

of our solar resource in Arizona. Number two would be the production tax credit. 

Mr. SENSENBRENNER. Okay. Ms. Jagger. 

Ms. JAGGER. Congressman, I think that—I would like to talk 

about a proposal that was made yesterday. 

Mr. SENSENBRENNER. I’m asking which tax credits were the top 

two priorities. 


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Ms. JAGGER. Well, I think an all-across technology tax credit, but 

I will support as well the fitting in tariff that was introduced yesterday by Congressman Jay Inslee. 

Mr. SENSENBRENNER. Okay. Mr. Buis. 

Mr. BUIS. Production tax credit. The PTC and also the VTECH, 

which helps the ethanol and biodiesel. 

Mr. SENSENBRENNER. Okay. Thank you very much. I yield back 

the balance of my time. 

The CHAIRMAN. The gentleman’s time has expired. The chair recognizes the gentlelady from South Dakota, Ms. Herseth Sandlin. 

Ms. HERSETH SANDLIN. Thank you, Mr. Chairman. Mr. Buis, 

thank you for your testimony today and the study that the National Farmers Union has done. Chairman Markey and I have discussed the issue of the transmission capacity in getting these wind 

resources out of the Great Plains and other parts of the country, 

and we know how important that will be to fully maximize the benefits that the wind energy and the solar energy in certain areas 

across rural America have. 

But I entirely agree with you as well about the importance of the 

local ownership and the local use of wind energy rather than just 

exporting these renewable sources out of the states that have the 

most abundant source. So you have stated in a number of areas in 

your testimony the importance of that local investment, the importance of altering the PTC to serve as an incentive for that local 

ownership and investment and development community-based wind 

energy, the community-based energy development like we’ve seen 

in Minnesota. 

Could you talk in just a little bit greater terms about where we 

need to make changes in federal policy as well as working with our 

counterparts in the state legislatures, whether that’s with net metering or other options available to assist farmers and ranchers and 

rural families not just in the lease payments they get for turbines 

on their land owned by larger wind farms and selling those to larger utilities, but how we can do more to benefit those rural economies based on some of the statistics you gave in job creation? 

Mr. BUIS. Thank you, Congresswoman Herseth. I think you captured a lot of what’s really going on in rural America. Every farmer, every rancher, every local person I’ve met in the past two years 

are so excited about the opportunity to help develop energy, not 

just ethanol, not just biodiesel, but wind and solar. And we have 

these obstacles. 

The state of Minnesota, as you referred to, has a communitybased requirement for any renewable energy developed in that 

state. Ten percent has to be community owned. And that’s to carve 

out some local ownership, you know. We’ve seen in the past in the 

production of farm commodities when that ownership goes away, 

the money follows. It’s taken out of those communities. It’s not reinvested in those communities. And the beauty about ethanol has 

been its been local ownership. The single largest owners and producers of ethanol today are not the big multinational grain companies. It’s farmers and local communities. They own 40 percent of 

the ethanol production. That gets reinvested in the community. 

You see boards coming off the storefronts instead of going up. 


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If we allow this, whether it’s ethanol or wind or solar, to all be 

taken out of that local control where they’re just paying for a footprint on a wind tower, I think we’ll lose those jobs, we’ll lose those 

benefits and we’ll lose a tremendous opportunity. 

Ms. HERSETH SANDLIN. Thank you. And then the only other point 

I would make is the further work that we’ll do with you and, 

Chairman Markey, if we can pursue this, the issue of the PTC, how 

it’s structured because it’s currently only against the passive income. 

The CHAIRMAN. Absolutely. 

Ms. HERSETH SANDLIN. Okay. Thank you. And thank you, Mr. 

Chairman. 

The CHAIRMAN. Thank you. The gentlelady’s time has expired. 

The chair recognizes the gentleman from California, Mr. 

McNerney. 

Mr. MCNERNEY. Thank you, Mr. Chairman. And as many of you 

know, I spent two decades of my career in the wind industry business, and I understand exactly how the production tax credit affects the industry and how the cyclical pattern has put us way behind the Europeans and other parts of the world. 

Mr. Unger, I have a question. What percentage of your production of new machines is being sold to overseas customers? Mr. 

Unger. 

Mr. ABATE. Mr. Abate you said or Unger? 

Mr. MCNERNEY. I’m sorry. Mr. Abate. 

Mr. ABATE. Oh. About 30 percent. 

Mr. MCNERNEY. And what percentage of those are produced 

overseas, of the 30 percent? 

Mr. ABATE. Those are produced overseas. 

Mr. MCNERNEY. So it’s fair to say that in our opinion, if we extend the production tax credit, many more jobs will be created in 

the United States? 

Mr. ABATE. Oh, yeah. Seventy percent are landing here in the 

United States, and a big part is, I think as you have a production 

tax credit here, more components, more machines will land here. 

If that changes, our customers who land these pieces of equipment 

are looking to go to other parts of the world. 

Mr. MCNERNEY. So if you sell machines here, you both produce 

them here and you create jobs in the field with maintenance and 

installation? 

Mr. ABATE. Right. 

Mr. MCNERNEY. Most of the work that goes into producing a 

windmill, is that all work produced here in the United States, or 

do you import products from overseas? 

Mr. ABATE. No. The assembly occurs here. Components we do 

source globally. But a lot of the components, due to their size, 

blades will be here, towers will be here. You know, components, 

electronic components can be global. But logistics make up about 

20 percent of the cost of a wind project. So it really forces that 

technology to be local relative to where the equipment is going to 

land. 

Mr. MCNERNEY. Thank you. And, Mr. Swezey, I think it was 

very illustrative that all of your production is being sold overseas 

now. And that’s a terrific loss for the United States of America. 


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How can we incentivize customers here to start buying your products and then selling them here in our country? 

Mr. SWEZEY. Right. All our customers for our thin film solar 

equipment line are overseas, and that has to do, as I explained 

both in terms of the incentives for locating production but also the 

end-use market. The panels that our technology produces are five 

point square meter panels. I mean, they’re based on flat panel display technology on glass. These are very large panels, and it makes 

sense to try to locate these production facilities near the end-use 

load. And we believe that if we do have a clear, consistent, longterm policy towards solar in the U.S. that we’ll see more—some of 

this manufacturing occurring in the U.S. for that reason, because 

it will build the market. 

The U.S. market today is only 10 percent of the entire global 

photovoltaic industry, yet we generate 25 percent of the global electricity. So there’s a disconnect there between how much we’re doing 

here in solar and what the rest of the world is doing. 

Mr. MCNERNEY. Thank you. Ms. Jagger, what steps of European 

governments are most effective in your opinion in developing new 

energy technologies and implementing that? 

Ms. JAGGER. I think that until now, the most effective has been 

Germany, and the Feed-In tariff that was introduced by the member of Parliament, Mr. Hermann Scheer. I think that had the most 

effect and they have been able to produce about 200,000, between 

200,000 and 250,000 jobs. 

So that’s what I was talking about with Congressman Jay Inslee 

together with the organization that I chair, yesterday, introduce 

the tariff legislation or policy in this country, and it will be really 

important that his policy be supported. I think it will make a big 

difference for this country. There are about 40 countries that have 

already, you know, embarked or embraced the Feed-In tariffs 

around the world. 

Mr. MCNERNEY. Okay. Thank you. And I reserve—— 

The CHAIRMAN. The gentleman’s time has expired. We appreciate 

that. We have a series of roll calls on the floor, and we’re trying 

to ensure that each member who is here gets a chance to ask some 

questions. Mr. Engel is here as a special guest of the Select Committee. We’ll recognize him for the purpose of asking questions. 

Mr. ENGEL. Thank you, Mr. Chairman. It’s good to be a special 

guest. Ms. Jagger, in your testimony, you said—I was struck by 

your remarks that you used to believe that reduced energy consumption was an important first step, and you used to believe that 

it would be enough to encourage more localized lifestyles, but you 

now say you realize that that’s not enough. 

I also have come to that conclusion, as have many Members of 

Congress, and I think it’s important to keep saying. I’m embarrassed that our country has not agreed to sign international agreements that would help with global warming. But countries like 

India and China, who have been exempted from these things, I 

really believe that if there are new international agreements that 

countries like India and China, which are now becoming more responsible for global warming, need to be included in these agreements as well. Would you agree? 


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Ms. JAGGER. What I will say, Congressman, is that it is vital that 

the United States realize that they need to sign onto the Kyoto 

Plus treaty. It is vital as well that the industrialized nations of the 

world realize that they need to come up with a reduction of CO2

emission that is realistic and not just simply what they think they 

can do, because otherwise, we will not be able to avert a climate 

change catastrophe. 

With regard to India and China, I think that it is very important 

that we supply and that we help them with providing renewable 

energy technology. What is important as well to understand for certain countries is that we cannot make them accountable for what 

we in the developed world have been responsible. Therefore, we 

have to keep that in mind, that it will be totally unfair if tomorrow 

we ask from China, India or Brazil to come up and sign the exact 

kind of agreement that would be required from the United States 

or from a European country. 

Mr. ENGEL. How about Brazil? Since you mentioned Brazil, I noticed in your testimony, you know, you said that ethanol and nuclear are not a solution. Yet I was just in Brazil and was amazed 

at the amount of—how much ahead they are of this country in 

terms of planning for the future and looking at alternative energy 

and weaning their country away from gasoline and things like that. 

Do you think we could learn something from Brazil? 

Ms. JAGGER. Well, there are certain polices that have been implemented in Brazil that I will question. I mean, I think that we have 

to realize that the use of biofuels and bioethanol, some of those 

technologies can lead us to have a humanitarian catastrophe, because we will be using farm land that should be used for feeding 

people rather than for—be used as fuel. 

I mean, one thing that I’d like to mention is that 200 times more 

surface area is required to produce energy from crops as compared 

with energy from photovoltaic cells. 

Mr. ENGEL. Thank you. I know, Mr. Chairman, we have votes, 

so I’ll end my questioning and I thank you for letting me participate. 

The CHAIRMAN. I don’t want the gentleman to miss the roll call. 

There’s now under one minute left to go, to go approximately a 

quarter of a mile to make the roll call on the House floor. 

Mr. ENGEL. Well, it’s good exercise. It’ll contribute to—against 

global warning I guess, you know, if we walk on our own and don’t 

ride. 

The CHAIRMAN. Let’s walk that walk then because we will miss 

the roll calls otherwise. But I think that it’s pretty clear from the 

panel today that the extension of the production tax credits, the incentive to this industry is going to result by 2015 in 100,000 

megawatts of renewable energy, electricity in our country, minimum. 

And by the way, there’s only 100,000 megawatts of nuclear power 

in the United States today after 50 years of federal subsidies. So 

no one should be embarrassed about the fact that we are going to 

give a relatively modest break to the competition to nuclear and 

other energy resources. 

I think rural America is ready to go. We have to solve the transmission issues. If we get the tax issues right, then we can have a 


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clean energy revolution that produces 15, 20, 25 percent of the electricity in our country and sends a signal to the rest of the world 

that we are serious. 

We thank all of you. You’re great leaders. With that, this hearing 

is adjourned. Thank you. 

[Whereupon, at 10:55 a.m., the select committee was adjourned.] 


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