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Recent U.S. debt deal to kill off prospects of renewable-power support

Geothermal Plant by Calpine in The Geysers, California (source: flickr/ thinkgeoenergy, creative commons)
Alexander Richter Alexander Richter 18 Aug 2011

The recent debt deal in the U.S. will likely make life a lot harder for renewable energy development in the U.S., including geothermal, as it won´t be able to compete with traditional power sources without support.

“Support for renewable energy may plunge from record levels, setting back the use of wind and solar power before they can compete on their own with oil, gas and coal”, so reported by Bloomberg, following the recent debt deal reached in the U.S. This clearly includes all other renewables including geothermal.

“The debt agreement, which is focused on cuts only and not revenue increases, makes it more likely that this infant sector gets strangled before it matures,” Daniel J. Weiss, a senior fellow at the Center for American Progress, a Washington policy group that advises Democrats, said in an interview with Bloomberg Government.

“The debt agreement, which is focused on cuts only and not revenue increases, makes it more likely that this infant sector gets strangled before it matures,” Daniel J. Weiss, a senior fellow at the Center for American Progress, a Washington policy group that advises Democrats, said in an interview with Bloomberg Government.

“The potential lapse of key subsidies at the end of 2011 puts the pressure all the more directly on the clean-energy sector to drive down costs and become more competitive between now and then,” according to a Dec. 13 report by Bloomberg New Energy Finance.

The Treasury Department has paid out $7.78 billion in grants to developers of wind, solar, biomass and geothermal energy under an incentive that was created in the stimulus bill and lapses at the end of the year. Tax credits for wind, solar and geothermal projects end in 2012 and 2016.”

All together not a good outlook for projects in the U.S.

Source: Bloomberg