Renewable energy is the future, and not only is it good for the planet, but it also benefits the economy. Since renewable energy is much less expensive than other forms of energy, it puts more money in consumers’ pockets. They can then spend more, benefiting their local businesses. The renewable energy industry is a huge source of jobs, and there are also plenty of tax breaks involved.
All the economic benefits are one reason why Alabama’s stone age energy policy is so jarring. Due to politics, the state has made it very difficult for solar and wind companies to operate. How has Alabama impeded renewable energy and why? Read on to find out.
The Issues with Renewable Energy in Alabama
The first thing to understand about Alabama’s renewable energy issues is that they’re entirely self-inflicted. The state has an excellent environment to harness solar and wind power. The Center for Biological Diversity found that in terms of technical potential for solar rooftop power, Alabama was number 19 among the 50 states. It has almost 200 sunny days each and every year. With its climate, it also gets plenty of wind.
Despite those natural advantages, Alabama is number 45 among the states in the Center for Biological Diversity’s rankings of installed solar capacity. For that reason and others, the center gave Alabama an “F” grade in regards to its solar policies.
There are two regions in the state and two very different utility providers handle those regions. Tennessee Valley Authority handles power in the northern third of Alabama. The company is forward thinking and has put quite a bit of money into renewable energy sources. It also provides incentives for customers who install solar panels on the rooftops of their homes or businesses.
The problem is that Alabama Power providers power to the southern two-thirds of the state, which covers its largest cities, including Birmingham and Montgomery. Alabama Power doesn’t have much in the way of solar incentives and it charges a higher amount for solar power, which means customers won’t save as much by switching. It also doesn’t pay much to customers who sell the extra solar power their panels generate back to the grid, only offering about three to four cents per kilowatt-hour. To put that into perspective, Tennessee Valley Authority pays 12 cents per kilowatt-hour.
So, most customers in the state have little reason to make the switch to solar panels because it won’t save them much money.
The situation hasn’t been any better for wind companies. Many have tried to launch wind projects in areas of Alabama, only for the county to then pass a law banning wind projects within its borders. There have also been lawsuits against companies that started planning wind projects in areas of the state.
A Hostile Political Climate
Of course, Alabama is one of many states that leans heavily to the right, and conservatives have traditionally been negative regarding renewable energy while those on the left have been more supportive of it.
Gadsden is one example of a city where politics prevented potentially helpful renewable energy projects. It was among the poorest cities in the nation in 2013 when there was the chance for new wind projects in the area. Local legislators did everything in their power to prevent these projects, with one major reason being that they were upset about the federal tax credits available for such projects.
The result was that the projects couldn’t go through due to the laws that were passed, and Gadsden lost out on a huge economic opportunity.
The Effect Alabama’s Policies Have on Its Economy
Alabama’s poor approach towards renewable energy is costing the state and its citizens money. In the aforementioned situation in Gadsden, those wind projects would have created jobs and brought in a significant amount in tax revenues, likely millions of dollars. That’s all without costing the taxpayers anything. Instead, the area stuck with its power plant, which has been funded by the taxpayers for years.
The greatest economic impact of the solar and wind industries is the number of people they employ, and part of that is the difference between how these industries and fossil fuel industries work. The fossil fuel industries use more heavy machinery. They require money and machines but not nearly as much labor so there aren’t as many jobs available.
Renewable energy requires more labor. The industries require people to manufacture solar panels and wind turbines, set up the projects, consult with customers and then handle installation.
With solar energy, net metering can earn money for those who have solar panels installed, both people and businesses, when their solar panels produce more power than they use. The economic benefits of businesses having more money are obvious. They’ll be able to put that money towards expansion and employ more people. And of course, when people have more money, it’s good for the local businesses where they shop.
To put it simply, renewable energy companies lead to more jobs and more money for everyone in the area. The states that take steps to improve their use of renewable energy see economic benefits for it. The states that obstruct renewable energy companies are damaging their own economies.
The Future of Renewable Energy in Alabama
Although Alabama has been wasting its potential as far as renewable energy is concerned for years, change could be in the air. Alabama Power has been taking steps towards more solar power.
The reality is that renewable energy isn’t going away. Solar and wind are two industries that the nation is gravitating towards, regardless of what is going on in Washington, D.C. Alabama has certainly been lagging behind, but with the obvious economic benefits and how much potential the state has for solar and wind power, at some point its citizens will demand a shift towards renewable energy.