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Boost of Energy

Energy policy in the U.S. heats up as President Obama announces $3.4 billion in spending on smart-grid initiatives, the solar industry lobbies for treatment as a mainstream energy source, and a Senate committee begins hearings on climate change.

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Call it an electric day.

President Barack Obama on Tuesday announced the biggest-ever government-spending plan for energy grid modernization. The Senate Environment and Public Works Committee began hearings on a plan to curb greenhouse gasses. And in California, the head of the solar-industry lobby called on his members to mobilize to fight for his industry’s future as a leading source of energy for the U.S. in the future.

Obama announced grants totaling $3.4 billion to 100 partners to begin modernizing the electric grid. The federal money had been set aside as part of the winter’s stimulus bill. The partners will put up another $4.7 billion, making the total spending $8.1 billion.

“I think it’s a great kick start toward a smart grid,” said Brian Castelli, executive vice president for programs and development at the Alliance to Save Energy, a Washington group that lobbies for energy efficiency. “It’s a great way to use the stimulus.”

Aside from the money spent and jobs created, a smart grid may not seem that exciting. But it’s key to conserving energy, which means savings for individuals and businesses. “It's expected to save consumers more than $20 billion over the next decade on their utility bills,” Obama said. Reducing electricity use is one of the strategies for cutting the emissions from plants that generate electricity and are blamed for global warming—and those emissions will have a dollars-and-cents cost if legislation contemplated in Congress goes forward.

Obama compared the building of a smart grid to the creation of the Interstate Highway system.

“To offer one analogy, just imagine what transportation was like in this country back in the 1920s and 1930s before the Interstate Highway System was built. It was a tangled maze of poorly maintained back roads that were rarely the fastest or the most efficient way to get from point A to point B. Fortunately, President Eisenhower made an investment that revolutionized the way we travel—an investment that made our lives easier and our economy grow. Now, it's time to make the same kind of investment in the way our energy travels—to build a clean-energy superhighway,” said Obama.

This round of projects, though, is just a start on building a smart grid for the nation. Billions more in investment will be needed to make the entire nation’s grid smarter.

Funding from this round for smart-grid initiatives will go to projects in every state except for Alaska, with the largest projects in Houston and Baltimore. In Houston, CenterPoint Energy will receive $200 million and put up another $439 million to install 2.2 million smart meters that allow consumers to see their electricity use in real time and cut their use when it’s most expensive. Baltimore Gas and Electric Company will get $200 million and put up $251.8 million for a similar project installing meters for 1.1 million customers. Across all the projects, about 18 million smart meters, 200,000 more reliable advanced transformers, and 700 automated substations will be installed.

A smart grid is also meant to take electricity from renewable-power sites like wind farms and solar installations to customers.

Obama chose one of the largest solar installations in the nation, a Florida Power and Light solar plant in Arcadia, Florida, as the location to announce the stimulus spending.

“To realize the full potential of this plant and others like it, we've got to do more than just add extra solar megawatts to our electrical grid. That's because this grid—which is made up of everything from power lines to generators to the meters in your home—still runs on century-old technology. It wastes too much energy, it costs us too much money, and it's too susceptible to outages and blackouts,” Obama said.

Obama wasn’t the only one talking energy Tuesday.

There was plenty of rhetoric in the solar space at the Solar Power International conference in Anaheim, California. There, Rhone Resch, president and CEO of the Solar Energy Industries Association, called on the members of his industry to intensify lobbying efforts across a range of initiatives aimed at bringing solar power into the mainstream of the U.S. energy mix.

“We cannot rely on the goodwill of policymakers to prevail,” he said. “We must fight together, and fight to win.”

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