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Renewable Energy Economics, Marketplace,and FinanceOverviewBecause RETECH was held just weeks into anew Presidential administration, and amidst thebiggest economic crises in generations,economics were of vital interest at RETECH2009. Discussion regarding various aspects ofthe economy took place in nearly every session,spanning the implications of the AmericanRecovery and Reinvestment Act, the state offinancial markets, and the prospect of RPS andcarbon legislation at the national level. Leadersfrom state and national government, finance,and policy convened to discuss how to get therenewable energy economy—and the nationaleconomy—moving once more.ConsensusAt RETECH 2009, there was a sense of optimismregarding renewable energy economics and thefederal government’s commitment to renewableenergy. There was also a humbleacknowledgement of the problems yet to besolved. With a once-in-a-generation stimulusplan sitting astride a once-in-a-generationmarket crisis, hope and uncertainty bothabounded. The innovative action taken byCongress to mobilize renewable energydevelopment as part of the American Recoveryand Reinvestment Act presented the industrywith many new opportunities. Theseopportunities were laid out in great detail byRETECH panelists.Economic DriversState Renewable Portfolio Standards (RPS) areparamount to systematically increasingrenewable energy generation in the US.The rising, volatile price of fossil fuelgeneratedenergy is the main economicdriver of the renewable energy industry. StateRenewable Portfolio Standards (RPS) haveplayed and still play a key role in mobilizingrenewable production.Renewable Portfolio Standards were born in 1995. Today,28 states have mandatory standards, 16 of them inexcess of 20%, and 6 have voluntary standards,explained panelist Alan Nogee, Director, Union ofConcerned Scientists.Under a business-as-usual scenario, by 2025 thesestandards will yield 77,000 MW of new renewable energy,reducing carbon emissions by 183,000 tons, the equivalentof taking 30 million cars off the road for a year. In thisscenario, renewable energy would mostly displace gasandcoal-fired plants, which Mr. Nogee forecasted wouldbe replaced by 53% wind and 21% solar, with biomassassuming a large role in the early transitional years. Ontop of a 1.6% ($95 billion) consumer savings comparedwith a business-as-usual model by 2030, the world wouldenjoy massive environmental benefits from the switch.With state and federal tax incentives, renewableenergy can be more affordable and competitivewith other energy sources.State and federal subsidies such as the Production andInvestment Tax Credits have provided the short-term costviability of renewable energy options. These credits havebeen extended and are compatible with a credit-constrainedenvironment in the American Recovery andReinvestment Act (ARRA). The ARRA extends the ProductionTax Credit (PTC) for Wind to 2012, and all otherrenewables to 2013, explained Eli Katz of Chadbourne &Park. The extension should help guard against the boomand bust cycles renewable energy has suffered during theAmerican Council On Renewable EnergyExecutive Summary Report 44