Markets in the politics of renewable technologies

• In Event: Climate Technologies and Unintended Consequences 1

Abstract

This paper identifies a paradox of energy liberalization and the promotion of renewable technologies. While proponents of market-based decarbonization argue that strong incentives can be built into markets, which will therefore guide the transition to renewables most efficiently, markets rule out the most effective political pathways for achieving pro-renewable policies. Support for renewables has been most effective where coalitions have been built among environmentalists, labor, and local politicians, linking renewable energy projects to jobs and economic development. Such coalitions form by defining renewable technologies as local or regional modernization projects. The renewable technology becomes a totem of these red-green developmentalist coalitions. But because such coalitions are realized through out-of-market subsidization of renewables, they are a threat to the logic of the market, within which they are seen as distortions of price signals. The market systematically mobilizes a range of actors against the types of policies that can activate an effective developmentalist coalition. By reducing technologies to the financial logic of investment, and rejecting any other considerations, the world envisioned by the market logic excludes one of the most effective political pathways to decarbonization. In electricity markets in the US, this conflict assumes the form of a current dispute over state renewables policies and regional wholesale power markets. This paper examines this case, to analyze the conflict between the socio-technical universe of the market and that of the developmentalist coalition, and then to suggest ways of mediating this opposition.

Author

• Daniel Breslau, Virginia Tech