Report bolsters White House energy agenda

A report from the White House Council of Economic Advisers measuring the effects of the 2009 American Recovery and Reinvestment Act through the second quarter of 2010 found the $787 billion economic stimulus package created or saved between 2.5 million and 3.6 million jobs.

That conclusion will surely be debated: The report acknowledges, "Our estimates are subject to substantial margins of error. The results, however, are strong enough and clear enough that we are confident that the basic conclusions are solid."

Vice President Joe Biden was less equivocal when he released the report during a press briefing Wednesday. "The economic initiatives we took are working," he said.

Additionally, the report said spending and tax incentives in clean energy had generated the largest co-investment from the private sector, noting, "A federal contribution of $46 billion will support more than $150 billion in total investments in energy efficiency, renewable generation, research and other areas of the transformation to a clean energy future."

Through the Recovery Act's Energy Cash Assistance program, individuals and businesses that install certain types of renewable energy generation can receive a grant equal to 30 percent of the project's cost. Thus far, the program has disbursed $4.7 billion, supporting more than $13 billion in total investment activity, the report said.

In another example the report cited, the private sector has invested $6 billion in smart grid projects aimed at creating more efficient electricity use as a result of $4.5 billion in spending under the Recovery Act.

The report specifically examined the effect extensions of tax credits and cash assistance grants had on wind energy production in 2009, concluding the Recovery Act bolstered generation 20 percent and generated substantial private sector investment, although the report did not cite a dollar value.

"It appears that government support was responsible for about 6,000 megawatts of wind capacity installation that might not otherwise have occurred," the report stated. "Moreover, the challenging credit conditions during 2009 and the introduction of the [cash assistance] grant program in the Recovery Act suggest that the overall effect on wind capacity installation may have been even larger."

The report also noted, however, that, "Determining how much of the spending associated with the co-investment provisions of the Recovery Act would not have occurred without the act is beyond the scope of this report. But the evidence from the analysis of the production tax credit and related incentives for wind energy suggests that the additional private sector investment that is generated by these provisions may be substantial."