Clean Energy Companies Struggling to Keep up as New Incentives and Policies are Added Everyday

By Mercom Capital Group

For clean energy companies, wading through a maze of federal, state and local policies as well as financial incentives can be a very intimidating task. Yet it is absolutely essential in order to get to the next level of competitiveness in an extremely dynamic and fluid industry. Within the 50 U.S. states, there are currently over 750 varying financial incentives and over 350 different policies at the federal, state, county and local levels to be dealt with in order to stay competitive and take advantage of the opportunities available in the marketplace.

Developing a renewable energy project or starting and growing a clean energy company is a challenging task in today’s market conditions, with most companies dependent upon favorable policies and financial incentives in order to stay cost competitive.



In the first illustration, we demonstrate the perplexity of the various state policies and incentives that change almost daily. Having real time intelligence to keep track of the markets, incentives and policies is a must for any company looking to enter new markets and capitalize on the benefits these policies offer. "Beyond competitive products and technologies, clean energy firms that want to outperform in the US market will need a sophisticated public affairs and government relations program and savvy policy partners who are very familiar with the latest developments from the federal level all the way down to the county level," according to Gartner Research Director Al Velosa.

Raj Prabhu, Managing Partner of Mercom Capital Group, commented, “Along with federal and state incentives and policies, there are also local city and county programs that cannot be overlooked and requires constant attention. Of course, companies cannot make their decisions solely based upon policies and incentives without looking at market size and opportunity.”



In the second map, we have included the retail sales and retail electricity rates, providing a truer reflection of the overall markets. For example, Texas had a total of 344 million Mwh in retail sales in 2007 and is by far the largest energy market in the nation, larger than most countries. These larger markets demand attention regardless of current policies or incentives. Companies need to get into these markets early to begin building relationships and making a presence. Having a local presence and being part of the business community will allow companies to work from the inside and have a say in how the policies and incentives will be shaped the future.

Having a strong public affairs program, along with real time market intelligence that will deliver timely information about your markets and the policies that can affect your business is a must for clean energy companies that are looking to make an impact in these larger markets.

 
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