Page 53 - Aamir Rehman Gulf Capital and Islamic Finance The Rise of the New Global Players

38 PART I Background and Context

the 1970s, which motivated Americans to seek alternatives to Middle
29
Eastern oil. In fact, there has been a longstanding pattern of spikes in
oil prices leading to greater efforts in the alternative-energy sector—
efforts that have typically lost momentum when oil prices came down
and the sense of urgency was lost. It was not surprising, therefore, that
both Democrats and Republicans in the United States made “energy
independence” a core theme of their 2008 election campaigns—oil was
trading well above $100 per barrel during the summer months of the
campaign.
More than previous alternative-energy initiatives, however, the
initiatives of the Obama administration appear to be central to a long-
term US economic strategy. When oil prices plummeted in early 2009,
the administration’s enthusiasm did not. In May 2009, President
Obama requested a budget of over $26 billion for the Department of
Energy, with significant emphasis on the department’s Office of Energy
Efficiency and Renewable Energy. According to the Department of
Energy, its revised budget “makes significant investments in hybrids
and plug-in hybrids, in smart grid technologies, and in scientific
research and innovation.” Proposed funding for alternative-energy
initiatives is up dramatically: a rise of 83 percent for solar energy,
70 percent for building technologies, 36 percent for wind energy, and
22 percent for vehicle technologies. 30 Promoting renewable energy is
seen as an important element of the government’s stimulus package
and long-term economic vision.
Recent initiatives look more like a genuine strategy than like a
reactionary fad. In addition, renewable energy has been positioned as
a priority for US national security. As president-elect, Obama com-
bined economics and security in his declaration that “the future of
our economy and national security is inextricably linked to one chal-
lenge: energy.” 31 Throughout the 2008 campaign season, candidates
from both the Republican and Democratic parties argued for
decreased US dependence on foreign oil, with Republicans often
advocating for increased domestic drilling and Democrats emphasiz-
ing renewable energy. While the security argument generally over-
looks the fact that Gulf oil producers are key US military allies (US
Central Command for the war in Iraq is, after all, in Qatar), it does
resonate with many Americans, who see oil states as a potential
threat. Adding security to the rationale for renewable energy gives
the movement increased strength and momentum.
The search for viable substitutes for fossil fuels is by no means an
easy one. In addition to addressing the inherent scientific challenges,