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Illustration: Rebecca Zisser/Axios

The 2008 financial collapse did not take the renewables industry down with it — and in several ways it even proved a blessing.

The big picture: The 2009 stimulus law funneled some $90 billion into low-carbon energy initiatives, including grants for renewable electricity development in lieu of tax credits. Those grants proved vital. Longstanding tax credits are key to building wind and solar power projects, but the tax equity market collapsed alongside the financial sector.

The Treasury Department quickly launched the grant program, which eventually provided over $26 billion.

"Deployment would have slowed down dramatically because these companies would have had to seek other financing, and it would have been more expensive even if it was available."
— Keith Martin, project finance specialist with Norton Rose Fulbright

Other provisions that aided low-carbon energy included:

  • The stimulus expanded and helped finance the federal loan guarantee program for various clean energy projects.
  • Despite some flops (most famously the panel manufacturer Solyndra), the program helped launch utility-scale solar power generation.
  • It provided the first funding for the Advanced Research Projects Agency-Energy, which seeds R&D into next-wave tech and moves it toward commercialization.

Yes, but: The financial crisis wasn't bloodless for U.S. renewables. It was during this time that China grabbed the lead in solar manufacturing, venture capital veteran Stephan Dolezalek said. And VC financing dried up for building U.S. solar panel manufacturing plants.

“A lot of enthusiasm and momentum that had been built up in the venture community for solar took a substantial hit post-market crash. VC’s thereafter simply did not have the capital available at the scale of the factories they needed to fund."
— Stephan Dolezalek, venture capitalist

Another casualty of the financial crisis — and the collapse in oil prices — was availability of financing for companies to produce "advanced biofuels," which are more climate-friendly than traditional corn-based ethanol. These fuels have never scaled up the way Congress envisioned when it expanded the national biofuels mandate in 2007.

Go deeper

Dan Primack, author of Pro Rata
56 mins ago - Economy & Business

Trump blocks banks from limiting loans to gun and oil companies

Illustration: Sarah Grillo/Axios

Big banks are no longer allowed to reject business loan applicants because of the industry in which they operate, according to a new rule finalized on Thursday by the Trump administration.

Why it matters: Wall Street has curtailed its exposure to industries like guns, oil and private prisons, driven by both public and shareholder pressures. This new rule could reverse that trend.

Former FDA commissioner: "Reliable drug supply is absolutely critical"

Axios' Caitlin Owens and former FDA commissioner Mark McClellan. Photo courtesy of Axios Events

Having a reliable supply of pharmaceutical drugs throughout America will be "absolutely critical" to boosting affordability in health care during the Biden administration, former Food and Drug Administration (FDA) commissioner Mark McClellan said at a virtual Axios Event on Friday.

The big picture: McClellan, who served under President George W. Bush, says drugs having limited supply and limited competition leads to elevated pricing. He considers drug supply to be a national security and public health issue.

Felix Salmon, author of Capital
4 hours ago - Economy & Business

Americans are still spending money

Source: Census Bureau; Chart: Axios Visuals

Americans spent more money at stores and restaurants in 2020 than they did in 2019 — even in the face of a devastating global pandemic that shut down broad sectors of the economy.

Why it matters: The monthly retail sales report this morning came in well below expectations, and showed consumer spending falling on a seasonally-adjusted basis. Total expenditures were still higher in December 2020 than they were a year previously, however.