For cleanenergy companies, last week’s midterm elections were a mixed bag. Votersdefeated a California proposition that would have raised$4 billion to cut petroleum use and advance alternative energy. But theDemocrats’ sweep in the U.S. House and the party’s advances in the U.S. Senateare seen as a big positive for the sector, as the Dems are considered moregreen-friendly than Republicans.
“Losing[the California proposition] doesn’t mean a great deal because itwas overshadowed by the fact that the House flung to the Democrats,” saysRobert Wilder, CEO of WilderShares, a San Diego, California-based company thatmanages clean energy indices. “The Dems are going to be much stronger in favorof clean energy than the Republicans.”
As returnsrolled in, several cleantech executives said the loss of Proposition 87—aninitiative that would have taxed oil companies between 1.5 percent and 6percent for oil extracted in the state—was something they would get over. Themoney raised would have funded cleantech, with the goal of reducing the state’spetroleum use by 25 percent.
“It wouldhave been a Grand Slam if it passed, but it’s not an additional barrier orhurdle because it didn’t pass,” says Jeff Wolfe, CEO of solar installerGroSolar in White River Junction, Vermont.
Mr. Wolfesays the defeat doesn’t reflect any lack of interest in cleantech. Instead, heand others say the initiative failed because oil companies, which would havehad to foot the bill, ran a powerful campaign against it. “It was defeated byBig Oil spending many millions of dollars,” he says.
Mr. Wolfeput a positive spin on the outcome, saying venture capitalists, the Americanpublic, and the rest of the world still back the field. “What it means it thatBig Oil is not in step with A, the rest of the world, B, the venture-capitalcommunity, and C, the American public.”
Despitethe loss, cleantech companies say a Democratic House—and a Senate that’s atleast tied—bodes well for the industry. U.S. investors seem to agree. The dayafter the election, the WilderHill Clean Energy Index, which tracks U.S. clean-energy stocks, rose 1.28percent to 185.34 by mid-afternoon, and the WilderHill Progressive EnergyIndex, focused on technologies to reduce the carbon-impact of fossil fuels,rose 1.36 percent to 227.41.
Contact the writer:JKho@RedHerring.com