Green Aluminum Prospects Show Value in Industrial Policy
Today’s WaPo has a deeply reported story by @StevenMufson and @partlowj on one of the most important environmental and economic challenges of the coming decades: decarbonizing heavy industry. With inputs from @SashaLyutse @NRDC @BGAlliance @bensonel @CSIS @MachinistsUnion and more.
As they report, the hold up at the moment to making green aluminum a competitive US industry is the Bonneville Power Administration.
Ironically, BPA is a public entity and creature of Roosevelt’s New Deal. It was stood up to have public and political control in order to transform the economy of Pacific Northwest. Today, it is a barrier to a second economic transition.
For a granular history of the BPA — and how it differed in its political economy from the Tennessee River Valley Authority that transformed much of the US South — I recommend Jeremiah Lambert’s excellent “Power Brokers” book. (mitpress.mit.edu/books/power-br…) It’s a commentary on how market norms have infiltrated the public service that the “solution” floated is for green aluminum to be dependent on investor-owned utilities, and that the notion of a “subsidy” from other users is described as a “non-starter.”
This is especially problematic since those incumbent customers include the crypto industry. The very least that industry could do for its energy use excesses is contribute a modest subsidy to a green aluminum plant.
This interest clash cries out for a more systematic industrial policy. As I wrote in a recent @rooseveltinst report, the federal government needs to take a more active role in coordinating complementary and competing industry needs, especially for energy.
This is especially true in situations where one industry (crypto) serves little to no useful social function, whereas aluminum is responsible for much historical progress and good jobs. Green aluminum could do the same for the 21st century. The BPA is a public entity. This should be low-hanging fruit for a new industrial policy. For more on why public control beats private control in energy markets, see the latest from @NikoLusiani @rooseveltinst. (rooseveltinstitute.org/publications/e…) If the WH can get the Commerce Department to suspend otherwise lawfully due tariffs on imported solar panels at an Energy Department request (see @AnaSwanson et al), the Energy Department should be able to get its own agency BPA to come to a solution. And for reasons as to why to put crypto at the back of the queue (if in the queue at all) for access to public resources, see work by @STOmarova. This quote is from a different regulatory context, but it makes a powerful case for industrial policy that steers — rather than relegating public power to a mop-up function.
(Adapted from this thread.)
