Google CEO Schmidt lays out U.S. energy ideas

WASHINGTON Tue Nov 18, 2008 4:33pm EST

WASHINGTON Nov 18 (Reuters) - The United States should use part of any future economic stimulus package to connect wind turbines and solar energy to the nation's electricity grid, said Google Inc (GOOG.O) Chief Executive Eric Schmidt, an advisor to President-elect Barack Obama.

In a wide-ranging speech, Schmidt, who has been mentioned as a candidate to become Obama's chief technology officer, argued on Tuesday that the United States should begin investing heavily in bringing wind and solar power into the mainstream.

"There is no grid where the wind and the solar is. The people are in the cities. So the simplest thing that we have to do is we have to address the grid problem," said Schmidt, a member of president-elect Obama's economic advisory transition team, although not speaking in that role.

"You have a command and control (power) grid designed in the 1960s," Schmidt told a New America Foundation event.

Schmidt also said slowing the growth of energy consumption was important, and called for a plan to give matching funds to state utilities working to improve energy efficiency, and differential tax treatment for more efficient cars.

Senate Democrats have proposed a $100 billion economic stimulus package, although hopes are fading that it will passed during a short legislative session this week.

The bill, which Obama supports, would include $13.5 billion for road, bridge, mass transit and other construction projects and nearly $38 billion to help states pay Medicaid health-care costs for the poor.

Obama, who will be sworn in as president on Jan. 20, has said if Congress does not pass such a measure this year, it would be at the top of his agenda once he becomes president.

Through its philanthropic arm, Google.org, the company is backing start-ups designing wind, solar and geothermal technologies, which it hopes will eventually be cheaper than coal-based electricity. Google invested $45 million in such companies this year.

Schmidt pointed to the role that government grants to universities played in creating the Internet. "Why don't we do the same thing with the energy grid?" he asked.

"If you're going to spur economic growth you've got to focus on infrastructure research and development and energy," he said. "These are jobs programs."

And that grid should also power America's cars, he said. "Our dependence on imported oil is a huge drain. How many wars has oil created?" he said.

He said federal money for basic science has dwindled in recent years and that the private sector cannot do everything.

He called for a balanced approach to regulation, as opposed to the "extreme version of the free-market approach" of recent years. (Reporting by Kim Dixon and Diane Bartz; Editing by Tim Dobbyn)

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