Could a Romney Win Hurt Investors in Green Energy?

With the oil industry booming in places like the Bakken Shale, with a glut of cheap natural gas, and with the U.S. holding the world's largest reserves of recoverable coal, it doesn't look like the country will be running out of traditional fuel sources any time soon.

That's why those invested in alternative fuels are watching the election closely, from Warren Buffett's Berkshire Hathaway to tech titans like Google . An Obama re-election could mean a continuation of subsidies for wind and solar power. A Romney win could turn off the spigot.

(Read More: Berkshire Hathaway Holdings )

The pressure is especially hot on solar.

Nearly a half dozen solar ventures backed by federal taxpayers have gone bankrupt, many blaming their failures on cheaper solar panels from China. Solyndra, the most famous flop, is now suing several Chinese companies. Despite the bankruptcies, the federal government has continued to provide grants or backed loans.

How long can the government afford to subsidize an industry before it should be allowed to compete on its own? That is a question the candidates may be asked to answer Tuesday night at Hofstra University.

"If the (solar) industry can't stand on its own two feet by 2016 without incentives, then the industry just doesn't deserve to survive, " says Angelo Zino, clean energy analyst for S&P.

For the moment, however, Zino says he's cautiously optimistic about solar, especially the installation side. A federal tax credit worth 30 percent of the cost of an installation is scheduled to last four more years. "We think that the solar industry is in better shape than maybe most other areas of the alternative energy space." He predicts solar installations will grow 60 percent this year and between 30 and 40 percent in 2013.

Robert Fortunato of Hermosa Beach, California, installed a system by SolarWorld for $16, 000 before incentives. "Solar is incredible, " he said, standing in front of the new panels on a sunny day. "We're getting a nine percent return on investment off these panels each month, making $100 that will be credited back to me, and I'll actually get a check at the end of the year." Fortunato added for emphasis, "I don't know how your stocks and CDs and what not are doing in the market, but we're getting a nine percent return."

The solar power players with the most at stake in the election are those investing billions of dollars building power plants across vast areas of the west. The Interior Department just released 285, 000 acres of federal land to be used as "solar energy zones" — land near already existing power lines. The hope is to speed up the approval process, getting more solar power online faster, and creating more jobs.

Nowhere is there more activity than in California, where the Governor has mandated that a third of the state's power comes from alternative sources by 2020. However, a Stanford economist tells the Los Angeles Times that even with all the subsidies, the state's alternative power mandate could raise power rates in California as much as 20 percent.

Nationally, money may be running out for subsidies. Barry Rabe, a Brookings nonresident senior fellow from the University of Michigan, says even an Obama re-election doesn't guarantee blue skies for solar. "Clearly the stimulus money is, in essence, spent at this point." He referred to the President's comments in the first debate in Denver that an Obama Administration would continue investing in alternative fuel sources. "What was not clear was where all that money might be coming from going forward." Rabe warns that any pullback in federal help could be the end of "a fair number of emerging solar and wind firms ... working on relatively limited profit margins." (Read More: Facts Take a Beating in First Presidential Debate )

Some firms are trying to use the power of the sun without subsidies. One company may surprise you — Chevron . At the country's oldest working oil field, near the town of Coalinga, California, a 300-foot tower shoots up out of the brush, glowing from the reflection of nearly 8, 000 mirrors directed at its top. Chevron is using the mirrors to concentrate the sun's heat on a boiler which creates steam. The steam is then shot into the ground to loosen up and recover viscous crude, a unique example of new energy helping produce old energy. "I think it's pretty awesome, " said Raymond Guidry, a 22-year Chevron employee put in charge of constructing the solar-to-steam facility. "It's pretty incredible to be part of a project that's bringing this kind of technology into an existing, successful 110-year-old oil field."

Chevron won't reveal the cost of the project, calling it a demonstration project to see if the technology works. It does. In fact, the amount of steam being produced has exceeded expectations. The problem is that solar is not cost effective here. The entire array of mirrors creates only five percent of the steam needed at the field. The rest comes from natural gas boilers which take up much less space, cost less to run, and can operate when it's cloudy or dark. So why make the investment? "There are many other parts of the world where natural gas is much more expensive, or just not readily available, " says Des King, President of Chevron Technology Ventures. The solar-to-steam technology could be very useful in the middle east, for example.

It may be ventures like this which can best survive the partisan politics and fiscal cliffs of Washington, projects funded by deep pockets in the private sector. In addition to the solar-to-steam boiler, Chevron is also testing seven different solar photovoltaic panels to see which can produce the most power for the lowest cost. The winner could be used to power remote oil fields around the world which have a lot of sunshine but little access to electricity. The company says investments in such projects will continue no matter who is elected. "Our view in renewables goes well beyond any election cycle, " says Chevron's Des King. "When we invest in technology and put steel in the ground, our view is that it will operate for 25 years or more."

-By CNBC's Jane Wells