Its dead - with all natural gas and oil reserves we have now. Nobody higher up seems to care about the enviromental impacts of these resources. Money is the main concern in this political climate. The Carbon Tax is are only hope giving renewable energy a hope for the future.
As far as funding goes, I think everything should be on the table. Most certainly, politics should be removed from the process, but, in all honesty, that probably isn't possible. The good progression of (various organizational funding;NIH, NSF, etc)- SBIR-angel investing-venture capital/private funding needs to go forward. In face, the entire system should be more heavily supported by the government.