You might want to look a little more into your assertion that oil came into its own without a ton of federal help. And in case you want to specifically focus on the real no kidding "birth" of the petroleum revolution that is fine. But make no mistake oil has and still does get a TON of federal help. I think a lot of people would be fine cutting alternative energy subsidies if only the petroleum ones were cut as well.
The problem as I understand it though is that the US petroleum industry "needs" all that help in order to compete with the rest of the world. I can't say for sure if that assessment of "need" is really valid, but non-US petroleum production and refining does get some non-trivial level of government support and so it would harm the US if they did not do the same in order to compete.
So given that, you have to ask the question, "how can a nascent industry like solar/wind/storage/any other renewable" have a chance to compete in a market where the entrenched incumbent has the advantage of both a lock on the market and government support?" Easy answer, it cannot.
As to picking winners and losers, that only applies where the government is specifically choosing a technology/company to the exclusion of others. I'm pretty sure that has only happened in one case; Ethanol and specifically corn-based Ethanol. Barring that, or in case we have been a little too specific, then the easy solution is you fund basic research,the kind that is high risk-long lead and not suitable for most commercial ventures, and you create pots of money that can be applied for (loans, grants, whatever) by anyone looking to demonstrate commercial-sized production.
Everything below here is more a response to other posts above yours, so if my comments don't apply to you, please don't take offense :)
Everyone likes to point to Solyndra and say, "SEE!!! That is what is wrong with renewable energy and picking winners and losers!!!" No, that is just what happens when you decide to spend money to find the right solution out of many. Some fail, some succeed, and some fail only to be picked up by smarter/better/better-timed people to finally succeed. And while Solyndra itself might also be an example of bad politics (I think the final post-mortem showed it actually wasn't), it is also proof that politics should be kept out of that sort of thing. The government should not feel the need to find a poster child for what amounts to good general policy of a country investing in its energy future.