The global race in clean energy technology and development is underway. According to World Economic Forum, the global clean energy market will reach $450 billion annually by 2012 and $600 billion by 2020.
But thanks to the Senate’s failure to act on climate legislation this summer, the United States is looking like a competitor whose shoelaces are tied together while our competitors run way ahead.
I think that the US could be winning this race, but the Senate has to unleash the power of American innovation and investment if we are to catch-up in this vital competition.
And it is not just me saying so. U.S. business leaders and organizations with large and small members are pleading with lawmakers to get off their duffs and pick clean energy and climate legislation this fall. If the Senate reconsiders its mistake and moves a serious clean energy and climate bill this fall, we might still be able to salvage the situation. Because make no mistake about it: A great deal of damage already has been done.
In fact, a broad coalition of large and small business leaders launched a campaign that is counting how far behind in the clean energy race the US is falling every second since the Senate dumped climate on July 22. The campaign features a neat counter that gets the message across pretty clearly:
E&E reported on the effort yesterday (subscription only):
A coalition of business groups is launching an ad campaign aimed at prodding the Senate to revive climate legislation that appears dead this year.
Clean energy advocates including American Business for Clean Energy, the American Sustainable Business Council, the Small Business Majority, We Can Lead and the Women's Business Development Center are running "ticker" advertisements, which run as banners on websites. They warn of the lost U.S. clean energy investments since the Senate punted on a climate bill and point to jobs that would have been created under such legislation.
The coalition, representing more than 5,000 businesses, plans to run the ads in Politico and The Washington Post this week.
The lobbying campaign comes after Senate leadership last month dropped plans for a sweeping energy and climate bill, deeming emission limits too controversial to pass.
The United States is falling $260 million per day behind the rest of the world in clean energy investments, the groups say, and lost the opportunity to create 1.9 million clean energy jobs by failing to pass climate legislation.
"Every day we delay putting a price on carbon, we fall further behind in the clean energy race -- ceding the playing field and new jobs to our competitors," the groups say in a letter to senators.
"A comprehensive clean energy and climate plan that includes a price on carbon will deliver long-term price signals that business leaders need to unleash capital and innovation, while creating millions of new American jobs."
(We Can Lead has a copy of the letter the business groups sent to the Senate.)
A column by Bloomberg’s Eric Pooley “Senate Inaction Cedes U.S. Energy Race to China” makes similar points:
On July 24, when some of the clean-tech industry’s leading executives gathered in Aspen, Colorado, for a Clean Energy Economy Roundtable sponsored by the Aspen Institute, the group was perplexed. “The deployment rate of renewable energy projects in America is withering,” said Andy Karsner, CEO of Manifest Energy and a former assistant secretary for Energy Efficiency and Renewable Energy during the George W. Bush Administration. “Projects announcements are happening, but largely at the end of a federal check.”
Instead of funding U.S. projects, banks and venture capitalists increasingly are putting their energy money into China, where the market is large and secure, thanks to government mandates. In the second quarter, for example, China attracted more clean-tech asset financing than Europe and the U.S. combined, according to data compiled by Bloomberg New Energy Finance.
Financing of wind turbines, solar panels, and low-carbon technology in China climbed to $11.5 billion, a 72 percent jump from the year-earlier quarter. U.S. investment in clean energy for the quarter measured $4.9 billion; Europe’s, $4.5 billion. “Where investors are placing their bets,” says BNEF Chief Executive Michael Liebreich, “is changing rapidly.”
On the same day that Reid pulled the plug on the carbon cap, China Daily announced that the People’s Republic would begin an experiment in carbon trading -- a policy mechanism invented in America, used by Republican George H.W. Bush to fight acid rain, and vilified by today’s GOP as “cap and tax.”
That’s right. The Chinese are going to eat our lunch on clean energy - using technologies and policy tools we created - if we don’t get our act together.
So what to do? Consider the advice of Lewis Hay, chairman and CEO of NextEra Energy:
The simple fact is that clean and renewable energy do not compete on a level playing field with fossil fuels, and until we put a policy framework in place to enable them to do so, we will struggle to compete in energy industries that we invented, such as wind and nuclear power. Here’s what has to happen:
First, we need a price on carbon. Only with the proper economic signals in the marketplace can we build a world class clean energy industry in the United States. Right now, carbon is not priced, which makes fossil fuel generation look artificially cheap. With a gradually escalating price on carbon that reflects the full social costs of burning fossil fuels, low-emissions fuel sources can compete on fair terms with their high-carbon counterparts.
Second, we need a national Renewable Energy Standard (RES). Even if Congress acts to put a price on carbon at some point, it will be many years before the price rises to a level sufficient to enable clean energy to deploy on its own. An RES that requires power producers to get a certain percentage of their electricity from renewable sources is the necessary bridge from our high-carbon electricity system to the low-carbon future.
Third, we need a stronger federal role in ensuring that high-voltage transmission lines get built. Renewable energy is most abundant on wind-swept plains and sun-baked deserts, but it takes transmission lines to transport it to the nation’s cities. We need legislation to give the federal government siting authority for electric transmission, just as it has for other critical national infrastructure such as railroads, interstate highways and natural gas pipelines. And the Federal Energy Regulatory Commission should use the authority it already has to ensure that the cost of building new transmission lines is shared broadly and fairly.
In short, it already is painfully clear how steep the price will be for our children and grandchildren if we fail to reverse the decision by the U.S. Senate to “throw” the clean energy race with the Chinese. Can the US Senate get our shoes untied? Let’s hope so.