There has been a lot of talk these days about the prospect of China outpacing America in the clean energy race. From a recent Los Angeles Times article reporting that China surpassed the United States in private clean-energy investment last year to a D.C. panel on Monday in which Senator Markey said, “If we don’t move, we are going to lose,” people are wondering whether America will be the frontrunner.
I believe America can still lead the clean energy market. If we pass strong climate legislation and focus our unparalleled innovation and entrepreneurial spirit, we can dominate the annual $230 billion clean energy investment the global clean energy industry is projected to attract by 2020.
Yet I have started to hear strains of defeatism coming from Congress.
Some senators say China has already won the race so we shouldn’t shift to clean energy and become dependent on its products. Others say that we won’t get any jobs out of clean energy because China’s low wages will steal them away.
In other words, the specter of China vaulting ahead into the 21st century energy future means we should stick with the same dirty technologies we have used since the Industrial Revolution.
Unlike some lawmakers, I am not ready to give up on America, especially not based on misguided notions about clean energy markets.
U.S. wind, solar, and geothermal resources actually grew during the recession of 2009, due in part to the federal stimulus package, which set aside $37 billion for clean energy and has already created roughly 18,000 clean energy jobs in the solar industry alone--even though most of the stimulus money has yet to hit the economy.
The stimulus was an incredible first step for the United States, but as China knows, the key to realizing the full potential is making a long-term commitment to clean energy--the kind of commitment that pays off in steady investment, jobs, and production.
America can build on the momentum of the stimulus--and keep pace with China--by passing clean energy and climate legislation. Economists have determined that it will create nearly 2 million jobs here in the United States.
In the face of record unemployment, senators owe it to American workers to get the facts straight about the enormous job opportunities we will gain by winning the clean energy race.
Manufacturing Here at Home is Cost-Effective
One common myth floating around is the idea that China is already winning the clean energy race, so if we invest in clean energy in the US it will only create manufacturing jobs in China--not here at home.
The fact is clean energy manufacturing jobs can be created in the US if we pass strong climate legislation because the jobs will follow the market demand.
In the last few years, China has become the world leader in the manufacturing of wind turbines and solar panels. Yes, average wages are lower in China, but China has sprinted ahead in manufacturing jobs largely because it has adopted policies that create long-term demand in China for clean energy products. Taken together, these two forces have created thousands of manufacturing jobs in China.
Even if much of China’s clean energy products continue to be manufactured in China, millions of clean energy jobs will be created here at home as well in order to meet our own demand for clean energy. Many clean energy products such as wind turbines are large, heavy, and fragile. It is not easy to ship them around the world. Indeed, transportation and logistics costs add 10 to 25 percent to the price of wind turbines. For this reason, it generally makes sense to manufacture wind turbines where the market is located, not halfway around the world.
Last year, for instance, the Isle of Wight in Great Britain lost many of its clean energy jobs when Danish wind-turbine manufacturer Vestas moved part of its production to the United States, where the turbines were being installed. The reason: it simply made more sense to manufacture the turbines close to where they would be used instead of shipping them across the ocean.
I heard a similar story when I was in Cleveland last year. Developers are planning to build a wind farm around Lake Erie, right offshore of the city. They chose this site in part because there are already 90 companies in Ohio manufacturing the 8,000 different parts it takes to build a turbine. As one local leader involved in the project explained: “We have companies making bearings, generators, electronics, and fasteners [for turbines] within a half-hour drive of Terminal Tower” in downtown Cleveland.
If the Senate passes strong climate legislation that expands the market for clean energy and creates long-term demand for clean energy products in the US, manufacturing communities across America will look more like Cleveland than the Isle of Wight. [For a view of Ohio’s clean energy sector, watch this ABC News’ report with Charlie Gibson.]
Most Green Jobs Are in Installation and Maintenance
Another myth frequently passed around is that most clean energy jobs are in the manufacturing sector. In fact, the majority are in installation and maintenance.
Most people recognize that you can’t give the job of insulating an American home to a worker in China. But the potential for clean energy jobs in America goes far beyond efficiency retrofits.
Studies by Barclays, Greenpeace, and the European Photovoltaic Industry Association have found that 75 percent of all solar panel jobs are in the installation and maintenance of the panels--neither of which can be done from overseas. The trend is similar for other clean energy technologies, and this means good news for American carpenters, welders, energy auditors, HVAC specialists, installers, retailers, service engineers and truck drivers, who will enjoy the majority of clean energy job opportunities.
These are good paying jobs. The Bureau of Labor Statistics cites industry sources that estimated solar photovoltaic installers earn between $15 and $20.96 per hour, depending on experience. Compare that to the mean salary for an assembler at a Detroit factory: $14.19.
All told, the average salary in the installation, maintenance, and repair occupations is about 15 percent higher than the average salary in production jobs in Detroit.
America Has the Technological Advantage
Thanks to our research institutions and venture capital community, America leads the world in technological innovation. Right now, we still have an edge in clean energy expertise, from cleaner power plants and cleaner cars to more efficient industrial processes.
When China announced plans to launch the world’s largest solar power plant in Inner Mongolia, for instance, it looked to American company First Solar (based in Ohio) because of its advanced thin-film solar cell technology.
And significantly, four of the five largest venture capital funding rounds in the global clean tech sector in 2008 went to US-based companies, including thin-film solar company Solyndra, advanced battery developer A123 Systems, smart grid company Silver Spring Networks, and fuel-efficient automaker V-Vehicle.
Still, China, not to mention Germany, Denmark, and Spain, are poised to leap ahead in the clean tech race since these countries have already put in place climate and clean energy policies similar to what is now being debated in the senate.
The best way for America to ensure our spot at the forefront of this global market is to pass a clean energy and climate law that will give companies across the economy the incentives they need to invest in low-carbon technologies.