Seize the Energy Opportunity or Slip Further Behind China

A Primer on Global Competition in Green Technology Investments SOURCE: AP/Xinhua, Li Rui

Wind power turbines at a wind power plant in Ulanqab, which is in north China's Inner Mongolia Autonomous Region.

By Ben Furnas | April 20, 2009

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China’s leaders are investing $12.6 million every hour to green their economy. Other countries are equally energetic in their embrace of alternative energy technologies; they are setting targets and investing billions of dollars to spur the development of entirely new markets in wind, solar, geothermal, biofuels, energy efficiency, high-speed rail, and other clean and innovative solutions to global warming.

The United States, too, is poised to transform its economy to create millions of new jobs and help create a cleaner, safer planet by investing in a green, renewable-energy based economy. The Obama administration wants to unleash the ingenuity of our private sector to rein in pollution and put millions of Americans back to work. Yet China is spending twice as much as the American Recovery and Reinvestment Act spends to lay the foundations for a green energy economy, despite the U.S. economy being 1.5 times as large as China’s. And across Europe and Asia, other governments have diversified their energy portfolios and encouraged entrepreneurs to start and expand clean and renewable energy companies.

As venture capitalist John Doerr recently pointed out in his testimony before the Senate Committee on the Environment and Public Works, “If you list today’s top 30 companies in solar, wind and advanced batteries, American companies hold only 6 spots. That fact should worry us all.”

Indeed, when it comes to preparing our country to compete in the new energy economy of the future and create millions of new jobs, we lag behind most of our competitors in the rest of the world in a four key ways.

• We have no national energy portfolio standard that encourages clean, renewable power and shifts away from dirty and dangerous energy.
• We have an outdated electrical grid unsuited for the task of carrying energy from regions rich in wind, solar, and geothermal potential to the people who need the energy.
• We don’t make dirty energy companies pay for the pollution they pump into the air; in fact, we give them billions every year in tax breaks.
• And we don’t invest enough in research, development, and deployment to inspire our entrepreneurs and leverage their discoveries by helping bring their bold new technologies to market.

As Doerr explained in his testimony, “What is at stake is whether America will be the worldwide winner in the next great global industry, green technologies.”

This analysis explores the current international terrain on which the United States is competing and asks three questions:

• Why is America losing the “green stimulus” competition?
• Why are we trailing Europe and Australia in renewable energy?
• Why are we clinging to the dirty, dangerous, job-killing energies of the past?