The Race Is On to Dominate the Global Clean Energy Market

Early this fall, Vinod Khosla’s venture capital firm announced the creation of two funds totaling $1.1 billion—the largest amount generated by a venture firm since 2007. What, in our recessed economy, is attracting that kind of investment? Green technology.

Khosla is not alone in betting on clean energy solutions. Innovative business leaders and engineers realize that solving global warming—the biggest environmental, humanitarian, and security threat of our time—presents an enormous opportunity.

This December, international climate negotiations will conclude in Copenhagen, and as more nations set limits on carbon emissions, the clean energy market will explode.
The question is: who will dominate that market?

There are promising signs here in America. Green jobs, for instance, are growing 2.5 times as fast as traditional jobs. But there is another indicator as well: the enormous sense of possibility that is spreading across the country. Everywhere I go I meet people who want to design, invest in, or build the next wave of clean energy technology.

Researchers at MIT are fired up to create the next generation of hybrid car batteries. Green entrepreneurs in Ohio are converting windshield factories to make solar panels. And steel workers in Indiana want to revive America’s ailing industrial heartland by manufacturing wind turbines.

These people are doing what America has always done well: leveraged our ingenuity to become technological leaders. But there is no guarantee we will retain our leadership when it comes to clean energy.

I just returned from a trip to China. When you travel to China these days, you get the sense that it is a nation on the move. Whatever China does with that momentum—from building skyscrapers to manufacturing cars—it does is on a massive scale.

This is especially true in the energy sector. China will build more coal-fired power plants than any other nation, but it will also implement more clean energy solutions—more efficiency, solar, wind, and biofuels. Already it has set an ambitious target of meeting 10 percent of its energy demand through renewables by 2012, and 15 percent by 2020.

The Chinese business community is rushing to catch up. China is set to become the world’s leading manufacturer of wind turbines this year, and is already the top producer of photovoltaic cells for solar energy.

While I was in Shanghai, I attended a clean tech conference. It was co-sponsored by the local American Chamber of Commerce, so about two-thirds of the participants were Westerners, and the rest were Chinese. At the end, someone asked me, “Did you notice that the Chinese business people were here at the beginning of the conference, but they didn’t stay? They are more focused on action than on talking.”

That is what we should be focusing on in America. We need to take swift action in order to unleash energy innovation here at home. If we don’t, we will lose the clean tech race to China, and we may fall behind other contenders such as Germany and Spain.

The best way to secure a place in the global clean energy market is through smart policies. We need government incentives to get technologies out of the lab and into the marketplace. In America, we are half way there.

Back in June, the U.S. House of Representatives passed the American Clean Energy and Security Act that set limits on global warming pollution. The bill would drive investment toward the low-carbon solutions that will reduce our greenhouse gases.

But these incentives aren’t in place yet. The Senate must pass its own version of the bill. Senators John Kerry (D-MA) and Barbara Boxer (D-CA) have introduced the Clean Energy Jobs and American Power Act, a market-based pollution reduction and investment system based on the highly successful program for reducing acid rain.

The bill has already garnered support not only from corporate giants like Alcoa and DuPont, but also from labor unions that welcome the potential to create millions of jobs. However, some lobbyists remain wedded to the same old dirty energy technologies we have been using since the 19th century.

If you believe it is time for America to enter the 21st century and lead the way into the clean energy future, I urge you to tell your lawmakers to pass this bill.