The Clean-Energy Investment Agenda

A shrinking cap on emissions and a rising price for carbondioxide is the sine qua non of enabling a sustained transition to aclean energy economy (see “The only way to win the clean energy race is to pass the clean energy bill“).  But it is not the only strategy needed to ensure a rapid transition at the lowest possible cost.  CAP’s John Podesta, Kate Gordon , Bracken Hendricks, and Benjamin Goldstein discuss what “A Comprehensive Approach to Building the Low-Carbon Economy” would entail in a new report (here) and a post first published here.

The United States is having the wrong public debate about globalwarming. We are asking important questions about pollution caps andtimetables, carbon markets and allocations, but we have lost sight ofour principal objective: building a robust and prosperous clean energyeconomy. This is a fundamentally affirmative agenda, ratherthan a restrictive one. Moving beyond pollution from fossil fuels willinvolve exciting work, new opportunities, new products and innovation,and stronger communities. Our current national discussion aboutconstraints, limits, and the costs of transition misses the realexcitement in this proposition. It is as if, on the cusp of an Internetand telecommunications revolution, debate centered only on the cost offiber optic cable. We are missing the big picture here.

Let’s be clear: Solving global warmingmeans investment. Retooling the energy systems that fuel our economywill involve rebuilding our nation’s infrastructure. We will createmillions of middle-class jobs along the way, revitalize ourmanufacturing sector, increase American competitiveness, reduce ourdependence on oil, and boost technological innovation. Theseinvestments in the foundation of our economy can also provide anopportunity for more broadly shared prosperity through better training,stronger local economies, and new career ladders into the middle class.Reducing greenhouse gas pollution is critical to solving globalwarming, but it is only one part of the work ahead. Building a robusteconomy that grows more vibrant as we move beyond the Carbon Age is thegreater and more inspiring challenge.

Reducing greenhouse gas emissions to avert dangerous global warmingis a moral challenge, but it is also an economic, national security,social, and environmental imperative. The “cap and trade” provisions,which will set limits on pollution and create a market for emissionsreductions that will ultimately drive down the cost of renewable energyand fuel, represent a very important first step and a major componentin the mix of policies that will help build the coming low-carboneconomy. But limiting emissions and establishing a price on pollutionis not the goal in itself, and we will fall short if that is all we setout to do. Rather, cap and trade is one key step to reach the broadergoal of catalyzing the transformation to an efficient and sustainablelow-carbon economy. With unemployment at 9.5 percent, and oil andenergy price volatility driving businesses into the ground, we cannotafford to wait any longer. It is time for a legislative debate over acomprehensive clean-energy investment plan. We need far more than capand trade alone.

This is not just an exercise in rhetoric. Articulating and elevatinga comprehensive plan to invest in clean-energy systems and moreefficient energy use will affect policy development and the politicssurrounding legislation now moving through the Senate, as well asinternational negotiations underway around the globe. The currentdebate, which splits the issue into the two buckets of “cap and trade”and “complementary policies,” has missed the comprehensive nature ofthe challenge and its solutions. It also emphasizes the challenge ofpollution control instead of organizing policy for increaseddevelopment, market growth, reinvestment in infrastructure, and jobcreation through the transition to a more prosperous, clean energyeconomy.

This paper lays out the framework for just such an investment-drivenenergy policy, the pieces of which work together to level the playingfield for clean energy and drive a transformation of the economy.Importantly, many elements of this positive clean-energy investmentframework are already codified within existing legislation such as theAmerican Clean Energy and Security Act, passed by House ofRepresentatives earlier this year. But with all the attention given tolimiting carbon, too little attention has been placed on what willreplace it. These critical pieces of America’s clean-energy strategyshould be elevated in the policy agenda and political debate as we moveforward into the Senate, and used to help move legislation forward thatadvances a proactive investment and economic revitalization strategyfor the nation.

Read the full report (pdf)



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