A new WWF report has come out further emphasizing the great needfor the US to do more to seize its fair share of the growingmulti-trillion dollar clean energy export market. This repost by Lynn Englum from WWF’s blog gives an overview.
Numerous news articles/op-ed pieces (see here,here& here) along with warnings from high-ranking governmental officials (see here& here) and Congressmenfrom both sides of the political spectrum have warned that the U.S. is losing the clean energy race to Europe, Japan and China. Thesecountries are ramping up their national renewable energy portfolios and gaining export market share, positively positioning themselves for the largest future export markets in clean technology deployment—thedeveloping world. According to the International Energy Agency (IEA), approximately $27 trillion willneed to be invested in clean technologies in developing countries overthe next four decades.
Why will these future markets be so large? In coming years, emissions will grow most sharply in developing countries, making cleantechnology deployment vitally important. The U.S. has enormouspotential to lead in these markets, but without U.S. legislation thatputs a price on carbon and includes public finance to help unlockdeveloping country markets for clean energy, America will continue tofall behind top competitors and miss important opportunities.
A new WWF report,Getting Back in the Game, reveals the potential for U.S. market share in clean technology deployment in the developing world. WWF estimates that the $27 trillion investment needed in developing countries translates into a $150-450 billion annual export market. The report finds that if the U.S. is able to capture a14% market share of this potential clean tech export market—on par with our current market share in environmental goods and services in developing countries—280,000-850,000 new, long-term American jobs would result.
A crucial component for harnessing the clean technology export market is public financing. Although private capital will provide thesubstantial majority of the finance for clean energy development, public financing to undertake key policy and institutional reforms and reduce investment risks in developing countries is needed to prime the pump. Well-targeted public investments can leverage much larger amounts ofprivate capital and benefit American businesses by opening new marketsfor U.S. clean energy industries, spurring innovation and lowering costs for clean technologies.
Including public finance in a climate and energy bill is vital forgenerating a dedicated stream of revenue, avoiding the volatility ofyearly congressional budget approval. Previous versions of the climatebill (House-passed Waxman-Markey bill & Senate’s Kerry-Boxer bill) set aside 1% of revenues from allowances to develop markets and overcome barriers to clean technology uptake in developingcountries and help facilitate U.S. exports to these new markets.
To unlock new opportunities, this set-aside (which is not currentlyin the American Power Act) must be preserved and a climate and energy bill must be passed. Without legislative passage and public finance components, the U.S. will continue to hemorrhage clean energy market share to overseas competitors and fall behind in the energy race.