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Is the US Losing the Clean Energy Race?

Ready to move to new domestic issues after a win on health care, U.S. President Barack Obama has again turned his focus to energy. But many clean energy advocates are criticizing the President's plan, saying that it will put too much focus on oil and gas drilling, and not enough on renewables.

The details of the President's plan have not been fully laid out, but in recent days he has announced plans to increase offshore gas and oil drilling on the Outer Continental Shelf of the U.S. Some onlookers see this as a way for the President to get bipartisan support for a broader energy strategy that all political parties can support.

“He's clearly trying to mainstream it in the U.S....trying to get republicans and independents engaged in the issue as well — not just democrats,” says Michael Northrop, directror of sustainable development for the Rockefeller Brothers Fund. “I think that's a positive, especially as we move into a new debate around climate change legislation.”

And after a year of bitter partisan battles over health care, the White House could use any positive political bargaining chip it can get.

But some environmental groups and renewable energy advocates say this move contradicts Obama's earlier campaign pledge to avoid more offshore drilling and will delay an aggressive focus on renewables, putting the U.S. further behind other countries in the race to develop clean forms of energy.

A new report released from the Pew Charitable Trust shows that the U.S. is already getting outpaced by other G20 countries in renewable energy investment. Although the U.S. is seen as a leader in risk-taking and innovation, other countries like China and Brazil are investing more money in clean energy relative to the size of their economies.

The report, titled “Who's Winning the Clean Energy Race?” looked at the top 20 economies in the world, which make up around 90 percent of investment in renewables. Overall, the trends were positive: Since 2005, there has been a 230 percent increase in capital flow to the industry. Throughout that time period the U.S. has lead the pack with the most installed capacity and the most total yearly investment. Until last year that is.

China took the lead in 2009 as the country made a comprehensive effort to develop more wind, solar thermal and biomass, as well as scale up its solar PV manufacturing. The country invested $34.8 billion in renewables last year, which was $16 billion more than was invested in the U.S.

While the news is not surprising, given China's rapidly growing energy needs and its top-down approach to developing industries, the report highlights another telling statistic: The U.S. came in eleventh in investment relative to the size of its economy, falling behind China, Brazil, Germany and the UK.

The report authors conclude that U.S. policymakers and citizens should be “concerned about America’s competitive position in the clean energy marketplace.”

Some see this report as a good way to get the conversation around clean energy back on track. If the U.S. is to stay competitive in the changing global economy, it will need to match or surpass the investments being made by other G20 countries — especially China.

“I think it's a big part of how to talk about it. Clearly people's dander gets raised anytime you talk about an economic race with the Chinese. I think it's a very helpful frame for us to be working in,” says Northrop of the Rockefeller Brother's Fund.

China, of course, is sucking up oil around the world and developing far more coal power plants than wind or solar farms. So while total investment in renewables is increasing, the country's domestic efforts may be impeded by its dirty, centralized energy system. But its export industry will rival any country in the world.

Northrop points out that of the ten largest wind companies in the world, the U.S. only has one. And of the ten largest solar companies in the world, the U.S. has two. That's unacceptable, he says, given that the country – known as a bastion of innovation and risk taking — consumes 25% of the world's energy.

“I hope now that health care has passed in the U.S., the president will start to speak out more forcefully about this issue,” he says. “We need the public engaged and we need to get people off the fence – and if we can do that, the future looks bright.”

For a breakdown of the investment figures for each country, see the Pew report here.

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