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VP Biden Claims US Will Lead the Global Clean-energy Revolution. Great News, Joe! When Do We Start?

By Craig Shields
May 27, 2011 | 10 Comments

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As suggested in this article, US Vice President Joe Biden claims that the US, gifted as it is with its "entrepreneurial spirit and innovative national labs, will lead the global clean-energy revolution and reap the economic and environmental benefits that go with it." Rats. I’m so sorry I missed that speech, since it certainly must be grounded in solid fact. Did he say when all this was supposed to begin?

While US politicians (democrats only, of course) are making empty speeches about it, the Chinese and others are actually making it happen. China leads the world in clean energy investment. According to Bloomberg, they’ll spend 5 trillion yuan (nearly $740 billion) over the next 10 years on renewable energy projects.

Having said this, perhaps talk is better than silence. Republicans, who form the majority in the US House of Representatives, stay as far away as possible from the clean energy discussion, hard-selling voters that environmentalism is bad for the economy and that the imperative to move away from fossil fuels is over-hyped.

So where does this leave us? What hath our democracy wrought vis-à-vis the clean energy picture? Uncertainty and constant flip-flops. But why is that so bad? Aren’t we entitled to a lively debate? Sure, but while it’s raging, don’t expect to see the solid stream of capital formation necessary to make clean energy a reality.

Not unlike an alcoholic who needs to hit rock bottom before he carts himself into AA and cleans up his life, I see a similar trajectory for the US. If we are unable to change this pattern of waffling, at a certain point in the next decade, Americans will realize that the country they love is now number four or five in clean energy – an industry that is dominating the world economy.

Perhaps this will generate the resolve that is required to get serious in this arena. After all, in the words of George C. Scott as General George Patton, "Americans love a winner. And we will not tolerate a loser." It’s really that simple. We’re losing, and I’m betting that Americans will eventually place a limit on their tolerance for failure.

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10 Reader Comments

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1 of 10

mitch3

June 1, 2011

The simple fact is - Congress doesn't have to spend dollars to move toward clean energy they just have to support the efforts and the money will follow; by ignoring the subject or condemning it due to lack of convictions about the need to clean up our air and water is just plain ignorance of the facts. Congress has become the comedian of the democratic world and they just don't "get it."

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mitch3

June 1, 2011

More... Even the most conservative sportsman in the western US should question the rising mercury levels in their favorite fishing holes; the constant "haze" wafting to their hunting grounds, and the increased lost of access due in part to drilling operations taking over hunting grounds. As a conservative myself but being in the energy storage development business I fully understand the need to find a better solution - business as usual isn't going to cut it. I understand that the economy of numerous western states depends on the energy sector, particularly the natural gas development, to keep the buck flowing but what they don't realize is that even though natural gas is cleaner it is still a major contributor to poor air quality during winter inversions forcing people to stay indoors during the worse times. The State representatives should realize this but are more concerned about remaining in office than really helping their constitutes by cleaning up the air. They would rather spend dollars harping about being energy conservative and energy efficient.

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Eric-Mathis

June 1, 2011

Not sure whether this will be interpreted as self promotion or serve as a supporting argument but here is a recent blog I wrote about our efforts in the coalfields of West Virginia: http://www.greenforall.org/blog/why-i-moved-to-the-heart-of-the-billion-dollar-coalfield

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steve-poppitz-157135

June 1, 2011

We should be paying for attention to the Germans, the So.Koreans, the Brit's and the Scandinavians (you notice Socialist countries)and follow their lead. Admit we are behind, and make plans to compete.Waive building and development fees on renewable projects and cut the required red tape.Cut oil and coal subsidies, and give that $ to electric vehicle builders.Transfer budget money from defense dept. to energy dept.etc.etc. The Chinese didn't accidently lead the world in clean energy investment. The Germans didn't accidently buy up the PV industry. They are planning for a sustainable future. We are driving into ours in oversized SUV's burning imported oil at ridiculous rates. I still believe in America, but we can't keep doing the same forever and expect different results.

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mitch3

June 1, 2011

exotericeric... good piece, and I hope you are successful. I have been in numerous collaborative secessions where one side had nothing to lose and the other was losing something they had, its not an even battle and considering the spirit of compromise - everyone loses something, no one is happy but they agree since there is no other choice. In the situation of "going green" we all have something to lose and only the large oil/coal/gas corporations have something to keep-money it is a one sided battle.
Ironically we're suppose to have a government that panders to their public's needs but it seems that the desire to stay in office AND reap campaign dollars is more important than the public's needs. If we have politicians who really listen and really see the damage from poor air quality, their contribution to the cause would be profoundly valuable, but it's not happening.
Just an after thought, when they remove the top of a mountain for the coal doesn't it create a great place for solar or wind development?

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ronald-steenblik-74298

June 3, 2011

And so, what is your solution more concretely. Huge subsidies? Mandates? Feed-in tariffs? A carbon tax? Cap and trade? One does not simply wish an industry into being. Yet these different policy instruments have profoundly different effects on an industry's structure, incentives to innovate, and on the prices faced by consumers and by competing industries.

You write, "China leads the world in clean energy investment. According to Bloomberg, they'll spend 5 trillion yuan (nearly $740 billion) over the next 10 years on renewable energy projects." Could you be more precise? Do you mean:

-- The Government of China (or the central plus sub-national governments) plans to spend that amount to support investments?

-- Industry will invest that amount?

-- Some combination of the above?

And what do you include in "renewable energy"? The Three Gorges Dam itself cost $25 billion.

In Europe and much of the rest of the developed world, investments are being made against a background of emission trading systems and high excise (or carbon) taxes on fuel or electricity. In the United States, many in the renewable-energy industry seem to shy away from suggesting such measures, and instead demand "temporary" subsidies and mandates -- in order to avoid raising consumer costs and so as to be able to say that the subsidies will no longer be needed after a few years. Yet those temporary subsidies keep getting extended. Those for biofuels have been around now for more than three decades.

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steve-poppitz-157135

June 3, 2011

Dear Ronald,
Here is one refer. re China and Renw.En. :http://www.bloomberg.com/news/2011-03-29/china-extended-lead-in-making-clean-energy-investments-in-2010-pew-says.html I also read it in FORBES and THE ECONOMIST. In the article it mentions that the Chinese plan to spend $54.5BB on renew.en.(and their defense budget is ~$66BB) While here in the USA our Dept. of Energy has a $13BB budget (and our dept. of Defense has a $663BB budget). Admittedly we are more "free market"and their people aren't used to home computers and plasma TV's. But just imagine what would happen to our oil imports if we spent 82% of our DOD budget on renew.energy? I still hope that VP Biden's claims and speculations come thru.

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ronald-steenblik-74298

June 3, 2011

@Steve Poppitz,

Thank you for the reply, and the link to the Bloomberg article. But neither answers my question about the share between government expenditure -- in the form of equity investment, loans, loan guarantees, and subsidies (or their tax-expenditure equivalents) -- and investment by private industry on their own penny.

You mention that the U.S. DOE has a $13 billion budget. But that figure does not include the value of tax credits, for example, just as the USDA budget does not report the value of tax credits for ethanol and biodiesel.

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steve-poppitz-157135

June 3, 2011

Ronald,
Points well taken. I was thinking those ideas when I referred to a "free market" economy, as compared to the Chinese. I suspect in the Chinese case that the Country owns the Utility (not private)
and they get their entitlements overnight (no NIMBY's in China), and they build it without a Union Scale wage, and they run it with a controlled profit margin,and they are not replacing an old infrastructure (they didn't have one prior).So,we are doing OK. But just OK. This is an area WE NEED TO EXCEL IN.

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nigel-morris-167490

June 6, 2011

Ronald, no, not many people can answer your question. It will need a serious academic research exercise to gather all of the various elements that each of the US and Chinese Governments and private sectors pay towards energy of different sorts (often in disguised and admixed numbers). Obviously it would be the subject of much useful and vigorous debate.

Advancing unsubstantiated and ballpark numbers without breakdown often doesn't advance the discussion a lot (and may mislead). However, similarly, just sitting back and saying "You haven't answered my question" without contributing some work or information yourself, doesn't advance the discussion, and doesn't negate or deny the unsubstantiated assertions.

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