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Here’s What the U.S. Needs to Do to Keep Up in the Race for Clean Energy

Here’s What the U.S. Needs to Do to Keep Up in the Race for Clean Energy

This is a guest post from Phyllis Cuttino, director of clean energy at The Pew Charitable Trusts.

At first glance, 2013 appears to have been a poor year for clean energy investment in most countries, including the United States. Global investment fell 11 percent from 2012, to $254 billion, and additions to renewable power generating capacity declined by 1 percent, according to Whos Winning the Clean Energy Race? 2013, the fifth in an annual series of reports issued by The Pew Charitable Trusts. And the United States came in second to China for the second year in a row.

Appearances are deceiving, though. Clean energy remains a vigorous sector of the world economy, with enormous potential for investment and for reducing dangerous dependence on fossil fuels. But the year-to-year fluctuations and lagging U.S. performance show that America needs policies that provide certainty and allow our clean energy sector to compete in the global marketplace, if we want to keep up with growth in Asia.

A look at the top 10 clean energy investing G20 nations

Overall, the clean energy industry has matured. It is now a $250 billion component of the world economy. Despite the decline in total investment, prices for renewable technologies continue to drop, making them increasingly competitive with conventional power sources. Major clean energy stock indexes rose significantly in 2013, with public market financing up by 176 percent. And markets for clean energy technologies are prospering in fast-growing developing countries, which view distributed generation as an opportunity to avoid investments in costly transmission systems.

As always, there were winners and losers in the 2013 race for clean energy investment. Among the winners, Japan, Canada, and the United Kingdom attracted increased investment, with Japan experiencing the fastest growth in the world, rising 80 percent to almost $29 billion. This moved Japan from fifth place to third among G-20 nations and reflects the priority that the country has placed on renewable power since the Fukushima nuclear disaster. Most striking was a near doubling in the country’s solar sector, which received $28 billion in investment, almost 30 percent of the G-20 total.
A look at clean energy investment by region in the G20 over 2013

In the United States, clean energy installations collapsed with the expiration of the production tax credit. Still, a record 4.3 GW of solar was installed, and the U.S. continued to lead the world in the biofuels and energy efficient/low-carbon technology subsectors. It also remains the dominant recipient for public market, venture capital, and private equity investments. Nevertheless, it is fair to ask why China continues to lead in overall clean energy investment, attracting $54.2 billion in 2013. And the short answer is national policies.

China’s government has put in place ambitious national renewable energy goals that are geared toward guiding robust investment: 200 GW of wind, 50 GW of solar, and 30 GW of biomass by 2020. In 2013, China had a nearly fourfold growth in solar power to an unprecedented 12.6 GW, and wind capacity grew by 14.1 GW. Its total capacity is a world-leading 191 GW. Few doubt China will achieve its renewable energy goals.

In contrast, the United States lacks national policies that will help provide certainty to investors, although more than 20 states and the District of Columbia have goals for renewable energy. While China added more than 30 GW of capacity last year, the United States added less than half that amount. China’s five-year growth rate is 23 percent compared with 12 percent for the United States. China is also accelerating installation of ultra-high voltage transmission capabilities that facilitate integration of renewable sources.

It’s clear that for any country to compete in the race for clean energy investment, ambitious energy targets will be paramount. In the United States, we need to renew our production tax credits for wind energy, implement a national renewable energy standard, strengthen our commitment to advanced biofuels, and improve the relevant financing vehicles. Only by doing so can we hope to regain the lead in a sector that is so critical to America’s future development.

Pew Webinar: Whos Winning the Clean Energy Race?

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89 comments

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1:58PM PDT on Jul 6, 2014

Very interesting but can we actually do it as a nation with big businesses controlling everything.

4:59PM PDT on Apr 16, 2014

Thunder Bay OPG Burning Coal Free
Net Newsledger ‎- 1 day ago
THUNDER BAY - Ontario is now the first jurisdiction in North America to fully eliminate coal as a source of electricity generation. The Thunder ... now being converted to advanced biomass

Check the comment section

6:10AM PDT on Apr 16, 2014

We need to stop the subsidies and get wind and sun on the free market. We must also insist that they follow safe siting recommendations as they are killing entirely too much wildlife.

1:53PM PDT on Apr 15, 2014

contd; Wind & Sun are FREE!!! Who claims ownership to them to exploit us? If we think the Koch brothers are a problem, KEEP your eyes and ears on the Greed Energy Group,

Lobby against $mart Meter$.

1:51PM PDT on Apr 15, 2014

The global investment chart is skewed, population wise China is #1 with India 2nd. India needs motivation. Smog in China would move anyone to clean technology, or Japans Nuclear tragedy.This post is by a financial Trust Company, Investor $pin. The truth is, the quote: lagging U.S. performance show that America needs policie$ that provide certainty and allow our clean energy $ector to compete in the global marketplace.

We DO NOT compete in the global marketplace for energy supply! They compete against themselves locally, Big Coal, Oil, Natural Gas, Propane, Solar, Wind, Hydraulic Water power etc. WE ARE a CAPTIVE MARKET! Big Coal does export to Asia, Liquid Propane, Natural Gas & Wood Pellets are shipped to Global markets, which has possibly caused the severe spike in propane prices and recent winter shortage.

In Ontario Canada we are slaves to the Ontario Energy Board's GREED ENERGY PROGRAM, which just approved a 40% increase in Natural Gas, pays Solar Farms with Feed In Tariff Contracts 1,500 % MORE for electricity @ 0.80 cents. Our BasE rate was 0.051 cents 2 years ago before SMART METERS, which in Winter Peak rate charged 94% to cook breakfast & supper at 0.099 cents plus a new Delivery Charge trailing behind at roughly 90% of Energy Charge.

Warning, the Greed Energy $pin needs very careful $crutiny. How does a $olar Farm or Windmill compare to the Capital Costs of a Coal Fired Power Plant, Nuclear facility, Natural Gas Co-gen or Concrete Power Dam?

3:47PM PDT on Apr 14, 2014

Thanks.

8:33AM PDT on Apr 14, 2014

Once more people & corporations see this as a race worth running in, then we'll all win.

4:51AM PDT on Apr 14, 2014

Noted. Thanks.

2:00AM PDT on Apr 14, 2014

petition signed

2:02PM PDT on Apr 13, 2014

thanks

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