By Jesse Jenkins, Devon Swezey, and Yael Borofsky
A new Clean Energy Deployment Administration (CEDA) is critical to "position the U.S. as the global leader in the development and deployment of clean energy technologies for years to come," according to a letter written by the country's leading clean tech entrepreneurs, investors, and stakeholders.
Thirteen leading clean tech companies, including Google, GE, and Kleiner Perkins, wrote to President Obama last week urging him to expedite the creation of a Clean Energy Deployment Administration along the parameters outlined by the Senate's American Clean Energy Leadership Act of 2009 (ACELA).
According to ACELA, a bipartisan product of the Senate ENR committee under the leadership of Senator Jeff Bingaman (D-NM), CEDA would be a new autonomous agency staffed with project financing experts and its own Administrator but maintain affiliation with the Department of Energy in order to benefit from DOE's considerable energy expertise. CEDA would provide financial enhancement, much like a bank, through a flexible suite of credit augmentation tools, including loan guarantees, securitization, insurance, that would reduce risk for investors in clean energy innovation. CEDA's financial support packages will thus help innovative new clean technologies secure private-sector financing, greatly increasing investment in this critical sector with limited risk to taxpayers.
Perhaps the most important and unique feature of CEDA is that it would be the first example of a deployment-oriented agency specifically designed to further accelerate clean energy innovation. To date, most clean energy deployment policies - renewable electricity standards, production tax credits, even the House version of CEDA - are far more focused on driving megawatts into the ground (and thus supporting more mature technologies, like wind). In contrast to the House version, which is more likely to act as (and compete with) a typical bank, the Senate's formulation of CEDA breaks new ground for deployment policy in its understanding that innovation doesn't end at the lab. Under ACELA, CEDA would have the ability to take on riskier projects thanks to explicit technology improvement goals, with objectives to drive lower prices and higher performance in an array of nascent clean technologies that advance some of the nation's most pressing interests.
In the letter, the advocates expand:
"We believe the availability of CEDA financing will help America's emerging clean energy technology companies cross the so-called "valley of death" between the invention of a technology and its commercial deployment, and thus substantially accelerate and increase private sector investment necessary to position the U.S. as the global clean energy leader. In short, CEDA will help finance the scale-up of precisely the kinds of innovative technologies that will create new, 21st Century American jobs and position the U.S. to capture the economic benefits of the global transition to low-carbon energy infrastructure."
CEDA is a critical component of the kind of clean energy competitiveness strategy that the United States must have to compete with other nations moving aggressively to capture global clean tech market share. In fact, clean tech companies in many other nations receive this sort of financial support, making it all the more necessary that this measure is fully capitalized with at least the $10 billion contained in ACELA - and probably much more over time.
Coming from a diverse group of clean tech innovators, this letter shows that private sector leaders are firmly behind the creation of CEDA and Senator Bingaman, who has been a leading champion of this critical and innovative program. With the potential to create thousands of clean energy jobs and provide a boost to long-term U.S. economic competitiveness, CEDA must be a part of any jobs or energy legislation that comes out of Congress.