Senators Introduce Bill to Boost Clean Tech Manufacturing

Originally Posted at the Breakthrough Institute

Last Thursday, U.S. Senators Jeff Bingaman (D-NM), Orrin Hatch (R-UT), Debbie Stabenow (D-MI), and Richard Lugar (R-IN) introduced bipartisan legislation aimed at accelerating the growth of clean technology manufacturing industries in the United States.

The American Clean Technology Manufacturing Leadership Act would extend a tax credit first introduced in the short-term American Recovery and Reinvestment Act (ARRA) to allow companies to write-off 30 percent of the cost of creating, expanding or re-tooling domestic clean tech manufacturing facilities.

The ARRA program--called the Advanced Energy Manufacturing Tax Credit--provides $2.3 billion in tax credits and has spurred new investments in U.S. clean tech manufacturing facilities. Funding for the popular program is expected to dry up in mid-January but the new legislation would provide an additional $2.5 billion to extend the life of the program.

In a statement on the release of the bill, Senator Stabenow proclaimed that the legislation is critical to boost economic growth, job creation, and U.S. competitiveness in the global clean energy race:

"In order to turn our economy around and create jobs, we need to build the clean energy technology of the future here in America. Otherwise, we will lose the race with other countries and see those jobs go overseas."

Senator Bingaman added some perspective about the current challenge facing the United States:

"Currently, the United States runs an annual 'green trade deficit' of almost $9 billion. But the United States should be the world's No. 1 manufacturer of clean energy technology. This tax incentive will help us move toward that goal."

Indeed, as the Breakthrough Institute and ITIF note in "Rising Tigers, Sleeping Giant," a recent survey of clean energy competitiveness in the U.S. and Asia, the U.S has fallen behind its international competitors in the capability to manufacture and produce clean energy technologies on a large scale:

"With no domestic manufacturers of high-speed rail technology, the United States will rely on companies in Japan or other foreign countries to provide rolling stock for any planned high-speed rail lines. And all three Asian nations lead the United States in the deployment of new nuclear power plants. The United States relies on foreign-owned companies to manufacture the majority of its wind turbines, produces less than 10 percent of the world's solar cells, and is losing ground on hybrid and electric vehicle technology and manufacturing."

The three Asian nations examined in the report--China, Japan, and South Korea--are also investing aggressively in clean tech sectors and will out-invest the United States three-to-one in these sectors in a bid to gain a first-mover advantage in rapidly growing clean energy markets.

If the United States does not strengthen its competitive position vis-a-vis its Asian competitors, the jobs, tax revenues, and other benefits of clean tech growth will overwhelmingly accrue to our competitors. The report also notes that the climate and energy legislation working its way through Congress, as currently formulated, will not be sufficient to close the clean tech investment gap and put the United States back in contention in the race to dominate future clean tech industries.

Toward a Clean Energy Economy Strategy

Simply attempting to limit emissions and put a low price on carbon--the primary mechanism of both the American Clean Energy and Security Act (ACESA) and the Clean Energy Jobs and American Power Act (CEJAPA)--will not forestall America's decline in the global clean tech industry. These are both pollution reduction bills, not clean energy economy bills, and should not be confused.

An effective clean energy economy strategy would have at its center large, direct and long-term public investments in domestic clean tech industries. Not all clean technologies are created equal and these investments should be optimized to address the hurdles of individual clean technologies in order to improve their performance and drive down their costs. In short, a clean energy economy strategy would invest in American clean energy to make clean energy cheap, driving U.S. clean tech exports and creating U.S. clean tech jobs.

The bi-partisan American Clean Technology Manufacturing Leadership Act announced by Senators Bingaman, Hatch, Stabenow, and Lugar is laudable because it recognizes that simply pricing carbon is not a clean energy economy strategy, and thus will not keep the United States competitive in the clean energy race.

This legislation is one step in what must be a comprehensive and robust clean energy economy strategy that prioritizes large public investments in clean energy innovation, manufacturing, deployment, and infrastructure. In the absence of such a strategy, the U.S. will continue to cede economic leadership in the global clean tech industry to its international competitors and sit passively by as the new clean tech industries of the future take root beyond our shores.

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Thoughts on Ending Energy Poverty and Copenhagen's Zero-Sum Game

Some food for thought here: Nathan Wyeth pens a very thoughtful column on the Copenhagen climate summit focused on the key challenges of fueling sustainable global development and expanded energy-access to the billions of energy poor worldwide, via the new WRI-affiliated blog, NextBillion.net:

Excerpts below with emphasis added:

Copenhagen Climate Summit: The Missing Billions

...

But although they are often discussed here as the first and worst victims of climate change, the base of the pyramid is, at first glance, invisible in the negotiations in the shape of solutions to climate change. Except in the context of avoiding tropical deforestation, carbon finance relevant to the base of the pyramid is at best a niche conversation. If intensive energy use and land development equal carbon emissions, the base of the pyramid would by definition not appear to be terribly relevant.

This means I have less to blog about except for maybe some side events, but plenty to say. I would argue that there's is a huge amount wrong with the orientation of these negotiations and the fact that the base of the pyramid is absent gets to the heart of the issue. In a vicious cycle, the weakening of the negotiations will lead to failure in their intended impact, simply hurting the poor even more.

The G77 bloc is angling to increase the $10 billion in annual aid that developed nations are promising to provide in funding for climate change adaptation and mitigation. But it seems likely that there will be plenty of double-counting of that aid money and it's not enough to begin with to address either mitigation (i.e. low-carbon development) or adaptation. And it's unclear what this will go towards, who will manage it, what it will truly be intended to do.

As they have in previous years, the negotiations pit the world's wealthiest 1 billion people against the 3-4 billion who have gained a some level of prosperity and are rising quickly. Who will cut back on carbon - those who already emit a lot, or those who are emitting some and want to emit more in the future? With the negotiations set up like this, it quickly becomes a zero-sum game. Since the UN process relies on the commitment of the nations that constitute it, as a zero-sum game it becomes useless as a force to raise the bar towards clean and sustainable development.

Left out of this picture are the 2-3 billion people who are essentially not using modern energy - at best a little bit of electricity from an unreliable grid, a little bit of kerosene for lighting, diesel to operate machinery or transport, and maybe charcoal or LPG for cooking. But likely using firewood or other biomass for cooking and as likely as not having no access to electricity at all.

These are the people this blog concerns itself with. It seems counterintuitive that those who use the least energy currently are critical to an international agreement on reshaping our energy industries and ending deforestation as quickly as possible. But I believe they actually lie at the heart of any global deal to address climate change.

Where does this third of humanity actually show up in the negotiations?

They are the anonymous presence assumed to be within the growth curves in projected energy demand in Asia and Africa. They imbue these growth curves with moral force because basic services, health care, education and more must reach these billions in the decades that are in question in the negotiations.

These growth curves of energy demand in Asia, and to a lesser extent Africa, are the mountains that the negotiators must climb to reach an agreement. It is assumed that this demand will be met with fossil energy unless otherwise subsidized, by the West or at the expense of the poor. And these curves are steep.

They would probably be insurmountable except for a few things.

The biggest thing that the developed nations could do to flip this zero-sum mentality and unstick climate negotiations would be to act like they truly cared about access to energy in the developing world - particularly for those whose lack of access is most severe.

Most of the growth in energy demand in Asia and Africa will come from industry but the moral imperative of that growth comes from the people who are in energy poverty and need to get out of it. Yet this is a relatively small amount of energy demand - it is not the first kilowatt of electricity demand by households at the base of the pyramid that is going to push us beyond the safe levels of carbon in the atmosphere.

The truth is that it is quite likely that even with no climate treaty at all limiting carbon-intensive development, very few of the 1.6 billion people who are off the grid right now would get on the grid any time soon. From India to South Africa, electricity grids are going into blackouts straining to provide power to industrial customers, let alone people without access to electricity. When oil prices rise, try as they might by cutting other services and going into debt, developing country governments will not be able to subsidize fuels indefinitely. There is no imminent or clear path, under current patterns of fossil fuel and power sector development, for those living in energy poverty to smoothly emerge from this.

If the Copenhagen summit prioritized access to electricity and efficient, low-carbon cooking and heating to the 2-3 billion people it is currently ignoring, it would be a very different summit. Both developed and developing countries would be united in confronting the dual moral imperatives of addressing climate and development, rather than appearing to pit one against the other.

And the reality is that providing modern energy to these 2-3 billion people could be done with clean energy about as quickly as could be done with dirty energy - over the next 20 years - for about the same price or perhaps a minor subsidy from developed countries. Solar lighting and similar renewables are now basically at price parity with kerosene and diesel generators, and the variety of price-competitive renewables, such as small wind turbines, will only increase in coming years. The businesses that Next Billion covers regularly are demonstrating that these technologies can be commercially deployed. With greater investment and prioritization by the global community, they could start replicating, franchising and scaling dramatically.

This would not only be a development success, but a climate success, because three billion people cooking and heating with fuelwood and biomass is a significant contributor to climate change. There could be a billion households that don't need to transition off of fossil fuels because their first electricity comes from solar.

Addressing the pockets - gaping holes really - of the deepest energy poverty would not only shave down the projected energy demand from fossil fuels. It would make negotiating between the wealthiest 1 billion and the 3-4 middle billion a more surmountable task. Not easy - but much more straightforward, dealing with a set of maybe fifteen major industrial economies that need to be brought into parity on carbon in the coming decades. In doing so they will create the utility-scale clean energy technology that can be deployed globally.

One of the key insights behind market-oriented development at the base of the pyramid is recognizing that there is a not a "First World" with one set of economic rules and a "Third World" with a different set. An extrapolation of this is seeing the world in terms of economic gradations rather than borders - there are "Third World" economic conditions in the poorest parts of the U.S. and "First World" conditions in Rio, Mumbai, and Shanghai. Seeing the gradation of needs that exist between the wealthy, the emerging middle classes, and the global poor in these climate negotiations would help move them beyond the impasse they have currently reached.

One might argue that global treaty negotiations should be explicitly focused on shared support for sustainable global development, rather than on emissions cuts.

Global energy demand will rise fast in the coming decades as billions of global citizens climb out of energy poverty. That's a good thing, a force of improved lives, greater health, opportunity and security. The challenge for the global community then is two-fold: 1) extending access to affordable energy to as many of the world's energy poor as possible - including many of the nearly three billion more expected to be added to the global population by mid-century; and 2) ensuring that such access to affordable energy is provided by sustainable sources.

The International Energy Agency made all that quite clear in their World Energy Outlook last year.

Clean AND cheap energy sources are needed to power sustainable global development and open access to energy for billions of global citizens. Developing and deploying the technologies and tools needed to fuel sustainable development at a global scale is the task of the 21st century. It's time the international community focused squarely on that task, for without solutions to this key challenge, no effort to stabilize the climate will succeed.

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COP15 Friday- Youth voices, US leadership, exhaustion and excitement

Guest post by Garett Brennan, Executive Director- Focus the Nation

Hey folks, I wanted to share how things are going over here from our perspective at the COP15 climate negotiations in Copenhagen. On the day I arrived, I found it very reassuring that back at home, our country’s longest serving Senator, Robert Byrd from West Virginia, posted a piece denouncing mountain top removal and honestly acknowledging the need to phase out coal.

We’ve been here for a week now and it’s some sort of wild combination that energizes and exhausts you all at the same time. Just to set the stage a little first, the weather is gray, cold and rainy—a lot like our headquarters in sunny Portland. Throughout the city, the street corners are filled with photo exhibits and banners and almost everyone I meet thanks me for “fighting for the climate.” Inside the Bella Center, it’s crazy and almost impossible to follow everything that’s happening. Our awesome Focus Organizer from Missouri, Lindsey Berger, has been helping the core Rapid Response strategy team so we can let all of you know how you can help from home.

Yesterday we had more than 1000 young people in orange T-shirts that say “How old will you be in 2050?” and we’ve also handed out 1000 orange scarf’s to the “older” delegates that say “survival is not negotiable.” It has created an awesome visual solidarity between generations and cultures throughout the entire Bella Center. I also thought you’d like to know that there about 500 young people here from the US Youth movement. Our presence is large and involved. Last night, we organized a wonderful event with 50 American youth and 50 Chinese youth to talk about our shared future together.

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New "Tri-Partisan" Climate Framework Aims to Clear High Senate Hurdle

Originally at the Breakthrough Institute

Promising "we can and will pass climate change and energy independence legislation this Congress," Senators John Kerry (D-MA), Lindsey Graham (R-SC) and Joseph Lieberman (I-CT) unveiled a new framework intended to form the core of a "compromise" climate and energy bill capable of clearing the 60-vote hurdle needed to secure passage.

The framework aims to cut U.S. emissions of greenhouse gases by 17% below 2005 levels in the "near-term," by which the senators apparently mean the year 2020. The three senators brand such a target "achievable and reasonable" and also declare their support for "a long term target of approximately 80 percent below 2005 levels," presumably by 2050.

Los Tres Amigos in action

According to the five-page summary document circulated today on Capitol Hill and published online by EnviroKnow.com, the "tripartisan" framework is meant to "build upon the significant work already completed in Congress" -- a nod to climate and energy bills already crafted by the Senate Committees on Energy and Natural Resources and Environment and Public Works earlier this year as well as the House's Waxman-Markey climate bill, narrowly passed in June.

Details of the new proposal are still scant, in an apparent nod to several Senate committee chairs -- and the numerous swing votes -- who will no doubt shape the final legislation.

Sen. Liberman told reporters today "there are well over 60 votes in play in the Senate, not that we have 60 votes yet." He'll have a steep hill to climb by all accounts.

Will details still vague, we can only get a sense of where the new Kerry-Graham-Lieberman framework is headed, but here's a run-down of notable passages...

The policy is framed around "better jobs [and] cleaner air," with an effort to center the rhetoric around clean energy job creation and pollution reduction, with the latter appearing to be a deliberate effort to blur the boundaries between greenhouse gases and traditional air pollutants. Both economic concerns and traditional environmental pollutants routinely rank as more salient to voters than concern for climate change.

While greenhouse gas emissions reductions have moved out of the rhetoric, they remain squarely at the heart of the policy framework, however, which like all other major Congressional climate proposals, centers around a cap and trade program that aims to limit the output of global warming pollution.

Here's how the three senators summarize their framework:

Our legislation will contain comprehensive pollution reduction targets that are both environmentally significant and achievable. It is our belief that a market-based system [aka cap and trade], rather than a labyrinth of command-and-control regulations, will allow us to reduce pollution economically and avoid the worst impacts of global climate change. It will also provide significant transition assistance to companies and consumers without using taxpayer dollars or driving up the national debt. We believe a near term pollution reduction target in the range of 17 percent below 2005 emissions levels is achievable and reasonable, as is a long term target of approximately 80 percent below 2005 levels. Finally, we believe a robust investment in the development and deployment of clean energy technologies will ensure that as pollution reduction targets become more rigorous, companies will be better equipped to meet their obligations in a cost effective manner. [emph. added]

The senators will have our agreement on that last part of course. But we'll have to wait and see how central a role Kerry, Graham and Lieberman envision for the direct public investments necessary to accelerate the development and deployment of clean technologies and the innovation necessary to make clean energy cheap. If public investment in clean technology and innovation plays the same tertiary role it does in the House-passed Waxman-Markey bill or the Senate EPW Committee's "Clean Energy Jobs and American Power Act" (also partly crafted by Senator Kerry), America will be hard pressed to meet the climate and energy objectives the senators outline above.

The framework provides little detail as to how the senators hope to drive the development and deployment of a suite of improved clean technologies, beyond nods to both nuclear power and carbon capture and storage for coal.

More robust support for nuclear power is central to the new framework and a core priority for Sen. Graham. Support to re-start the U.S. nuclear industry is also considered critical to wooing other key fence-sitters, including a handful of Sen. Graham's potentially interested Republican colleagues. Here's the relevant passage, which, as I read it, seems to mirror many of the policy "asks" outlined by the Nuclear Energy Institute:

Encouraging nuclear power. Additional nuclear power is an essential component of our strategy to reduce greenhouse gas emissions. We strongly support incentives for renewable energy sources such as wind and solar, but successful legislation must also recognize the important role for clean nuclear power in our low-emissions future. America has lost its nuclear technology manufacturing base, and we must rebuild it in order to compete in the global marketplace. Our legislation will encourage the construction of new nuclear power plants and provide funding to train the next generation of nuclear workers. We will make it easier to finance the construction of new nuclear power plants and improve the efficiency of the licensing process for traditional as well as small modular reactors, while fully respecting safety and environmental concerns. In addition, we support the research and development of new, safe ways to minimize nuclear waste. We are working with our colleagues to create incentives for low-carbon power sources, including nuclear, that will complement the Energy and Natural Resource Committee's work to incentivize renewable electricity.

On "ensuring a future for coal," they write:

Coal's future as part of the energy mix is inseparable from the passage of comprehensive climate change and energy legislation. We will commit significant resources to the rapid development and deployment of clean coal technology, and dedicated support for early deployment of carbon capture and sequestration.

These two passages should be no surprise. In the October NY Times op ed announcing their bi-partisan effort to craft a new climate framework, Senators Kerry and Graham wrote that they intended to restart America's stalled nuclear industry and help "America... become the Saudi Arabia of clean coal."

On manufacturing, a touchstone issue for many swing Senators, including a bloc of increasingly well-organized Senate Democrats frequently led by Senators Sherrod Brown of Ohio and Debbie Stabenow of Michigan, the framework states:

Manufacturing is the backbone of our nation's economy, and we refuse to believe that the days of American leadership are behind us. Despite some initial success stories, such as North Dakota's 30 percent growth in clean energy jobs in the last decade, the United States is falling behind. Successful climate legislation will not send existing jobs overseas. Rather, pricing carbon will drive innovation - creating new opportunities for those who develop clean energy technologies, as well as those who build, install, and maintain them. We plan to provide significant assistance to manufacturers to avoid carbon leakage and ensure the continued competitiveness of American-made goods. Our legislation will also provide financial incentives to both large and small manufacturers to improve the efficiency of their processes, which will mean even more new jobs. In addition to employing thousands in the building trades, our envisioned development of nuclear and wind power will also mean jobs and growth for our steel industry. It is time to regain our leadership and create the jobs of the future here in America.

It doesn't appear that Kerry, Graham and Lieberman plan any significant direct support for U.S. clean energy manufacturing capacity, as most of this language seems to focus simply on transition assistance for today's manufacturing base (most likely free allowances and help cutting energy use in manufacturing). While it's clearly important to protect the manufacturing jobs of today, if the Senators rely on "pricing carbon" alone to "drive innovation," we'll see little of those "jobs of the future" appear in America's manufacturing heartland.

Without robust, direct support, America's manufacturers will be hard pressed to compete with the massive direct investments provided by the governments of Asia's "rising clean tech tigers" to aid their domestic clean energy manufacturers. China alone is poised to invest nearly $400 billion in the nation's clean energy technologies and industries over the next five years, with a particular emphasis on the nation's rapidly growing clean energy manufacturing base.

As we make very clear in our recent report, "Rising Tigers," the U.S. will need a significantly more robust clean energy economy strategy to compete with aggressive Asian (and European) competitors. Pricing carbon, quite simply, is not enough. We'll see what Senators Brown and Stabenow think of this framework...

On offsets (and how there will be lots of them, of course), the framework states:

While we are still discussing the details of the offset program with our colleagues, we have reached agreement that we will include significant amounts of real, monitored and verified domestic and international offsets and other incentives in our system in order to contain costs and create opportunities for farmers, ranchers and forest owners to benefit from climate change legislation.

Finally, on an international climate agreement and protecting American competitiveness, the framework states:

Ultimately, climate change must be addressed through a strong international agreement that includes real, measurable, reportable, verifiable and enforceable actions by all nations. American leadership is essential, but action by the developing world is necessary to maximize the benefits of our effort. ... [W]e will include strong measures that are compatible with our obligations under the World Trade Organization to prevent our economic competitors from exploiting the American market if they shirk their responsibility to minimize carbon pollution.

This language mirrors a recent letter from nine swing Senate Democrats released last week demanding similar provisions in any final Senate climate bill.

That last statement appears to opens the door for carbon border tariffs, which will all-but-certianly prove critical to securing the support of key swing Senators, but simultaneously place the U.S. in the middle of an international climate conundrum.

Major developing nations, including China, India, Brazil and South Africa, have vehemently opposed using climate change as a pretext for restricting international trade, and in international climate negotiations now underway in Copenhagen, Denmark, have remained insistent that their pledges to reduce their output of greenhouse gases are strictly non-binding in an international context.

Despite the clear hurdles ahead, the three senators conclude by declaring:

We intend to continue to engage our Senate colleagues in the weeks ahead to develop sensible, effective climate change legislation that will create jobs, ensure our energy independence, restore America to a position of leadership in the clean energy economy and reduce pollution. ... Together, we can and will pass climate change and energy independence legislation this Congress.

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TIME: Technology, Not Targets, Are What Matters Most in Copenhagen

Originally posted at the Breakthrough Institute

Addressing the global clean technology challenge should be the focus of climate negotiations in Copenhagen, not carbon emissions reduction targets, writes TIME's Bryan Walsh.

TIME's Bryan Walsh emphasizes the need for the additional investments in clean energy technology highlighting the International Energy Agency's call for $10.5 trillion between now and 2030 and citing a recent blog post by the Breakthrough Institute's Jesse Jenkins and Devon Swezey:

But there is one number that may not get discussed much at Copenhagen, even though it is as important as all the others: $10.5 trillion. That is the additional investment needed between now and 2030 to set the world on the path to low-carbon development, according to the International Energy Agency -- a number that is far above the pittance the world currently spends on clean energy research and development (R&D). As Jesse Jenkins and Devon Swezey of the think tank Breakthrough Institute wrote on Dec. 7: "Without measurable progress that dramatically increases global investments in clean energy, we can forget stabilizing global temperatures or atmospheric carbon dioxide at any level."

Walsh continues:

Beyond the policy wars in the halls of U.N. summits or on Capitol Hill, the battle against climate change requires better and cheaper forms of alternative energy, which will need to be deployed fast. Unfortunately, they don't exist.

Citing Breakthrough Senior Fellow Christopher Green and co-author Isabel Galiana's recent commentary in Nature, Walsh adds that improving clean energy technologies requires increased public investment in innovation.

Ultimately, however, we will need better renewable energy technologies -- and that will require increased spending on innovation, in the U.S. and elsewhere. "Energy technology research and development will be essential to decarbonize the global economy," write Green and Galiana.

The current emphasis, in Copenhagen and the U.S., on capping emissions is both politically and publicly unpopular "because they implicitly acknowledge that the world has limits." Walsh concludes by quoting Breakthrough's Michael Shellenberger:

But technology offers the promise that with the right breakthroughs, we can keep growing. "Investing in R&D to make clean energy cheap is the most popular energy proposal there is," says Michael Shellenberger of the Breakthrough Institute. That may be a global deal everyone can embrace.

Click here to access the full article.

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$10.5 Trillion by 2030: the Number that Should be at the Heart of Copenhagen Climate Talks

By Jesse Jenkins and Devon Swezey

Forget 80% by 2050 and 17% by 2020. Time to stop fixating on 450 ppm vs 350 ppm. As UN climate talks kick off today in Copenhagen, Denmark, if you want a number to focus the world's attention on, try this one: $10.5 trillion.

That's the scale of additional investment required between now and 2030 to put the world's energy system on a lower-carbon path, according to the world energy watchdog, the International Energy Agency.

Without measurable progress that dramatically increases global investments in clean energy, we can forget stabilizing global temperatures or atmospheric carbon dioxide at any level. And as the IEA makes clear, the world's governments must lead the way in making massive public investments to rapidly develop and deploy an array of clean energy technologies capable of sustainably and affordably powering the planet.

So for those following the progress in Copenhagen, keep that sense of scale -- $10.5 trillion -- and just one phrase on your mind: Show me the money!

Enough With the Targets and Timetables

In the days leading up to the UN climate summit beginning today in Copenhagen, the focus has been on pronouncements from world leaders establishing various national targets to reduce or curb the growth of the carbon dioxide emissions principally driving global warming.

In July of this year, the world's 17 largest economies declared support for "an aspirational global goal" to reduce emissions by 50% by 2050. Then, the world watched in recent weeks as first the United States, then China and most recently Brazil and India put their emissions pledges on the table. Each would cut their emissions some amount by some date, with the developed countries outlining targets for absolute cuts to CO2 emissions and most developing countries, including China and India, announcing reductions in the carbon intensity of their economies (aka CO2 per GDP).

The withering array of different baselines and methods for counting cuts has left plenty confused as to where the world now stands as we enter the global climate talks this week.

But where do all these targets and timetables get us?

Whether you think the world should aim for 450 ppm or 350 ppm, 80% by 2050 or 50% by 2050, upshot is pretty much the same: the world must drive net global greenhouse gas emissions as rapidly as possible towards zero. The real question then, is how to get there. And that is a question that tireless debate over emissions targets, timetables and ppm gets us no closer to answering.

The obsession with targets and timetables, both at the national and global level, obscures and diverts attention from the critical and fundamental reality underlying any successful global effort to reduce carbon dioxide emissions. A revolutionary transformation of the global energy system requiring trillions of dollars of shared investment in clean energy technology will be necessary to meet the global climate objectives being discussed in Copenhagen.

As Breakthrough Institute Senior Fellow Christopher Green and co-author Isabel Galiana recently wrote in Nature:

"The fixation on near-term targets for reducing greenhouse-gas emissions at the climate meeting in Copenhagen has resulted in insufficient attention towards the technological means of achieving them."

10.5 Trillion Dollars by 2030 - The Scale of Investment Required

In November, the International Energy Agency (IEA) released its 2009 World Energy Outlook in an effort to provide a boost to international climate negotiations by "detailing the practical steps needed for a sustainable energy future as part of a global climate deal."

The IEA predicts what the world energy mix will look like in 2030 under business-as-usual (what they call their "Reference Scenario"). Under the Reference Scenario, global energy demand increases by 40% from now until 2030. Absent significant global efforts to increase the utilization of clean energy technologies, fossil fuels will account for more than three quarters of the additional global demand. Significantly, the large majority of additional global energy demand--over 90 percent of the increase--will come from developing countries, with China and India alone accounting for half.

There is little doubt that such a scenario would be insufficient to keep the cumulative global carbon dioxide emissions under 450 parts per million. A business-as-usual energy future would also propagate a "persistently high level of spending on oil and gas imports"; the United States would still be dependent on imported oil, with the attendant negative implications for U.S. energy independence and national security.

The IEA also outlines a "450 Scenario", a future energy path that would limit the atmospheric concentration of greenhouse gas emissions to 450 parts per million. In the 450 Scenario, 60% of global electricity production comes from clean energy sources; 37% renewable, 18% nuclear, and 5% from plants fitted with carbon capture and storage.

Achieving anything close to this scenario will require a revolutionary transformation of the global energy system. Investment and innovation will be required across a wide range of technologies, almost all of which must be improved to become cheaper and more reliable in order to accelerate the pace of global clean tech adoption and emissions cuts.

This worldwide energy technology transformation, according to the IEA, will require additional investments in energy efficiency and low-carbon energy technologies on the order of $10.5 trillion from now until 2030, above and beyond investments in energy infrastructure already included in their business-as-usual scenario.

This scale of additional clean energy investment, at roughly $500 billion per year over the next two decades, is far more than the world spends today on clean technology. And until we have cheaper and better clean energy technologies, the costs of meeting our climate objectives will continue to be excessively high, creating real, ongoing political hurdles and slowing the pace of clean energy adoption.

Indeed, the costs of climate mitigation are one of the major barriers constraining efforts to successfully address climate change. That is why the Breakthrough Institute has consistently advocated for a proactive clean energy technology strategy to make clean energy sources cheap, thereby cutting the costs of their widespread adoption. As the IEA has made clear, clean and cheap energy is needed to power sustainable global development, particularly to meet the massive demand for new, affordable energy sources in the developing world, where the bulk of new energy infrastructure investments will be made in coming decades.

All of this exposes an ironic truth: we will never reduce global carbon emissions on the scale necessary if the world continues to obsess about targets for reducing carbon emissions To succeed, the world must instead focus a healthy obsession on the massive shared global investments in clean technology needed to get the world running on low-carbon energy.

How to Judge the Outcome of Copenhagen

The important question in international climate negotiations should not be which countries are promising to reduce their emissions by which level. As similar commitments under the Kyoto Protocol reveal, these emissions pledges can easily become empty promises, and creative accounting offers plenty of ways to "comply" with these targets while avoiding the real task of fundamentally transforming the way the world makes and uses energy.

The only truly important metric is the impact Copenhagen has on the shared sums the global community will invest to build a new clean energy economy, how and where the funds are allocated, and where the investment will come from.

Without real, concrete strategies to drive over half a trillion dollars in new global annual investment in clean technology over the coming decades, our critical climate objective will remain far out of reach. And we will no doubt see world leaders continue to make empty promises that may provide a brief moment of catharsis for many climate advocates, while doing little to solve climate change.

$10.5 trillion dollars by 2030. That's the scale we must grapple with. If Copenhagen doesn't get us closer to closing this massive clean energy technology investment gap, it will have failed the global community, plain and simple.

Post updated 12/9/09

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NYTimes Gets "Lessons from Kyoto" Right

A new info-graphic from the New York Times, released today as UN climate talks begin in Copenhagen, looks at the "Lessons from Kyoto," the global treaty that's ongoing fate will be the focus of UN climate negotiations beginning today in Copenhagen, Denmark.

The graphic gets the lessons pretty much dead-on, including how little actual progress any nations have made towards meeting their Kyoto “obligations.” As the Times notes, "The legacy of the Kyoto Protocol is mixed." Of the 36 wealthy nations who agreed under the 1997 treaty to cut their emissions by an average of 5% below historic 1990 levels, just 18 are on track to meet their targets, almost all of them in Europe.

As the graphic illustrates, the bulk of these "successful" nations are former members of the Soviet bloc, and almost all saw deep economic declines after the fall of the Soviet Union, which conveniently occurred after the 1990 emissions baseline year used in the Kyoto treaty. Deindustrializing Eastern bloc nations, including East Germany, saw big cuts in their emissions and made compliance with the Kyoto protocol easy. Better yet, for these nations, exceeding their Kyoto "obligations" left them with excess credits under the treaty framework that they could sell to other nations struggling to cut their own emissions.

As the Times notes, 19 other nations subject to the Kyoto treaty are not on track to meet their emissions targets. Most have seen emissions grow with little hope of complying with Kyoto due to surges in economic growth and activity, including Canada (where emissions shot up through development of the Alberta tar sands for heavy oil extraction), Spain and Portugal (who's economies boomed over the last decade) and even green-minded Ireland and New Zealand (who's growing economies drove emissions up roughly 20% above 1990 levels).

The United States, meanwhile, never ratified the Kyoto Protocol, yet saw emissions grow at a slower rate than many Kyoto countries, including each of those mentioned above.

Emissions have soared in rapidly developing China and India. Major developing nations were not subject to any requirements to cut emissions or drive clean development under the Kyoto treaty framework.

Essentially, as the Times info-graphic clearly illustrates, the "Lessons from Kyoto" are clear: economic trajectories, and little else, determined emissions outcomes under the targets and timetables focused Kyoto Protocol.

Without a proactive and massive shared global effort to sever economic growth from emissions by accelerating clean technology innovation and deployment, the Copenhagen summit now underway shouldn't be expected to produce a dramatically different outcome than it's Kyoto predecessor, despite likely "participation" from the U.S. and big developing nations like China this time around.

Check out the full, interactive info-graphic at the New York Times here. All graphics in this post from NYTimes. Originally posted at the Breakthrough Institute

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CNBC: U.S. Must Support Clean Energy Economic Effort to Win Clean Energy Race

Originally posted at the Breakthrough Institute

The developing global clean energy race has serious implications for pending U.S. climate and energy legislation, CNBC reported today. The article, which summarizes how the focus of the bill is being repackaged as a jobs bill, emphasizes that the U.S. is already well behind in the clean energy race, which could cost it thousands if not millions of clean energy jobs, not to mention the economic benefits of its position as a world leader in technology innovation.

The article cites "Rising Tigers, Sleeping Giant," a recent report released by the Breakthrough Institute and the Information Technology and Innovation Foundation and quotes Breakthrough's Director of Climate and Energy Policy, Jesse Jenkins.

Jenkins explains why the U.S. government must ramp-up investment in clean energy technology if it wants to lead the clean energy race and mitigate climate change.

Further complicating the issue is that the U.S. is already in catch-up mode with its major trading partners on cleantech investment.
An October report by Deutsche Bank Climate Change Advisors group showed $52 billion in capital flowing into the clean energy sector in the US from 2000 to 2008, with $15 billion of that in 2008.

By comparison, China invested $42 billion during the same period, with $16 billion coming in 2008-even though its GDP is one-quarter the size of the US.
Future spending plans also indicate a sizable gap, according to a recent report of the Breakthrough Institute, a non-partisan think tank, which compares that of the U.S., China, Japan and South Korea.

Including the cap-and-trade legislation passed by the House of Representative in June and provisions for cleantech investment in the stimulus package earlier in the year, the U.S. will invest $172 billion over the next five years. China, however will invest $397 billion, a more than four-to-one ratio on a per-unit-of-GDP basis.

"We're in danger of having to import all of our cleantech products from China if we don't step up, says Jesse Jenkins, the institute's director of energy and climate policy.

"There's a lot of push-back that says the government shouldn't be picking winners and losers," he says. "But that ignores hundreds of years of U.S. economic activity."
From railroads to satellites to the Internet, government policies have supported infrastructure development deemed vital to our national economic and security interests, which eventually spurred whole new industries.

"It's less about picking winners and losers than it's about creating the conditions for these to arise," he says.

At the same time, Jenkins and others say the conventional wisdom of carbon reduction for the sake of carbon reduction is fundamentally wrong. He calls the pollution control approach of cap-and-trade an effective one for smaller-scale issues--like acid rain-causing smokestack emissions in the '80s and ozone-depleting chloroflurocarbons in the '90s--but of insufficient scale for climate change emissions.

"We're talking about something transformative, and that's a different challenge and requires different solutions," says Jenkins. "What we need is a clean energy economic effort, not a pollution control effort."

And that will require costly investment but hopefully generate valuable jobs.
Nicholas Parker, executive chairman of the research and consulting firm Cleantech Group, calls the situation a new "space race."

"The race to reinvent the world has officially started, and we believe this will become increasingly apparent in 2010 as global economies recover," Parker says in his firm's "Ten Predictions for 2010" report on the cleantech sector, released earlier this week.

"Those who do not adapt, innovate and change will be left behind," says Parker.

"Fasten your seat belts."

Read the full CNBC article here.

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