This week’s energy news looks bad for the United States – at first glance. The nation has slipped to second behind China in clean energy investment. Moreover, five of the G-20 nations have surpassed the US for clean energy investment relative to size of economy.
But look a little deeper into the report, “Who’s Winning the Clean Energy Race,” and you’ll see that the US did not slide in all forms of clean energy. In fact, its level of energy efficiency investment tops others worldwide in two of three investment categories analyzed in the report.
The US stood out as the strongest among the G-20 nations for public market financing of energy efficiency and related low carbon dioxide technologies and services in 2009, the year studied. And it dramatically surpassed all of the other countries when it came to venture capital for these resources.
In fact, the report found that the US “remained the overwhelming leader in venture capital investment” with energy efficiency and smart grid among the top resources attracting investors. VC investment totaled $3.9 billion in the US, far exceeding the second place country, Brazil, with $0.7 billion. China had only “negligible” VC activity.
“The United States remained the enduring leader in venture capital investment, reflecting its strong foundation of technology innovation,” the report said.
There are some good arguments to be made for the US’ pursuit of energy efficiency. Energy prices reverberate throughout the economy, pushing up the cost of goods and services when they rise. Efficiency advocates like to say that the megawatt never generated is the cheapest one, so it’s best to pursue all cost effective efficiency before building new energy infrastructure.
After reading the Pew report, it’s easy to see why the Obama administration is pushing so hard to build the energy efficiency industry in the United States, one positioned to export its innovations to the world. Obama reiterated his commitment March 30 in a speech to students at Georgetown University:
And by the way – we also know that ushering in a clean energy economy has the potential to create an untold number of new jobs and new businesses – jobs that we want right here in America. Part of this change comes from wasting less energy. Today, our homes and businesses consume 40 percent of the energy we use, costing us billions in energy bills. Manufacturers that require large amounts of energy to make their products are challenged by rising energy costs. That’s why we’ve proposed new programs to help Americans upgrade their homes and businesses and plants with new, energy-efficient building materials like lighting, windows, heating and cooling – investments that will save consumers and business owners tens of billions of dollars a year, free up money for investment and hiring, and create jobs for workers and contractors.
Of course, the Pew report relies on figures that are now a few years old. Have we maintained our position? Will we build the energy efficiency export industry that is just getting off the ground? It’s hard to say. But the bigger question in energy is always: What will be the game changer? Who will come up with the light bulb of the Internet age? Call me an optimist, but I’ll bet on the country of innovators.
Elisa Wood is a long-time energy writer whose work appears in many of the industry’s top magazines and newsletters. She is publisher of the Energy Efficiency Markets podcast and newsletter.