America takes steps towards clean energy

By Jeff Immelt and Jonathan Lash
Published: January 28 2009 18:59

In 2005, the two of us joined together on a quest for what we called “the courage to develop clean energy” in America. More than three years later, we have seen courage demonstrated in abundance – by scientists, entrepreneurs, elected officials, businesses and citizens. Clean technology has rapidly matured to the point where we see a stronger and more secure domestic energy future taking shape.
Now a big question remains: will the US step towards this future? At the centre of an economic storm, is America willing to make the massive clean energy investments and tough policies needed to catapult the nation again to the vanguard of innovation, competitiveness, security and true energy freedom? In today’s difficult economy, it would be easy to say no. Halting investment in clean energy technology would placate climate change curmudgeons – but it would also allow other nations to lead the next technology revolution that will shift the global balance of energy and security for decades to come. It would be short-sighted, too, because bold investments in clean energy have transformed drawing-board dreams into great businesses that align naturally with, and inform, great policy.
President Barack Obama has outlined a bold energy vision in his framework for a stimulus package – a vision we endorse – and congressional leaders have vowed to pass legislation quickly to boost the economy. In any such proposal, however, we believe three fundamental criteria must be included.
First, declare America open for business and invest quickly. Thousands of projects to improve the energy efficiency of buildings and to construct wind turbines and solar power stations have been halted by frozen credit markets and unpredictable energy prices. The stimulus is crucial in restarting the engine of innovation. Immediate investment using the inherent strength of the government’s balance sheet can create jobs right away, getting work boots and equipment on dozens of important infrastructure projects that are ready to go. To accomplish this, refundable tax credits and renewable portfolio standards with near-term goals are essential.
Second, invest fairly. While we need to move swiftly to lubricate the wheels of the US economy, any stimulus must ensure that all Americans benefit. Investments in energy efficiency can immediately put people to work on transit projects, improving existing buildings and increasing the use of waste heat in industrial processes and facilities. Efficiency programmes, especially for residential buildings, will also lower working families’ energy bills and allow them, and small businesses, to keep more money in their pockets. These projects should be deployed with urgency and to those areas hit hardest by the economic crisis.
Third, invest to ensure future value. It is easy to create the low-skill, low-paying jobs that vanish again on a whim. The hard work comes in investing in people and technology to create long-lasting, well-paid jobs that will expand America’s competitive capacity for decades. In time, these jobs will form the green-labour backbone of a stronger workforce that turns wind and sunlight into abundant supplies of clean energy, drives electric cars out of laboratories and on to highways, and builds out the next-generation smart energy grid.
These investments will take hold only when Washington takes bold policy steps to wean the country from its overreliance on imported energy. The marketplace must have a strong, long-term price signal for clean technology in the form of a carbon market. As founding members of the US Climate Action Partnership – a coalition of more than 30 large corporations and environmental organisations – we call on Congress to pass cap-and-trade legislation as soon as possible. Whether such legislation stands alongside a stimulus package or comes shortly after, it will be a crucial factor driving America’s shift to a low-carbon-technology economy. Incentives such as a federal renewable portfolio standard will also be critical to ensure growing industries including wind and solar power generation reach maturity and at competitive cost.
The US has proved that it has the will, the capabilities and the courage to invest in innovation – even in difficult times. If you do not believe green jobs exist, visit cities such as Erie, Pennsylvania, or Greenville, South Carolina, where thousands of General Electric engineers run multibillion-dollar businesses that export advanced, clean technology products around the world. We ask that new leaders join us in working to create thousands of similar, high-technology, high-paying jobs, enable greater domestic innovation and help make the tough investments that will form a more secure, better tomorrow for all Americans. It will not be easy – but fighting for freedom, of any kind, never has been.
Jeff Immelt is chairman and chief executive of General Electric. Jonathan Lash is president, World Resources Institute
Copyright The Financial Times Limited 2009