Energy is a $6 trillion global industry, and will likely grow to more than $10 trillion by mid-century. As clean energy replaces carbon-based energy sources around the world, new markets employing millions of people will emerge. Countries like China recognize this opportunity, and are racing decisively ahead. Meanwhile, the United States’ inaction is relegating our country to the back of the pack.
Passing a climate bill this session that establishes a price on carbon will send a critical price signal to the private sector. It will unleash a torrent of investment in new technologies, create countless new ventures, and catalyze the innovation required for the U.S. to gain a leadership position. Massachusetts is well positioned to be a “disproportionate beneficiary,” enjoying more job creation and economic prosperity from this revolution than any state save California. The Commonwealth received over $350 million in cleantech venture investment in 2009 (second only to California), and will receive a great deal more in the years to come if investors are provided with the market certainty that a price on carbon provides.
The benefits of passing strong energy & climate legislation this session are substantive:
- A climate & energy bill will create thousands of jobs in Massachusetts. Clean energy is already the state’s fastest growing industrial sector with nearly 2000 companies and over 26,000 jobs. Separate studies by UMass Amherst and UC Berkeley show that a federal low-carbon policy could create up to 40 thousand jobs in Massachusetts and increase the State’s real Gross Domestic Product by up to $2.8 billion between now and 2020.
- Clean energy investments create 16.7 jobs for every $1 million in spending. Fossil fuels, by contrast, generate only 5.3 jobs per $1 million in spending. Clean-energy investments create 2.6 times more jobs for people with college degrees or above, 3 times more jobs for people with some college, and 3.6 times more jobs for people with high school degrees or less.
- A climate & energy bill will give investors the market signals and long-term certainty they need to commit additional dollars to the sector. Under a federal low-carbon policy, Massachusetts could see a net increase of about $3.5 billion in investment revenue.
- Comprehensive climate and energy legislation will save money for consumers. Massachusetts’ experience under the Regional Greenhouse Gas Initiative (RGGI) shows that Massachusetts electricity prices declined from 18¢/kWh at the start of the program in January 2009 to 16¢/kWh in November 2009.
- Strict limits on carbon emissions will improve our competitive standing with respect to the rest of the world. A recent report from the Pew Charitable Trust finds that China, Brazil, the United Kingdom, Germany and Spain—all with strong, national policies aimed at reducing global warming pollution and incentivizing the use of renewable energy—are establishing strong, defensible positions in the clean energy economy. Unless our country makes a significant, long-term commitment to this sector, we may find ourselves out of the running.
What’s at stake here is no less than America’s global competitiveness, and we are already being lapped. Today, the U.S. is home to only one of the top five wind turbine manufacturers, one of the ten largest solar panel producers, and two of the top ten advanced battery manufacturers. China is now the largest wind turbine manufacturer, the largest solar panel manufacturer, and a dominant market player in advanced vehicle and battery technology.
Each day we wait, we fall further behind, sacrificing economic growth and badly needed jobs here at home. And that will not change until Congress passes a strong energy/climate bill.
Senator Lindsey Graham (R-SC), who is working with Senators John Kerry (D-MA) and Joe Lieberman (I-CT) to craft compromise energy and climate legislation in the Senate, recently noted: “Six months ago my biggest worry was that an emissions deal would make American business less competitive compared to China. Now my concern is that every day that we delay trying to find a price for carbon is a day that China uses to dominate the green economy.”
The 1900s were labeled “The American Century.” Unless we act now to enter our bid for market leadership in the world’s largest industry, we run the very real risk that the twenty-first century will have China’s name written all over it.
It’s time for the Senate to get our country out of the starting blocks and into the clean energy race.
