A lot of people think that U.S. clean energy technology leadership is under threat.
Joe Romm recently published a piece criticizing President Trump’s new budget cuts to climate and clean energy programs. In the piece, Joe suggests that America will lose out on millions of new jobs to China as a result of Trump's recommendations. Most recently, Jeff Sachs just published his version of the same argument in the Boston Globe.
I have to say, I am pretty tired of the U.S.-versus-China narrative.
This often comes up in R&D these days, when we are reminded of President Reagan’s strong support of the government’s role in helping early-stage scientific and technology research. While I fully subscribe to that idea, I think clean energy's current trajectory will be hardly impacted by R&D spending.
As Victor Hugo is credited as saying: “Nothing is more powerful than an idea whose time has come.”
Let's be clear. The Trump budget document is nonsense, and the good people of Congress should not cut clean energy R&D and climate funding. That said, deployment is already happening at scale.
In 2016, 100 percent of all new net generating capacity (new plants built minus old plants retired) came from clean energy sources like solar, wind, nuclear and hydro.
Today, it is fully accepted by experts who study energy that the transformation of our energy system is already underway at scale. Wholesale power prices are falling due to massive renewable energy deployments -- making it more difficult for coal plants to pencil out economically. Appliance standards and LED lighting are so energy-efficient that the U.S. economy is using less electricity now that it did in 2007. Electric vehicles still make up just a small fraction of the market, but they are increasingly being viewed as the inevitable direction that fleets will take since they offer lower maintenance costs than their internal-combustion alternatives.
Researchers with the Deep Decarbonization Pathways Project (DDPP) demonstrate that it is possible to drastically reduce the emissions of the highest-emitting countries by 2050 without harming countries’ economic growth targets and social priorities -- using technologies that are already invented.
So why do so many people push the U.S.-versus-China narrative -- particularly when it comes to job creation? It's not a zero-sum game.
America is a mature economy with mature energy supply chains that are being disrupted by clean energy technologies. China is still a fast-growing developing country that has to keep up with its rapid growth in energy use.
It is not surprising that China has chosen to deploy clean, resource-efficient technologies at scale -- a $360 billion scale. On the manufacturing front, it is clear the Chinese are deliberately losing money on solar manufacturing in order to gain market share. So how would a DOE loan guarantee program for manufacturing plants fix that? China is begging American companies to come help it spend the $360 billion.
Simply put: China's success is not a negative for America and its innovative companies.
In the U.S., we are deploying enough energy efficiency to zero out electricity growth; we're replacing retiring coal and natural gas plants with clean energy; and we are electrifying more of our energy footprint through electric vehicles.
The U.S. advanced energy market is now worth $200 billion -- nearly double the revenue of the beer industry, more than pharmaceutical manufacturing, and approaching wholesale consumer electronics. In fact, the clean energy industry has created more jobs than any other industry since 2008.
Today, Fortune 500 companies like Wal-Mart, Kohl’s and Staples are joined by the largest cities and universities in the country to deploy these clean, resource-efficient technologies at scale. With rapid cost reductions, it is making deployment a no-brainer for many businesses and residents.
The government certainly could -- and should -- accelerate these deployments to save consumers money and help our economy get back to President Trump's goals of 3% growth rates. And as President Reagan stressed, investing more money into research and development is critical to keep America and its citizens in the lead.
But after 40 years of R&D, we now have the right technology at the right time. We should stop pushing the simplistic America-vs.-China narrative. We should also realize that China relies on exported American ingenuity -- and will continue to rely on it. That is a good thing for American workers and consumers.
Jigar Shah is the president of Generate Capital. He's also the co-host of The Energy Gang podcast.