The National Journal just published our response to Tuesday’s White House energy and climate summit, following contributions by the CEO of the American Wind Energy Association, CEO of the George C. Marshall Institute, and a Director of Policy at Brookings Institution.

Third Way For Energy And Climate Bill

NationalJournal.com | June 30, 2010

This is a guest post by Teryn Norris, director and founder of Americans for Energy Leadership and senior advisor at the Breakthrough Institute.

Tuesday’s White House energy summit drove yet one more nail into the economy-wide cap and trade coffin, with Senator Kerry declaring “we’re prepared to compromise further.” The compromise gaining momentum is a scaled-back, utility-only approach. But if President Obama and Senate leaders want to deliver a real victory on energy and climate policy reform, they should move quickly to advance a third way approach based on major federal investment in clean energy technology.

As Mark Muro of Brookings Institution wrote here, “the latest efforts to gain political consensus in the Senate are continuing to neglect a crucial aspect of cleaning up the country’s energy system—technology innovation.” It was President Obama himself who highlighted an innovation-based approach in his Oval Office speech, noting that “Others wonder why the energy industry only spends a fraction of what the high-tech industry does on research and development – and want to rapidly boost our investments in such research and development.”

Regardless of an economic-wide or utility-only cap, robust federal investment in clean energy technology is a national imperative. In addition to tackling our fossil fuel addiction, it can rapidly drive down the price of low-carbon energy technologies, build new export-oriented and manufacturing-intensive industries, and accelerate the transition to energy independence. The federal government currently invests $30 billion per year in health R&D and $80 billion per year in military R&D. Energy currently receives $3 to $5 billion – less than our national expenditure on potato chips.

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Building the Energy Innovation Consensus

As the national debate on federal energy and climate legislation continues to unfold, Americans for Energy Leadership has been working to advance energy innovation and education investment as a critical component, adding to the growing “energy innovation consensus.”   These efforts have been recognized by a number of outlets and experts.  Some recent examples include:

In Time Magazine’s Special History Cover Issue, “The Electrifying Edison,” Bryan Walsh wrote:

“Even when America’s scientific preeminence was threatened by the Soviet Union’s Sputnik launch in 1957, the U.S. only came back stronger. “The federal response to Sputnik was an overwhelming investment in science and engineering education,” says Teryn Norris, director of Americans for Energy Leadership. “That had spillover benefits across the board.”

At the National Journal, in “Bill Will Slight Technology Innovation,” Mark Muro from Brookings Institution wrote:

“As we and many others have been saying for years, the nation badly needs to sign up for a new push for energy system innovation that seeks countless efficiencies but also triples to quintuples today’s anemic baseline level of federal energy innovation R&D. (For some great discussion of this need see recent posts by Microsoft founder Bill Gates, a group of 34 Nobel Laureates, NYT Dot Earth blogger Andy Revkin, and Teryn Norris of Americans for Energy Leadership).”

At New York Times Dot Earth, in “Quantum Dots, Obama and the Energy Quest,” Andrew Revkin wrote:

“I asked Dan Kammen, along with Teryn Norris, an energy policy blogger affiliated with the Breakthrough Instituteto assess the energy innovation report. Their views are appended below.  Interestingly, there’s a decent amount of agreement between Norris and Sean Pool, the author of the Center for American Progress report. Here’s Norris’s take on the innovation analysis, followed by Kammen’s:”

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President Obama hosted a bipartisan meeting on comprehensive energy and climate legislation Tuesday morning. Roughly 20 senators from both parties attended the West Wing gathering and although it was scheduled to last less than an hour, the meeting ran overtime at 90 minutes. Discussion centered on the Kerry-Lieberman American Power Act, an analysis of which can be seen here.

While the president held firm in his calls for a price on carbon and provisions to reduce greenhouse gas emissions, reactions from Republicans were more mixed. The Hill noted that Senator Lamar Alexander (R-Tennessee) said, “Republicans would work with the White House on legislation to boost electric vehicles, nuclear power, and boosting energy research and development.”

Continuing disagreement ensures that a window remains open for a serious alternative agenda. Senator Joe Lieberman (I-Connecticut) quoted the president as encouraging attendees to “forget partisan politics” and “aim high.” On that note, Americans for Energy Leadership has laid out a bipartisan strategy to wean the nation off its addiction to fossil fuel and move towards clean energy independence.

Below is a roundup of news coverage of the White House meeting to date:

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A Bipartisan Strategy for Energy Leadership

By Teryn Norris & Clifton Yin
Published by The Huffington Post

When President Obama and key Senate leaders meet today to reach a compromise on energy and climate legislation, they should strongly consider increasing federal investment in clean energy technology to at least $15 billion annually. This is a comprehensive third way strategy to improve U.S. energy independence, economic competitiveness, and climate security, and it deserves bipartisan support.

We are a Democrat and Republican. One of us campaigned for Barack Obama in 2008, the other as a delegate for John McCain. One of us worked on energy and climate policy for the progressive Breakthrough Institute, while the other worked on similar issues for the conservative American Enterprise Institute. We disagree on a wide range of issues, and we hold different economic philosophies.

Despite our differences, we are strongly united behind a serious federal agenda for clean energy innovation. Regardless of the future of cap and trade, robust federal investment in clean energy technology can effectively tackle both energy and climate policy reform. In addition to reducing our oil addiction, it can help build new export-oriented and manufacturing-intensive industries, seize global market share, drive down the price of clean energy technologies, and accelerate the transition to a cleaner, low-carbon economy.

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Edison_Time_Magazine_CoverWelcome to our new Time Magazine readers.  Americans for Energy Leadership was just featured by Time’s must-read Special Annual History Cover Issue on Thomas Edison and U.S. technological leadership (July 5th), called “The Electrifying Edison.”  Time’s lead energy and environment reporter Bryan Walsh wrote:

“Inventors like Edison helped build America’s unparalleled scientific and technological dominance, a dominance that, more than any other single factor, made the 20th century the American century… the federal government played an important role through its own research laboratories and investments in education. Even when America’s scientific preeminence was threatened by the Soviet Union’s Sputnik launch in 1957, the U.S. only came back stronger. “The federal response to Sputnik was an overwhelming investment in science and engineering education,” says Teryn Norris, director of Americans for Energy Leadership. “That had spillover benefits across the board.” (emphasis added)

The article explains the critical importance of large-scale federal investment today in clean energy technology and education for the sake of America’s global leadership and competitiveness, adding Time’s voice to the ever-growing national “energy innovation consensus.”  It cites statistics from the previous report I co-authored with Breakthrough Institute and Information Technology & Innovation Foundation, “Rising Tigers, Sleeping Giant,” a widely acclaimed study containing the first comprehensive international review of clean energy competitiveness (see our updated “The Power to Compete” policy memo for more).  The article continues:

“It’s ironic that nowhere is America’s position in science and technology more threatened than in the industry that Edison essentially invented: energy. Clean power could be to the 21st century what aeronautics and the computer were to the 20th, but the U.S. is already falling behind. China, South Korea and Japan are set to invest more than $500 billion combined in clean technology over the next five years, while the U.S. is likely to invest less than $200 billion, and that’s assuming clean-energy legislation makes it into law. Meanwhile, Congress remains largely paralyzed.

The article, available in news stands this week, concludes by pointing to Bill Gates and Jeffrey Immelt, who recently joined forces with other business titans to launch the American Energy Innovation Council, calling for at least $16 billion per year in federal energy RD&D.

“In mid-June, a group of corporate titans, including Microsoft co-founder Bill Gates and GE CEO Jeffrey Immelt, descended on Washington to call for U.S. spending on energy research to be tripled.  They noted that the government today spends less than $5 billion a year on energy research and development – not counting temporary stimulus projects – compared with $30 billion annually on health research and more than $80 billion on military R&D. At a time when energy is more important than ever – and while oil from a blown well bleeds into the Gulf of Mexico – the U.S. no longer seems willing to create the environment that can engender the innovation we were once known for. “The world is not going to wait for the United States to lead,” said Immelt.  “This is about innovation.  This is about competition. This is about energy security.”

Some erosion of the U.S.’s scientific dominance is inevitable in a globalized world and might not even be a bad thing. Tomorrow’s innovators could arise in Shanghai or Seoul or Bangalore.  And Edison would counsel against panic – as he put it once, “Whatever setbacks America has encountered, it has always emerged as a stronger and more prosperous nation.”  But the U.S. will inevitably decline unless we invest in the education and research necessary to maintain the American edge.  The next generation of Edisons could be waiting.  But unless we move quickly, they won’t have the tools they need to thrive.”

AEL 2010 FellowsLast week, Americans for Energy Leadership welcomed its seven new 2010 Policy Fellows at our headquarters in Washington, DC to support our efforts and advance our mission of fostering the next generation of energy leaders.  All our fellows have significant experience and education in public policy, especially related to energy, and have either graduated or will soon graduate from universities including Stanford, Columbia, University of Pennsylvania, Washington University in St. Louis, University of California Berkeley, Georgetown, and Claremont McKenna.

The fellows began with an advanced, comprehensive reading course in energy policy, and to capstone their first week, they wrote an article on a topic of their choice. Excerpts of these articles are included below, and full articles can be accessed at the new AEL Fellows Blog.

The Time for a New American Narrative by Sydney Baloue

Last Tuesday night President Obama took to the Oval Office to reassure the nation of the government’s concerted efforts to solve the oil spill problem in the Gulf Coast. In between hitting the right measure of sympathy for Gulf victims and scorn for BP executives, the president managed to briefly mention his not-so-distant vision for America. We heard the calls for America to wean itself off of its obsession for fossil fuels and a short point on creating a stronger clean energy industry. Most outstanding however, was how the president noted that this time signifies a chance to, “seize the moment.” But what moment are we supposed to be seizing and how?

Energy Markets and the Government by Jeremy Cohn

The United States needs to invest in energy. Global and domestic energy demand is set to skyrocket in the coming years and the US is still heavily dependent on foreign imports, inefficient technologies, and fuels that are polluting our planet and threatening massive political and economic upheaval in the coming century. Throughout our history the US has turned to the unique power of technology and government investment when private industry was not enough: the Manhattan Project, Apollo Project, DARPA, the oil crises of the 1970s, and today’s energy crisis is no different.

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IEEE and GridWise Urge Senator on RE-ENERGYSE

Last week, IEEE USA and GridWise Alliance wrote a joint open letter urging U.S. Senator Alexander (R-TN) to support RE-ENERGYSE, a Department of Energy and National Science Foundation strategic partnership that would establish the nation’s first comprehensive federal program for clean energy science and engineering education. Senator Alexander is a member of the Senate Appropriations Subcommittee on Energy & Water Development, which will decide if RE-ENERGYSE gets appropriated or not.

Americans for Energy Leadership has been a champion for this proposal through its ReEnergyse Campaign, which recently organized over 100 university and college student body presidents in support of the program.  The IEEE and GridWise letter builds upon these efforts — as well as last year’s RE-ENERGYSE letter signed by over 100 universities and professional associations — by urging the Senator to support the Obama Administration’s request of $55 million in funding for the new energy education and training program in the FY2011 budget. It also explains that RE-ENERGYSE’s goal is to support technical training, fellowships, internships, scholarships, and new masters programs that focus on applied energy science and engineering:

“The IEEE USA and GridWise Alliance have joined forces to urge your support for the Department of Energy’s “REgaining our ENERGY Science and Engineering Edge” (RE-ENERGYSE) program… The program will help students and workers learn skills needed to solve practical energy challenges, such as deploying clean energy and energy efficiency technologies, as well as essential enabling smart grid technologies… RE-ENERGYSE is also needed to boost our nation’s capability for innovation… RE-ENERGYSE will advance a clean energy and energy efficient economy which will remain competitive in global markets; we urge your support for this appropriation.”

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Oil executives testifying before Congress in May.

Oil executives testifying before Congress in May.

Reporting on BP’s imbroglio in the Gulf of Mexico, Peter Coy of Businessweek finds that energy companies are neglecting long-term investments in research and development at the price of technological breakthroughs:

“Energy companies worldwide are far less science-oriented than one might expect from an industry that is heavily dependent on technology for safety and profit. In the U.S., energy companies’ spending on research, development, and deployment amounts to just 0.3 percent of sales. That’s barely more than a tenth what the auto industry spends as a share of sales and is dwarfed by the pharmaceutical industry, which spends nearly 19 percent of sales.”

He goes on to ponder the shortcomings of public investments in innovation:

“But government R&D spending on energy has been scarce, too. It was less than 0.03 percent of U.S. gross domestic product as of 2007, about one-third the share in Japan. The dearth of investment in energy R&D helps explain why the world is still getting its energy by punching holes in the sea floor rather than from safer, renewable sources such as the sun and the wind.”

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Obama at the GulfThis Tuesday, President Obama gave a speech addressing the response to the oil spill in the Gulf of Mexico.  While the president spent some time discussing energy and a clean energy environment, the reaction from pundits has been critical.  On the left, many criticized the president’s silence on cap-and-trade as the right has continued to criticize Obama’s response to the spill.  Americans for Energy Leadership responded with “Obama Signals Need for New Energy Agenda.”  Below is a roundup of other reactions to the speech.

Politico, “Deadly silence on carbon caps,” Jun. 15, 2010

Obama never even uttered the words “carbon,” “greenhouse gases,” “global warming” or “cap and trade.” He used the word “climate” only once — and then only to acknowledge that the House last year passed a “a strong and comprehensive energy and climate bill.”

Dot Earth, The New York Times, “Energy Comes to the Oval Office,” Jun. 16, 2010

President Obama has long asserted that the nation’s energy challenges are a priority. But — like most presidents before him with that same stated concern — he has not been inclined to make the sustained push for an expanded and sustainable energy menu a top priority in the face of competing issues and events.

Now that Obama has made the Gulf of Mexico disaster and energy policy the subject of his first Oval Office address, this may be the start of such a push

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Obama Signals Need for New Energy Agenda

[Update: Andrew Revkin cites this article at New York Times Dot Earth]

By Teryn Norris
Published by Huffington Post

The biggest news from President Obama’s  Oval Office address is that cap and trade legislation is probably dead for the foreseeable future, and the administration is seeking new ideas.

Instead of using last night’s prime-time opportunity to push cap and trade in the form of the Kerry-Lieberman American Power Act — as many climate advocates saw as their last hope for “comprehensive” climate reform — President Obama pressed the reset button on energy and climate policy, saying he was “happy to look at other ideas and approaches from either party, as long they seriously tackle our addiction to fossil fuels.” He made no mention of setting a price on carbon or establishing an emissions cap and trade system.

As Andrew Revkin observed at New York Times Dot Earth, the president “signaled that he is leaving open a variety of paths on energy and climate policy and no longer hewing tightly to the idea of a cap and trade system for restricting heat-trapping emissions — which he never wavered from during his campaign.” David Roberts of Grist, one of the few remaining hopefuls for cap and trade reform, wrote “Final thought: Obama didn’t drive the carbon cap tonight, so there won’t be a carbon cap in the energy bill this year.”

Several key Democratic Senators have reached a similar conclusion. “I doubt very much whether those 60 votes exist right now,” said Senator Byron Dorgan (D-ND) yesterday on C-SPAN, referring to the 60 votes necessary for cap and trade in the Senate. “The climate bill isn’t going to stop the oil leak,” said Senator Dianne Feinstein (D-CA), asserting that “The first thing you have to do is stop the oil leak.” Echoing these sentiments, Senator Jay Rockefeller (D-WV) stated, “There’s not a great call for it in the Democratic caucus,” and Senator Ben Nelson (D-NE) called climate legislation “unrelated” to the Gulf spill.

If cap and trade is dead, then what’s next? The only serious alternative that could attract bipartisan support is a comprehensive national strategy for clean energy competitiveness and innovation — including substantial new federal investment in research, development, demonstration, deployment, and manufacturing — to accelerate America’s transition away from fossil fuels, build a strong and competitive clean energy industry, and rapidly drive down the price of low-carbon power and transportation technologies.  These investments could potentially be included as part of a comprehensive energy package, building upon the proposed American Clean Energy Leadership Act.

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