On Wednesday evening, Director of Americans for Energy Leadership Teryn Norris was interviewed on TV as part of The Alyona Show in a segment called “China Leaves U.S. in Clean Energy Dust,” aired live in Washington DC, New York City, and Los Angeles.

In the midst of a raging nation-wide debate on energy and climate policy, Alyona asked Teryn what will it take for lawmakers to realize the U.S. is falling behind in the global clean energy industry and take the necessary action to regain our position.  Teryn discussed the clean energy race and implications for federal policy, the need for a “third way” energy and climate strategy based on public investment in technology innovation, and the DOE Clean Energy Ministerial as an alternative global forum for climate change mitigation.

While America talks about energy innovation, our competitors are championing it. Just weeks after Chinese company Yingli Solar signaled its nation’s status as the world leader in solar technology at the World Cup, Bloomberg Bunsinessweek provided yet another reminder of China’s increasing competitive edge:

“China attracted more asset financing in clean-energy technology in the second quarter than Europe and the U.S. combined, Bloomberg New Energy Finance said…Financing of wind turbines, solar panels and low-carbon technology in China climbed 72 percent to $11.5 billion compared with the year-earlier quarter [while]…total new investment in clean energy worldwide, including share sales, venture capital, private equity and asset finance, slipped 3 percent to $33.9 billion in the second quarter from the same period last year.”

This news came on the same day that Devon Swezey, Project Director at the the Breakthrough Institute, testified before the U.S.-China Economic and Security Review Commission on China’s clean energy innovation policy and the steps the U.S. must take to remain competitive.  He explained to the commission that the Chinese government is simply putting more effort and resources into its clean energy industries:

“China is not out-competing the United States through some inherent comparative advantage, but through targeted and comprehensive public policy characterized by large and sustained public investment across the entire industry.”

Swezey goes on to point out a startling trend: America is no longer just losing manufacturing jobs, it is losing key investments in research and innovation because of it’s lack of sustained funding for clean energy.  The testimony builds on criticism of Washington for its paralysis in the face China’s ambitious energy policy.

Last week, while stumping in Nevada for Senate Majority Leader Harry Reid, President Obama urged Congress to pass $5 billion in clean energy manufacturing tax credits.  The White House estimates that the $5 billion expansion would generate nearly 40,000 jobs and $12 billion or more in private sector investment, which in turn could create up to 90,000 additional jobs.  While the plan seems like a solid proposal, helping create jobs and cut emissions through a tax incentive, it is sure to meet opposition amongst deficit hawks.

This will undoubtedly become part of the larger debate on the Hill over whether the government should be worried more about stimulating the economy or balancing the deficit.  The discussion is an important one, but if we are to talk about tax breaks for energy companies we must do so in a forthright manner.

Any legislator that opposes tax incentives for renewable energy producers should be asked to explain why they don’t act to cut similar tax breaks for fossil fuel-based utilities.  According to The Environmental Law Institute’s report, Estimating U.S. Government Subsidies to Energy Sources: 2002-2008, between 2002 and 2008 fossil fuel energy companies were entitled to 23 tax breaks, costing the government over $54 billion.  That comes out to an average of $6.75 billion a year.  At the same time, renewable energy received  11 tax breaks, costing the government just under $18 billion during the same time period, or around $2.25 billion a year.  We will never move away from a fossil fuel economy so long as polluting technologies have a tax advantage on top of their price advantage.

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