Losing the Clean Energy Race

Losing the Clean Energy Race

The United States once led - actually, began - the clean energy revolution. As recently as 1990, U.S. industries played the dominant global role in wind and solar PV development and deployment.

But, due to a lack of appropriate and consistent government support for clean energy technologies, and government subsidies that continue to favor dirty, conventional fuels and technologies, we are losing our role as technological leaders.

We are now falling farther and farther behind as Japan and Europe surpass us with regard to total installed clean energy generating capacity, share of the global market, and ownership of manufacturers.

U.S. companies must compete in the global marketplace.

If this trend is not reversed, America will lose millions of potential high-wage, high-tech jobs, billions of dollars in potential investment and revenue. The US will also fail to glean multiple benefits not traditionally measured in economic terms that come with clean, safe, domestic and renewable energy technologies - including cleaner environment, reduced risk of global warming, improved human health, better quality of life, and a more secure future.

With only 4.5 percent of the United States land area and a fraction of its wind resource potential, Germany has more than double the U.S. installed wind energy capacity. Denmark, a small nation of about five million people, is the world's leading manufacturer of wind turbines, with several turbine companies that consistently rank in the global top ten. The U.S. share of global PV shipments reached a peak in 1996, declining from 44 percent that year to 27 percent in 2001.

Total grid-connected PV in the United States is now estimated to be only 15 percent of that in Japan, and 31 percent of that in Germany.

The rising demand for Japanese and European made technology is due primarily to the dramatic increases in demand for renewable energy capacity in these countries, sparked by successful government policies aimed to develop markets for renewable energy. Meanwhile, the U.S. government continues to subsidize fossil fuels and nuclear power, at levels many times that for renewable energy technologies.

Around the world, leaders in business and government are calling for a transition to a clean energy economy to address global climate change, increase national security and meet rising demand for energy worldwide. Perhaps most importantly, the American public wants clean energy.

In poll after poll, Americans have expressed their preference for investment in renewable energy technologies over conventional energy. According to a Gallup poll taken November 8, 2001, 91 percent of Americans favor investments in new sources of energy, such as solar and wind.
  • Top level advisors under Clinton, Reagan and Nixon have urged Congress to adopt strong measures now to advance renewable energy in order to advance America's energy security. "They [renewable energy technologies] are now ready to be brought, full force, into service…. Speedy action by the Administration and the Congress is critical to establish the regulatory and tax conditions for these renewable resources to rapidly reach their potential."

  • David Freeman, who has held top positions at the New York Power Authority and Tennessee Valley Authority (TVA), and now heads the California Power Authority, notes that "our whole system of electric
    power supply is hard to defend against attack. The worst is nuclear."

  • Sir Mark Moody Stuart, former CEO of Shell Oil company last month called on governments of northern countries "to expand renewable energy targets, removing inappropriate subsidies and switching some to renewable energy to provide a level playing field in the energy sector."

  • Russian Vice Prime Minister Ylia Klebanov recently said that "using traditional energy technologies, it's hard to talk about [a] competitive economy. And for renewable energy technologies we do too little…."
Every region and state in this nation has significant renewable energy potential - wind and solar energy, geothermal energy, ocean power, crops for biomass, and environmentally sustainable hydropower. In fact, North America has some of the world's greatest wind energy resources; North Dakota alone has enough to produce 1.2 trillion kilowatt hours (kWh) of electricity each year , 37 percent of total U.S. electricity consumption in 1999 (3 trillion kWh ). Every minute, the sun drenches earth's surface with more energy than the world consumes in a year. The United States has the best solar resource of any industrialized country.

According to the U.S. Department of Energy, enough electricity could be generated to meet all of U.S. demand with solar energy on a plot of land 100 miles square in Nevada. The benefits of renewable energy are compelling: a cleaner environment for current and future generations, reduced threats of global warming, economic growth, greater diversity of fuel supply, improved energy and national security, rapid and modular deployment, and a global potential for technology transfer and innovation.

In addition, renewable energy technologies provide more jobs per unit of energy generated than do conventional energy technologies. According to the Department of Energy, wind energy provides about five times more jobs per dollar invested than coal or nuclear power. A recent study concluded that solar PV provides the most jobs of any renewable technology, on an energy capacity basis, and many of these positions are high-wage, high-tech jobs.

The global markets for renewable energy and energy efficient technologies are booming. Wind has been the fastest growing energy source worldwide for most of the past decade, while global shipments of solar photovoltaic (PV) panels and modules have increased at an average annual rate of 33 percent since 1996.

During the same period, the use of coal for generating electricity has declined by 9 percent worldwide. Solar PV and wind power technologies have matured considerably since the 1980s, experiencing dramatic increases in productivity and lifetime, while achieving significant declines in cost. In good wind sites, wind power is now the cheapest new energy source, with full life-cycle costs below those of most fossil-fuel powered plants.

Today, solar PV provides electricity for several hundred thousand people around the world, creates employment for more than ten thousand people and generates business worth more than $2 billion annually. According to some forecasts, clean-energy markets will grow from less than $7 billion in 2000 to more than $82 billion by 2010 , and the U.S. National Renewable Energy Laboratory (NREL) predicts that PV technology has "the potential to become one of the world's most important industries."

Driven by concerns about global warming, energy security, increasing demand for energy worldwide - particularly in developing countries and advances in renewable energy technologies, nations around the world are setting targets for renewable energy. The European Union aims to generate ten percent of its electricity with renewables by 2010, and the European Wind Energy Association projects that Europe will have 60,000 MW of installed wind capacity by that year. By the year 2020, wind energy could generate 10 percent of the world's electricity and create more than 1.7 million jobs. The European PV Industry Association projects that solar PV will provide 26 percent of total global annual electricity demand by 2040.

Even China, India and Brazil have committed to significant increases in the use of renewable energy; India established a ministry for advanced energy technologies, and China has eliminated subsidies for coal. These three nations combined have more than two billion people, with rapidly rising demand for energy and the technologies that produce it, offering nearly unlimited market potential.

The current political and commercial commitment to renewable energy around the world implies that the recent surge of activity in this industry is only the beginning of a massive transformation and expansion expected to occur over the coming decades. But without strong and sustained political leadership at home, Americans will lose out in this energy revolution. To compete successfully in the clean energy race, U.S. industries must be strong and resilient, which requires a strong and consistent domestic market for their products.

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By Janet L. Sawin of Greenpeace USA. It is based significantly on her doctoral dissertation entitled "The Role of Government in the Development and Diffusion of Renewable Energy Technologies: Wind Power in the United States, California, Denmark and Germany, 1970-2000" (Fletcher School of Law and Diplomacy, Tufts University, September 2001).

Greenpeace would like to thank the American Wind Energy Association, the Solar Energy Industries Association, and Scott Sklar (The Stella Group, Ltd.) for their guidance and editorial assistance.

Greenpeace is solely responsible for any errors of fact or interpretation in this report.

The full report can be downloaded online.