Consider the following recent news from Ernst & Young about investment in cleantech companies this quarter:
- US Department of Energy announced loans and guarantees of $32 billion, including over $10 billion for solar projects.
- First Solar secured $4.5 billion in loan guarantees.
- A group of 11 wealthy US families formed The Cleantech Syndicate to invest $1.4 billion in renewable energy companies over the next five years.
- Google and SolarCity create a $280 million fund to provide solar panel leases and ppas to households - the largest residential solar financing scheme to date.
- BofA and partners are financing $2.6 billion in commercial rooftop solar arrays -- the largest distributed solar deal in history.
- GE announced a $600 million investment to manufacture solar panels -- in a factory slated to be the largest in the US.
So there's no doubt that billions of dollars are flowing into this market from government, private investors, banks and major corporations.
The question is -- is it enough?
Is it enough to stimulate the economy? Is it enough to combat climate change? Is it even enough to keep up with China?
Despite the billions in loan guarantees and investments this year, there is still no clear federal policy on funding clean energy. But amidst all the sound and fury of the debt ceiling debate, however, some quiet steps were recently taken to change that.
In mid-July, the Senate Energy and Natural Resources Committee passed the Clean Energy Financing Act of 2011 with a rare unanimous vote. If that kind of broad bi-partisan support can sustain a vote on the floor, the bill would establish a Clean Energy Deployment Administration, or CEDA. Commonly referred to as a "Green Bank," CEDA would be an independent institution providing affordable financing for clean energy technologies who've had funding difficulties. A similar Green Investment Bank was recently launched in the UK, and even the conservative the US Chamber of Commerce supports the CEDA legislation.
While there are still questions about how the program will be funded, and which technologies should be included, the idea also has support from the influential American Energy Innovation Council, a group of America's top business executives who've developed a plan to make America a global leader in energy technology innovation. The Council's members include Bill Gates; John Doerr, partner at Kleiner Perkins; Chad Holliday, chairman of Bank of America; and Jeff Immelt, chief executive of GE.
These business leaders have several recommendations for making CEDA successful, including: #1 -- Creating an independent national Energy Strategy Board, and #4 -- funding ARPE-E at $1 billion per year. But they warn that if their second recommendation is not met "our other recommendations will not matter much."
So what is their 2nd recommendation? Invest $16 billion per year in clean energy innovation.
Currently we're only investing $5 Billion per year. For comparison, the China Development Bank Corporation plans to finance more than $30 billion in clean energy each year, according to the Center for American Progress.
To keep our economy strong, and remain competitive, the business leaders on the Council say the US needs "sizable, sustained investments in clean energy innovation. We believe that $16 billion per year -- an increase of $11 billion over current annual investments of about $5 billion -- is the minimum level required. This funding should be set with multi-year commitments, managed according to well-defined performance goals, focused on technologies that can achieve significant scale, and be freed from political interference and earmarking."
Even if CEDA passes, these are lofty aspirations in today's political climate, to say the least. And if our top business leaders think triple what we're doing now is the minimum required to stay competitive, then I think we have our answer.
Are we investing enough in Clean Energy?
Sadly, no. Not by a long shot.