President Obama and the Congress have made tremendous strides over the last four months to speed the transition to a clean energy economy. The economic recovery package enacted in February and the appropriations bill approved in March invest more than $100 billion to scale up wind, solar, clean fuels, next generation vehicles, a smart energy grid, energy efficiency, and transit. The president's budget calls for $150 billion more for clean energy development, research, and green-collar job creation.
Now comes the most critical piece: a new national energy policy that, if done right, would put a cap and a price on carbon emissions and drive demand for a whole new generation of American jobs in the clean and efficient energy sectors. The House and Senate are each working on versions of an energy bill, with the goal of reaching agreement by fall. Both houses are moving forward to adopt a renewable energy standard that has the potential to reduce emissions, generate billions of dollars in economic activity, and create a million well-paid manufacturing jobs.
Less certain is the fate of legislation to cap and reduce carbon emissions -- arguably the single most important environmental and economic decision of the century. Instituting a cap on carbon emissions sets a clear national goal that can only be met by shifting how we power the nation.
The legislative debate over cap and trade has largely focused on the economic consequences of putting a price on carbon, which is the wrong way to look at it. A carbon cap should be seen as an opportunity to set a national limit on pollution and to foster the invention and development of the clean and efficient energy systems that will help meet it. Past federal decisions to regulate air and water quality stirred political disputes similar to those on Capitol Hill today, but in every instance, the high standards we set to combat pollution led to a wave of innovation, new technologies, and measureable economic benefits.
We have a similar opportunity now. Tough new limits on pollution -- accompanied by bold investments in domestic, clean energy manufacturing -- will provide a once-in-a-generation chance to revive America's ailing industrial sector and rebuild the middle class through high-quality, family-supporting green jobs. In fact, some of the states hardest hit by manufacturing job losses in recent decades -- Ohio, Michigan, Indiana and Missouri -- are the ones with the most to gain from a revitalized manufacturing sector capable of making the clean and efficient energy systems that will be the backbone of the new energy economy.
But neither the House nor the Senate bill will deliver on this economic promise without assurances that the systems and parts for the U.S. clean energy sector are made here at home. The United States currently imports more than 70 percent of its clean energy components -- even as manufacturing plants are closing across the country. Unless we invest in domestic manufacturing, we will continue to bleed jobs and depend on other nations to meet our energy needs.
Renewing our manufacturing base through clean energy -- already one of the fastest-growing sectors of the U.S. economy -- isn't just a pipe dream. According to the respected clean tech website CleanEdge.com, the domestic market for solar panels, wind turbines and biofuel equipment will reach $325 billion annually by 2018. In Ohio, nearly 100 manufacturers -- including companies like Canton-based Timken, a maker of ball bearings and other steel products for wind energy equipment -- now make up the state's expanding clean energy supply chain. Even Michigan, a state whose manufacturing sector has been devastated by job losses, produced more than 3,000 new jobs -- mostly in the solar and wind industries -- over the last 20 months.
It's time to join 21st century environmental and economic goals and to embrace the aggressive, bold solutions needed to realize them. If we truly want to curb climate change and fix the economy, we need to adopt a strong carbon cap and make the investments in manufacturing that will put millions of Americans back to work in a new generation of clean energy jobs.
With our planet in peril and our economy in crisis, we can afford to do no less.
Phil Angelides is Chairman of the Board of the Directors of the Apollo Alliance. He is a Principal at Canyon Capital Realty Advisors, and is former California State Treasurer.