U.S. needs to play
to win in the clean energy race
Steven Chu, Secretary, U.S. Department of Energy
The Department of Energy's loan programs have been the subject of much
public attention. As part of our commitment to being a responsible
steward of public dollars, the Department has welcomed and cooperated
with the requests of Congress to discuss our loan portfolio. We also
welcomed the independent review by Herb Allison.
Mr. Allison released a thorough, thoughtful report. He made some
important recommendations to strengthen the management and oversight of
the loan portfolio. Even before the conclusion of Mr. Allison's review,
we took steps—many of which are consistent with the report's
recommendations—to improve the loan programs.
While the portfolio includes loans to a range of projects that carry
different levels of risk, the report finds that the Department of
Energy has reasonably estimated the costs of these risks.
The purpose of the loan programs is to provide low-cost financing to
innovative clean energy projects that have a unique value to the
U.S.—both in terms of providing the clean energy the U.S. needs
and in spurring the development of new industries that can generate
many more jobs down the line.
Overall, the loan programs have been successful in growing America's
clean energy sector. The Department supports roughly three dozen clean
energy projects that are expected to employ more than 60,000 Americans,
generate enough clean electricity to power nearly three million homes,
and displace nearly 300 million gallons of gasoline annually. And these
are just the direct benefits; they do not include additional jobs and
investment that come from supply chains.
Through active projects supported by loans and loan guarantees, our
Loan Programs are spurring $40 billion in investment in clean energy
and advanced vehicles and helping to unlock private capital.
Additionally, the success of these projects is generating additional
private sector activity by serving as a model for other projects.
Thanks in large part to the loan programs and other federal programs,
last year—for the first time since 2008—the United States
regained the title from China as the world's leader in total investment
in clean energy.
Improvements in technology and dramatic reductions in cost are driving
a global revolution in clean energy. Last year, a record $260 billion
was invested globally in clean energy, and trillions of dollars more
will be invested in the coming decades. The question is no longer when
the clean energy economy will arrive, but whether America will lead it.
As the global clean energy opportunity grows, so does the competition.
At least 10 countries have adopted renewable electricity standards, and
more than 50 countries offer some type of public financing for clean
energy projects. For example, Germany and Canada operate
government-backed clean energy lending programs, and China has provided
strong support to its clean energy industries.
These countries are determined to win the global clean energy race. And
by any measure, they are already reaping rewards on their investments.
Americans invented the silicon solar cell, developed modern wind
turbines for electricity generation, and developed lithium ion
batteries, but we are no longer the leader in these industries. China
has surged into the solar manufacturing lead. Denmark is home to the
world's largest wind manufacturer, and Japan and Korea lead in advanced
battery manufacturing, although the United States is making strong
To win the clean energy jobs of the future, the United States must do
more than invent technologies; we must also manufacture them, deploy
them here at home, and sell them around the world. The production of
energy technologies benefits from scale. Simply put, we cannot have a
competitive clean energy industry without programs that help spur
deployment and markets.
America faces a stark choice today. Will we play to win the clean
energy race— creating U.S. jobs by making and selling clean
energy technologies—or will we watch the rest of the world pass
us by? We can invest in America's workers, industries, and innovations
or we can send more money and jobs overseas to import the technologies
Throughout our history, from aviation to agriculture, from
biotechnologies to computer technologies, the federal government has
supported the private sector to keep the United States at the
technological forefront of important industries. In clean energy, other
countries are running our plays. It's time for us to take a page from
our own playbook. We can still win the clean energy race, but we must
the Record is an excerpt of a presentation by Steven Chu, U.S.
Department of Energy Secretary, before the Committee on Energy and
Natural Resources of the U.S. Senate in March 2012.