China is increasing its global lead in clean energy investment as Republicans seek to derail the administration's clean energy policies. Image: CC warrenski/Flickr

China led the world in clean energy investment last year, according to a recent study. The U.S. slipped from second to third behind Germany in the race to develop renewable energy sources for the future. As the U.S. falls behind, Republicans in Congress favor more offshore drilling, oppose Obama administration energy policy and want to cut Department of Energy loan programs supporting clean energy development.

Clean energy: China is #Winning

The U.S. led the world in private investment of clean energy until 2008. In 2010 China took the lead, and Germany further displaced the U.S. by taking second place, according to “Who’s Winning the Clean Energy Race,” a report published Tuesday by the Pew Environment Group. Finance and investments worldwide in clean energy grew 30 percent last year to reach a record $243 billion. China attracted $54.4 billion of that money. Germany attracted $41.2 billion. The U.S., although it increased investment in clean energy 51 percent to $34 billion, is losing ground. The report’s authors said that although the U.S. attracts 75 percent of all venture capital for clean energy innovation, it lacks energy policies used by countries like China to spur demand for deployment of clean energy. As a result, the U.S. is ceding opportunities to other countries for attracting clean energy investment, developing new manufacturing capabilities and creating jobs.

GOP: Clean energy too futuristic

Last month, the Obama administration proposed ending oil and gas subsidies that total about $3.6 billion a year to help increase clean energy investment. House Republicans promptly voted, unanimously, to protect them. Last week the Obama administration presented an energy policy with goals to reduce U.S. dependence on oil imports and increase development of abundant U.S. natural gas reserves. The administration also wants to increase fuel efficiency in commercial and government fleets and expand the deployment of renewable energy sources such as wind and solar power. Oil industry officials called Obama energy policy “misguided.” Republicans responded by saying that the administration’s goals look too far into the future and don’t do enough to immediately increase oil drilling both on land and offshore. Meanwhile, China has achieved world domination in wind power, and countries like Argentina enacted policies that increased its clean energy investment 568 percent.

Whose side are they on?

Republicans also threaten to put the U.S. further behind the rest of the world in clean energy with spending cuts. The Republican budget cut proposal calls for eliminating the Department of Energy Loan Guarantee Program, which was established under the Bush administration by the Energy Policy Act of 2005. The program is designed to reduce risks for lenders by backing loans to approved clean energy start-ups. The program has either committed or closed nearly $18 billion in loan guarantees for 20 clean energy projects worth $28 billion. According to the DOE, every dollar of those loans drives $13 of private investment in clean energy. The DOE estimates that by cutting the program, Republicans would force the withdrawal of six current loans to clean energy projects, kill 25 pending agreements and eliminate 20,000 jobs.

Sources

Sustainable Business: http://www.sustainablebusiness.com/index.cfm/go/news.display/id/22145

Wall Street Journal: http://online.wsj.com/article/SB10001424052748703712504576232481675369892.html

Forbes: http://blogs.forbes.com/christianwolan/2011/04/05/republican-budget-cuts-threaten-clean-energy-investments/

Daily Kos: http://www.dailykos.com/story/2011/03/03/952153/-Fox-blames-Obama-for-oil-subsidies

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