The New (Green) Arms Race

Hobbled by opposition from the carbon incumbents and their short-sighted allies on Capitol Hill the Obama administration acknowledged this week that it would not return from Copenhagen with any groundbreaking commitment to control green house gases. Meanwhile, Congress is backsliding on the administration's wise commitment to impose a rational price on carbon. Behind the logjam, a treacherous U.S. Chamber of Commerce, always willing to put its obsequious scraping to Big Oil and King Coal ahead of its duty to our country, has battled every effort to accelerate America's transition to a market-based de-carbonized economy.

The Chamber has continued to argue, idiotically, that energy efficiency and independence will somehow put America at a competitive disadvantage with the Chinese. Meanwhile, the Chinese have shrewdly and strategically positioned themselves to steal America's once substantial lead in renewable power. China will soon make us as dependent on Chinese green technology for the next century as we have been on Saudi oil during the last.

Indeed, the Chinese are treating the energy technology competition if it were an arms race. China is spending as much or more on greentech as it does on its military, hundreds of billions of dollars annually on renewable energy and grid infrastructure improvements. Those investments, if not vigorously countered, will effectively erode America's greentech industry leadership and secure China's dominance. China's economic stimulus package, targeted 38% of spending on greentech, as compared to a miserly 12% of the U.S. stimulus program. By 2013, greentech will account for 15 percent of the Chinese GDP. While the United States is projected to roughly triple its wind generation by 2020, China will increase its capacity twelvefold to a wind generating capability more than twice that of America's. And, while the United States is projected to increase its installed solar generation a modest 33% by 2020, China's solar generation is projected to increase 20,000%.

China's investments in solar technology have so powerfully stimulated the growth of a Chinese solar market that Chinese solar panel manufacturers now far outnumber American ones, and they are achieving low-cost production much faster than their American counterparts. Chinese companies are now flooding the American market with cheap Chinese solar panels and devastating the American manufacturing sector that was gearing up to create tens of thousands of U.S. jobs for our own ailing economy. Hundreds of U.S. solar manufacturers now see their prospects as grim. BP Solar, Evergreen, and General Electric have already announced the closing of American-based solar panel factories and outsourcing, primarily to China. America's leading solar manufacturer, Applied Materials, has opened the largest non-government solar energy research facility in the world in China. Of today's ten leading solar panel manufacturers, only one is American. The largest solar panel installation in the United States is a 70,000 panel, 14.2 megawatt array on Nellis Air Force Base in Nevada. The array provides more than 25% of the base's power needs, and saves the Pentagon a million dollars annually in energy costs, but the panels' manufacturer was China's Suntech Power Holdings. Even in the thin film solar market, among the last redoubts of American dominance Chinese businesses are squeezing profit.

Last year, America achieved a milestone, building more wind power generation than all new oil and coal generation combined. We have led the world in wind installations for several years, and the wind industry already accounts for more American jobs than coal mining. At one point the U.S. enjoyed global domination of wind turbine manufacturing with great prospects for job creation. Yet today, of the five leading wind turbine manufacturers, only one is American. While Congress dawdles, China is clobbering us. Shenyang Power Group recently inked a deal to be the exclusive supplier of turbines to the largest wind project in the United States, a 36,000 acre, 600 megawatt development in west Texas. The project will create 2,800 new jobs -- 2,400 in China, but only 400 in the United States. As Lu Jinxiang, chief executive of Shenyang's controlling shareholder noted, "This is just the beginning ... [the United States] is an ideal target." China is likewise poised to take away our lead in batteries and electric cars, and has already pulled far ahead of America in automobile fuel efficiency.

Capitol Hill Republicans will soon recognize that the arms race of the 21st century is already in progress with a totalitarian nation that they not long ago called "Red China." But America will not win with more warheads and better rockets. We can only prevail with robust investment in and support of U.S.-based greentech innovation.