Monday, August 03, 2009

The Business Case for Government Leadership on Energy

Writing in the Washington Post, John Doerr, a partner in the renowned venture capital firm Kleiner Perkins Caufield & Byers, and Jeff Immelt, chairman and CEO of General Electric, tell us what what the government needs to do to promote green energy in the U.S. Their call for greater government intervention in the market, including a system that puts a price on carbon emissions, will dismay free market fundamentalists:
Send a long-term signal that low-carbon energy is valuable. We must put a price on carbon and a cap on carbon emissions. No long-term signal means no serious innovation at scale, which means fewer American success stories.
As I noted last week, cap and trade "uses market forces instead of brute force regulation" to reduce emissions and provide incentives for renewable energy production.
The fundamentalists won't like this either:
Set energy standards that grow steadily stronger.
Stronger energy efficiency standards will not diminish our propsperity, but will enhance it by creating savings and promoting new industry.
I don't suppose the free marketeers will like this call for government research either:
Get serious about funding research, development and deployment, at scale.
As Business Week reports, Energy Secretary Steven Chu is on it:
For years, science policy players have had a bad case of DARPA envy. The Defense Dept. agency has long funded breakthrough research deemed too risky for industry to tackle on its own. So why not create a civilian version to jump-start technologies crucial to American competitiveness? One passionate advocate has been scientist Steven Chu. He succeeded in getting Congress to authorize a DARPA-like agency for the latest hot area of research—energy—in 2007, though Congress didn't provide any money for it then. But after he became President Barack Obama's Energy Secretary, Chu finally got the Advanced Research Projects Agency-Energy off the ground in March with $400 million from the stimulus package.
For those who doubt whether a government research agency can be effective in promoting economically useful technologies, DARPA is the agency that created the precursors to the Internet, UNIX, the computer mouse and several generations of advanced silicon chip designs.

2 Comments:

Blogger Jeremy Filliben said...

Tom,

I don't necessarily disagree with your point, but keep in mind that Kleiner Perkins has shifted focus from tech to energy, and Immelt has been steering the GE ship in the same direction. It's certainly not surprising now that they're positioned to profit from government intervention, they're on board with it and trying to sway public opinion.

4:07 PM, August 03, 2009  
Blogger TommyWonk said...

It's not surprising to me. I first wrote of Jeff Immelt's interest in alternative energy three years ago:

http://www.tommywonk.com/2006/07/ge-ceo-immelt-surprising-bedfellows-on.html

4:28 PM, August 03, 2009  

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