Government regulation, venture capital driving clean energy economy
According to a new report by the Pew Charitable Trusts, going green not only pays off for the environment, it pays off for the economy.
Pew found that between the years 1998 to 2007, clean energy jobs grew at a national rate of 9.1 percent, while traditional jobs grew by only 3.7 percent during the same period. Similar findings were reported on the state level, where 38 states and the District of Columbia saw clean energy job growth outperform overall job growth.
Despite a lack of sustained government support of clean energy in the past decade, the Pew report found that the sector is poised to expand significantly, driven by ever-increasing consumer demand, venture capital infusions, and federal and state policy reforms. In 2007, about 770,000 jobs comprised America’s clean energy economy.
“The clean energy economy is poised for explosive growth,” Lori Grange, interim deputy director of the Pew Center on the States, said in a statement. “These jobs are driving economic growth and environmental sustainability at a time when America needs both.”
from 2005 to 2008, venture capital investment in clean technology jumped from just over $1 billion to $12.6 billion, the report finds. And in 2008, clean technology investment totals accounted for 15 percent of all global venture capital investments.
Further growth is expected through further government regulation of clean energy standards. States will enjoy a major infusion of federal funds through the American Recovery and Reinvestment Act, which sets aside nearly $85 billion in direct spending and tax incentives for energy- and transportation-related programs. On the state level, nearly half of the states (23) have adopted regional initiatives to reduce pollution from power plants, 46 states offer some form of tax incentive to encourage residents and companies to use renewable energy, and 29 states have established renewable portfolio standards, requiring electricity providers to supply a minimum level of power from renewable energy sources.
“There is a potential competitive advantage for federal and state policy leaders who act now to spur jobs, businesses and investments in the clean energy sector,” Ms. Grange said.
According to Pew, “a clean energy economy generates jobs, businesses and investments while expanding clean energy production, increasing energy efficiency, reducing greenhouse gas emissions, waste and pollution, and conserving water and other natural resources.”
It comprises five categories:
- Clean Energy,
- Energy Efficiency,
- Environmentally Friendly Production,
- Conservation and Pollution Mitigation, and
- Training and Support.
The definition provides a first-of-its-kind framework for tracking jobs, investments and economic growth over time and allowing the public and private sector to evaluate the effectiveness of policy choices and investments, the group claims.
To read the full report, click here.