Greentech Policy

greentech policy

It’s clearly political silly season yet again, and we can all expect that the rhetoric will continue to be dog-gone bad. We can also tell, unfortunately, that federal clean energy policy will be a lightning rod for a lot of that mendacious rhetoric this year. So I don’t expect anything significantly good or bad to happen this year on a federal energy policy front. Just lots of shouting and lies, and maybe some small token legislative actions.

So it seems like a good time to step back and reflect on the choices the cleantech sector has made, in terms of how we position ourselves with regard to policy. Thus, I’ve come up with four basic questions I think everyone should be asking themselves right now. These aren’t rhetorical questions — these are intended to prompt discussion. The first two questions are kind of complementary to one another. The final two questions are, at least on the surface, in conflict with each other. Do with this what you will.


The argument we’ve made as a sector so far goes like this: Clean technologies (or green technologies or advanced energy or whatever the heck is the latest punchless label du jour) are going to be big in the future, so clean technologists should be considered vital for America’s economic future. Thus, governments (federal and state) need to support them at this nascent stage of development.

I agree with this statement. But is the phrasing and perspective the right way to go about it?

Critical question: Why should the 99% of Americans not directly involved in clean technologies care about any of the above? Because of somewhat vague and distant arguments about future climate change and future economic leadership? Perhaps that’s not really compelling for most.

But look at it this way: If we in the clean technology sector are successful, if we can bring everyday Americans solutions in their home and workplace that are economically compelling, what will that mean?

Lower energy prices. Period.

Cleantech leaders and our political allies keep talking about our own jobs, the “green jobs”. But perhaps we should be focusing instead on what we can do for everyone else’s jobs.

What would it mean if manufacturers in the U.S. had a near-zero marginal cost of energy input, because we (in a very targeted way) helped them get cheap distributed generation like solar, via capex or tax incentive support? It would mean a whole lot more manufacturing jobs, because our manufacturers would be more competitive.

What would it mean for commuters and small business owners if all these advanced biofuels manufacturers could succeed in bringing <$2/gallon gasoline substitutes to the American public?

What would it mean if homeowners had significantly lower energy bills, via better efficiency retrofit programs and easier solar financing?

Beyond economic arguments, if we stopped being so focused on our own types of jobs, and started focusing our message on how our efforts put more money in the pockets of everyone else, it also becomes easier to bring arguments like energy independence into play. If we don’t make it all about ourselves, for example, it’s easier to see the domestic natgas revolution as an ally in bringing cheap domestic energy to the U.S. economy. Crystallizing our message in this less self-centered way also makes it easier to partner with others who can support the same message, even if they’re not in 100% alignment with us on other things.

Lobbyists don’t get paid to serve the general public, I understand. Washington, D.C. doesn’t work this way. But at least in how we frame the problem and our role in solving it, we in the cleantech sector might think about focusing less on what others can do for us, and more on what we can do for our country.


I get it: VCs and other investors have mostly backed startups that are involved in the production of cleantech products. So when the industry lobbyists, backed by VCs and other investors, go to DC and ask for support, it ends up being an ask for support of production capacity and production-centric R&D. And certainly, there are cogent arguments to be made about how it’s valuable to support the production capacity of strategic and nascent industries so that we don’t get left behind in the race to dominate future markets.

Is that the best way to attract political allies? To win general public support?

Is that even the best way to build domestic markets and domestic production industries?

It’s certainly not the best way to grow generic “green jobs,” if that’s your ultimate goal. Jobs involved in the production of a commodity can be more easily automated and more easily exported. Downstream distribution and installation and service jobs are much harder to export, and the economic activities themselves are inherently more labor-intensive, and yet dollar-for-dollar result in even better energy- and carbon-savings results, anyway.

It’s certainly not the best way to avoid political backlash. Loan guarantees and state-level incentives given directly to cleantech manufacturers have, even if they’ve only rarely failed, quickly become political conflagrations, because they’re easily characterized as handouts to very specific recipients. Meanwhile, ARRA block grants to promote energy efficiency retrofitdemand have very quietly been a huge success, helping a lot of homeowners in communities across the country.

And as important politically, if the investors drive the political ask to be supported for their production-oriented startups, that leaves a lot of the most likely allies among the traditional industries out in the cold. Yes, we saw positive rhetoric in support of clean energy policy from the CEOs of major utilities and capital equipment manufacturers. Well, I’ve seen how the lobbyists for some of those very same CEOs then quietly worked behind the scenes to gut clean energy legislation — or at very least, didn’t actively help. Why? Because they didn’t really see how these policies would directly help their company’s bottom line.

By focusing on production, we could very well end up sending mixed messages to Americans about how valuable we are to them. Solar is a prime example. The storyline right now is that the U.S. solar industry is in trouble, and along with the political scandals, mainstream journalists and most Americans asked would declare governments’ support of the solar industry to have been a failure.

In truth, it’s been anything but. For the vast majority of Americans, the collapse of solar panel prices is a wonderful thing. The drop in ASPs, and supportive demand growthpolicies at the state level, have prompted the rise of a wave of innovation in solar financing that means a huge number of Americans can now get solar panels on their rooftop for zero or little money down, and get net savings on their total electricity bill. That is a wonderful outcome. Yes, individual panel manufacturers (and their investors, like me) have been very hurt, and probably unfairly so, by China’s pumping of cheap capital into their domestic production capacity. But meanwhile, the end solar market in the U.S. is one of the fastest-growing sectors of the economy, there’s significant job growth in installation and other supportive technologies, and homeowners are getting cheaper power.

When we focus on production and how its been hurt by the booms and busts of capital cycles and political inconsistency, do we fail to make the more important point, namely, that the price declines are an inevitable result of the success of our efforts, and that this is a really, really good outcome for 99% of Americans? As a sector, we should be celebrating the collapse of solar panel prices, not lamenting it.

The cleantech sector remains small and mostly populated by entrepreneurs who don’t have a lot of cash to throw around on political donations — as long as we define ourselves so narrowly, which focusing on ourselves, and especially on our production-oriented startups, really does. Perhaps it’s time to place even more emphasis on demand-creation policies, and de-emphasize asking for policies that support production.


It’s a simple fact: There is indeed an energy revolution going on in this country. And it’s being driven by cheap natural gas, not by renewables.

While certainly not universal, I continue to see many within the cleantech sector making political arguments based around aspirations of effectively zero carbon energy. It’s the environmentalist side of the sector, as well as a reaction out of frustration that low natgas prices are lowering our price-competitiveness benchmarks.

I’m an environmentalist who started my career at an environmental NGO. I’ve had a lifelong passion for these issues, and I know that those who work at environmental NGOs and foundations often don’t get nearly as much credit as they deserve for taking low-paid, low-profile roles in their dedication to helping society and the planet. But I also know the environmental NGO community has always been fractious, territorial, at times ineffective politically, and generally not good at compromising in order to achieve a good outcome.

The environmental community (and its foundation backers) has been the cleantech industry’s best friend, among established political constituencies, and the one most relied upon to carry the water for the sector in the halls of Congress when it comes to specific legislation like cap and trade. But they haven’t been a reliable ally. Nor should they be — desert tortoises, etc. illustrate that the goals of an environmental NGO and the goals of a cleantech entrepreneur can’t ALWAYS be in alignment. And that’s as it should be. But when you rely upon an ally who often doesn’t share your goals on specific issues, of course you won’t be happy with the results.

Furthermore, this alliance and this vocal dedication to a pure clean energy future alienates other potential allies, ones who are more powerful and also aligned with profit principles like we are. The purist positioning doesn’t leave room for win-win relationships with more established and well-funded sectors’ lobbyists. There’ve been some sporadic efforts made by some cleantech trade groups to reach out to the natgas community, for example, but I continue to see many people involved in the cleantech sector attack that industry and cheer every piece of bad PR it gets, so those outreach efforts go nowhere.

My argument isn’t that cleantech entrepreneurs and investors should abandon our core principles or our aspirations to help the planet. Nor am I trying to take sides in any debate around natural gas regulations.

But I’m asking if some more horse trading, and more strategic alliances with traditional energy players, might not help advance the goals of the cleantech industry net-net, versus the more purist stance that sometimes dominates our sector’s political rhetoric. Again, remember that our sector is small, dwarfed in financial resources by the traditional players, and still learning how to effectively message our positions. I’ve now seen several specific projects by cleantech trade associations and similar groups to raise money for big PR campaigns, and they’ve all fallen flat, because our sector simply doesn’t have the financial resources to support such efforts on our own. Within that context, can we afford to be pure, when it comes to the daily battles of policymaking?


Perhaps asking for realistic and incremental policy shifts hasn’t done anything other than to politicize the issue and stonewall progress. Asking for small changes makes the same enemies just as mad as asking for big changes, after all. And short-term policy wins that engender long-term resentment may miss the bigger picture.

Most of the time when there has been a very significant policy shift in America, it has come about in one of two ways: either as a very rapid reaction to a very significant and disruptive event that forced immediate action, or as a result of many years of parallel exercise of all three levels of what John Gaventa calls “dimensions of power.” To paraphrase:

First dimension: The ability to control a decision on a particular issue.
Second dimension: The ability to decide which issues are up for a decision.
Third dimension: The ability to affect the mindset and moral playing field upon which all these issues and decisions exist.

A three-dimensional strategy has clearly been deployed, for example, to eventually create “critical political mass” in favor of small government and anti-tax perspectives, attitudes and policy in the U.S. And it relies upon really emphasizing the long-term strategy of that third dimension, as driven by repeated and insistent very purist pronouncements and aspirational mission-driven think-tank-type activity. If you win on the third dimension, you’ll reliably win on the first two dimensions as a matter of course.

The type of energy policy shift we need is indeed pretty significant. So according to this line of thinking, we can either hold our breath for that very significant and disruptive event (which I, for one, sure don’t want to root for), or tackle this longer-term strategy.

But if so, to be effective, it needs to be done with a consistent message. And audaciously. And without shame. And without compromise.

Forget complicated cap-and-trade schemes designed to triangulate support from a sufficient number of constituencies to barely pass the Senate, with a lot of pragmatic horse trading involved. Instead, propose a very simple revenue-neutral, phased-in pollution (i.e., carbon) tax, described even more simply: “Make polluters pay, and send me the check.” Something so simple in design that every cable news watcher can instantly understand it — no more 1,400-page-long bills. Admit that it’s going to fail to pass at the federal level. But make it a mission to get it passed wherever possible at the state and local level. Advocate passionately in the name of future generations and for our men and women in uniform. Enlist allies from the agricultural and tourism and re-insurance industries, and others directly affected by climate change. Pull no rhetorical punches.

This is not a strategy designed to “look clever” or make friends or (definitely not) to succeed in the near term. But it’s designed to eventually completely change the terms of the debate. Can that work here? Can the cleantech sector survive long enough for such a long game to play out?

Again, the above questions are just intended to prompt your thinking. Because it’s time to rethink the sector’s political positioning, in my opinion. This year, you’ll see a lot of useless campaign rhetoric and a lot of rear-guard legislative battles trying to preserve one highly technical piece of policy or another. But if what we’ve seen so far is the best that this sector can do in terms of winning over the average American voter, and in terms of getting significant energy policy change to happen at the federal level, there’s not a whole lot of room for optimism on this front. So let’s take a step back and rethink all our political assumptions and strategies.