May 2008 Edition

an executive view

The path to secure energy

Renewable is the key word in search to find more power sources

By Samuel Bodman, Secretary, Department of Energy

Renewable energy is helping us bring about a new energy future, one that is cleaner, more sustainable, more affordable, more secure and less reliant on carbon-based fossil fuels.

While there is no "silver bullet" that will solve the world’s energy problems, it is clear that renewable energy and efficiency technologies are an indispensable component of the solution. We must continue to aggressively pursue their development and widespread deployment. And all nations must be involved in this effort.

The whole set of global energy challenges grows more acute with time.

But I’m confident that we will meet them. And, even more than that, I’m optimistic that they represent a major opportunity for the world.

Because just as the components of the problem are all too clear today, the components of the solution are also coming into focus — and more so every day.

First, we have what I believe to be one of the most important elements of a successful strategy: a global imperative to act. In this country, as perhaps never before, the American people are calling for action — and taking action themselves.

We are seeing a growing — and admirably strong — commitment to not just affordable energy, but clean, secure and sustainable energy as well. This is true at all levels — government, businesses, households — and not only in the United States, but around the world as well.

Secondly, we have put in place a series of federal policies to increase our national investment in R&D to break our over-dependence on fossil fuels and harness the tremendous power of renewable energy.

Through the President’s Advanced Energy Initiative, we have identified the technologies that are having the greatest impact — today and over the course of the next decade. We are going after them with increased resources, measurable metrics and milestones, and national plans that include aggressive timelines. Over the past year alone, the Energy Department has announced over $1 billion of investments to spur the growth of a robust, sustainable biofuels industry, and in particular to tap the great potential of cellulosic biofuels derived from waste streams rather than edible fuel sources.

Here is the third component of a successful energy strategy:

All of our catalytic efforts at the federal level are being reinforced by the indispensable role of the private marketplace.

Having spent a fair amount of my career in the financial sector, I can honestly say that for the first time in my life we are seeing the venture capital community investing more and more in the alternative energy business.

In 2007, the so-called "clean tech" sector, which includes renewable energy and efficiency technologies, saw record venture capital investment levels of $2.2 billion — a 46 percent increase over 2006 — according to a report by the National Venture Capital Association and PriceWaterhouseCoopers. Or look at it this way: in 2005, about $500 million was invested in this sector; in 2006, it jumped to $1.5 billion; and in 2007, $2.2 billion, as I mentioned. That is remarkable growth by any measure.

The clean-energy market is not just viable, it is thriving, and particularly in places where innovation and investment is valued and enabled by clear, simple, transparent and enforceable commercial and legal frameworks. After all, we know that investors did not enter this field for purely altruistic reasons, though the importance of the mission may inspire success. The private sector recognizes that there is an opportunity here, one that can favorably impact balance sheets as well as our global energy security and environmental health.

The bottom line is this: We are seeing a convergence of forces that tells me that our world is on a path to a cleaner, affordable, and more secure energy future, and renewable energy is at the center of it all.

We certainly have a lot of work ahead of us, and this is not going to be an easy fix. But look what we have going for us: We have forward-looking leadership and funding commitments from Washington and governments around the world.

We have the dedication and ingenuity of our scientists and engineers. We have the innovative power and the unmatched capital of the private sector. And we have the commitment of the global community to achieve together what none of us can do alone.

Excerpted from a speech before the Washington International Renewable Energy Conference earlier this year.

What do you think?
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