We all know energy is global, and as much policy driven as technology driven.
We have a quote, in energy, there are no disruptive technologies, just disruptive policies and economic shocks that make some technologies look disruptive after the fact. In reality, there is disruptive technology in energy, it just takes a long long time. And a lot of policy help.
We’ve ranked what we consider the seminal programs, policies and subsidies globally in cleantech that did the helping. The industry makers. We gave points for anchoring industries and market leading companies, points for catalyzing impact, points for “return on investment”, points for current market share, and causing fundamental shifts in scale, points for anchoring key technology development, points for industries that succeeded, points for industries with the brightest futures. It ends heavy on solar, heavy on wind, heavy on ethanol. No surprise, as that’s where the money’s come in.
1. German PV Feed-in Tariff – More than anything else, allowed the scaling of the solar industry, built a home market and a home manufacturing base, and basically created the technology leader, First Solar.
2. Japanese Solar Rebate Program – The first big thing in solar, created the solar industry in the mid 90s, and anchored both the Japanese market, as well as the first generation of solar manufacturers.
3. California RPS – The anchor and pioneer renewable portfolio standard in the US, major driver of the first large scale, utility grade wind and solar markets.
4. US Investment Tax Credit for Solar – Combined with the state renewable portfolio standards, created true grid scale solar.
5. Brazilian ethanol program – Do we really need to say why? Decades of concerted long term support created an industry, kept tens of billions in dollars domestic. One half of the global biofuels industry. And the cost leader.
6. US Corn ethanol combination of MTBE shift, blender’s, and import tariffs – Anchored the second largest global biofuels market, catalyzed the multi-billion explosion in venture capital into biofuels, and tens of billions into ethanol plants. Obliterated the need for farm subsidies. A cheap subsidy on a per unit basis compared to its impact holding down retail prices at the pump, and diverted billions of dollars from OPEC into the American heartland.
7. 11th 5 Year Plan - Leads to Chinese leadership in global wind power production and solar manufacturing. All we can say is, wow! If we viewed these policies as having created more global technology leaders, or if success in solar was not so dominated by exports to markets created by other policies, and if wind was more pioneering and less fast follower, this rank could be an easy #1, so watch this space.
8. US Production Tax Credit – Anchored the US wind sector, the first major wind power market, and still #2.
9. California Solar Rebate Program & New Jersey SREC program – Taken together with the RPS’, two bulwarks of the only real solar markets created in the US yet.
10. EU Emission Trading Scheme and Kyoto Protocol Clean Development Mechanisms – Anchored finance for the Chinese wind sector, and $10s of Billions in investment in clean energy. If the succeeding COPs had extended it, this would be an easy #1 or 2, as it is, barely makes the cut.
Combination of US gas deregulations 20 years ago and US mineral rights ownership policy – as the only country where the citizens own the mineral rights under their land, there’s a reason fracking/directional drilling technology driving shale gas started here. And a reason after 100 years the oil & gas industry still comes to the US for technology. Shale gas in the US pays more in taxes than the US solar industry has in revenues. But as old policies and with more indirect than direct causal effects, these fall to honorable mention.
Texas Power Deregulation – A huge anchor to wind power growth in the US. There’s a reason Texas has so much wind power. But without having catalyzed change in power across the nation, only makes honorable mention.
US DOE Solar Programs – A myriad of programs over decades, some that worked, some that didn’t. Taken in aggregate, solar PV exists because of US government R&D support.
US CAFE standards – Still the major driver of automotive energy use globally, but most the shifts occurred before the “clean tech area”.
US Clean Air Act – Still the major driver of the environmental sector in industry, but most the shifts occurred before the “clean tech area”.
California product energy efficiency standards – Catalyzed massive shifts in product globally, but most the shifts occurred before the “clean tech area”.
Global lighting standards /regulations – Hard for us to highlight one, but as a group, just barely missed the cut, in part because lighting is a smaller portion of the energy bill than transport fuel or generation.
US Hydrogen Highway and myriad associated fuel cell R&D programs. c. $1 Bil/year in government R&D subsidies for lots of years, and 10 years later maybe $500 mm / year worth of global product sales, and no profitable companies.
Italian, Greek, and Spanish Feed in Tariffs – Expensive me too copycats, made a lot of German, US, Japanese and Chinese and bankers rich, did not make a lasting impact on anything.
California AB-32 Cap and Trade – Late, slow, small underwhelming, instead of a lighthouse, an outlier.
REGGI – See AB 32
US DOE Loan Guarantee Program – Billion dollar boondoggle. If it was about focusing investment to creating market leading companies, it didn’t. If it was about creating jobs, the price per job is, well, it’s horrendous.
US Nuclear Energy Policy/Program – Decades, massive chunks of the DOE budget and no real technology advances so far in my lifetime? Come on people. Underperforming since the Berlin Wall fell at the least!