The Clean Technology and Sustainable Industries Organization (CTSI) organized a "DC Policy Tour for Clean Technology" this month, taking 50 cleantech industry players (representing cleaner coal, solar, wind, nuclear, hydrogen, demand response, water, biomass and fuel cells, plus investors) on a Congressional walk-about. I spoke with Patti Glaza, executive director and CEO, to get her take on the day and the outcomes. After a total of 45 meetings with elected officials from more than 20 states, Ms. Glaza reported that renewable energy tax credit extensions will happen, but only for one year (longer term extensions will most likely come in the next administration) and that climate change legislation will be considered in June, although again it would be surprising to see anything being signed into law prior to the next administration. She also said that both the House and Senate have requested a significant increase in the Dept. of Energy (DOE) budget from what was in the department's original request, and that more funding should be available than last year. Ms. Glaza added, however, that it was unlikely that the Advance Research Projects Energy (ARPA-E) program that was approved in the America Competes Act last year will get off the ground.  More details from the day can be gleaned from the Q&A below, including tips from Ms. Glaza for how companies, even start-ups, can work with their elected officials to make a bigger difference at the Federal level. 

Q: Any humorous moments from the tour?

A: We learned to never let a tour member tell a Republican official that we should pay for the renewable energy tax extensions with funding for the Iraq war.

Q: Who did you visit and get traction with?

A: The primary focus of the meetings was with members of the Appropriations and Ways & Means Committees as Congress is currently finalizing agency budgets and funding programs slated for this fiscal year. We also targeted the Science & Technology, Small Business, Energy Independence & Global Warming, and Energy & Commerce committees and subcommittees, in addition to several executive-level meetings at the DOE. The highlight was Sen. Byron Dorgan (ND) who leads the Democratic Policy Committee and sits on key committees including Appropriations; Commerce, Science & Transportation, and Committee on Energy & Natural Resources. Sen. Dorgan and his staff took a significant amount of time with our group and showed real interest and knowledge of the challenges the sector faces.    There are a lot of champions on the Hill and we need help in reaching out to all of them. Congressmen that took the time to meet with the tour directly included: Tom Udall, Vito Fossella, Dale Kildee, Phil English, Jay Inslee, and Dorgan. Additional offices showing high-level support included: Cantwell, Clinton, McNerney, Barrow, Capuano, and Candace Miller. 

Q: It seems there is a scarcity of coordinated government relations work being done on the part of the cleantech industry. Is that an accurate read on the situation?

A: My initial assessment is that as an industry or sector, clean technology has not had strong representation in Washington DC. Inslee made the comment that he has been waiting for a group like CTSI and is glad we have started our efforts. That being said, there is strong government relations work being done for specific clean technology segments, solar, wind, and biofuels being examples. The role CTSI is trying to fill is to advocate for policies and programs that address the complexity and interrelated issues of energy, water, and the environment. Renewable energy needs smart grid needs cleaner base load generation needs distributed generation support needs water management/reduction, etc.

It was obvious from our meetings that the Hill is extremely receptive to a sector they see as providing new jobs, energy security/independence, and increasing the US global competitiveness. Regardless of the group organizing, a broad technology platform is essential. Industry has to be seen as working together on solving the bigger issues (growing energy demand, climate change, etc.) and not just advocating for specific industry segments in isolation.    

Q: How can companies make a difference on the national level?

A: I see three immediate ways that organizations can make a difference:

- Companies need to take the time to educate their local representatives on their companies, technologies, and how they are working to solve the larger issues.

- Executives need to participate in Washington DC based meetings to emphasize the important role policy and regulation play in developing the clean technology sector. Nothing grabs attention like a company telling their representative that they expect to start laying off workers in June/July because the renewable tax credits haven't been extended.

- Overall, companies need to recognize that policy isn't just for the big players. Policy and regulations have and will have a significant impact on the rate of development and adoption of clean technologies, and growing technology companies need to be at the table when those policies and regulations are being created. Yes, resources are limited. Yes, policy is complicated and difficult to understand. Thus the role of policy and trade organizations.

It's an unenviable position to have to prioritize the world's problems and solutions. First, there are too many. Second, there is an inter-relatedness to all of the problems that makes it difficult to pinpoint a chief culprit. Increasingly, however, it is clear that one issue trumps them all: energy. Plenty of other smart people have explained this, so I will just quote one - Nobel laureate Richard Smalley, who said "It is impossible to imagine bringing the lower half of the economic ladder of human civilization - about three billion people - up to a modern lifestyle without abundant, lowcost, clean energy". He made a strong case that energy touches everything - disease, water, poverty, terrorism, malnutrition, etc. As you might guess, I'm no Bjorn Lomborn booster. From where I sit he's advocating buying a dinghy to save those stranded on a desert isle when we need to marshal resources for an Armada to save the island's inhabitants... and everyone else. 

 

At any rate, it is encouraging to see a shift in public, business and government urgency that recognizes the energy calculus, some for energy security reasons, others for economic prosperity reasons and still others for climate change reasons. Support, happily, is getting stronger every day. Unhappily, as the Intergovernmental Panel on Climate Change notes, even with drastic action, we are still in big trouble.

 

Yet curiously, from a non-descript building on Lake Union here in Seattle, the Bill and Melinda Gates Foundation - the Fort

Knox of the NGO world with funds north of $30 billion and Warren Buffett's still to come – is so far nearly quiet on the issue of energy. And dare I say that Mr. Gates, a technology revolutionary himself, seems nonplussed that he is missing a revolution that badly needs him.

 

It almost goes without saying that the Foundation is doing incredible work to alleviate suffering of the world's poor. That work must continue and is testament to the size of Bill Gates’ heart and his commitment to activism and witness. But there are two sides to the coin. He is addressing the symptomatic and saving millions of lives, but oddly there is still nothing on the systemic issues surrounding energy that threaten billions. Even odder since technology - Mr. Gates' playground - has a key role to play in reducing poverty through the production of clean, distributed energy. 

 

Gates has clearly thought about energy. He has made two public pronouncements that I could find. One a 2006 interview with Newsweek, in which he stated that he was “already reading some books on energy and the environment… But I will read a lot more two years from now and think whether there's something the foundation should do in those areas,” he said. “The angle I'll have when I'll look at most things is, What about the 4 billion poorest people? What about energy and environmental issues for them?”

 

In November 2007, he added for Rolling Stone: "Between now and 2100, how many people in Africa are going to die of malaria? Just do the numbers. Helping them avoid an eleven-inch rise in the water in 2100, we could do it and we should do it, we will do it. But in terms of relative priorities, if you want to help the poor, this is not the issue to be focused on."  For a genius who started one of the most successful companies in human history, Gates appears to be unwilling to fully accept that energy affects the global commons, not discriminating based on income. While he's reading up on the issues, China put 90,000 megawatts of coal-fired power online in 2006 alone (about the equivalent of two Californias in capacity). All dirty coal, some of which finds its way to our lungs here in the Pacific Northwest. In Beijing last week for the Cleantech Forum, the Chinese government's cleantech guy, Shi Dinghuan, said that even by 2050, coal would still account for 50% of China's power generation (it's 70% now).  

So far, the Foundation appears to be hedging on energy/climate change. In August, it made its first investment, with a 100 million Euro commitment to Peony Capital Ltd., a Beijing-based company that is using investment in technology to lower GHG emissions through the UN CDM process. But we are all fooling ourselves if we think the market will take care of introducing the technologies to deal with GHG quickly enough to make a dent. Nor is the slow churn of policy going to get us there fast enough. Where Mr. Gates could make a difference, for example, is using his financial leverage to advocate for the creation of a public/private fund that works to provide financing for clean technologies that are already out there but not being implemented because of cost. Coal plants in China are a great example. They don't spend the money on cleaner technology, but if a powerful enough fund was created to drive the cost of the gasification/sequestration technology down and provide favorable financing (or even give it away), things could be greatly accelerated.  

 

It is certainly just a coincidence that the Gates Foundation is moving its offices from the lakeside to higher ground over the next two years. But maybe not. Maybe they are preparing to add their important voices to the campaign against dirty energy - from dry ground as the world's waters continue their eleven foot rise. One only hopes.

I spent last week in Beijing for the kick-off meeting of Cleantech China's founding members. The air pollution was so bad that my eyes were stinging for two of the days; visibility was less than 500 meters according to the local news, but it seemed more like 200 meters. Understandably, a lot of the conversation was around coal, since it accounts for 70+ percent of China's power generation and is the main source of pollution and CO2. Todd Glass, who heads the energy practice group at Heller Erhman, was particularly informative on the topic (when he wasn't being subjected to my harangues that "clean" coal was a mythic moniker, and should be replaced by "cleaner" coal.). Several interesting companies came up in our discussion. Ergo Exergy Technologies already has two projects demonstrating its in situ sequestration/gasification technology, while cash rich GreatPoint Energy and publicly traded Synthesis Energy were two other companies mentioned as leaders in gasification. Interestingly, however, when we toured Tsinghua University's energy research facilities, we heard from Dr. Cai Ningsheng that the best option for China today is not gasification, but ultra-supercritical pulverized coal (USC-PC) and also coal-fired boiler (CFB) technology. They are working on gasification, pre-combustion and sequestration options too, of course, but Dr. Cai's opinion is that USC is the near- to mid-term solution for China. USC-PC is at least half the cost of IGCC in China and has a lower technology risk as well. Nor is all coal suitable for IGCC. Technology advances, Cai said, are possible with USC-PC and CFB that allow CO2 capture, post-combustion capture and oxy-fuel combustion. In my earlier conversations with pre-burn technology companies in the US such as CoalTek and Evergreen Energy, their concerns were more around IP protection when going to China, not necessarily market demand. It will be worth watching the outcome of the strategic economic dialogue between the US and China on easing restrictions on coal technology transfer and how the different technologies on the table play out in the market.

(This is an article I wrote for Yes! magazine a couple of years ago. I am currently updating it for the China Business Review). 

After an initial rush of excitement over writing a piece about China for YES!, a slow creep of dread and unease replaced the thrill. With global oil prices spiking because of China's rapacious growth in oil consumption and the country poised to replace the United States in the dubious role of world leader in carbon dioxide emissions, could I honestly write an article portraying as positive what is happening with China and fossil fuels?

My doubts were not erased, but amplified, after some initial phone calls to environmental leaders in China were met with long pauses when I asked for suggestions on positive stories.

But I was not deterred. China is important to me. I take what is happening there to heart. In many ways it is my home, and I am protective of it. I have spent nearly half of my life there, as a foreign correspondent and businessman from 1986 to 2002. During that time, I experienced what I consider to be one of the most dramatic periods of transformation in world history from the brief ecstasy of free expression in the late 1980s and the might of totalitarianism in snuffing it out, to a shift toward capital markets and the massive spiritual, economic, and social changes that came with that shift, including the beginnings of civil society. (When the United States industrialized, it had fewer than 80 million people, and it took around 40 years to do it. China has nearly 20 times that number of people, and it is industrializing at hyper-drive speed, manufacturing not only for itself but for the rest of the world.)

I believe it is essential that all of us not only understand what is going on in China, but that we become active agents for making it better. Unless we do something urgent, my two-year-old son will enter adulthood in a world neither he nor I want to contemplate.

When I first arrived in China, Beijing was one big bicycle lane, as was the rest of China. There were no private cars no one had the money and even if they had, private car ownership was prohibited by the government. The few cabs on the road catered to the few foreigners who paid in the equivalent of U.S. dollars.

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