PHOTO CREDIT: SOLAR HOME & BUSINESS JOURNAL
Investments in technology innovation pay off with economic prosperity, Secretary of Energy Steven Chu said in a speech Monday in Washington, D.C. He said that the China-based solar company Suntech Power Holdings is succeeding not because of low-cost labor but because of technical innovations. Above, Suntech modules generate power at the California Institute of Technology in Pasadena.
By Michael Balchunas
Steven Chu, a longtime professor who is now secretary of energy, says the United States is facing a crucial test.
With the rest of the developed and developing world moving toward renewable and cleaner energy technologies, he said in a speech Monday, the time is now for the nation to seize the initiative.
PHOTO COURTESY U.S. DEPARTMENT OF ENERGY
U.S. Secretary of Energy Steven Chu.
“America still has an opportunity to lead in a world that will need essentially a new Industrial Revolution,” he said, adding that developing lower-cost, clean-energy technologies “is a way to secure our future prosperity.”
“But I think time is running out,” Mr. Chu said in an hourlong talk at the National Press Club in Washington, D.C.
He described the situation as a new “Sputnik moment” for the country, referring to the shock U.S. leaders and citizens felt when the Soviet Union launched the first Earth-orbiting satellite in 1957.
The nation quickly began mobilizing to ramp up science education, research and development to ensure that it could compete and ultimately become a leader in space-age technology.
This time, China is the country forging ahead, with 40 percent of the world’s solar photovoltaic manufacturing capacity, five of the top 10 silicon-based solar PV manufacturers, and three of the top 10 makers of wind turbines. China has made no secret of its intent to promote new-energy industries as a route to economic success.
The energy secretary referred to a 2009 speech in which H.E. Wen Jiabao, premier of China’s State Council, said, “We should see scientific and technological innovation as an important pillar and make greater effort to develop new industries of strategic importance. Science and technology is a powerful engine of economic growth. To overcome the severe international financial crisis, we must rely more on science and technology in making breakthroughs and boosting development.
“We will make China a country of innovation. We will seek breakthroughs in key technologies that are vital to industrial transformation and upgrading, speed up the development of new industries of strategic importance, and give priority to research, development, and industrial application of technologies in new energy” and other fields. “We will accelerate the development of a low-carbon economy and green economy so as to gain an advantageous position in the international industrial competition.”
Mr. Chu, a Nobel Prize winner in physics, said the United States, which devotes 0.14 percent of its $3.6 trillion annual budget to energy research and development, needs “sensible, long-range energy policies” to be competitive.
He said a commonly held myth among Americans is that China has become the leading silicon solar PV manufacturing center as a result of low-cost labor. Mr. Chu told the journalists and others at the gathering that he toured the headquarters factory of Suntech Power Holdings Co., China’s leading solar PV manufacturing company.
“This company, Suntech, as I toured this plant, it was 100 meters by 400 meters and four stories. It was a high-tech, modern plant that imports its raw materials – raw crystalline silicon – from where? The United States.” The company makes solar wafers and cells at its China plant, but has established plants around the world that assemble the energy-producing modules. One such factory is now operating in Arizona.
“So, what is wrong with this picture?” Mr. Chu asked. The plant in China “is a high-tech, automated factory. It’s not succeeding because of cheap labor.” Instead, he said, the company’s polycrystalline silicon modules have set a record for production efficiency. Its success stems from producing a lower-cost, higher-efficiency module.
“This is the threat that I see,” Mr. Chu told the audience.“
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He stressed the importance of investing in research and development through government channels, because many ventures are too risky for private companies, and there is resistance to change. Although some U.S. political leaders have opposed a move toward cleaner-energy development, and some newly elected members of Congress have spoken of rescinding federal stimulus funding for energy projects, Mr. Chu indicated he does not expect that to happen.
“This is fundamentally a bipartisan, nonpartisan issue,” he said. “It’s all about economic prosperity.” There is a simple reason why countries are pursuing renewable energy development, he said.
“One of the drivers with wind and solar and these other technologies is, we think it can be cheaper than fossil fuel,” Mr. Chu told the group. “In the end, this will be a cornerstone for our economic prosperity.”
“What I’m trying to tell the American public is that this is an economic opportunity,” he said, an investment “in the long run, for the future economic health of the country.” The time is fast approaching in which the investment has to be made to keep pace with countries like China, he added.
In his 2009 speech at a meeting of the World Economic Forum, Wen Jiabao also talked about the country’s actions to address global warming.
“The world economy is undergoing profound changes and transition,” China’s premier said. “The future and destiny of all countries are more closely interconnected than at any time in history. We should be more forward-looking and more broad-minded. To promote world harmony and prosperity, I propose that we make concerted efforts in the following areas:
“First, tackle climate change. Climate change is a common challenge confronting the entire mankind. Each and every country, enterprise and individual should assume a due share of responsibility in meeting the challenge. China takes this issue very seriously. We have developed the national program on tackling climate change, increased resources for scientific research and taken aggressive steps to adjust the industrial structure with a view to saving energy and reducing pollutants.”
Without mentioning the United States by name, he said, “Developed countries should recognize their historical responsibility as well as their high per capita emissions, substantially cut greenhouse gas emissions, and extend financial, technological and capacity-building support to developing countries in their effort to tackle climate change.”
Mr. Chu, in response to a question from the audience at his speech Monday, said that although no binding global or national action on greenhouse gas emissions is likely to occur soon, “I think a price will eventually be placed on carbon worldwide, and we’re going to go forward on what we can do now.”
In regard to fossil fuel emissions, he made an analogy to a community’s decision on whether to treat raw sewage or dump it in a river so that it becomes a problem for the next community downstream. The cost of treating the sewage at the source is higher than dumping it into the river, but the overall benefit far exceeds the cost.
“That is why there should be a price on carbon,” he said.
As in 1957, when the 184-pound Sputnik, bristling with spiky antennas, soared far above the United States, untouchable and unmatched by the best technology this country could muster, a turning point has arrived, the secretary of energy said.
“I’m hoping that the United States can recognize the economic opportunity that virtually all of Europe, Western Europe, has recognized, and developed countries in Asia have recognized, and developing countries around the world are beginning to recognize,” Mr. Chu said.
“America, I believe, will wake up and seize the opportunity, and when it does, it still has the greatest innovation machine in the world.”