The Power to Compete: Benchmarking the Kerry-Lieberman American Power Act on Clean Energy Innovation

A new policy brief released today by the Breakthrough Institute and Americans for Energy Leadership provides the first independent analysis of how the Kerry-Lieberman American Power Act would impact U.S. competitiveness in the global clean energy industry, benchmarking its provisions against key policy components for technological innovation and industrial development in the low-carbon power and transportation sectors.

The policy brief, titled "The Power to Compete: Analysis of Key Clean Energy Technology and Competitiveness Provisions in the Kerry-Lieberman American Power Act of 2010," assesses the proposal's key technology provisions, including research and innovation, manufacturing, and domestic market demand -- the central pillars of a national clean energy competitiveness strategy -- as well as supportive mechanisms in infrastructure, workforce development, and industry cluster formation.

Download Full Briefing (PDF)

Federal energy policy has become a primary U.S. national priority in the wake of the Deepwater Horizon oil spill and amidst the ongoing Senate debate over comprehensive climate and energy reform. The May 2010 release of the Kerry-Lieberman American Power Act (APA) currently represents the flagship proposal for comprehensive reform in the Senate, and its future within the context of broader energy legislation will be determined in the weeks ahead.

The renewed urgency for energy reform arrives among growing national concern that the United States is falling behind its competitors in the growing clean energy industry. Thus, in addition to reducing emissions of greenhouse gases, one of the core objectives of the Kerry-Lieberman proposal is to enhance U.S. competitiveness in clean energy technology markets. As Senator Kerry declared in the opening of the APA release press conference, "The bill that we are introducing today and revealing today, the American Power Act, will restore America's economy and reassert our position as a global leader in clean energy technology."

The United States currently lacks an effective national strategy for competitiveness in this sector, and as numerous reports have documented -- including our previous report "Rising Tigers, Sleeping Giant," which provided the first comprehensive comparison of clean energy competitiveness in the U.S. and Asia -- the nation is falling behind in a number of core metrics. However, the policy brief finds that the American Power Act does not contain a comprehensive clean energy competitiveness and technology innovation strategy. While the legislation includes a number of measures with varying degrees of support, it falls substantially short in each core policy component of clean energy competitiveness.

In research and innovation, the legislation would invest an order of magnitude less than the majority of energy experts recommend. In manufacturing, it would provide a modest expansion of existing programs, along with some targeted support for advanced vehicles and general manufacturing efficiency. Beyond a modest carbon price, APA would not provide robust and direct support for clean energy deployment and market creation besides carbon capture and storage, with largely insignificant results for renewable energy technology. Finally, it provides little support for clean energy industry cluster formation, clean energy workforce development, and infrastructure development.

As the policy brief notes, restoring U.S. leadership in this industry requires a robust, comprehensive, and well-targeted set of public investments and policies to match and exceed those of competing nations. This includes substantially larger and more targeted technology investments and incentives, as well as improved institutional structure and policy mechanisms. If federal policy aims to secure the nation's leadership in this growing sector, the scale and scope of these provisions must be significantly improved in future legislative proposals.

Key Figures from Briefing: