Manufacturing and Climate Policy

Manufacturing and Climate Policy

The development and deployment of clean energy production has the potential to both sustain existing manufacturing jobs and create millions of new employment opportunities.

Billions of dollars are being invested to support the production of clean energy in the United States. However, Americans have been frustrated to learn that our efforts to create jobs here at home often result in the creation of manufacturing jobs in China and elsewhere.

Without properly designed tax and investment incentives for clean energy generation, loan guarantees for nuclear reactor construction and other federal supports, our efforts to rejuvenate our manufacturing base could be unseated by subsidized imports from countries seeking to capitalize on new demand for clean energy products in the United States, such as wind turbines and solar panels.

The U.S. is falling behind countries like China that, in 2009 alone, invested $34.6 billion in clean energy technologies. It is essential that policies to spur further growth and investment in clean energy technologies and clean energy manufacturing are included in any clean energy and climate policy developed by Congress.
These should include strong domestic content requirements for all federal infrastructure investments, such as Buy America requirements, including for investments to support renewable energy equipment manufacturing or loan guarantees.

Congress should expand access to capital so that companies are able to make efficiency improvements to their existing operations and build new plants to meet the demand for renewable energy projects. And it should provide additional funding for the 48c advanced energy manufacturing tax incentive, which supports increased manufacturing capacity of clean energy technologies in the United States.

Finally, any climate change legislation must include a mechanism to impose a “border adjustment” on goods imported from countries that do not have comparable limits on carbon emissions. Such a mechanism would impose a fee on the carbon content of goods imported from these countries—an adjustment that is rebatable to our exporters so that action—or inaction—on climate change is not used as a competitive tool by our trading partners to limit trade flows.

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