WASHINGTON (Reuters) - Several Asian countries inaddition to China could soon challenge the United States in therace to build a renewable energy industry if Washington doesn'tprovide more incentives for its domestic business, venturecapitalists and others told a Congressional hearingWednesday.
The United States, once the world's leader in energyinnovation, is now also "challenged and threatened" by India,South Korea, Malaysia and the Philippines, because it is notproviding enough incentives to fund development of alternativeenergy and to increase demand, Ravi Viswanathan, a partner atNew Enterprise Associates told a hearing chaired by U.S.Representative Ed Markey.
"These nations have outpaced the U.S. in recruiting,incenting and developing domestic manufacturing of solar, wind,and battery technology," he said.
China already has more than half of the world's market forsolar panels and its companies are looking to export windturbines.
The Senate failed to pass a climate bill this year thatwould put a price on carbon emissions, so it must pass lawsthat would create demand for alternative energy or fall furtherbehind, experts told the panel.
Senator Jeff Bingaman introduced a bill this week thatwould require utilities to generate minimum amounts ofalternative energy through a federal Renewable ElectricityStandard, or RES, but the legislation faces an uncertainfuture.
Mark Fulton, Deutsche Bank's global head of climate changeinvestment research, said that many states in America havedeveloped their own renewable power mandates, but "in mostcases these do not have enforcement measures nor penalties toensure that they are financed."
Not everyone agrees that a federal RES is a good idea.James Sensenbrenner, the ranking Republican on the House SelectCommittee on Energy Independence and Global Warming, saidmandates for alternative power could ultimately harm theindustry by picking winners that might not ever become cheap,reliable sources of energy.
Fulton countered that the oil and gas industries receivefar more subsidies than alternative energy and that alternativeenergies will fall in price as they develop.
Uncertainties in the United States, such as when it willpass a climate bill that would launch a carbon market and apolitical move in California to stop the state's ambitiousprogram on emissions, discourage investors from deployingcapital deployment into alternative energy on a long termbasis, Fulton said. [ID:nN17133975]
The United States could make progress if it passed anational RES, extend recovery act grant programs that willexpire at the end of the year, and streamline the Departmentof Energy's loan guarantee programs for small businesses, saidTom Carbone, the chief executive at Nordic Windpower.
Germany, Japan, and China have dedicated funds to developdomestic alternative energy technologies, but the United Stateshas only just begun this effort, the experts said. (Reporting by Timothy Gardner; Editing by Marguerita Choy)