Skip to main content

Will China Eat America’s Lunch in Cleantech?


In the State of the Union Address last Wednesday, President Obama said “the nation that leads the clean energy economy will be the nation that leads the global economy and America must be that nation.” At the same time, on the other coast, 75 clean energy investors, entrepreneurs, and researchers were debating whether the U.S. can gain this leadership position. They agreed that even though Silicon Valley leads the world in technology, it is not clear if it will ever lead in Cleantech. The Valley may develop some breakthrough technologies, but without government help these are unlikely to translate into global leadership. The technology world is rightfully allergic to government assistance and intervention. Cleantech is different, however, and we aren’t dealing with a level global playing field.

In the State of the Union Address last Wednesday, President Obama said “the nation that leads the clean energy economy will be the nation that leads the global economy and America must be that nation.”  At the same time, on the other coast, 75 clean energy investors, entrepreneurs, and researchers were debating whether the U.S. can gain this leadership position.  They agreed that even though Silicon Valley leads the world in technology, it is not clear if it will ever lead in Cleantech. The Valley may develop some breakthrough technologies, but without government help these are unlikely to translate into global leadership. The technology world is rightfully allergic to government assistance and intervention. Cleantech is different, however, and we aren’t dealing with a level global playing field.


The Knowledge Economy Institute Leadership Summit, which I attended, was held at the Joint BioEnergy Institute (JBEI), in Emeryville, California. The question posed: what will it take for the U.S. to achieve global leadership in the clean-energy economy? The group concluded that the U.S., by far, has the strongest innovation platform in the world. But other countries may well reap the benefits of its research efforts. China, in particular, is making massive investments and has a huge advantage from focused policy and large markets.  Even though China is not likely to produce its own innovation, it will continue to appropriate U.S. technology and gain a major advantage by combining this with its manufacturing prowess.  American firms which are increasingly choosing to build design and manufacturing operations in China will provide it with additional advantage.


What will it take for America to lead? Despite decades of dominance in technology innovation, America has a dilemma in the clean-energy economy. Most entrepreneurs aren’t getting the support needed, and we are unable to translate research discoveries in our universities into profitable businesses that attract high levels of investment, make lots of money through manufacturing, and create jobs.


There are two problems with university research – the system for commercializing discoveries doesn’t work well, and there is no clear path-to-market for new technologies which do make it out the door. I’ve written about these problems and I prescribed some workarounds. JBEI is a bold experiment to fix some of these problems the right way. It brings together researchers from different disciplines with business. And it has a practical focus on solving real-world problems.


Centers like JBEI may produce major breakthroughs in technology. But that is when the next set of problems kick in both for university research and for entrepreneurs – clean energy is different than other technologies.  Startups typically need hundreds of millions of dollars to develop and scale up technologies.  Investors don’t see steady, strong and growing markets. So, few are taking the risks and making the big investments.


U.S. policy is not as aggressive as other countries in creating sustainable markets, investing in commercialization, or promoting manufacturing.  Take, for example, Japan’s Sunshine Project and related initiatives that have consistently driven that country’s clean-energy policy since 1974.  Japan has succeeded in building infrastructure, markets, and technology companies that help meet national energy security goals for the long-term.  The U.S. has not.


Contrast this with how U.S. government responded to challenges to its semiconductor industry by rallying behind it and keeping a significant value piece here.  How do we keep our innovative clean-energy companies and their design and manufacturing operations in America?


We need to learn from other countries.  In industries like Cleantech, success depends upon consistent and reliable government policy that links market supply and demand over the long-term.  U.S. policy has been cyclical, unilaterally focused on petroleum, and unrealistic about the value of short-term subsidies and support.  American startups suffer from inconsistent pricing-signals that make investors wary.  As investment cycles wax and wane, small companies lose top talent and are unable to recruit it back when funding begins to flow with the next cycle upturn.


Policy makers need to look at things that affect pricing. Energy is a commodity and it is all about cost.  The energy sector is undifferentiated.  Startups compete with large incumbent firms.  Moreover, clean-energy technology often has a deceptive fit with current industry and markets.  Take biofuels, for example. The high ratio of bulk-to-fuel, distributed biomass sources, and inherent chemical variation dictate smaller-scale and more regional patterns of development and deployment than for petroleum.


Consumers are key.   Consumer perceptions of energy prices have potent effects on the market.   China figured this out.  In addition to subsidizing manufacturing, it is training thirty thousand salespeople to sell new clean technologies to consumers. In the U.S. energy is just too cheap, so consumers don’t see the benefits of Cleantech. Rebates and short-term subsidies just aren’t creating long-term demand. As a result, entrepreneurs trying to build companies on energy efficiency are finding it hard to stay afloat.  The demand and growing markets are just not there.


Will America meet President Obama’s call for global leadership in the clean energy economy?  Not likely if Congress and state governments don’t make it a lot easier for startups to attract investment and a lot more attractive to manufacture here.  Governments need to coordinate comprehensive, long term energy policy – now.


Editor’s note: Guest writer Vivek Wadhwa is an entrepreneur turned academic. He is a Visiting Scholar at UC-Berkeley, Senior Research Associate at Harvard Law School and Director of Research at the Center for Entrepreneurship and Research Commercialization at Duke University. Follow him on Twitter at @vwadhwa.










Comments

Popular posts from this blog

How to find ideas to post new article in your blog

How to find ideas to post new article in your blog    阅读原文»   It is true that sometimes being a blogger may face situations where I would personally like to call it your brain juices got dried up as you have pretty much ran out of topic to blog and you are in crisis as your readers are anxiously waiting for your new posts but you are unable to give in. That’s when you will probably come with excuses like I just posted last week although that post was more directly towards the newbies who stop themselves from making money but it’s still pretty much the same even though you consider yourself not a newbie. The fact is that ideas are everywhere and I mean everywhere if you know where to find it and know how to leverage it. You may be surprised that sometimes these ideas are just right in front of you but you are not observant enough to convert these ideas and turn it into your blog post. Today I will share some tips on where to get these ideas and most of it is part of your dai

Lindsay Lohan Breakup Confirmed by Lohan, Locksmith, Police [Gossip Roundup]

Farewell, last season's Suri Cruise fashions. Goodbye, Amy Winehouse's bathing suit. Adieu, humanoid version of Lauren Conrad. And so long, LiLo and SamRon's fairytale romance. Lindsay Lohan confirmed her split with Samantha Ronson and insisted the decision was part of a very healthy and mature effort to " focus on myself ." Upon hearing this, Ronson changed her locks and discussed a restraining order with police, so confident was she in Lohan's ability to turn productively inward. Lohan promptly had a run-in with the police . Who would have imagined such a messy breakup for this model relationship? Courtney Love's lawyer, on her client's drug-fueled plunge into broke-ness: ""Courtney noticed the money was gone when there wasn't any left." Deadpan gallows humor: the only possible response to having Courtney Love as a client. (Besides asking for a hefty retainer.) [ P6 ] Before Lauren Conrad's contract expired in March, MT

部门心脏?

i.am.weihua.1234您好!!              生产计划与物料控制PMC高级研修班 ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ 课程背景: 生产计划和物料控制(PMC)部门是一个企业"心脏", 掌握着企业生产及物料运作的总调度 和命脉,统筹营运资金、物流、信息等动脉,直接涉及影响生产部、生产工程部、采购、货仓、品 控部、开发与设计部、设备工程、人力资源及财务成本预算控制等,其制度和流程决定公司盈利成 败.因此PMC部门和相关管理层必须充分了解:物料计划、请购、物料调度、物料控制(收、发、退、 借、备料等)、生产计划与生产进度控制,并谙熟运用这门管理技术来解决问题,学习拉动计划价 值流(VSM)图,从拉动计划价值流切入剖析工厂制造成本和缩短制造周期 ,提高物流过程循环效 率(库存、资金的周转率)及客户满意率;为降低或消除物流过程中的非增值活动. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ 课程目标: 1、建立制定完善的生产与物控运作体系?提升准时交货和降低库存成本 2、预测及制定合理的短、中、长期销售计划?达成公司策略管理目标 3、对自身的生产能力负荷预先进行详细分析并建立完善产品数据机制协助公司建立产品工程数据 4、生产前期做好完整的生产排程和周生产计划?提高备料准确率,保持生产顺畅 5、配合生产计划做到良好物料损耗控制和备料?完善降低物料损耗机制和停工待料工时 6、对生产进度及物料进度及时跟进和沟通协调?缩短生产周期,提高企业竞争力 ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ 报名详情: 培训时间:2012年11月 3- 4深圳 11月15-16上海 11月22-23北京 12月 1- 2广州 承办单位:新 活 力 顾 问 培训对象:生产计划部门、物料计划部门、采购部门、 生产部门、销售部门、物流、研发部门、 PIE、IT 培训费用:3200元/人(包括资料费、午餐及上下午茶点等) 报名热线:400-623-8399 (免长途话费) 电邮: maomao@xhlpx.com QQ:120915