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In his 2010 State of the Union address, President Obama declared the need for “serious investments in clean energy” because “the nation that leads the clean energy economy will be the nation that leads the global economy”. In a new paper funded by the German Marshall Fund of the United States under the Transatlantic Climate Bridge initiative, authors from the Ecologic Institute in Washington DC and Berlin identify investment needs and policy incentives required to achieve this transition to a clean energy economy.

Titled “Transforming Economies through Green Investment: Needs, Progress and Policies” [pdf, 1 MB, English], the report provides guidance on a range of important questions that legislators will face as they debate clean energy legislation in coming months. Substantial investment is needed to catalyze the transformation of our economy and put it on a low-carbon, sustainable pathway.

How much has the recent injection of stimulus funds achieved in this regard, and what are the investment needs going forward? What policy options should legislators consider as they move to craft a bill that generates jobs, increases energy security and brings down energy costs while channeling investment into the efficient, clean energy technologies of the future?

As our focus shifts to reducing a gaping deficit, what policies can help us tap new sources of revenue to finance critical expenditures in clean energy research and infrastructure development, and to meet international climate finance obligations recently entered by the United States?

As the report states, our current economic framework has not succeeded in channeling the required capital into clean energy technologies that will form the basis of tomorrow’s low-carbon economy. This new report provides guidance at a crucial time as decision makers consider policy options available to them in a renewed effort to craft comprehensive clean energy legislation. It sets out a range of policy approaches that can drive investment at the required scale and hence serve as a powerful catalyst towards the clean energy economy of tomorrow.