June 14 (Bloomberg) -- The lack of consistent U.S. support for clean-energy production has put the nation at a disadvantage with China, where the government has been investing in companies, a senior Senate Democrat said.
“The U.S. cannot compete on a level playing field with countries that have strong industrial policies when our own policies have been so inconsistent and erratic,” Senator Jeff Bingaman of New Mexico, chairman of the Energy and Natural Resources committee, said today at a hearing in Washington.
Clean-energy manufacturers in China and the U.S. are grappling with an economic downturn, and government aid to boost production has added to tensions between the nations. The Obama administration in May imposed duties on solar- and wind-energy imports from China, while the Beijing government filed a complaint with the World Trade Organization alleging that U.S. anti-subsidy measures undercut $7.3 billion in Chinese goods, including solar panels.
While the U.S. “should continue to rigorously enforce its trade laws” to be competitive, “additional domestic measures are likely to be needed if the U.S. is to fully compete” on clean energy, Bingaman said.
The China Development Bank Corp. since 2010 has made available $47.3 billion in credit, which hasn’t been fully tapped, to support the country’s wind and solar manufacturers, according to a Bloomberg New Energy Finance study in October.
The U.S. has aided clean-energy companies with loan guarantees from the 2009 economic stimulus law and incentives such as a production tax credit for wind energy, which ends this year. The Energy Department has guaranteed about $14.9 billion in lending for wind- and solar-power initiatives, mainly for generation, according to the agency.
Policymakers should consider China’s policies when considering U.S. responses, including what the U.S. can afford to spend, according to Senator Lisa Murkowski of Alaska, the top Republican on the panel.
“Imitating China is not necessarily the best way to compete with China,” where production of raw materials for energy use has harmed air and water quality, she said.
The U.S. leads China in innovation and shouldn’t seek to match the financial investment in clean energy just to keep up, said Derek Scissors, a senior research fellow at the Washington-based Heritage Foundation, a group that backs limited government and a strong national defense.
“Money should not be the metric,” he said.
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