Remarks at the American Chamber of Commerce

Chief Operating Officer Paul Dickerson's remarks at the American Chamber of Commerce in Tokyo, Japan

February 29, 2008

Thank you, Andrew.

This is my first time in Tokyo—what a beautiful city. Earlier this week I had the chance to present at the Fuel Cell Expo at the Big Site. I made the case that the United States "gets it" when it comes to the challenges we face on energy security and climate change.

In short, we know what we're up against: imported oil that's costing us about $1 billion a day and growing greenhouse gas emissions being fueled by surging growth in energy demand. Because this audience gets it, too, what I'd like to do today is tell you what the United States is doing about it, and how we're helping U.S. companies win, both at home and abroad.

If it wasn't clear to Americans before, it is clear now, that energy is one of the most critical issues we face. How we obtain it, how much we pay for it, and how we consume it are all questions we face on a daily basis. And what's nice is, for the first time in our lives, being green is not a partisan issue. Whether you care about the environment, national security or the economy, we all want the same result: clean, green, secure, and affordable energy sources.

To achieve this result, my office is mobilizing on three major fronts: policy, research and development, and deployment. On the policy front, this Administration understands that industry needs long-term predictable policy. You deal with enough uncertainty in your businesses, and don't need your federal government designing erratic, two-year policy fixes.

To help, President Bush has set in motion a number of initiatives that bring more predictability to business planning and create a new stronger level of support for a portfolio of clean-energy technologies. His Advanced Energy Initiative, announced during his 2006 State of the Union, is a sweeping plan to change the way we power our homes, offices, and cars. Last year, the president announced an equally ambitious, but achievable, vision in his "20 in 10" plan. He tasked Congress to raise fuel economy standards, and establish a renewable fuels standard to reduce our gasoline usage by 20% over the next decade.

And late last year they met his challenge when they delivered to his desk the Energy Independence and Security Act. It represents a major step forward in our bid to expand the production of renewable fuels, reduce our dependence on oil, and confront climate change. Among other things, the new energy law mandates the use of 36 billion gallons of renewable fuels by 2022, and increased CAFE standards for the first time in more than three decades. Meeting the renewable fuels standard alone will cut the amount of greenhouse gases associated with cars in the United States by 8%. Our policies are setting aggressive targets for the short- and long-term because we know our problems will require firm commitments that endure through many political cycles.

In terms of R&D, there is no doubt the Department of Energy knows research and development. For the last 25 years, we have essentially been an R&D shop. In fact, during that time, we were pretty much the only game in town. But our world changed in 2005, when America seemed to wake up to the opportunities in cleantech. Suddenly there was a mass of private funding available for research and development.

Realizing we needed to stay relevant, three years ago we came to the DOE to change our direction, quicken our pace, and certainly begin investing Americans' tax dollars smarter. Instead of guessing what the market was thinking, we turned to industry for advice, embarking on a concerted effort to make our office more transparent and to deepen our relationships with the entrepreneurs and business leaders on the front lines.

Each of our program offices have opened their doors to scientists, CEOs, investors—everybody involved in the chain of development—so we can keep their fingers on the pulse of the market. I personally carve four to six meetings into my schedule each week for company leaders to discuss the challenges they're facing and explore ways the government can help.

We have learned much from these candid discussions. For instance, our contacts in solar told us that demand for silicon feedstock was driving up prices for crystalline silicon PV, so we partnered with firms to produce thinner wafers with the same performance. With cellulosic ethanol, they told us banks were unwilling to finance their first plants. Today we're supporting six companies for cost-shared commercial scale biorefineries that will produce 130 million gallons of cellulosic ethanol in the next five years.

By listening to stakeholders and targeting our resources, we are clearing hurdles which keep breakthroughs from seeing the light of day.

Research is important, but without deployment the technology has limited value. We have to have the right mechanisms to help get these valuable inventions to market—and to help you sell more. To accomplish this, our resources in the United States are going to three areas: creating markets by demonstrating the value of technology, building the infrastructure to support them, and using our government's purchasing power to lead the way.

The partnerships we have formed are helping us meet those objectives in more ways than one. I'll use fuel cells as an example, since it was the topic that brought me to Tokyo. With fuel cells, we're working with auto companies to build demonstration fleets to test these technologies under real-world conditions. To develop the necessary fueling infrastructure, we're working with energy companies to design filling stations. And we're partnering with U.S. federal agencies, like the Department of Defense, to help them become first adopters of hydrogen-based technologies for lift trucks or back-up power for telecommunications networks.

By creating a testing ground to prove these technologies, we are building connections with the market, and we're encouraging the growth of new markets and building the appropriate infrastructure. Through policy, R&D and deployment, we're striving to bring down the cost of these technologies, prove their case outside the lab, and help them proliferate in a global marketplace.

When I say "global," I do mean global. The world cannot afford for these technologies to only do well in some parts of the world. It's not just a matter of environmental stewardship, it's also a matter of economic competitiveness. By helping all nations bridge the gap between dirty and clean technology, we're making meaningful strides to reduce emissions and bringing your alternatives to markets.

I came to the Department of Energy from the Department of Commerce, where I served as Chief of Staff for the Foreign Commercial Service, a federal agency with 1700 employees in 250 offices around the globe, including Tokyo. Their sole mission is to assist U.S. companies in selling their goods and services around the world. We have no sales force at the DOE, so I have asked the Commercial Service to become that sales force. Last year, I hosted the federal government's first ever cleantech trade mission to India and China. We hosted 16 U.S. companies, from small startups like an Arkansas clean coal company to large companies like Dupont and GE, and each returned with new opportunities in each country.

Then there's our Export-Import Bank. In 1994, Ex-Im created an office of renewable energy and environmental exports. This group works hand-in-hand with my office to support companies developing renewable energy technologies by helping them graduate to overseas markets with much-needed financing. We have combined to give U.S. companies—big and small—greater access to renewables markets across Asia, Latin America and Europe.

We have also signed key agreements to develop energy efficiency and renewable energy technologies with nations from China to Denmark to Brazil. In Japan, our energy cooperation work goes back several decades. Nearly every laboratory in the U.S. is directly engaged in scientific collaboration with Japan, on matters as diverse as climate, basic science, materials research, and nuclear energy.

And just last month, the president announced during his State of the Union that he is creating a $2 billion international clean energy fund. The fund will accelerate the deployment of all forms of cleaner, more efficient technologies by leveraging private-sector capital to make clean energy projects more financially attractive. All of these initiatives are helping us promote further advances and adoption of clean-energy technologies, while clearing the way for new markets for U.S. companies.

Finally, you have probably heard that we are hosting discussions between the world's major economies, first in Washington, and then last month in Hawaii. Our goal is to drive international negotiations that are working to cement a post-2012 international framework that holds all nations accountable. We're looking forward to continuing our progress on that front at the G8 meetings here in July.

The United States is making it clear to everyone that we are going to lead on this issue, at the negotiating table and by way of international partnerships that get these technologies into the global marketplace.

We're pushing these technologies aggressively because we understand the stakes. Based on some estimates I've seen, it will require $1.4 trillion in capital investment by the year 2030 to meet our clean energy goals. $1.4 trillion—or about $60 billion a year between now and then. Right now, the private sector is pumping in about $5 billion to $10 billion a year. And that is the opportunity for the United States. How much of that $60 billion a year would you like invested in your companies?

We must lead on these issues. We are being asked not only by our own people, but by all the people of the world to take a leadership role in confronting the challenge of global warming. Whether through diplomatic action, technological cooperation, or the creation of new ways to manage our carbon footprint, we can meet our obligation.

Ten years from today, the world will look back on this as the time when we rose to the challenge and engaged in one of the greatest market transformations of all time. For our economy, for our climate, for our neighbors, and for our way of life, we must act—and we must act together.

Thank you.