The Grand Staircase-Escalante National Monument.

The nation’s public lands are a central part of our national heritage, imagination, and spirit. Millions of Americans visit our public lands each year to experience history firsthand and wonder at some of the nation’s most beautiful natural spaces. That’s why one of my proudest accomplishments from the Clinton administration is working with Secretary of the Interior Bruce Babbitt to protect these national treasures. Together, we helped President Clinton protect more land in the lower 48 states than any president since Teddy Roosevelt, from the north rim of the Grand Canyon to President Lincoln’s Cottage to Pompeys Pillar in Montana to the California Coastal National Monument that includes 20,000 islands, rocks, and reefs. Because of President Clinton and Secretary Babbitt’s dedication, these and thousands more acres will be preserved and protected for future generations.

Today, Babbitt is back in the spotlight with an important speech about defending these lands from attack and carrying our preservation legacy forward. On this 105th anniversary of the Antiquities Act, signed by Teddy Roosevelt to protect America’s most special natural places, I hope that the president will thoughtfully consider the secretary’s recommendations.

A first stop should be Fort Monroe. Virginia Sens. Jim Webb (D) and Mark Warner (D), as well as Gov. Bob McDonnell (R), have asked to designate Fort Monroe, an important Civil War landmark once referred to as the “Gibraltar of Chesapeake Bay,” as a national monument. The fort will be decommissioned in the fall, and designating the post as a national monument will ensure that the post is preserved for public use for many years to come.

But that’s just the first step. Public lands are about far more than stewardship; they also help revitalize and strengthen local communities. In Utah, the counties surrounding Grand Staircase-Escalante National Monument have seen strong economic growth [PDF] since the designation in 1996: 38 percent growth in jobs and 30 percent growth in per-capita income. Fort Monroe would similarly benefit, as would many other sites around the country. For the sake of communities like these, and the sake of our national heritage, it is critical that we continue to make preservation a priority going forward.

Former Secretary of the Interior Babbitt.Photo: Tarek Rizk Full text of Secretary Babbitt’s speech [PDF]:

Secretary Bruce Babbitt

Speech at the National Press Club

Washington, DC

June 8, 2011

Good afternoon.

It is now more than ten years since I left public office. I am returning to the public stage today because I believe that this Congress, in its assaults on our environment, has embarked on the most radical course in our history. The Congress, led by the House of Representatives, has declared war on our land, water and natural resources. And it is time for those of us who support our conservation tradition to raise our voices on behalf of the American people.

It is clear to me that the House of Representatives will not only block progress, but will continue to sustain an assault on our public lands and water. Therefore, it is imperative that President Obama take up the mantle of land and water conservation — something that he has not yet done in a significant way. President Obama and the Executive Branch are the best, and likely only, hope for meaningful progress on this critical issue.

So I am here today to call on the President to lead us in standing up to the radical agenda of the House of Representatives, and to replace their draconian agenda with a bold conservation vision.

The opening salvos in this war were fired in April, when the new Congress enacted a budget measure, called a Continuing Resolution, to appropriate funding for the balance of this fiscal year. Beneath the cover of that budget process, however, the House leadership inserted unrelated “riders” to begin dismantling our environmental laws.

Here are three examples of these “riders.”

• In the April resolution, the Congress removed the grey wolf from the Endangered Species list. The restoration of the grey wolf to Yellowstone and our northern forests was an historic achievement, now threatened by this Congress.
• In the April budget resolution, the Congress terminated an Administration program to rebuild our depleted ocean fisheries. The program, called “catch shares” was amazingly successful in restoring fish populations and providing fishing jobs and was on the way to becoming the most innovative environmental initiative of the Obama Administration.
• In the April budget resolution, Congress axed an initiative by the Secretary of the Interior to identify and maintain the natural character of our most important remaining undesignated public lands.

Viewed singly, in isolation from one another, these rider provisions might not appear to justify my characterization of this Congress as the most radical in history. Yet viewing them together, along with pending legislative proposals, a larger outline emerges. It is a pattern of a broad, sustained assault on nearly all our environmental laws.

The intent is to chip away, a blow at a time, at the edifice of environmental laws and regulations, avoiding a frontal assault that would call attention to the overall objective.

To illustrate, I would like today to single out for discussion, just one such area, and that is the public land laws that are so meaningful to me as a westerner and that are so much a part of our great American heritage.

The best place to observe what is happening is by reference with our two great public laws, the Antiquities Act of 1906 and the Wilderness Act of 1964.

The Antiquities Act is a great American innovation. It was enacted into law in 1906 on June 8th, the very date on which I am making these remarks. It was sponsored by a Republican Congressman and signed by a Republican President, Theodore Roosevelt.

Way then, more than a hundred years ago, the sponsor, Representative John Lacey (R-IA), made this observation: “The immensity of man’s power to destroy imposes a responsibility to preserve.”

Since then the Act has been used by nearly every President, laying the foundation for many of our best known National Parks and other protected areas.

President Clinton used the Antiquities Act to establish the Grand Staircase Escalante National Monument, a widely acclaimed decision.

President George W. Bush used the Act to protect the marine reefs and waters of the Northwest Hawaiian Islands, the largest area ever set aside under the Act. The radical leaders of the House voiced few objections to that action by their President, perhaps because oil and gas companies have evinced little interest in the Islands.

This past April, a House rider to gut the Antiquities Act failed by a mere four votes. Now that the public has been awakened, I doubt that Congressional leaders will try another frontal attack.

However, what they are continuing to do is to chip away with piecemeal bills and amendments some of which will likely be transmuted into budget riders during the course of the summer in budget negotiations.

Here are a few examples. Congressman Rehberg (R-MT) has introduced legislation to exempt Montana from the Antiquities Act and Congressman Labrador (R-ID) to exempt Idaho. Similar legislation was introduced in the Senate to exempt Nevada.

Perhaps the ultimate objective of these piecemeal attacks is best revealed by a bill introduced by Representative Rob Bishop of Utah and others that would amend the United States Constitution to grant states the power to nullify Federal law.

The Wilderness Act of 1964 is the other great, generic public land law of our Nation. The National Wilderness Preservation System, with units established by Congress in virtually every state in the Union, is an enduring achievement of many successive Congresses.

The radical leaders of the House, however, are relentlessly attempting to chip away at this law as well. Not only are certain members of congress prohibiting any new Wilderness designations, a bill recently introduced in both houses by Senator Barrasso (R-WY) and Congressman McCarthy (R-CA) would eliminate our nation’s Wilderness Study Areas — millions of acres no longer protected for conservation. In addition it would remove protections for National Forest Roadless Areas — watersheds that provide our drinking water, and protect the best fish and game habitat in the West. In total, this extreme bill would undo protections for more than 40 million acres of public land.

As these attacks escalate the urgent question for those of us who support and advocate for our conservation tradition is how to respond.

One alternative is to lie low, hoping that this storm will soon pass by without too much lasting damage.

Failure to respond, however, is a form of appeasement that has not worked in the past and it will not work this time. Our adversaries prefer to operate in the shadows, outside the sunshine generated by public knowledge and participation. For our opponents know that when anti-environmentalism becomes a public issue they will lose. They know that American support for our environmental heritage is wide and deep.

We made the appeasement mistake when I was Secretary. Back in 1995, another Congress, in thrall to then House Speaker Gingrich, inserted a “salvage rider” to increase logging in our National Forests onto an appropriations bill. Pressured by the timber industry and the House leadership, we capitulated and President Clinton signed the bill with the rider intact.

It was a big mistake that set off a prolonged and destructive episode in the history of our National Forests.

We did learn from that experience however. President Clinton vowed to veto any additional anti-environmental riders. The Congress, aware that when the President commands the high ground, he will carry public opinion, backed off. We did not face another rider crisis.

I’m not here, however, to dwell on the past. I am here to look forward. To sound the alarm about the assault on our natural resources by the Republicans in Congress, and also to remind the President that he has the power, the responsibility and the public support to stand up to those who would destroy our heritage.

The current debt limit and budget negotiations will provide President Obama an opportunity to demonstrate that he has learned from the events of April. He should stand strong against environmental riders, in whatever guise, whether legislative amendments, funding moratoria, or limitations on agency initiatives.

Drawing a line against riders is a good beginning. However, we cannot measure conservation progress by the number of bad ideas that are blocked. We should measure progress in healthy rivers and streams, forests protected, species saved and restored, wilderness areas added and national monuments created.

The Antiquities Act is a good place for this Administration to begin building a conservation legacy. The Antiquities Act is a remarkable conservation tool that has been used to protect renowned areas including Grand Canyon, Zion, Olympic National Park and Joshua Tree National Park. It was used extensively by President Obama’s immediate predecessors. President Clinton used the Act to establish the Grand Staircase and more than twenty other Monuments. President George W. Bush set aside a larger area than any of his predecessors — the marine reefs and waters of the Northwest Hawaiian Islands.

The Antiquities Act has, for more than a hundred years, granted the President authority to establish National Monuments. Monuments should be established through a process of public consultation both local and national, with a chance for all to be heard. But that process cannot begin until the Administration puts forth specific proposals for public consideration.

There are numerous proposals, and many important cultural, historical and environmental sites are awaiting protection. Many of these proposals have wide public support, including the endorsement of members of Congress from the areas in question.

The best way to defend the Antiquities Act is for the President to use it.

The Wilderness Act is also in need of more vigorous advocacy from its friends, including the Administration.

The critics who complain that we already have too much Wilderness have it all wrong. We have too little designated Wilderness.

Here are some facts: the Bureau of Land Management (BLM) administers more than 250 million acres of public land. More than 41 million acres of that land is leased for oil and gas. To date only 9 million acres of public land managed by the BLM has been designated as Wilderness. It is past time to bring some balance back to the public lands with the creation of more Wilderness Areas.

The designation of Wilderness is a Congressional prerogative. And every member of Congress, from whatever part of the country, has an equal voice and vote in designating Wilderness. For the public lands, wherever located, are the common patrimony of this nation, belonging to each and every citizen of this country.

President Obama should call upon the Congress to expand the National Wilderness Preservation System. A good place to begin is with the wilderness bills already introduced, most of them by members of Congress from the states where the lands are located.

And the President should remind the Congress that where wilderness legislation is being bottled up by an intransigent few, that he has the power to designate those areas as National Monuments, a designation which can carry protection comparable to a Wilderness designation.

By voicing his willingness to use the Antiquities Act as an alternative to Wilderness designation, the President can bring Congress to the table to work out conservation measures acceptable to reasonable stakeholders. President Clinton used the Antiquities Act in this fashion to work with the Congress, and it produced good results in such places as Steens Mountain in Oregon, the Colorado Canyons, the San Jacinto Mountains and Otay Mountain in California and Las Cienegas in Arizona, among others.

We also need to hear this Administration in support of protection for our ocean resources. For too long the beauty and diversity and productivity of ocean life and fisheries has been taken for granted, as limitless and beyond destruction. That is no longer the case. Every day we are learning more of the impending destruction of coral reef systems and declining productivity of our oceans.

This Administration has frequently spoken of the need for responsible expansion of offshore oil exploration and production.

Well and good, but we have not heard equally strong support for enhanced conservation and protection of the most important places in our offshore waters and along our coastlines.

The link between offshore oil and the imperative for conservation of our natural resources was recognized by the Congress more than fifty years ago by creating the Land and Water Conservation Fund (LWCF). LWCF is based on a simple idea: use revenues from the depletion of one natural resource — offshore oil and gas — to support the conservation of another precious resource — our land and water.

Interior Secretary Ken Salazar has made a strong and continuing effort to persuade Congress to fund the LWCF at the level originally intended by Congress. He needs the President’s firm support in budget negotiations to assure adequate permanent funding.

The most important place to demonstrate Administration leadership for mitigating the impacts of offshore drilling is in Alaska. Offshore drilling in Arctic waters poses high risks that must be mitigated with strong conservation measures.

Bristol Bay, the passageway for the myriad salmon runs that travel through the rivers system of Alaska is the greatest and most productive fishery on the planet. President Obama should use the Antiquities Act to designate the federal waters of Bristol Bay, as a National Monument, permanently off limits to oil and gas.

And as the Administration opens the western Arctic slope lands to oil and gas leasing, there will be another opportunity to strike a balance between oil production and wildlife conservation. More leasing and drilling on the Arctic slope should await and be conditioned upon passage of legislation establishing protected shoreline areas and wetland regions in the far western Arctic frontier, including breeding and migration corridors for the fabled western Arctic caribou herds.

There is no issue as lasting or as worthy as the preservation of our natural and cultural heritage. Theodore Roosevelt, more than a hundred years ago, put it this way: “We have fallen heir to the most glorious heritage a people ever received, and each one must do his part to show that the nation is worthy of its good fortune.”

Mr. President, America’s great outdoors is under attack as never before. We need you to stand up to this assault as only the President can. You will have the lasting gratitude of the American people for generations to come.

This post was coauthored by Sierra Club Chairman Carl Pope and League of Conservation Voters President Gene Karpinski. It was cross-posted from the Center for American Progress.

America is suffering from another oil price shock less than three years after prices hit a record of $147 per barrel in July 2008. Over the past month, oil prices rose by over $20 per barrel, or more than 25 percent. This price hike reflects political instability in many oil-producing Persian Gulf nations. And Wall Street speculators have preyed upon oil users’ fears about supply interruptions to bid up the price to over $100 per barrel.

As the price of oil climbs, so too does the price for gasoline. Every $10-per-barrel increase in oil prices boosts gasoline prices by 25 cents per gallon. Many Americans do not have the option to significantly reduce their driving or easily buy more fuel-efficient new cars, so they spend more on gasoline and less on other goods and services. This slows our nation’s still shaky economic recovery and disrupts job growth. Meanwhile, our economy ships off nearly a $1 billion per day to other nations to purchase foreign oil. And higher prices due to instability and speculation inflate the profits of big oil companies while Americans’ wages remain stagnant.

It’s time to get control of volatile oil prices that are hurting our economy, our security, and the everyday budgets of American families. These measures are crucial for longterm economic growth, more jobs, and less dependence on foreign oil. They work together to reduce imports and save money.

We propose a bold “Cleaner Cars, Less Foreign Oil” plan [PDF] that has four crucial elements:

• Cut foreign oil use by 5 percent annually to slash these imports in half by 2022: Importing foreign oil sends $1 billion per day to other countries instead of investing these dollars at home. Foreign oil purchases are nearly half of our trade deficit.
• Invest in 21st century clean, efficient vehicles and transportation: We need to build 21st century cars that get 60 miles per gallon by 2025, trucks with a 15 percent improvement in fuel economy, and invest in electric cars. And we need to modernize our transportation infrastructure by providing more transportation choices to consumers. The domestic manufacture of these cars and trucks of the future alongside a 21st century transportation network will dramatically cut oil use, save vehicle owners thousands of dollars, create jobs, and restore America’s manufacturing might.
• End tax loopholes for big oil: End billions of dollars of tax giveaways to big oil companies. Use these funds to support transportation choices and deficit reduction. Recover one cent of every dollar of Big Oil profits to invest in advanced vehicle technologies, such as cars with double the fuel economy, electric cars, and natural gas powered buses.
• Stop speculators from driving up oil prices: Prohibit Wall Street speculators from driving up oil prices by hiring more “cops on the beat” at the Commodity Futures Trading Commission to police oil trades. There is evidence that speculators are driving up oil prices to make a quick buck, just as there were during the record oil and gasoline prices in 2008.

President Obama and Congress must act to make fundamental changes in our energy policies. These systemic changes we recommend will enable us to finally shed the chains of oil dependence after 40 years of imports, high prices, stagnant growth, and pollution. But we must act now.

Governments can use policy measures alongside relatively small sums of public money to catalyze the private sector to help developing countries finance their clean energy transition.Photo: Center for American Progress

A new report released today, “Investing in Clean Energy,” from the Center for American Progress and seven other global think tanks that comprise the Global Climate Network, provides a progress report on commitments to clean energy development in several sectors in China, India, Nigeria, and South Africa. Our report estimates the total cost over the next decade for achieving these targets, and then offers recommendations on how best to use public funds that may become available in the creation of a global climate fund to leverage the private capital needed to meet these goals.

Before detailing our findings, some history about the global climate fund. One of the items agreed to as part of the Copenhagen Accord at the U.N. climate summit in Denmark last December was a commitment to raise $30 billion from developed countries for “fast start” financing for these projects in developing countries between 2010 and 2012, with the goal of generating $100 billion in new capital annually by 2020. The money would be deployed toward enhanced mitigation of carbon pollution, technology development, and adaptation to a warming world.

The accord stops short, however, of determining the ratio of funds that will be spent on mitigation and adaptation, respectively, and of identifying any specific mechanisms or sources of finance other than “public and private, bilateral and multilateral, including alternative sources.” Later this week, however, a special report from the U.N. Advisory Group on Finance — an informal but high-level group of heads of state, experts, and finance ministers — will provide a more comprehensive look at the instruments that could be used generate these funds.

Our report complements this forthcoming U.N. Advisory Group report by demonstrating that significant amounts of additional funds will be necessary to achieve a successful, global low-carbon transition for long-term climate protection. Private finance is undoubtedly needed. According to the World Bank, additional annual capital costs for mitigation in developing countries will range between $265 billion and $565 billion by 2030. We find that investments in the sectors and countries highlighted in this study must double if current government ambition for renewable energy expansion is to be achieved.

Indeed, excluding China, the average annual investment needed is $15.93 billion, yet the financing gap is around $15.73 billion in India, South Africa, and Nigeria, all of which are currently only investing a tiny fraction of what would be required.

Take India, which is embracing substantial targets to decrease their emissions and shift to a low-carbon growth strategy. The Indian government’s Eleventh Five-Year Plan includes a renewable energy target of 10 percent of total power generation capacity, with 4 percent to 5 percent of the final electricity mix to be achieved by 2012. If these goals are met, then renewable energy would account for approximately 20 percent of the total added energy capacity planned in the 2007 to 2012 period. Toward the same goal, India expects to install 15 gigawatts of additional renewable power capacity by 2012.

The Indian government has allocated $850 million of public finance to support renewable energy under the Eleventh Five-Year Plan, including $16.2 million for wind power demonstration projects and $43.3 million in subsidies to support grid-interactive solar photovoltaic power generation infrastructure. Yet the total capital investment required to achieve the plan’s target of 15 gigawatts of installed renewable electricity by 2012 are likely to be significantly higher.

Using estimates of capital and generation costs calculated by the Indian government’s Integrated Energy Policy-Expert Committee, our report finds that between $9.5 billion and 12.7 billion will be required between 2007 and 2012 if the 2012 target is to be met. This will require leveraging as much as 15 times the budgetary support currently provided by the Indian government in the form of private investment. Follow-up interviews with government officials and clean energy investors in each country participating in our study point to the hurdles and possible solutions needed to build the needed renewable energy infrastructure by tapping private capital. In most countries, the majority of participants suggest that the primary barrier to private sector low-carbon investment was the absence of clear and stable national policies.

Inadequate regulation and standards (South Africa, China), lack of incentive policies (South Africa), the absence of market mechanisms and a price on carbon (China), and failure to implement existing policies (Nigeria) were all cited. Nonetheless, participants in several countries (India, China,) suggest that financial instruments deployed by governments at the national level to date have been quite effective in stimulating private investment in low-carbon energy projects despite limitations in the policies.

The types of instruments that have been successful so far differ depending on a country’s unique circumstances. In India, for example, feed-in tariffs for renewable-sourced energy have been important. In China, requirements on banks to phase out loans to high-carbon emissions sectors have been very effective. Clearly, if the balance of risk and return is acceptable then the private sector will invest. Indeed, participants in the national dialogues held by the various partners in our study suggest there is no lack of enthusiasm or available capital for clean energy. Yet our unequivocal finding is that government intervention will be needed to ensure the private sector’s perception of risk does not exceed its expectation of return.

In effect, clean energy investment requires a public-private partnership. Governments can use policy measures alongside relatively small sums of public money to catalyze private sector participation, enabling government involvement to help reduce the perception of risk, and consequently actual risk, among private sector investors. We propose that governments building the proposed $100 billion climate fund should foster an investment partnership with the private sector. Our report proposes several leveraging mechanisms, such as loan guarantees, subordinated equity investments, and policy insurance, which together could be the basis of this partnership. These tools will help lower costs in two ways.

First, lowering the cost of capital will bring down incremental costs. Developed country government-sourced subsidies and guarantees to help private investors finance clean energy in developing countries will reduce the costs of borrowing. The reason: Cheaper capital i
n most clean energy sectors means lower incremental costs generally.

Second, deployment on a large scale will drive down technology costs. A public-private partnership for clean energy investment should lead to a rapid increase in the pace and scale of deployment, which in turn would lead to technological, technical, and business innovation — learning by doing — and so bring down the currently high relative unit costs of clean energy.

There are some participants in the international climate community who criticize the deliberations of the U.N.’s Advisory Group on Finance because it focuses too much on generating private investment out of public capital. Our report demonstrates that the clean energy investment challenge will only be solved through coordinated public and private effort. This investment challenge is now the world’s greatest innovation challenge.

It is imperative that the United States find effective and economically viable solutions to the climate crisis. Our elected officials and business leaders ask how we can afford the global transition to a low-carbon economy. Around the globe, developing nations ask how they can afford to reduce their emissions without sacrificing their hopes for a better life. There is no single answer, but there is one unexpected solution that offers hope on both fronts.

To date, the climate debate has focused on reducing fossil fuel emissions and ramping up crucial clean energy alternatives. Far too little attention has been paid to the role tropical deforestation has in warming the planet. It accounts for 17 percent of global emissions — more than all the world’s cars, trucks, planes, trains, and ships combined. This is a serious oversight; if left unaddressed, deforestation will undermine all our efforts to solve the climate crisis.

The good news is that protecting “climate forests” is a major global warming solution that can be implemented immediately and affordably. Many developing nations, including Brazil and Indonesia, which together account for 50 percent of global deforestation, are eager to partner with the United States to protect their climate forests. Indeed, Brazil has established a goal of reducing emissions from the Amazon by 80 percent by 2020 and is already making impressive progress in that direction, including robust monitoring and verification systems. Indonesia is moving in a similar direction. These efforts could be focused, honed, and replicated globally.

Protecting climate forests doesn’t just make environmental sense — it’s an economic imperative. By including tropical forests in U.S. climate policies, the United States can help reduce future carbon prices confronting U.S. companies by 50 percent and help save the United States $50 billion by 2020 compared with the costs of domestic action. Capturing these savings, however, will require substantial new financial and technical resources, including investing $1 billion in public funding before 2012, growing gradually to $5 billion in public funding and $9 billion in private-sector investments annually by 2020.

Saving climate forests would also strengthen U.S. national security by reducing environmental degradation and international instability caused by climate change, which acts as a threat multiplier for conflict. It would contribute to alleviating global poverty by channeling substantial new revenues to the forest-dependent rural poor and conserve invaluable biodiversity and ecosystem services by protecting some of the world’s most important natural places.

This is the thrust of the recommendations issued by the Commission on Climate and Tropical Forests, a bipartisan and multi-sector panel of leaders we co-chair, which recommends that the United States lead a global effort to halve emissions from tropical deforestation by 2020 and achieve zero net emissions from the forest sector by 2030.

In the context of the cap-and-trade approach endorsed by President Obama and being debated in the Senate now, the way to achieve these ambitious goals is to allow U.S. companies to invest in reducing tropical deforestation in order to meet a substantial portion of their domestic emissions reduction obligation. We must leverage these private-sector investments by using public funds to provide technical assistance that enables nations to participate in U.S. carbon markets. This can also support countries that prove unable to attract private capital and engage nations where deforestation threats are growing.

The climate bill passed by the House of Representatives in June would mobilize private-sector investments and would fund new technical assistance programs with a percentage of revenue from domestic emission-allowance auctions. The climate bill released last month by Sens. John Kerry (D-Mass.) and Barbara Boxer (D-Calif.) allows for a similar approach. While these are for the moment among the least-understood parts of pending climate change legislation, they deserve broad bipartisan support.

Coupled with meaningful reductions in domestic emissions, protecting climate forests is one of the most important as well as the most readily available and most cost-effective means of finding a path forward on climate change. For economic, security, humanitarian, and environmental reasons, tropical forest conservation must be a centerpiece initiative of U.S. climate legislation and diplomacy. The alternatives — further delaying climate action, neglecting our responsibility as a global leader, and failing to include robust protections for forests — threaten the vital national interests of the United States. We have the chance to lead, and we must take it.

The world’s leading economic powers remain inactive in preventing an increase in the serious impacts of climate change.

While current impacts of climate change may not have reached alarming proportions, according to the Intergovernmental Panel on Climate Change that will happen soon enough if we do not take early action. What is causing increasing concern, as the December U.N. climate summit in Copenhagen draws ever nearer, is the continuing deadlock in political action to deal with this challenge.

There is clear consensus among those arriving in Pittsburgh this week for the G20 that climate change is our most pressing global problem. The leaders of 16 of these countries signed a declaration last July after the G-8 meeting in Italy acknowledging that temperatures should not be allowed to exceed 2 degrees Celsius and that, as a consequence, global emissions must be reduced 50 percent by 2050. But the IPCC had clearly concluded that to ensure this limit, global emissions would have to peak no later than 2015, a finding that both the G-8 and the G-20 failed to highlight. Nor do the negotiations leading up to Copenhagen reflect this imperative.

The interim U.N. meetings over the summer leading up to Copenhagen have not gone well. Still unresolved are fundamental differences between developed countries about whether the Kyoto Protocol should be continued or be abandoned altogether for an entirely new treaty. The document under discussion at the U.N. is some 200 pages of contradictory provisions from a variety of submissions from different countries. Practically every sentence contains bracketed language still needing debate and revision. The prospect of shaping this up into a coherent document by December, with only two more interim meetings to go, appears grim.

The greatest divide that remains, however, is between developed and developing countries. In the massive voting blocks that still dominate this process among 192 countries it appears that developed countries and developing countries are at an impasse. While it is true that developed countries carry the burden of historical responsibility, and must prove to be the first movers in mitigation, developing countries will become bigger emitters in the future; this intractable dynamic is proving unconstructive.

There is much at stake here. If leaders say they want to cooperate internationally, and then fail to do so, the whole credibility of action on climate change will be damaged in the minds of the public, which may retreat to defeatist pessimism or cynicism.

How can this be avoided? In our view, a way has to be found to nudge the whole debate onto a more positive track, where the discussions among the leadership of countries is focused on how collaboration can deliver a step change in the use of low-carbon technology and create jobs and new economic growth along the way.

The countries meeting in Pittsburgh represent more than 80 percent of global emissions; they must act together, in keeping with the principles of the U.N. Framework Convention on Climate Change. We suggest they emerge from their talks having agreed to what we might call a Pittsburgh Protocol: an informal agreement containing two elements.

The first part of the Pittsburgh Protocol would reaffirm a collective will to find solutions to the political divisions through negotiations under the United Nations. Coming from this group it would signal that meetings among smaller sets of countries can advance the U.N. agenda in a less adversarial manner.

The second part would focus on a series of mini-agreements that could be reached at or before Copenhagen and that could be sketched out in Pittsburgh. These should include more specific measures to cooperate on immediately available low-carbon technologies, collaboration on pilot projects to capture and store carbon emissions, new financing arrangements to help developing countries meet energy-efficiency goals and immediate support to slow down deforestation.

A high level group of finance ministers from among the G20 countries has already drafted three papers on the creation of new finance mechanisms to help pay for a global transition to a clean energy economy in advance of the Pittsburgh summit. These proposals must be advanced so that we can assess the amount of money that could be generated.

A new study from the Global Climate Network of think tanks, to which we belong, argues that development of climate change policies and low-carbon technologies promises to create a generation of new jobs. But this will only come to pass if governments are bold in their approaches to creating new markets.

The G20 is a good opportunity for leadership countries to pull in the same direction on creating a green economy. More importantly, given the short road to Copenhagen, it is now a critical opportunity. Let’s not waste this chance.

The United States is having the wrong public debate about global warming. We are asking important questions about pollution caps and timetables, carbon markets and allocations, but we have lost sight of our principal objective: building a robust and prosperous clean energy economy. This is a fundamentally affirmative agenda, rather than a restrictive one. Moving beyond pollution from fossil fuels will involve exciting work, new opportunities, new products and innovation, and stronger communities. Our current national discussion about constraints, limits, and the costs of transition misses the real excitement in this proposition. It is as if, on the cusp of an Internet and telecommunications revolution, debate centered only on the cost of fiber optic cable. We are missing the big picture here.

Let’s be clear: Solving global warming means investment. Retooling the energy systems that fuel our economy will involve rebuilding our nation’s infrastructure. We will create millions of middle-class jobs along the way, revitalize our manufacturing sector, increase American competitiveness, reduce our dependence on oil, and boost technological innovation. These investments in the foundation of our economy can also provide an opportunity for more broadly shared prosperity through better training, stronger local economies, and new career ladders into the middle class. Reducing greenhouse gas pollution is critical to solving global warming, but it is only one part of the work ahead. Building a robust economy that grows more vibrant as we move beyond the Carbon Age is the greater and more inspiring challenge.

Reducing greenhouse gas emissions to avert dangerous global warming is an environmental challenge, but it is also an economic, national security, societal, and moral imperative. The “cap and trade” provisions, which will set limits on pollution and create a market for emissions reductions that will ultimately drive down the cost of renewable energy and fuel, represent a very important first step and a major component in the mix of policies that will help build the coming low-carbon economy. But limiting emissions and establishing a price on pollution is not the goal in itself, and we will fall short if that is all we set out to do. Rather, cap and trade is one key step to reach the broader goal of catalyzing the transformation to an efficient and sustainable low-carbon economy. With unemployment at 9.5 percent, and oil and energy price volatility driving businesses into the ground, we cannot afford to wait any longer. It is time for a legislative debate over a comprehensive clean-energy investment plan. We need far more than cap and trade alone.

Importantly, many elements of this positive clean-energy investment framework are already codified within existing legislation such as the American Clean Energy and Security Act, passed by House of Representatives earlier this year. But with all the attention given to limiting carbon, too little attention has been placed on what will replace it. These critical pieces of America’s clean-energy strategy should be elevated in the policy agenda and political debate as we move forward into the Senate, and used to help move legislation forward that advances a proactive investment and economic revitalization strategy for the nation.

Read the Center for American Progress report, The Clean-Energy Investment Agenda.

The Obama administration once again convened a Major Economies Forum in Italy this week after the G-8 meeting, which included the world’s 17 major carbon emitters, to press forward on a global deal on climate change and the transformation to a clean-energy economy. One of the most important announcements to come out of this meeting is the formation of a formal “Global Partnership” on “low-carbon, climate-friendly technologies.” This program aims to double the current commitments on technology assistance by 2015 and sets a deadline for mapping actions for achieving a range of important goals on this cluster of issues by November 15, 2009.

Achieving success in this program could potentially be key for engaging the major emitting developing economies, such as China and India, on accepting meaningful measures for reducing their carbon emissions. Such assurances are necessary for negotiating a successful new international treaty responding to climate change this December at the U.N. climate change meeting in Copenhagen. The countries composing the Major Economies Forum have, with this movement, recognized that the struggle against climate change will not be won without a revolution in the use of existing, low-carbon technology and a tidal wave of new inventions.

The Center for American Progress, working jointly with eight other progressive think tanks from around the world in our Global Climate Network, today launches a report, “Breaking Through on Technology,” to help to pave the way for a successful global deal on the transfer of clean-energy technology. Together with our partners in India, China, Brazil, South Africa, Nigeria, Germany, Australia, and the United Kingdom, we think a new focus on technology will not only help to avert a climate crisis, but also transform the ongoing international negotiations into a forum focusing on shared opportunities rather than arguments over historically differentiated carbon emissions.

Our research involved speaking to more than 100 leading business people, government officials, and academics in eight countries: Australia, Brazil, China, Germany, India, Nigeria, South Africa, and the United States. We reached three key conclusions through these discussions, which leaders should consider in enacting the new technology partnership mandate of the Major Economies Forum.

First, we argue, as the Intergovernmental Panel on Climate Change also said, that a low-carbon technology revolution will not simply happen—it requires government intervention. Our research demonstrates that one of the major barriers to low-carbon technology is the lack of coherent policy at the domestic level in both industrialized and developing countries.

Conventional wisdom points to the importance of establishing economy-wide programs to price carbon emissions through taxation or trading, such as the cap-and-trade program passed recently by the House of Representatives as part of the American Clean Energy and Security Act. This may indeed help low-carbon technology over the longer term, especially when innovations are more firmly established.

But right now more keenly targeted government policies are urgently needed, particularly because many of the barriers have to do with a lack of skills and know-how, including knowledge of how to make good policy, as well as the availability of technology. Such policies might include phasing in carbon standards for specific products or sectors, providing tax incentives to drive investment in low-carbon energy, and generally creating stable investment climates and supporting the research, development, and deployment of new technologies.

The need for finance is the second conclusion of this study. Almost all of those interviewed identified the lack of upfront finance and financial mechanisms to help meet the higher costs of deploying new technology rapidly as being a major barrier to low-carbon technology. The private sector should become the major source of low-carbon finance, but government money is needed early on to make new technologies cheaper and less risky. We at CAP advocated the establishment of a new national green bank to help achieve this outcome within the legislative architecture of the American Clean Energy and Security Act.

But beyond this domestic initiative we suggest that an international framework for reducing emissions should contain a mechanism to reward robust, comprehensive policymaking at the national level with new finance. Developed countries have an obligation under the existing U.N. climate agreement to be the major contributors to this effort.

Third, we call for an international technologies initiative, which could help accelerate the collaborative development of new technology and realize the brightest and best ideas through the difficult demonstration stage to full commercial production and deployment. The so-called “valley of death” in which many great ideas perish for want of finance cannot be allowed to kill off important low-carbon innovations. We will argue for such an expanded function as part of the MEF’s Global Partnership on technology.

Again, many of the experts we consulted in our study highlighted the perilous state of research and development funding. We propose that governments, key academic institutions, and companies work together in regional hubs and under the umbrella of such a clean technology initiative to share equipment, know-how, and skills in an urgent drive to find the climate-saving technologies of the future, especially those that will also help bring energy services to poor people.

Some will balk at the suggestion that government should have such a strong role in driving new, low-carbon technology. And yet our study shows that while there are some differences of view among public servants, politicians, and people in the private sector, the overwhelming conclusion is that governments have to steer the low-carbon technology revolution, and do so with more purpose than has hitherto been the case.

Cooperating on technology will not be easy; the bailing out of banks and resuscitation of economies has led to large fiscal deficits in some countries, even if some of the money has helped deploy low-carbon technology. But our message in this research is clear: put technology at the heart of negotiations; agree on an international mechanism that rewards robust low-carbon development strategies; pool resources to plough into research, development, and project demonstration; focus on know-how as much as equipment; share knowledge across borders; and propagate skills.

Success at Copenhagen in December depends on reaching consensus in each critical area currently under negotiation. A clear commitment by developed countries to support robust, internationally approved, national plans with new finance and agreement and a commitment to make the new MEF initiative on technology successful could lay the foundations for the low-carbon revolution we need.

Read the report: Breaking Through on Technology: Overcoming the Barriers to the Development and Wide Deployment of Low-Carbon Technology

For more information, see:

• Closing the Mitigation Gap, by the Global Climate Network and Center for American Progress
• Global Climate Network Launches in Poznan, by Andrew Light
• The Great Transformation: Climate Change as Cultural Change, by John Podesta

Once again Mick Jagger is right: “You can’t always get what you want/But if you try sometimes you just might find/You get what you need.”

The House of Representatives is poised for its first-ever floor debate and series of votes on a landmark measure to reduce global warming pollution. This bill is revolutionary in its intent and, while imperfect in its means, it deserves the support of progressives.

The American Clean Energy and Security Act would establish binding greenhouse gas pollution limits, set the first national renewable electricity and efficiency standards for utilities, and improve efficiency standards for buildings and appliances—creating 1.7 million new jobs and spurring $150 billion in investments. At the same time the bill would also make ratepayers whole while protecting low-income families for the cost of less than a postage stamp.

The original draft of this bill included a more aggressive 2020 greenhouse gas reduction target and a higher renewable electricity standard. Both were lowered to reach a fragile compromise between environmental champions in the House of Representatives and others members concerned about local industries. Despite these changes, this bill starts the critical transition to a low-carbon economy. It sets a hard cap on emissions—something the previous administration was dead set against—that will be lowered over time so we can achieve the emissions reductions climate science demands over the next few decades.

In the short term, the cap will reduce emissions by the equivalent of removing 500 million cars from the road by 2020. The cap will also set a price on carbon pollution, reflecting the costs of dirty coal-fired electricity. It will spark more clean-energy innovation and private investment in energy efficiency and alternative energy, including wind and solar energy.

Passing this bill is the first arduous step toward energy transformation. Senate passage of similar legislation will be more difficult, and the Senate Energy Committee is off to an inauspicious beginning by passing an energy bill that would do little to boost investments in renewable electricity. The bill would allow oil drilling in an area only 45 miles off the Florida Gulf Coast and worsen global warming by lifting the prohibition against the federal government purchase of oil from Canadian tar sands, which produce twice as much greenhouse gas pollution as regular oil. The Senate bill is weak, toothless, and unacceptable, and it must be improved before it passes.

The U.S. political system has never attempted to solve a problem as complex as climate change, with all its scientific, economic, energy, security, and humanitarian dimensions. The congressional will to act lags far behind the scientific evidence that there is little time left to avert the worst impacts of global warming.

President Barack Obama’s determination to speed our energy transformation has brought defenders of the status quo out in force. Opponents of change understand that now is the best opportunity for our success. We have a new, very popular president, a dedicated speaker of the House, a determined Senate majority leader, and the numbers in both bodies to realize this clean-energy vision. Opponents know they must block these changes now or it will be too late. Conservatives joined by big oil and coal lobby groups have unleashed a massive campaign to block these measures.

Some of my allies in the progressive community worry about worst-case implementation scenarios that might eviscerate the American Clean Energy and Security Act ’s greenhouse gas pollution reductions. Because of these fears they believe that inaction is preferable to this action. I do not question their sincerity, but their strategy could prove disastrous. Without meaningful action in Congress, the Obama administration will lack the credibility to cajole developing nations to reduce their growing emissions as part of the Copenhagen global warming talks this December. The chance to adopt meaningful clean-energy and global warming policies will evaporate for at least two years.

Some advocates argue that congressional inaction is preferable because the Environmental Protection Agency can use its authority under the Clean Air Act to require power plants to reduce their emissions. I strongly believe that if Congress cannot muster the votes to pass a decent energy and climate bill, then the EPA can and indeed must act to regulate carbon dioxide emissions under the Clean Air Act. But I also know that approach is rife with peril. It would face legal assaults that would significantly delay implementation of any such reduction rules.

What’s more, the EPA lacks the authority to adopt and implement other important near-term pollution reduction tools, such as a national renewable electricity and efficiency standard. Relying on the EPA is an important fail-safe strategy, but that administrative path is rocky and long.

The American Clean Energy and Security Act is not all that environmentalists and progressives want. But we must pass this bill so that we can get what we need: a clean-energy law that creates jobs, reduces oil use, and cuts global warming pollution.

A blueprint for the future.

Photo: iStockphoto

But times change. Ten years later, it’s increasingly clear that it will be more costly not to act on global warming than to act. Clean, renewable, efficient energy will not be a burden but a boon — the next in a series of revolutions, beginning with telecom and digital that have invigorated our economy with new ideas, new industries, and new jobs.

Voters, investors, activists, business leaders, and policy experts are pushing for clean energy to create jobs, limit climate change, and reduce America’s dependence on foreign oil. And yet, progress is slow: oil imports and carbon emissions continue to rise. Why?

Because the rules of the game — the laws, regulations, subsidies, and tax credits that shape the energy market and the way it acts — continue to make fossil fuels a less expensive, more convenient choice for consumers.

These rules are both the heart of the problem, and the key to a solution.

In 1931, Thomas Edison met with Henry Ford, whose popular cars were driving up demand for gasoline, and told him: “I’d put my money on the sun and solar energy. What a source of power! I hope we don’t have to wait until oil and coal run out before we tackle that.”

Seventy-four years later, the three largest technology IPOs of 2005 were solar-energy companies. We’re finally catching up with Edison.

Bill Joy, the founder of Sun Microsystems, says that clean energy is where we’ll find “the Googles, the Microsofts of the new era.” Venture capitalist John Doerr — whose firm, Kleiner Perkins, got rich investing early in companies like Google, Amazon, and Sun Microsystems, has called clean energy “the largest economic opportunity of the 21st century.”

They base these predictions, in part, on advances in technology. Wind power now costs about 5 percent of what it did 25 years ago. Solar energy costs are down more than 90 percent since 1970. The National Renewable Energy Laboratory says that the price of renewable energy will drop another 45 percent over the next 20 years. Indeed, this estimate may be low, given that scientists like Craig Venter, who cracked the human genome, and Steven Chu, who won the 1997 Nobel Prize for Physics, have turned their attention to clean energy.

Support for a new energy future is coming from everyone from evangelicals like Pat Robertson, who believe we have to preserve God’s creation; to union leaders, who see the opportunity for new jobs; to farmers, who know wind and biofuels will boost their income; to policymakers like Republican Sen. Richard Lugar (R-Ind.), who says we must reduce our dependence on oil “in the interest of American national security and our economic future.”

It even includes business leaders like the CEOs from DuPont, GE, and Duke Energy, who earlier this year called for tough federal limits on global-warming emissions — a call that was echoed in March by institutional investors managing $4 trillion in assets.

Ten Northeastern states are implementing a regional cap-and-trade system to reduce CO2 emissions. And the California legislature has required the state to cut its greenhouse-gas emissions 80 percent by 2050.

But in spite of this momentum for change, our energy habits are still stuck in the past. Carbon dioxide emissions are up 19 percent since 1990 and still rising. Oil imports are up 70 percent since 1990 and still rising. Renewable sources like solar power and biofuels provide just 6 percent of America’s energy — and that share is not rising.

What’s wrong? Big majorities of Americans want clean energy for its national security and environmental benefits. Why aren’t we moving faster toward a clean energy future?

Huge society-wide change comes only when millions of consumers change their habits, and consumers will not change their energy habits until we reach the “crossover point” at which clean energy beats coal and oil on the basis of price, convenience, and availability.

Right now, most drivers cannot pull into a gas station and fill up with domestically produced biofuels. Most homeowners cannot choose wind- or solar-generated electricity to power their appliances. Going green too often costs more — in time or money.

Change won’t come until the price is right. That price is set by the market, the market is shaped by rules, and the rules favor fossil fuels.

If we want to change the future, we have to change the rules.

Rules Matter

Rules matter. Rules define the character — and shape the future — of the society that makes them. Democracy’s distinguishing excellence lies in its ability to write the rules in a way that serves the common interest.

Good rules align the interests of individuals and corporations with the public interest, so that business can profit in ways that also make society richer and safer. This is the foundation of sound public policy. When high purpose is combined with the profit motive, the results can be astonishing. Time and again market capitalism, bounded by smart rules designed to serve the public interest, has delivered the desired result more cheaply, quickly, and easily than anyone thought possible.

Unfortunately, rules that are passed to advance the public interest can come, over time, to harm the public interest.

The rules we have now encourage the use of energy — especially oil and electricity. For most of the 20th century, this was smart policy. Electrification of the U.S. economy produced huge gains in productivity and quality of life. The increased mobility of people, goods, and services had similar benefits. Using more energy did not make us dependent on foreign oil. As late as 1940, the U.S. produced 63 percent of the world’s oil, compared to the 5 percent that came from the Middle East.

But the world is very different today. Geologists estimate that the Middle East has over 60 percent of the world’s oil reserves, the U.S. just three. And carbon dioxide emissions from our power plants and vehicles are wrecking the world’s climate. The rules need to change.

The rules today give oil and gas companies — the most profitable industry in the history of the world — billions of dollars in tax breaks and research subsidies. The rules do not factor in the indirect costs of oil — the cost of protecting oil supply lines to the Middle East, the cost of oil price shocks that lead to recessions, and the cost of intensified storms that make coastal property uninsurable. Insurers have priced insurance in Florida so high that the state has stepped in and pledged tens of billions of dollars in public money if a major hurricane strikes — despite the fact that neither the state’s catastrophe fund nor the state-chartered insurance company has anywhere near enough money to pay the claims.

The rules perpetuate our energy habits. Auto companies sell cars that get as little as 13 miles per gallon — something they could never do in Europe, Japan, or even China. Utility companies make more money when their customers waste energy and less when they save it. Developers build with energy-inefficient materials because they don’t have to pay the utility bills. And power plants use the atmosphere as a free garbage dump for their global-warming emissions.

We need new rules that will make the best choice for the country also the best choice for consumers.

We don’t have to undo investments we have already made. We don’t need to take old cars off the road or shut down coal-fired power plants prematurely. But the next investments we make — the next cars and buildings we design, the next power plants we build — should follow new rules that reflect our need for clean, renewable, efficient energy.

Changing the rules to unleash the power of the market is not a new idea. Until 1984, telecommunications in the United States were monopolized by a single company: AT&T. For a time, that was sound policy. It ensured dependability during the early years of the industry. Customers bought their phone service and rented their phones from Ma Bell. But when rivals emerged, the government and the courts changed the rules. The market took over, and the telecom revolution began.

Phone sales jumped from 19.7 million in 1983 to 30.3 million in 1984. New features like call waiting and call forwarding proliferated. From 1984 to 2001, AT&T’s share of the long-distance market declined from 90 percent to 38 percent as competition drove down prices. New producers of telecommunications technologies like switches, microwave antennas, cables, and modems began to thrive.

Today, we are on the cusp of a similar revolution in energy, but the old rules are still in place. There is a lot of money ready to invest, but too few good investment opportunities. To enable those emerging products and technologies to succeed, the most important thing we can do is change the rules.

Consider the recent case of Xcel Energy, a Minnesota utility that wanted to build a new coal plant. When the state utility commission asked Xcel to recalculate the cost of running the plant with an $8-per-ton cost for carbon emissions, the company did so — and then abandoned its plan for the coal plant. Instead, it will rely on wind generation and hydropower. A spokesperson said that the prospect of a carbon fee helped prompt the decision, and the company now advocates mandatory standards for reducing greenhouse gases.

In this case, just the anticipation of a rule change created a market incentive for Xcel to make its next investment in a way that favored new technology.

Because the challenges of climate change and oil dependence are so urgent, when we make this transition matters just as much as whether we make it. Sooner is better — much better — particularly if we want to be one of the countries that sells these new technologies.

The New Energy Competition

Many of our economic competitors are moving more quickly than the United States to capitalize on the new jobs and new industries that will come with clean energy — Japan and Germany in particular.

Japan, which has very limited fossil-fuel resources, has supported solar energy with government research-and-development funds and a decade-long subsidy for consumers who install solar panels. Germany, since the late 1980s, has supported wind and solar energy with tax breaks and a tariff that guarantees renewable-energy producers a competitive price. Cornelia Viertl, a senior adviser at the German Federal Environment Ministry, explains: “We feel there’s a chance for Germany to be innovative, to create an industry and possibly be the leader.”

Because of their rules, our competitors are farther along than the United States in the transition from old energy to new energy, and they have captured most of the growth and jobs along the way. Just 10 years ago, the United States produced 44 percent of the world’s solar cells; today its market share is less than 10 percent. Japan is now the world leader, producing 43 percent of the world’s solar-energy products. Europe, meanwhile, produces 90 percent of the world’s wind turbines. Brazil, where the government requires all gasoline to contain ethanol, has led the way on biofuels.

Even Abu Dhabi is getting into the game. The oil-rich emirate recently pledged hundreds of millions of dollars toward developing alternatives to fossil fuels. In the past year, it has announced plans to build a 500-megawatt solar power plant — the first in the Middle East — and has also announced a partnership with MIT to develop a research center for the study of clean energy technology. They’re not just out to get the industries and jobs that we want here, they’re using our oil payments and our intellectual power to help them do it.

We still have a chance to reassert our leadership. Our educated workforce, top-level universities, and culture of innovation still position us to capitalize as the world moves to clean energy. We have to decide whether we’re going to lead the world — and claim the economic benefits — or follow, and send money to other countries for clean energy technology, in the same way that we now send money to the Middle East for oil.

The Rule Changes

The future of energy is not terribly complicated to envision:

• Clean energy: We’ll use new, renewable sources of energy: more biofuels and less oil, more wind and solar, and less coal and natural gas.
• Energy efficiency: Our homes, office buildings, cars, and appliances will require less energy, and we’ll have better ways to manage that use.
• Carbon capture: Emissions from coal-fired power plants will be captured and pumped underground.
• A “smarter” grid: Digital technology will finally come to the electric power grid, making it more efficient, more reliable, and better able to draw on renewable resources. It should become a national grid, like our highway system, so any renewable or non-renewable electricity generated in any part of the country can be transmitted to market.

President Bush addressed the first two goals in his State of the Union address in January. His “20 in 10″ initiative called for U.S. vehicles to use 35 billion gallons of alternative fuels by 2017, and he also suggested that fuel economy standards could be increased by 4 percent a year over the next decade. On May 14, he directed four federal agencies to take action toward this goal. These are steps in the right direction, but we have a long way to go.

Here are five more rule changes that would reduce emissions, give consumers new choices, launch new businesses, and accelerate the profitable transition to new energy technologies:

Put a price on carbon.

Putting a price on carbon dioxide — through a cap-and-trade system similar to the one that reduced acid-rain pollution at low cost — would end the use of the atmosphere as a free garbage dump and create a market for any technology that reduced global-warming emissions.

Just as important, a cap-and-trade system would give businesses the basis for making capital investments in cleaner energy research, technology, and capital stock. As Elizabeth Moler, an executive at Exelon, one of the nation’s largest utility companies, said last year: “We need the economic and regulatory certainty to invest in a low-carbon energy future.”

Carbon limits should be broad-based, predictable, and achievable. A simple reduction of 1 percent of our carbon emissions each year would capture the public imagination and unify individuals, families, corporations, and government behind this crucial national goal. The goal might need to be strengthened over time, but it would be a strong start.

Set “carbon efficiency” standards for vehicles.

The debate over fuel efficiency standards has bogged down in finger-pointing between Washington and Detroit. To break the impasse, Congress should pass tough standards for “carbon efficiency.” If companies had to reduce the average carbon emissions of their fleet, it would encourage them not only to build lighter, more efficient vehicles, but also to build cars that can run on biofuels and on electricity — rather than simply updating the internal combustion engine. California has recently taken the first step in this direction. This is the technology of the future, and it is where Detroit should be making its investments.

At the same time, Congress or the U.S. EPA should require oil companies to phase out the harmful additives in their gasoline. In the 1970s, when Congress required the elimination of lead in gasoline, oil companies turned to additives called “aromatics” — benzene, toluene, and xylene — to give engines the added octane they used to get from lead. Today, these toxic additives make up more than a quarter of every gallon of gasoline. Their use creates airborne particulates, which cause thousands of premature deaths every year and may be related to the unexplained urban epidemic of asthma among children.

Removing these additives would take some of the “kick” out of gasoline. But that would just be another incentive for motorists to turn to biofuels — which have the power to replace the octane now supplied by aromatics. With this one rule change, we would not only make the air cleaner and improve public health, we would also create additional demand for the next generation of biofuels, made from non-food crops like prairie grasses — so-called cellulosic ethanol — which contribute almost nothing to global warming.

Make energy efficiency the business of utilities.

Today, in almost every state, utilities make more money as their customers use more energy. We should flip those incentives. Utility companies in California are compensated for helping their customers reduce their energy use. They make money by helping customers install better insulation and use more energy-efficient products. When a utility can make more money helping people save energy rather than use energy, that’s a smart set of rules.

We should go one step further and allow utilities to profit by investing in energy efficiency directly. Today, new windows have three times the insulation value as old ones, and new air conditioners use 30 percent to 40 percent less energy than models that are just 10 years old — but they are rarely installed in new homes, because home builders don’t have to pay the utility bills. Even the new homebuyer may only plan to live there for a few years and may not want to invest in energy efficiency.

For utilities, however, a new building is a 50-year energy obligation, and permanently reducing its energy use should be treated as a 50-year asset. Utilities should be able to earn a return on structural investments in energy efficiency just as they do in a new power plant. Indeed, because home-based renewable-energy systems have the effect of reducing demand, utilities should be compensated for buying solar panels and geothermal heat pumps, which will cut a building’s energy consumption for decades.

Modernize the electric power grid to be more efficient and better deliver clean energy.

Nearly every sector of the economy has been made more efficient with the introduction of information technology — but not the electric power grid, which still operates on 50-year-old technology. A modernized, digitally connected national electricity grid will be more secure, reliable, and resilient, allowing quicker restoration of power after outages and the ability to avert large-scale blackouts. Renewable electric power should be given priority access to such a grid.

A modern grid will also be able to manage intermittent power flows from renewable-energy sources and give producers — from farmers with wind turbines in their fields or homeowners with solar panels on their roofs to large solar farms in the desert — a better opportunity to sell electricity back to the grid. Instead of relying only on a few, traditional power plants, utilities will be able to get electricity from a network of clean power providers, which would not only make clean energy more widely available to consumers, but also make the energy supply more stable and secure.

By allowing remote control of energy demand, a modernized grid will also reduce the need for new generation and cut costs to consumers. It will also create new economic opportunities that are unpredictable today, just as other networks — the interstate highway system and the internet — did before.

Increase government support for clean energy.

No industry of any consequence to the country has grown and thrived without government support. According to the Government Accountability Office, the oil industry alone received more than $140 billion in subsidies and tax breaks between 1968 and 2000. In the 21st century, the U.S. government has just as much interest, if not more, in the success of clean energy.

That’s why the government should boost incentives and dramatically increase R&D spending for clean energy — in line with its importance to the national interest. Last year, the federal government spent less than $2 billion on energy R&D — just one-third what it spent 25 years ago, adjusted for inflation. During the same 25-year period, government medical research is up nearly 300 percent to $28 billion, and government military research is up 250 percent to $75 billion.

A major chunk of new money, ironically, should go to a fossil-fuel technology — coal — to enable power plants to capture their carbon emissions and bury them underground. Coal can continue its large role in meeting the nation’s power needs only if its global-warming emissions can be sequestered. A greatly intensified program of research and development is needed in this area. Another chunk of new money should go to utility-grade renewable technologies like solar thermal power plants to create a clean energy horse race.

It’s also crucial that the government invest not only in research and development, or R&D, but also in the other Ds — demonstration and early deployment. The engineering challenge of applying new technologies is just as important as the scientific challenge of discovering them — and government needs to fund both aggressively.

To pay for this work, we can cut back our handouts to the oil companies. It is certainly arguable that all subsidies to oil companies should be eliminated — but at the very least, we should cut off taxpayer support when the price of oil rises above $50 a barrel. President Bush himself has said, “With oil at more than $50 a barrel, by the way, energy companies do not need taxpayers’-funded incentives to explore for oil and gas.”

Tying subsidies to price is only common sense. Just as tax breaks for oil should be phased out as the price rises, subsidies for clean energy should be increased as the price of oil falls, and reduced or eliminated if oil stays near current levels. Last year at the World Economic Forum in Davos, Switzerland, a Saudi official warned: “If biofuels start to take off, the price of oil could drop.” Linking alternative energy subsidies to the price of oil would signal to oil suppliers — and OPEC in particular — that predatory pricing would be futile. Within a decade, clean alternatives to oil will not need subsidies if the scale of markets is large enough.

Changing the rules on subsidies responds to the threats of oil dependence and climate change. Today the rules favor fossil fuels. For the sake of the country, it’s time to switch. If clean energy doesn’t win, we all lose.

These five rule changes will help build a market-based system in which companies and consumers can advance the national interest by acting in their own self-interest.

All the arguments against action — from “global warming is not proven” to “India and China have to go first” — share the same assumption: that accelerating the move to clean energy will impose huge economic costs on the country. That’s a false premise. As soon as we get the rules right, we will create a multibillion-dollar market for new products and technologies here in this country. The sooner we create that market, the sooner companies will emerge to profit from it. Any delay simply forfeits an economic advantage to countries that are more far-sighted in setting their rules.

Nearly 30 years ago, President Carter went on national television and told Americans to turn down their thermostats and put on their sweaters. The message Americans received was one of sacrifice: reduce your energy use and your quality of life.

We saw how well that worked.

People are willing to embrace sacrifice in the midst of an urgent and obvious crisis — but only if they see their sacrifice as a solution, and only if there is an end in sight. That is not the situation we face. To meet today’s energy challenge, hundreds of millions of people must change their habits — not just for a few months or a few years, but forever. That makes our options clearer.

We can try to scold people into embracing sacrifice — and change nothing — or we can offer the kind of choice that can change the world, which is choice that is cheaper, cleaner, better. Choice is what markets do best, but not if government is standing in the way with old rules that favor the industries of the past.

Climate change and oil dependence are pushing us toward a clean, renewable, efficient energy future. The profits to be made in making and selling these technologies are pulling us in the same direction. With one strategic leap, we can wipe out two of the biggest threats to our children’s well-being while creating the high-tech industries that will employ them in the future.

If we just change the rules.

Timothy E. Wirth is president of the United Nations Foundation and a former U.S. senator and undersecretary of state for global affairs. Vinod Khosla is the founding partner of Khosla Ventures and remains an affiliated partner of Kleiner, Perkins, Caufield, & Byers; he was the founding CEO of Sun Microsystems. John D. Podesta is president and CEO of the Center for American Progress and served as White House chief of staff under President Bill Clinton. All three are members of the steering committee of the Energy Future Coalition.