Why does the US need energy innovation?

Train pulling out of station by Mike Wilson Unsplash
Editor's note:

“In Unpacked, Brookings experts provide fact-based analysis of Trump administration policies and news.”

THE ISSUE: As the Trump administration forges ahead with its revised energy policies, including a decision to withdraw from the Paris Agreement, and as global efforts to reduce carbon emissions continue, research shows that the threat of climate change and a lack of energy innovation extends beyond just the environment. In the U.S., a decline in funding and patents for clean tech innovation risks harming U.S. economic growth and global competitiveness, while stalling progress toward combatting climate change.

We have a responsibility to continue the advancement of our economy, and there are tremendous economic opportunities in clean tech.


  • Clean tech innovation is a $1.4 trillion global economy and it would be very unfortunate for the United States to remain sidelined during the growth of that over the next 20 years.
  • Moreover, we need energy innovation to respond effectively to the threats of global climate change.
  • If the administration is interested in reducing carbon emissions while providing affordable energy services to all, then it needs to double down on energy innovation.
  • Energy innovation has clear, proven implications for the economy. We have a responsibility to continue the advancement of our economy, and there are tremendous economic opportunities in clean tech.
  • Secretary of State Rex Tillerson and Secretary of Energy Rick Perry have both said that energy innovation is crucial to turning the American economy around.
  • Research finds that patenting trends for clean tech innovations grew significantly since 2001, but have started to slow down in recent years.
  • Compared to U.S. companies, foreign companies are patenting clean tech innovations at a much higher rate.
  • Taken together, these trends raise serious concerns about the competitiveness of the United States in the clean tech innovation landscape and the ability of the U.S. to effectively respond to the threat of climate change.
  • Recent research also identifies risks associated with the slowing pace of venture capital investment in the United States.
  • Venture capital is critical for helping great concepts and entrepreneurial ideas begin to scale up and grow. Without having strong venture capital or other early stage financing, many great ideas won’t make it to the marketplace.
  • There’s the possibility of simply missing out by slowing the pace of innovation. If we had stopped investing, we may not have had the Tesla car, or easy access to solar PV on rooftops. There are very real, material losses that the public and the market might incur if we stop trying to roll these technologies out quickly.
  • There’s also the question of whether or not the United States is going to participate in the $1.4 trillion global economy. Nations like China are moving to dominate this economy and it would be a shame for the United States to take itself out of the game.
  • Without innovation and major advances in clean energy technology, the United States and the rest of the world will only be able to offer modest improvements in their future climate plans, and that won’t be enough.
  • Energy innovation is the ultimate solution to the challenge of climate change.