A new report proposes investing $25 billion per year in clean energy technologies. Think tanks' new energy plan

With energy legislation left in tatters this year, experts from both sides of the climate debate have some advice for lawmakers: ditch cap and trade.

Extreme political polarization on energy and climate has stalled long-term action on the issues for decades, according to a new report from major liberal and conservative think tanks. The study calls for a “post-partisan” plan that nixes controversial cap-and-trade programs and backs away from dirty fossil fuels in favor of clean energy technology incentives.


“The entire climate and energy agenda that we’ve been talking about for several years now has hit a dead end, to it’s time to hit the reset button,” said Steven Hayward, a scholar at the conservative American Enterprise Institute and a co-author of the study.

AEI will release the report Wednesday along with the liberal-leaning Brookings Institution and the Breakthrough Institute.

The authors blame lawmakers on the left and right for getting wrapped up in the “climate wars” of the last decade while doing little to advance clean energy.

“The choice is not, as liberals often maintain, between global warming apocalypse or mandating the widespread adoption of today’s solar, wind, and electric car technologies,” they write. “Nor is the choice, as conservatives have argued, between an economy wrecked by liberal global warming policies or expanding drilling and nuclear power.”

Instead, they’re proposing a middle ground. And they think the country might have a bigger appetite for compromise after the demise of energy and climate legislation this year.

Their vision: to accelerate energy innovation by investing $25 billion per year in clean energy technologies. The proposal advocates funneling cash into the Energy Department’s science funding, energy education, and the Defense Department’s energy innovation efforts. The authors also advocate a new generation of small nuclear reactors as part of a larger clean energy portfolio.

Federal energy subsidies ought to be overhauled, they say, to reward innovation.

“What we do now is we subsidize existing technologies and we hope that they improve. And sometimes they do, but it’s not disciplined around that,” said Michael Shellenberger, one of the authors and co-founder of the Breakthrough Institute. Under their proposal, he said, technologies that don’t improve would stop getting public investment.

To ensure that the investments don’t add to the deficit, the authors propose a range of financing options, including cutting existing energy subsidies, new royalties for oil drilling, small surcharges on oil imports and a low carbon price.

The authors see politics turning in their favor after election season winds down and lawmakers begin to look for policies that can win bipartisan support.

“I think that forward looking Republicans and Democrats will see this as a top contender for an economic growth strategy,” Shellenberger said.

Even President Obama, who has long advocated cap-and-trade climate legislation, said recently that he’d be open to looking at energy policy that’s done in “chunks.”

The policies laid out in the report “are broadly popular, provide a very broad and appealing American vision of economic transformation and are certainly far more doable than a global pricing system at this point,” said co-author Mark Muro, co-author of the report and a senior fellow at the Brookings Institution.

“I think you hear the president beginning to move in this direction too,” Muro said, adding he sees promise in the fact that Obama is “already talking about chunking.”