A Cap on Carbon is a Private Sector Stimulus Bill

About one million new jobs in the clean energy field have been created by the American Recovery and Reinvestment Act, better known as the stimulus bill. That’s according the latest report from the Council of Economic Advisers.

That's good news for the clean energy economy, and for those Americans who are looking for work. But we can't rely on tax dollars to finance growth indefinitely. The stimulus bill is a jump start, not a long-term fix.

We need to harness the power of private sector investment if we hope to see long-term growth and job creation. And the best way to do that is through a clean energy bill with a limit on carbon pollution.

That’s what EDF’s president Fred Krupp says in today’s column by New York Times writer Tom Friedman:

As Fred Krupp, the president of Environmental Defense Fund, notes: U.S. utility companies today “are sitting on billions of dollars in job-creating capital — but they will not invest in new energy projects until they have certainty on what their future carbon obligations will be. In just one state, Indiana, there are 25 power plants 50 years old or older. The fleet needs to be modernized, and Senate paralysis is keeping it from happening. A recent study from the Peterson Institute projects annual investment in the sector in the next 10 years would rise by 50 percent as a result of climate legislation — an increase of nearly $11 billion a year.”

That’s new employment from a private sector stimulus.

Political analyst Joe Lockhart is saying almost the same thing. Lockhart is quoted in the Atlantic’s blog in a piece, Cap-and-Trade: The Next Best Stimulus?

We're rapidly approaching the end-date of our near-term economic solutions – and it's not clear that we have a policy to get private dollars moving again once those solutions end. That makes movement on a utility-first cap on carbon emissions essential.

The bottom line: If we pass a climate and clean energy bill with a carbon cap, we’ll create jobs without increasing deficit spending.

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