1. Climate and Energy at a Crossroads Michael Shellenberger and Ted Nordhaus: Breakthrough Institute Kakushin is Japanese for “radical innovation and renewal”

2. 20 Years of Carbon- Focused Policies Have Failed Copenhagen failure only the latest Cap and trade in trouble. Again. House Dems BTU’d again? Canada and Australia unlikely to move forward without U.S. EU stranded No carbon trading partners No level carbon price playing field The United Nations will not oversee global carbon market, technological revolution, or steady declines in emissions.

3. Policy shift underway from making dirty energy expensive to making clean energy cheap. $40/ton CO2 price in Europe did not stop plans to build 50 more coal plants (without CCS) EU firms bought carbon offsets rather than invest in new technology. US cap and trade would allow 140% offsetting, price of $10 – 20/ton (source: EPA/CBO) (P.S.: We did not get computers through a cap and trade on typewriters)

4. Clean tech deployment from supply-side policies. German feed-in tariff Chinese feed-in + PTC US PTC & ITC Danish wind deployment Nuclear procurement in France, China, US, Denmark — the list goes on and on… We are picking technology winners — and that’s a good thing. DoD procurement of microchips in late ‘50s drove price from $1,000/chip to $20/chip in under 10 yrs.

6. Asia’s Clean-Tech Tigers

7. Asia Governments to Invest 3 Times More Than U.S. Asia will gain “first mover” advantage: economies of scale, learning-by-doing, and innovation Asian government investments are direct and coordinated. U.S. and Europe indirect and uncoordinated. U.S. developed solar, nuclear, wind, and electric car technologies — then lost them to Japan, Denmark, France and others because of its failure to invest.

8. Storm Clouds on Clean Tech Horizon Rapid growth will be difficult to maintain as renewables start to achieve larger market share. E.g., 25% annual growth much easier to maintain at 1% of generation than 10% of generation Subsidy-driven deployment increasingly harder to maintain politically as market share grows: 20% wind = $20 billion annual PTC Rising cost pressure on wind/solar with greater deployment Marginal sites, higher transmission costs, higher load management/storage costs

9. Clean Tech Funding Cliff Ahead

12. Incremental Niche Market Strategy Can’t Deal with Climate Energy Challenge Population to rise to 9 billion, and global energy use will triple by 2050 — must get emissions from energy to zero. 1.5 billion people will still have no electricity — for them, conventional energy is too expensive, not too cheap Stabilizing carbon emissions at 450 ppm means completely decarbonizing global energy supply. “If you gave me one wish for the next 50 years it would be energy at half the cost with zero emissions.” — Bill Gates 2.24.10

13. How to Make Clean Energy Cheap Increase public investment in all stages of innovation — private sector investment will follow. Four Key Technological Breakthroughs: 1.PV efficiency 2.Battery density 3.Biofuel production 4.Mass-manufacture of small self- contained nuclear plants. Deployment for radical cost-reductions, not insignificant emissions reductions.

14. Cheap Clean Energy for All Cheap energy has been central driver of rising global prosperity since beginning of Industrial Revolution. Energy and technology replace hard human labor in ag & simple manufacturing Frees up human capital for higher value enterprise Increasing the cost of energy is thus not a solution for economy, poverty, or environment. The only answer for economy, poverty, environment is radical technological innovation to make clean tech cheaper than coal, oil, and gas.

15. “Prescient.” — Time Thank You! www.theBreakthrough.org