Good Climate Policy Is Good for Economic Growth

After my first smoggy afternoon in New Delhi last week, I yearned for the preternaturally blue skies we had enjoyed in Beijing a few days earlier.

During a trip to China and India to learn about the growing market for clean technology in Asia, I had the opportunity to join leaders from civil society in New Delhi for the fifth in a series of “Track II” discussions between India and the United States on climate change and energy, organized by the Aspen Institute and the Ananta Center in India. On our final day in Delhi, Carol Browner, the dialogue's co-Chair and former EPA Administrator announced the news from East Asia, where Presidents Xi Jinping and Barack Obama had reached a bilateral agreement to fight climate change.

Around the table in New Delhi, the group began speculating about the implications for India. Would India now be expected to announce its own peak emissions year? Would the United States now redirect its "crosshairs" from China to India in upcoming UN negotiations? Could India's economy cope with more aggressive climate change mitigation?

The questions belied a deeper fear that India would be forced to forego economic growth to help clean up a global crisis that the West created.

While the desire to assign blame is understandable, climate mitigation need not mean economic doom. In fact, China's commitment showed the opposite: a strong economy and meaningful environmental policy are not mutually exclusive; one cannot be had without the other.

For me, an American traveling through Asia, the too often-invisible externalities of carbon-based economies were on full display.

During the Asia Pacific Economic Cooperation meeting that brought Obama to China, Beijing partially shut down one of the world's major economic centers in an effort to temporarily improve air quality. Industry was turned off, thousands of workers sent home and half the city's cars banned from the roads. The skies were "APEC Blue."

In Delhi, air quality has deteriorated over the last decade, too. Elsewhere in India, climate change doomsday scenarios have begun playing out: rising oceans encroach on crops; changing ecosystems force tigers into cities; and drought threatens India's national parks.

But a growing economy and rising sea levels don't have to coincide. Indeed, we now know they are antagonistic. What good is a commercial business district if all the workers have fled in search of breathable air? Or a farm without fresh water?

The U.S-China announcement reflects a dawning understanding that fighting climate change is good business.

From a selfish perspective, this understanding allows firms like Opower to go to Asia and sell clean energy technology. In India, where national missions to develop solar resources and energy efficiency are already in place, investors have led record growth in clean energy generation. Taken together, India's domestic leadership and the new China-U.S. climate deal provides more certainty and predictability to a market that has only recently solidified its footing in the mainstream economy. As more businesses come to the table in support of clean energy development, a model for clean economic growth can become a reality.

We may look back on the Chinese and American announcement as the first crack in the theory that an industrializing economy needs cheap, dirty fuel to propel its growth. Development need not go hand-in-hand with air pollution, traffic, and health risks that ultimately inhibit productivity and competitiveness.

On the eve of our New Delhi Dialogue, we visited Humayun's Tomb in central Delhi. As the sun lowered over the city, the light refracted through the smog giving off a gorgeous red glow. The light illuminated a majestic grave built more than four centuries ago. Mary Nichols, Chair of the California Air Resources Board, recalled similar sunsets over Los Angeles forty years ago. She assured us she didn't miss them.

Jake Levine is Director for Strategy and Chief of Staff at Opower, Inc., a clean technology firm based in Arlington, VA.