California is the leader of energy innovation in the United States. This status is rooted in the state's unique assets in entrepreneurship, intellectual property and venture capital combined with policy commitments to cleaner energy and lower greenhouse gas emissions.
We can see signs of progress all around: wind and solar farms in the desert, electric vehicles on the highways and solar on rooftops. The state is reaping benefits of these innovations in energy efficiency savings, cleaner air, jobs and business growth. The advanced energy economy is having an impact.
But California is at a critical juncture. The state's commitment to energy progress is about to be tested.
The state is well on its way to hitting its targets for 2020 -- 33 percent of electricity from renewable energy and greenhouse gas emissions reduced to 1990 levels. The goals for 2050 are another matter.
How do we get to greenhouse gas emissions 80 percent below 1990 levels, across all sectors of the economy, by mid-century? Have we built the public, business and financing infrastructure for energy transformation on the scale we will need to reach that goal? How do we support innovation, drive results, and ease concerns about cost?
We won't get there without a pathway. Creating that pathway will require a collaborative effort and new ways of thinking from lawmakers, businesses, and consumers.
The seeds have been planted. Energy efficiency, demand response, storage and smart grid technologies are providing ways to meet growing energy needs with greater reliability and resiliency without more resources. Rooftop solar is making property owners into power producers, meeting their household needs and contributing excess electricity to the grid. Electric vehicles are on the road with vehicles using less gasoline. Technological innovation is disrupting old ways of doing business. Infrastructure is showing its age. Customers are demanding new forms of service.
Still, the pathway to 2050 will be different from the path that got us to where we are today. To their credit, California's policy leaders have not been afraid to experiment in the course of moving the state toward a better energy future. They have given us a Renewable Portfolio Standard to require renewable energy from utilities; cap and trade to reduce carbon emissions and provide resources for investment; Low Carbon Fuel Standard to do the same for vehicle fuels; Prop. 39 to provide energy upgrades for schools and other public buildings; and a dizzying array of state and utility programs.
These policies have put California on the cutting edge. Now, with the Environmental Protection Agency moving to require lower greenhouse gas emissions from the electric power sector in every state, the entire country will follow California's lead.
California may be a trailblazer, but it can learn from others. States like New York, Massachusetts, and Hawaii are working on sweeping reforms of utility business and regulatory models to accommodate rapid change. What will it take to give California an electric power system for the 21st century?
This is just one of the questions that must be answered on the pathway to 2050. How do we implement new technologies on a large scale? How do we hold down costs and ensure that scale brings with it economies? How do we stay nimble, but provide the regulatory certainty necessary for private investment in innovation and business growth? How do we align state-specific goals with regional efforts that grow markets and address grid upgrades? Above all, how do the public and private sectors work together?
California has made a promise of secure, clean, affordable energy to its citizens and to future generations. To deliver on that promise, we need a pathway to 2050. Let's get to work.
Graham Richard is CEO of Advanced Energy Economy, a national business organization. Arno Harris is CEO of Recurrent Energy and an AEE board member. AEE's "Pathway to 2050" conference is Wednesday in Sacramento.