Venture Capitalists to Washington: Price Carbon Already

House Speaker Nancy Pelosi has put organic eggs and hormone-free milk on the House cafeteria menu. Big Cow wasn't pleased. So it unleashed its lobbyist troops to have the healthy competitors removed.

It's a taste of the battles to come when carbon gets a price on the US energy menu.

Who knows when that will be exactly, but there's a growing chorus of influential supporters. We know for one that the American banking sector is anxious for a carbon price signal -- the absence of which has kept the US behind Europe's big banks on seizing lucrative, climate-related investment opportunitiies.

And Silicion Valley is starting to get vocal too. Kleiner Perkins Caufield & Byers -- the top-notch venture capital firm that snatched up Al Gore several months ago to help beef up its cleantech portfolio -- is the latest to voice its concern over Washington's climate inaction. It wants the same market signal that the EU has had for years: a price on carbon, legislatively introduced.

If they get it, they promise immediate results. From Reuters today:

"If we legislatively put a price on carbon... that would be a watershed event in the energy world...It would send a signal to the entire world that the United States understands that climate change is a crisis, and it would be a rallying cry for the rest of the world to work with the U.S," said Kleiner Perkins Caufield & Byers Partner John Denniston.

It would "instantly make any green tech solution more cost-competitive with
fossil-based competitors..Overnight that will happen."

Of course, US politics operates according to its own set of (often alien) rules, where ideology trumps common and business sense as a matter of routine.

But money talks in American politics. And venture capital firms are accumulating a lot of it these days. In fact, they're one of the few financial sectors in America that are richer today than they were in the heyday of the dot.com years.

Here's the final tally for ‘07, just in: 235 venture capital firms closed with $34.7 billion in 2007, an increase of 9.4% from the $31.6 billion in 2006. And the most they've raised since 2001.

It's largely because of cleantech startups and their wide-eyed investors, with their foresight to milk the ingenuity of Silicon Valley to cure America's energy crunch and climate debacle.

So perhaps the wealth that's starting to grow again on the valley's trees will begin to influence climate policy in Congress. Perhaps legislative leaders will begin to think smart on clean energy -- follow the lead of the venture capitalists, heed their calls to action. Why not? These investors have been known to change the world and make obscene amounts of money in the process, one Google at a time...

And putting a price on carbon seems an obvious fix to America's economic and environmental woes. It will deliver regulatory certainly to the markets and wealth to the renewables industry. Hundreds and thousands of new green-collar jobs at a time when there are more florists than coal miners in America. And of course, cuts in carbon pollution.

But obvious to some is anathema to others. And in a town where progress is often a four-letter-word, expect an uphill battle -- organic egg by organic egg, glass of hormone-free milk by glass of hormone-free milk.

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