That money will fund research in solar energy, biofuels, nuclear energy, underground storage of carbon dioxide and hydrogen.
In addition, the White House has called for a 10-year extension in a tax credit for businesses investing in R&D. That time frame marks a long-term commitment to innovation, Obama said.
"We need some inventiveness. Your country needs you to mount a historical effort to end, once and for all, our dependence on foreign oil," Obama said. "Your country will support you, and your president will support you."
The stimulus package includes $55 billion in spending and tax incentives for green tech, which will lead to 3.5 million jobs, mostly in the private sector, Obama said.
To those who would rail against government support for this industry over any other, Paul Holland, a venture capitalists at Foundation Capital, offered a more realistic evaluation of the role of government tax policy.
Many successful tech companies, like Intel and Netflix, would "not be where they are today if it were not for the progressive policies, such as the federal R&D tax credit and the stimulus plan," Holland said.
"The middle tier of finance--the private equity firms, which were pretty vital to clean tech have been decimated over the last couple of years," he said. "The federal government has become the provider of last resort in that part of the food chain."