Cleantech’s Future Resides in California, Flourishes in Bay Area Cities

By Steven Tavares

Fremont cleantech firm Solyndra.

A report from the Bay Area Council Economic Institute says California’s has a unique opportunity to enhance its international and economic standing in clean technologies, but cautions against the aggressiveness of policymakers in China and Europe within a global context.

The report comes after an election season where conservatives raised doubt over the effectiveness of environmental legislation known as AB 32. It calls the law instrumental in attracting venture capital to the state. The Bay Area and specifically Fremont has made great strides in attracting clean or green tech to the area and may well harness the state’s next great economic revival. The Bay Area Council Economic Institute is a local public policy group founded by the Association of Bay Area Governments. (Click here for the entire report.)

Significant amounts of capital has already been invested in California companies, according to the report, but urges for the state to ramp up access to investment from China. “China’s strong position in particular raises policy and economic issues fro California,” the reports says. Nine Chinese cleantech firms have recently opened offices in San Francisco, including three of the largest, it says.

Two of the state’s largest union pension plans–CalPERS and CalSTRS have  also invested over $500 million into cleantech while the government has issued large loan guarantees to a pair of Fremont-based firms, Solyndra and Tesla Motors. In the last year, Solyndra received a visit from President Obama and $535 million in loan guarantees from the Department of Energy. Tesla received $465 million in loan guarantees from the federal government. Both hope to create 1,000 jobs apiece in the next couple years.

The flood of foreign investment could mirror the rise of Japanese investment 30 years ago, they say. Locally, the partnership between Toyota and General Motors in 1982 resulting in the NUMMI auto plant in Fremont is a prime example. “Some of these companies will eventually manufacture in the U.S. much as Japanese auto manufacturers did starting in the 1970s and 80s,” it said. In the past year, San Leandro Mayor Tony Santos has met with officials from a Chinese solar panel company looking to invest in the area.

Tax exemptions signed by Gov. Arnold Schwarzenegger for cleantech businesses purchasing equipment will also stoke investment in the state, the report says. The passage of AB 32 in 2006 has signaled to investors and competing states and nations, a willingness by California to lead the way in the burgeoning industry. Conservatives had argued through Proposition 23, the landmark environmental law, which failed last November, would kill jobs. Not so, it says. The state’s adoption of various climate change legislation has reversed a national trend of rising energy consumption, the report says. Over the past 30 years, while the state’s population has risen precipitously, the level of energy usage has remained flat. California ranks 47th out of 50 in energy consumption.


Categories: California, CalPERS, climate, economy, energy, Fremont, green, NUMMI, Solyndra, Tesla, Tony Santos

1 reply

  1. Hard to imagine that we are 47th with all the car transportation,Car-li-fornia is how Arnold pronounces it and he's right.Relatively low heating bills I guess.
    With my Clean Energy Reverse Mortgages , we could make a major step in solar development but the government does not touch anything that doesn't have significant donations tied to it.What the new governor might think of doing is buying 10,000 or so electric car batteries from Chevron (it's just a coincidence that an oil company would own a product that could seriously hurt their profits see Cobysis batteries )and start a car conversion industry. Many street mechanics out their who would love to learn the trade.Could be a little like the kitchen remodeling business.


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