Last month, The Economist told us that changes on the scale necessary to prevent even a two-degree rise in global temperatures are a “wishful dream.” The United Nations Intergovernmental Panel on Climate Change’s 2007 Report on Impacts, Adaptation and Vulnerability concluded that the poorest regions in the world were going to suffer the most. And as the world keeps getting warmer, scientists agree that some parts of the world are in “danger of sudden and catastrophic collapse before the end of the century.” But in tragedy lies opportunity, at least for the policymakers and industry leaders who are using global warming as a driver for new investments in innovation and business growth. In fact, the global challenge has prompted a response at nearly every level of government to tie climate planning and energy policy to economic development.
The economic benefits of “clean tech,” a sector that is growing faster than the economy as a whole, has not gone unnoticed. In Clean Tech Job Trends 2010, Clean Edge reports:
“Clean energy continues to fuel the plans of many cities, states, nations, investors, and companies as they look for the next wave of innovation and growth. And on many counts, the clean-energy sector is delivering new job and economic opportunities, as it moves from a once-marginalized niche to an increasingly cost-competitive, mainstream offering. There are many challenges facing the sector, but clean energy and more broadly, clean tech, offer some of the largest growth opportunities on the global economic horizon.”
While the societal costs of climate change are still unknown, the need to combat global warming, develop adaptation strategies, and generally preserve our natural environment has already led to the formation of thousands of new businesses worldwide. But as with economic development generally, every promise of job creation brings regional competition for the entrepreneurs and companies in the emerging industry. Every mayor and city manager wants the new wind developer, solar panel manufacturer, or biofuels start-up to locate within their borders because of the potential to create local jobs.
This competition is playing out at all levels of government. When the U.S. Department of Energy and U.S. Economic Development Administration solicited proposals for the creation of an Energy Innovation Hub focused on developing technologies to make buildings more energy efficient, more than a dozen regions applied. Though Penn State landed this grant, the other applicants are continuing to actively pursue strategies to further their position as the center of the clean tech universe. For example, UC Berkeley, Lawrence Berkeley National Laboratory, and the East Bay Green Corridor Partnership have been putting their heads together since late 2007 to figure out how to leverage their research strengths to build clean energy clusters throughout the East Bay. Though they didn’t land the national grant for this specific project, the organizations continue working together to “create a thriving region of green technology innovation, commercialization, and economic development that generates high quality jobs and meets environmental and social goals.”
The competition remains fierce for these lucrative, job creating opportunities at the state and regional level, as well. Washington State has developed a Green-Economy Strategic Framework to “lay the groundwork for developing a strategic plan for growing Washington’s green economy,” which includes goals for green job creation, policy principles, and a number of recommendations for growing the number of Washington-based clean tech businesses. In Tennessee, the Green Energy Tax Credit has attracted several new solar manufacturers. In the Northeast, nearly 200 organizations have gathered under the banner of the New England Clean Energy Council to “accelerate New England’s clean energy economy to global leadership by building an active community of stakeholders and a world-class cluster of clean energy companies.” Meanwhile, in the Southeastern United States, the SAFER Alliance has outlined the opportunities for bioenergy through the Southern Bioenergy Roadmap. And though many regions proclaim they want to become the next Silicon Valley of clean tech, Silicon Valley has also thrown its hat in that ring (see the February 2009 Joint Venture Silicon Valley Network report, Climate Prosperity: A Greenprint for Silicon Valley).
With the lack of climate leadership at the national and international levels, most of the action on climate and energy policy is likely to stay at the regional & local levels, with workforce development agencies, economic development departments, and Mayors and Governors’ offices at the helm. With catchy names like Mission Verde, Greenlight Greater Portland, and Greener Denver, many cities are developing climate action plans and connecting them with their economic development strategies. Yet there is no magic formula for becoming a “clean tech hub” or building “green tech clusters”—instead, regions will have to experiment with a host of clean energy policies and traditional economic development tools. Those that link the two successfully will have the best chance of becoming meccas for clean tech businesses, bringing along the green jobs and tax revenues that local governments so urgently seek.
Elizabeth Redman is the Founder of Cross Sector Strategies, a consulting firm that specializes in collaborative economic development strategies and policies to promote sustainable business growth.