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Fighting greenhouse gases: Demise of small business is greatly exaggerated

The demise of small businesses due to AB 32 has been greatly exaggerated. I should know – I founded a small business and clean energy laws like AB 32 are a big part of the reason we are still here. Not because I am a clean tech investor or venture capitalist but because our company, which partners with businesses and communities to convert organic waste to renewable energy, is leading the wave of clean energy job creation that is sweeping across the state.

In “Small businesses feel pinch of curbing greenhouse gases,” (April 25, 2012) John Kabateck of the National Federation of Independent Business (NFIB) references a poll released last week – funded by the AB32 Implementation Group (whose leadership worked with out-of-state oil companies back in 2010 to try, unsuccessfully, to derail AB 32) – and suggests that voters don’t support the state’s efforts to address climate change. We must not have read the same poll results because the data I saw shows plenty of evidence that California voters strongly support the state’s efforts to address climate change.

In fact, the poll shows that a majority of Californians support AB 32 and favor the market-based “cap and trade” system that will launch this year. To Kabateck’s point that voters won’t pay more for goods and services to address climate change – if you frame something as a “hidden energy tax” that will bankrupt businesses, which is right out of the oil companies’ playbook, of course the average person doesn’t want that.

The truth is that there is no component of AB 32 that involves anything hidden or a tax. The cap and trade program is about putting an economy-wide cap on emissions for the largest polluters in the state. There is nothing about that program that is going to negatively impact small businesses. In fact, there are opportunities that business owners can take advantage of through California’s clean energy policies, if planned correctly.

I should know – our company is developing facilities that make renewable energy and fuels from discarded food that would otherwise rot in landfills, releasing pollution and greenhouse gases. And the technology we use is “homegrown” – developed nearby at UC Davis.

Clean energy policies have resulted in a climate of innovation that has allowed us to turn an environmental problem and financial liability into an economic resource. AB 32 has helped us grow our business, and California would be at a competitive disadvantage if it heeded the advice of Mr. Kabateck and the others working to derail the law.

Recent analysis by The Brattle Group found that AB 32 will have a barely noticeable impact on small businesses – less than a tenth of one percent in 2020. By investing in energy efficiency, taking advantage of rebates, incentives, and other programs small businesses can lower their energy costs significantly and achieve cost savings. We even hope some of our fellow small businesses will use our company’s technology to generate their own renewable electricity from the materials they had been previously paying to throw away.

Study after study over the last few years has shown that California can reduce greenhouse gas pollution while growing the economy, and that we have been doing it for the last 35 years since energy efficiency policies were first introduced. AB 32 policies also can increase household income and create hundreds of thousands of jobs.

Mr. Kabateck talks about mending but not ending AB 32, but his organization, NFIB, worked alongside those Texas-based oil companies in 2010 to kill the law. It’s unfortunate that organizations like NFIB are spreading misinformation that could actually hurt the very small businesses they are supposed to represent. Businesses like ours, and thousands of others across the state, see AB 32 as an opportunity. We need to move past exaggeration and distortion and embrace our clean energy future – my business depends on it.

Ed’s Note: Warren Smith is Co-Founder and Senior Vice President Business Development for Sacramento-based Clean World Partners, which promotes sustainable waste management and renewable energy.


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