A package of bills has been proposed that would require the state to generate half of its electricity from renewables such as solar and wind, cut petroleum use by 50% and double the energy efficiency of existing buildings, all by 2030.
The package would set strong new targets for reducing carbon emissions that contribute to climate change and establish a panel of experts to recommend clean-energy strategies that would generate jobs. One measure would require the state’s largest pension funds to divest in coal.
The measures have drawn the predictable support of environmental groups concerned about climate change.
They deserve the strong – and enthusiastic – backing of business, too.
Simply put, clean energy is good for the state’s economy.
Bloomberg recently reported that the 26 California companies in its Clean Energy Index added employees at a median annual rate of 9.5 percent for the past two years — more than quadruple the 2.3 percent for the 115 U.S.-based companies in the index.
Clean energy now employs more people in California than the motion picture and aerospace industries, according to the Advanced Energy Economy Institute.
I’ve spent my career in Silicon Valley, an area that thrives due to a confluence of factors including a diversity of brainy entrepreneurs, risk-embracing investors, a strong university research base, and the right market-friendly policies. Those factors still exist for cultivating a rejuvenating cleantech industry for our state. Since 2006, investors have put more than $27 billion in venture capital and other types of investment in California clean tech companies, according to Next 10, and our state universities conduct some of the best research in the world on new innovation for the emerging sustainable technology economy.
This growth can mean opportunities for many California industries including the agricultural sector, too. For example, our Just Business start-up incubator works with Andrew’s Ag Solutions, which innovated a process that converts farm manure into organic fertilizer. This is a new income stream for farmers, and mitigates a powerful greenhouse gas. California can continue to deploy the right policies to accelerate adoption of solutions like this.
Business leaders are increasingly seeing a strong clean-energy agenda as not only good but necessary for economic growth.
A bipartisan business-focused group that includes former U.S. Treasury Secretaries Henry Paulson, a Republican, and Robert Rubin, a Democrat, warned last year that climate change could cost the U.S. economy billions of dollars, from lower crop yields in the Midwest to massive property losses from rising sea levels on the east and gulf coasts.
The White House Council on Economic Advisors also warned that the cost of addressing climate change will rise by about 40 percent each decade in which action is delayed. Investing today will yield better returns in the future.
The connection between the environment and the economy is at the core of Environmental Entrepreneurs, a group I belong to.
Nationally, we’ve been involved in financing, creating or working in the early development of more than 1,700 companies, which have created over 570,000 jobs. Our members manage over $175 billion in private equity capital that will flow over the next several years into new companies.
At the federal level, businesses, including a number of Fortune 500 companies based in California, have gotten behind the U.S. Environmental Protection Agency’s plan to limit carbon pollution from power plants.
Here in California, we have become a national leader in promoting clean energy and spurring innovation through visionary laws such as the 2006 landmark global warming law, 33% renewable portfolio standard, and low-carbon fuel standard.
Let’s increase the momentum with further leadership from California. It’s good for environment – and the economy.
Ed’s Note: Mark Bauhaus, a veteran technology and marketing expert, is a partner in the Silicon Valley-based Just Business.