Clean-Tech Advocates Urge California Global Warming Leadership
- Last week, a group of entrepreneurs and advocates
spent the day at the Capitol expressing support
for AB32, the Californi Global Warming Solutions
Act of 2006. If enacted, this bill will become
the world's flagship legislation for evolving
economies to reduce carbon. At the highlight
event, a press conference with Assembly Speaker
Fabian Nunez, and other meetings, my 100+MPG
PHEV, which I drove to Sacramento, was repeatedly
cited as an example of the economic possibilities of green/clean technology.
AB32 is in late stages of negotiation between
Assembly and Senate leaders and the Governor,
with the goal of passing the bill by the end of
the month. Below is the press release, followed
by some of the media coverage. (More info on the
The same day, a group of California economists
released a letter to the Governor entitled, "The
most Expensive Think We Can Do Is Nothing." --
you can find this and other info at
Business and Innovation Leaders Rally to Support AB 32 in Sacramento
Call It a "Job Creation" Bill Needed for California Leadership in Greentech
Sacramento, Calif., August 16, 2006 - Six
business and innovation leaders from across the
state announced their support for the California
Global Warming Solutions Act of 2006 (Assembly
Bill 32), calling it a "job creation" bill that
will spur economic, environmental and health
benefits. The group of concerned California
leaders, including John Doerr, partner at Kleiner
Perkins Caufield & Byers, Bob Epstein, co-founder
of Sybase, GetActive Software and Environmental
Entrepreneurs, Larry Gross, CEO of Altra, Felix
Kramer, founder of the California Cars
Initiative, Jack Newman, co-founder and research
VP of Amyris, Ellen Pao, KPCB partner, and Dave
Pearce, Miasole CEO, met with Assembly members
and senators in Sacramento today to share their views.
"Just as California leads in high-tech and
biotech, we can lead or follow in greentech,"
said John Doerr. "The choice is clear: Are we
going to innovate and prosper, or stagnate and
suffocate? Or, would we rather fund farmers or
terrorists? AB 32 may be controversial in its
newness and innovation, but it is the right move for California."
"AB 32 delivers solutions to global warming that
create new jobs and green sources of energy for
all Californians," Bob Epstein said. "California
is exporting nearly $30 billion every year -
that's $2,500 from every Californian household -
to buy fossil fuels. AB 32 will bring that money back to California."
According to the California Environmental
Protection Agency, worldwide demand for new
technologies developed to reduce global warming
emissions will create an annual global market of
over $180 million. The California Climate Action
Team determined that global warming action would
increase Californians' income by over $4 billion
and provide approximately 83,000 new jobs.
"The most expensive thing in the world we can do
is nothing," said Larry Gross. "Global warming
pollution reductions are inevitable, but
uncertainty over how governments will enable
those reductions is choking economic growth. AB
32 will create market certainty and spur
investment in a multi-billion dollar global
greentech industry. We applaud co-sponsors
Speaker Fabian Núñez and Assembly Member Fran
Pavley, as well as the other tenacious members of
the House and Senate who worked with them to create and drive AB 32."
Three of California's largest industries,
agriculture, wine and tourism, will suffer
dramatic losses if global warming emissions
continue unabated. Small firms, which operate on
slim profit margins are most vulnerable to global warming losses.
"We see California as the beachhead for federal
and international change," Dave Pearce said.
"California was the first to adopt energy
efficiency standards for buildings and appliances
in the late 1970s. Now these standards exist
across the nation and even in Russia and
China. Our clean cars law has been adopted by
ten other states and Canada-and will reduce
global warming emissions in 2010 by more than 64
million tons of carbon dioxide a year."
These leaders met in May 2006 as part of the
Greentech Innovation Network, comprising 50 of
the world's leading entrepreneurs, scientists and
policymakers from the United States, Asia, Europe
and South America. Members of the networking
event built a strategic map for evaluating needs
and encouraging innovation, and forged new
partnerships in support of greentech policy and technology.
Global-warming bill generates political heat
Clean-tech push exposes rift within business community
By Michael Gardner
COPLEY NEWS SERVICE
August 21, 2006
SACRAMENTO Californians could eventually see
subtle and dramatic innovations in grocery
stores, new-car showrooms and kitchens if
Republican Gov. Arnold Schwarzenegger and leading
Democrats agree on legislation aimed at slowing global warming.
Venture capitalists and entrepreneurs say a
commitment from the state to regulate greenhouse
gases would send a confidence-building signal to
the marketplace, spurring a clean-tech revolution
on par with the surge in high-tech and biotech
that has helped drive California's economy.
Sustainable technologies are the next big thing.
This is really the mother of all markets, said
John Doerr, a billionaire who helped launch
Google, Intuit and the Segway scooter.
Unlike Doerr and other entrepreneurs who stand to
make money off state-ordered clean technology,
industries such as cement makers, utilities and
manufacturers remain worried about emissions
caps. The California Chamber of Commerce has
warned that additional regulations would lead to
a spike in energy prices and job losses.
By placing an arbitrary carbon-emissions cap on
California employers, we would be encouraging
them to leave our state and take jobs to
countries or states that do not impose caps,
said Allan Zaremberg, president of the state
Chamber of Commerce. When employers move to
other global locations, they may produce even more carbon emissions.
On Thursday, the Senate Appropriations Committee
approved the legislation, Assembly Bill 32.
Most researchers agree that unchecked greenhouse
gases, primarily carbon dioxide, could disrupt
global climate patterns, threaten crops, raise
the risk of forest fires and shrink Sierra
snowpacks that hold water for millions of
Southern Californians. However, a few skeptics
say the climate shifts have little to do with
human emissions and may be part of historic weather patterns.
Schwarzenegger has made the issue a centerpiece
of his environmental agenda as he runs for
re-election, proposing a rollback of emissions to 1990 levels by 2020.
Schwarzenegger's push puts him at odds with the
state Chamber of Commerce, one of his closest
allies. But other business interests are eager to
see the measure pass, convinced that state
regulations will prod demand for their
energy-saving products, from hybrid cars to solar panels.
Doerr, who led a contingent of investors and
entrepreneurs on a Capitol lobbying trip last
week, said Californians should not be surprised to see big and small changes.
Seven years ago, there was no Google. That's how
fast Californians can change the world, Doerr said.
Grocery stores already are starting to adapt by
putting goods such as milk and eggs behind doors
instead of in open refrigeration units.
Time-of-use metering, common on farms and in
other industries, may come to the kitchen and
laundry room as power companies seek to
discourage the use of large appliances by
charging more during periods of peak energy demand.
California already has moved to push car makers
to curb greenhouse gas emissions in their fleets
starting with the 2009 models. Demand for hybrids
such as the Toyota Prius and Honda Civic continues to outstrip production.
Moreover, said entrepreneur Felix Kramer,
state-required reductions from all industries
would spark investment interest in his venture, a
hybrid car that plugs into a wall socket and gets
the equivalent of 100 miles per gallon of gas.
It's important to have a long-term market and
stable demand. That's what we need, Kramer said.
The legislation and regulations will provide that.
The endorsement of leading entrepreneurs with a
stake in clean-air technologies has helped shift
the debate and has handed business-friendly
Democrats a reason to support the legislation in an election year.
It's bringing new voices to the fight. When you
have new voices, it makes good political sense to
exercise them, said Ann Notthoff, state advocacy
director for the Natural Resources Defense Council.
Schwarzenegger appears confident that a
compromise bill will reach his desk before the
Legislature ends its session for the year by the end of the month.
There will be some environmentalists who say
this is not perfect and there will be other
people in the business community who will say
this is not perfect, Schwarzenegger said
Wednesday. For us, the challenge is to prove
that we can protect the environment and also
protect the economy at the same time.
That may be impossible, economist Margo Thorning
said. She argued that fuel prices will soar as
utilities and refiners recoup their investment in
reducing emissions. In turn, consumers and
businesses will squeeze their spending to pay higher energy bills.
People don't have unlimited resources, Thorning said.
However, a recent study by the University of
California Berkeley concluded that California's
economy will see a net gain in jobs amid an
injection of new investment in technology.
Although Democrats and the governor are in
agreement on a broad framework, they remain split
on three major points: how much industry should
be allowed to buy pollution credits elsewhere to
meet required targets, what powers to grant a
regulatory agency and how to temporarily relieve
businesses of obligations in a natural or economic disaster.
Environmentalists say California is positioned to
show the way nationally, leading to lowered
expenses as more technology comes to the market.
The entire country is looking to California to
lead, said Jim Marston, an Environmental Defense
attorney involved in global warming issues nationally.
Business generally agrees on that point. But
Kevin Fay, who represents a consortium of large
corporations that included DuPont, Boeing and
General Electric, called the legislation a big gamble.
No economy this size, Fay said, has gone it alone in the world.
Businesses divided over warming bill's bottom line
Mark Martin, Chronicle Sacramento Bureau
Thursday, August 17, 2006
(08-17) 04:00 PDT Sacramento -- A push to make
California the first state in the country to cap
greenhouse gas emissions has many businesses
split over whether the new limits would hobble
the state's economy or create jobs and big profits.
The debate has intensified as Democratic
lawmakers and Gov. Arnold Schwarzenegger, a
frequent ally of big business who also touts his
efforts to fight global warming, try to reach a
compromise before Aug. 31 on what is perhaps the
most closely watched piece of environmental legislation in the country.
Traditional business groups such as the state
Chamber of Commerce and Farm Bureau Federation
oppose the legislation. The chamber is running a
radio advertising campaign that seeks to torpedo
support for the measure as the legislative session winds down.
But several venture capitalists and entrepreneurs
promoting the legislation argued Wednesday that
new regulations would create a boom in industries
such as solar power and biofuels that will power
the California economy for decades.
Also on Wednesday, a UC Berkeley study predicted
that reducing greenhouse gas emissions in the
state would create 17,000 new jobs and add $60
billion to the gross state product by 2020.
"Green technologies, sustainable technologies,
are the next big thing,'' said John Doerr, a
partner in the powerhouse Silicon Valley venture
capital firm Kleiner, Perkins, Caufield & Byers.
"This really is the mother of all markets."
Business groups opposed
A coalition of business groups, however,
forecasts higher gas and electricity prices and
fewer jobs if California adopts the first-in-the-nation caps.
"It's just not appropriate for California
businesses to go this alone,'' said Dorothy
Rothrock, an executive with the California
Manufacturers and Technology Association. "We are
already in a state where it costs 24 percent more
to do business, and this will only increase that.''
The legislation, AB32, authored by Assembly
Speaker Fabian Núñez, D-Los Angeles, and
Assemblywoman Fran Pavley, D-Agoura Hills (Los
Angeles County), would require a 20 percent
reduction in the amount of carbon dioxide and
other greenhouse gases emitted into the air by
2020. Industries would be required to begin
making reductions in 2012. Schwarzenegger and
lawmakers are still negotiating over some aspects
of the bill, including who would set up new
regulations for businesses and draw up other plans to meet the target.
Some measures to cut greenhouse gasses, such as a
law requiring automakers to reduce car emissions
and efforts to boost the use of solar power,
already have been approved by state agencies.
The legislation has a key hearing today in the
state Senate Appropriations Committee and could
be voted on by the full Senate as early as Monday.
Governor supports caps
Schwarzenegger, who signed an executive order
last summer setting state targets to reduce
greenhouse gas emissions, has indicated he
supports setting caps into law. But the
administration has proposed amendments to the
bill that some environmentalists say will weaken
it by allowing deadlines to be delayed.
Both Núñez and Linda Adams, head of
Schwarzenegger's Environmental Protection Agency,
said this week they were working closely to come
up with a bill that both lawmakers and the
governor can support. And a legislative source
familiar with the negotiations said an agreement
could be announced as early as today.
The heart of the broader debate is how a major
change in the energy use of businesses and individuals will affect the economy.
The coalition opposing the legislation predicts
that limits on companies' energy use will be
disastrous. The group has cited studies by Margot
Thorning, a Washington, D.C.-based economist who
works for the American Council for Capital
Formation, a business-funded think tank.
Thorning argues that companies will move out of
state to avoid the regulations, causing a loss of
jobs in California. She also notes that
greenhouse gas caps are likely to force some
companies to simply slow down production, which
also would hurt the economy, and could force
electricity utilities to increase prices as they
seek other sources to produce electricity.
The business coalition's push against the bill,
which has included radio advertisements around the state, has angered some.
"The Chamber of Commerce needs to back off,''
Núñez said at a Capitol news conference
Wednesday. "They've cried wolf one too many times.''
Technology could add jobs
And other studies predict an economic boom. A
Schwarzenegger-created task force formed to come
up with ways to reduce greenhouse gases suggested
that a cap would add more than 80,000 new jobs.
And the study released Wednesday, by David
Roland-Holst, an adjunct professor of
agricultural and resource economics at UC
Berkeley, suggests that California businesses and
consumers would save money through energy
efficiency that will lower electricity bills. The
report also suggests that businesses with lower
power bills will invest money elsewhere and create jobs.
"Yes, there will be adaptation costs,'' said Alex
Farrell, a UC Berkeley professor who helped with
the study. "But those up-front costs will easily pay for themselves.''
Some companies that have already made moves to
reduce greenhouse gas emissions agree.
Sonoma Wine Co., which bottles 1.5 million cases
of wine per year and which supports the
legislation, is planning a $2 million investment
that will reduce its greenhouse gas emissions by 50 percent per case.
The changes will largely come through better
insulation of its 135 wine tanks, which will
dramatically lower electricity costs, said
Natasha Granoff, director of business development for the company.
"It absolutely makes bottom-line sense,'' said
Granoff, noting the company estimates it will
recoup its investment in two years through lower energy bills.
E-mail Mark Martin at markmartin@....
Posted on Thu, Aug. 17, 2006
Supporters rally around emissions bill
Problem areas are governing board makeup, role in
meeting caps and opponents say it increases energy costs
By Mike Zapler
TIMES SACRAMENTO BUREAU
SACRAMENTO - A hotly contested bill to reduce
greenhouse gas emissions in California would spur
a wave of new clean energy technology, prominent
Silicon Valley venture capitalist John Doerr predicted Wednesday.
Entrepreneurs "are going to go out and compete
and innovate to bring enormous solutions to the
market" if the legislation passes, Doerr, a
leading partner at Kleiner, Perkins, Caufield &
Byers, said at a news conference at the Capitol.
He was joined by Assembly Speaker Fabian Nunez,
D-Los Angeles, and executives from several alternative energy companies.
Assembly bill 32, authored by Nunez and
Assemblywoman Fran Pavley, D-Woodland Hills,
would mandate cuts in statewide greenhouse gas
emissions to 1990 levels by the year 2020 -- a
roughly 25 percent reduction. The bill, one of
the most contentious issues pending in the
Legislature this summer, has drawn intense
opposition from some business groups that say it
will drive up energy costs and prompt some companies to leave the state.
But Doerr's appearance underscored that sentiment
within the business community is divided. He said
that companies stand to gain by embracing
conservation and alternatives to burning fossil fuels.
"I think the losers will be those who don't change," Doerr said.
His comments came on the same day that a UC
Berkeley study was released that predicts the
greenhouse gas legislation would spur billions in
economic activity and create thousands of jobs as
companies invest in new energy technology. But
opponents countered that the study did not
account for the actual costs of complying with the legislation.
The bill's prospects appear bright. Gov. Arnold
Schwarzenegger has endorsed the basic framework;
he is negotiating with Democrats over how it
would be enforced. Among the sticking points are
the makeup of a governing board that would
oversee the program, and a dispute over what role
a pollution-trading system would have in meeting
the caps. That system would essentially create a
market for carbon emissions, allowing companies
that fall below the caps to sell credits to
businesses that are unable to meet the mandatory limits.
Schwarzenegger and Democrats are also at odds
over a proposed "escape hatch" that would allow
the governing body to ease the emissions
deadlines under certain circumstances, including
if it finds that compliance would be "detrimental
to the economy." Administration officials insist
the clause is meant to give the state flexibility
to respond to an emergency, not to let industry off the hook.
Nunez criticized the California Chamber of
Commerce for what he called its "knee-jerk"
opposition to the bill. The chamber has labeled
AB 32 a "job killer" and is working to block it.
"The Chamber of Commerce needs to just back off,"
Nunez said. "They've cried wolf one too many
times" about legislation that would purportedly harm the economy.
A spokesman for the Chamber of Commerce said
Nunez's comments indicate that his constituents
are starting to understand the consequences of
the bill -- and they are relaying their concerns to the Assembly speaker.
"The bill is going to increase energy costs in
California," the chamber's Vince Sollitto said.
"That makes California companies less competitive
and California a less attractive place for businesses to invest."
A business umbrella group and environmentalist
organizations have launched competing advertising
campaigns to promote their positions.
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Felix Kramer fkramer@...
Founder California Cars Initiative
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