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Clean-Tech Advocates Urge California Global Warming Leadership

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  • Felix Kramer
    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.
    Message 1 of 1 , Aug 21, 2006
      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
      legislation at
      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
      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

      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.

      -- -- -- -- -- -- -- -- -- -- -- --
      Felix Kramer fkramer@...
      Founder California Cars Initiative
      -- -- -- -- -- -- -- -- -- -- -- --
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