Before the stimulus package or the congressional bill to reduce carbon emissions, U.S. mayors decided to adopt their own climate policy.
Cities including Boston, San Francisco, and Seattle sent the government a "we'll do it on our own" statement in response to the lack of federal policy. They signed on to the U.S. Mayors Climate Protection Agreement to reach the greenhouse gas reductions targeted by the Kyoto Protocol.
Since the 2005 agreement, some 500 more cities and counting have signed on. And while some cities simply signed the document and moved on, others have used the initiative to draft further strategies that deliver meaningful reductions in emissions.
Early Adopters of Green Products
The most effective strategies, by far, have been those that bring sustainability initiatives into the office of economic development and turn cities into early adopters of "green" products and services. It's exactly this sort of strategy that makes the following cities the best in the country for a cleantech startup. In a May report, Living Cities interviewed sustainability directors around the country. We've landed on the following seven as the best spots to start a cleantech company (more interviews from the report here).
1. San Jose Before Portland, Ore., and San Francisco started competing for the most expansive plug-in electric-vehicle infrastructure, San Jose was a proving ground for the technology. It's part of the city's innovative economic development strategy. "We want to be the R&D arm for the country," says Collin O'Mara, cleantech policy strategist for the city. In addition to having an entire cleantech strategy team, the city has become a liaison between local community colleges and companies in an effort to help create real "green jobs," launched a $3 million venture fund to invest in cleantech back in 2007 (the Economic Development Catalyst fund), and helped bring in the country's second Underwriters Lab testing facility.
It also doesn't hurt that the city is close to the big cleantech venture capitalists on Sand Hill Road, as well as a huge pool of talent compliments of neighboring Stanford University and the University of California at Berkeley. So far, that heady combination has wrestled a Tesla plant away from New Mexico and tempted a number of other cleantech companies, including SunPower and Nanosolar. In fact, O'Mara was so successful as the lead strategist for San Jose, he was just snatched up by the state of Delaware. (This week, O'Mara was nominated as the state of Delaware's Secretary of Natural Resources & Environmental Control, so we may be seeing big things coming out of Dover.)
2. Boston A decade ago, no one in Boston wanted to hear about sustainability; it was too "crunchy granola," said Brian Glascock, director of the office of energy and environment for the city of Boston. That's until they realized they needed to talk about efficiency, which led to fiscal policy, Glascock said. Now the city boasts a $500 million solar initiative, a $2 million green affordable housing project, and building codes that require green construction. In addition, the city is preparing for the carbon market by looking at a green fund that would aggregate small-scale carbon reduction projects into a larger fund that could participate in the market. Companies such as demand-response darling EnerNoc, lithium-ion battery company Boston Power, and solar inverter-maker Satcon operate in Boston, and the city has easy access to talent from both Massachusetts Institute of Technology and Harvard.
3. Austin, Tex. Just as San Jose has been able to leverage its high-tech past to become cleantech central, Austin is using its experience creating an information technology hub to bring cleantech companies to the Lone Star State. In addition, Esther Matthews, director of Austin's Climate Protection Program, said the city set up its Environmental Business Cluster incubator program to look for "technology that would help us in our effort to become carbon-neutral." Austin is also interested in water conservation and pollution control.
4. San Francisco Taking a page from San Jose's book, San Francisco Mayor Gavin Newsom announced to the audience at the Green:Net conference in March that the city by the bay would be a test lab for cleantech. Long before that announcement, however, the city's gigantic (65 full-time staffers with a budget of about $15 million) SF Environment department was hard at work on economic development policies that would help companies offset the high cost of operating in the city.
Solar companies such as Borrego Solar have rented offices in San Francisco to take advantage of the preference for local installers in the city's solar incentive plan. Other cleantech companies, including wireless energy sensor maker Arch Rock Wireless, solar concentrator company GreenVolts, solar developer Recurrent Energy, and GE-backed smart-grid startup Grid Net, have made the city their home to take advantage of support for cleantech businesses and its proximity to the same universities and VC firms that make San Jose attractive.
As Newsom campaigns for governor, chances are it's going to get better and better to be a "green" company in San Francisco, as he told us it would be a major part of his gubernatorial platform. As Jared Blumenfeld, director of SF Environment, put it: "We have no excuses. We have a very educated, environmentally literate, affluent citizenry who elect pretty progressive politicians, and we also have a lot of money as a city government. If you can't do it here, it's going to be very hard to do it somewhere else."
5. Seattle Seattle Mayor Greg Nickels drafted the U.S. Conference of Mayors Climate Action Agreement and has since gone on to turn his city into an environmental leader. In addition to some of the most aggressive green building codes in the country, Nickels recently announced his intention to build an extensive charging network in the city. Despite the downturn in biofuels, the city boasts some of the best access to biodiesel anywhere in the country, thanks in part to its ties to the agricultural community. It continues to offer support to biofuel companies such as Propel Fuels.
Proximity to Boeing's operations also makes Seattle attractive for cleantech companies (for cleantech R&D and algae jet fuel), as does its local socially responsible bank ShoreBank Pacific; active and well-funded social development fund ShoreBank Cascadia Enterprise; cleantech-hungry VCs like Cascadia Capital; and regional utility Puget Sound Energy, which is aiming to ramp up its renewable energy purchases and is open to testing out new technologies, including a $50 million trash-to-fuel pilot. Seattle is also tired of losing out on cleantech cred to its southern West Coast neighbors, which makes it willing to do quite a bit to attract cleantech startups and retain its current roster of cleantech companies, including energy management solution provider PowerIt and nuclear-energy company Helion.
6. Portland, Ore. Besides being every transit planner's dream come true (the city prioritized compact development and mass transit), Portland has made itself one of the best places to be a "green" business in the country. Its new Bureau of Planning & Sustainability brings together the economic development and planning arms of the city's sustainability initiatives. (They were previously separate departments, which is not always great for communication and working together.)
In addition to innovative grants that support renewable energy and a big push to be the first EV-ready U.S. city, Portland plans to use stimulus funds to roll out its own Clean Energy Fund this month, which will fund residential energy retrofits. An emphasis on buying and selling local, an abundance of natural resources, low taxes and property prices, and access to a sustainably minded talent pool (thanks to Portland State University and the University of Oregon) round out the benefits for Portland-based cleantech companies, which currently include solar companies Solaicx and SolarWorld as well as software developer GreenPrint. The next big fish for the city could be Norway's Think Automotive, which scoped out the area as part of its recent site search.
7. Denver "We have traditionally been an energy hub," said Michele Weingarden, director of Greenprint Denver, the city's sustainability initiative. "First with coal, then natural gas, energy production has often fueled a boom-and-bust cycle here. Now both the governor and the mayor have made the recruitment of renewable energy companies a priority." The Green Denver Business program, run out of the city's Office of Economic Development, is working not only to attract new cleantech companies but also to reach out to companies that already exist in the community to make sure they know about available incentives and rebates. Already in the city there's nanotech company ZettaCore and solar company Conergy. The city also benefits from its proximity to the University of Colorado at Boulder. This week, Denver became the first in the country to become ISO 14001 certified, a milestone that's in line with its Greenprint plan and its growing reputation as a "green" city after hosting the lowest-impact Democratic National Convention ever.