GREEN GROWTH: FROM RELIGION TO REALITY - Sustainia

Chapter 5take a more traditional corporate investment form whileothers are invested in third party venture funds focusedon clean-tech (Reuters 2010). The funds in question aresignificant, Energy Technology Ventures, a joint venturebetween GE, NRG, ConocoPhilips, is set to invest$300 million in 30 clean tech venture and growth-stagecompanies over the next four years (Danko 2011). Intelhas announced plans to partner with a number of VCfirms and other corporations to invest a total of $3.5 billioninto with a focus on clean tech (Kanellos 2010).3.4 Retaining created valueFinally, regardless of funding mechanism, Californiamust retain enough of the economic value it creates tomake current policy worthwhile. There are two perspectiveson this issue. The first is that while the breakthroughinnovations may be generated in California,evidence suggests that clean-tech may follow traditionalpatterns of global trade with the majority of productiontaking place abroad (Glaeser 2011). Current Californiapolicy lacks a specific link between market creation andcreation of local manufacturing jobs, and it is unclearthat California is positioned to capture these gains. Thesecond perspective, however, is that creation of a largelocal market means gains at other points in the valuechain, such as innovation, installation, construction,marketing, and services. These functions are more likelyto remain local, and could generate significant value intheir own right. This perspective highlights the value ofpolicy creating local markets, and not merely supportingthe competitiveness of industry in global competition(Prabhakar 2011).4 ConclusionTwo key lessons emerge from the California greengrowth case."The first is that green growth policy can be an iterativeprocess in which each round of green or environmentalpolicy helps to broaden the set of constituencies thatare tolerant or supportive of further green policy steps"The first is that green growth policy can be an iterativeprocess in which each round of green or environmentalpolicy helps to broaden the set of constituencies that aretolerant or supportive of further green policy steps. Thus,initial (successful) rounds of pollution and energy efficiencypolicy are credited with building familiarity andsupport among consumers and industry that createda permissive environment for green policy like AB32.AB32 is, in turn, helping to swiftly create a significantindustry group with a direct stake in seeing green policysurvive and expand. This lesson is echoed in the Danishcase; and we see the possible beginning of a similar processin the Colorado case.Second, green growth policies and initiatives musttake into account and coordinate with existing systematicand environmental characteristics. In the case of deregulation,California’s deregulatory moves failed partlybecause they were mismatched with conditions in theregional electricity system California participated in.In that case, mismatch led to failure. California’s cleantech venture capital community now stands at a criticaljuncture. The current VC investment model may provemismatched to the characteristics of clean-tech development.However, it appears that the business communitymay be adapting; continuing to capitalize on the supportiveenvironment created by clean tech market-creatingpolicy while experimenting with new investment models.How well these investment models are able to adaptto clean tech characteristics may determine their success.California green policy works best when it can buildindustry coalitions and ensure long-term policy stability.Industry coalitions work to create sustainable policyacross partisan shifts. Long-term policy stability providesinvestment models the time and incentive to experimentuntil they find success. Energy systems and the economyare large, complex, slow-moving systems, which meansthat designing well-matched policies for these systems isan inherently difficult problem. This suggests green policymoves will work best when they are relatively simpleand open-ended, supporting experimentation.Works CitedBay Area Council Economic Institute (BACEI). 2010. “Global Competitiveness,China and California’s Emerging Clean Energy Economy.”White paper. Last accessed July 28, 2011. http://www.bayeconfor.org/media/files/pdf/CaliforniaChinaCleantech.pdfHanoo, Sindya A. 2010. “Trucking and Oil Industries Protest FuelMandate in California.”New York Times, February 5. http://green.blogs.nytimes.com/2010/02/05/trucking-and-oil-industries-protest-fuel-mandate-in-california.California Air and Resources Board (CARB). 2010. “Cap andTrade 2010.” Last accessed July 28, 2011. http://www.arb.ca.gov/regact/2010/capandtrade10/capandtrade10.htmCalifornia Air Resources Board for the State of California. 2008.“Climate Change Scoping Plan (a framework for change pursuantto AB 32).” Last accessed July 28, 2011. http://www.arb.ca.gov/cc/scopingplan/document/adopted_scoping_plan.pdfDanko, Pete. 2011. “Cleantech Sees Big Players Investing,” Earthtechling,February 9. Last accessed July 28, 2011. http://www.earthtechling.com/2011/02/cleantech-sees-big-players-investing/.Energy Information Administration, Department of Energy. 2009.“The Current and Historical Monthly Retail Sales, Revenues DatabaseElectric Utility Sales and Revenue Data.” Last accessed July 28, 2011.http://www.eia.doe.gov/cneaf/electricity/page/sales_revenue.xlsOMB. 2011. Executive Office of the President of the United States,Office of Management and Budget. Usaspending.gov. Washington,DC: 2011. Last accessed July 28, 2011. http://usaspending.gov/trends.Green Growth: From religion to reality 59