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Metro Orlando

Cleantech Assets, Capabilities, Presence, & Potential

Commissioned by Richard T. Crotty Orange County Mayor October 2009

University of Central Florida Institute for Economic Competitiveness


Metro Orlando Cleantech Report

Commissioned by Orange County Mayor Richard T. Crotty, this study assesses Metro Orlando’s Assets, Capabilities, and Potential in the cleantech industry. The study methodology includes both comprehensive primary and secondary research in the cleantech industry as well as a survey within the local business market. The study also uses input from the series of cleantech symposiums that were launched by Mayor Richard T. Crotty. In this report, we highlight the evolution of the cleantech industry, and we study the six major cleantech areas of opportunity for the region, based on our research. We also highlight the existing cleantech clusters and initiatives; Metro Orlando’s current strengths, including its natural resources, educational institutions, supporting organizations; the Metro Orlando cleantech industry; its potential for growth, including the region’s economic strengths, the leadership, its R&D capabilities, and its strong technology base. Finally, we share the findings of the survey and make recommendations on the best course of actions in the near or medium future, including the policies that could benefit the region. Institute for Economic Competitiveness University of Central Florida College of Business Administration P.O. Box 161400 Phone 407.823.1453, Fax 407.823.1454 iec@bus.ucf.edu Director: Dr. Sean M. Snaith Project manager: Marielle Granjean

RESEARCHERS/WRITERS: Laura Burkstrand Erin Garlow Amanda Silvestri CONTRIBUTING PHOTOGRAPHERS: Scott Todd www.stoddphotography.com Thomas Baker LAYOUT & DESIGN: MV Design PUBLISH DATE: October 7, 2009 The Institute for Economic Competitiveness wishes to extend a special thank you to John Lewis, Orange County Economic Development Administrator, for his advice and guidance throughout the preparation of this study.


Welcome Message

This benchmark study is an initiative between Orange County and the UCF Institute for Economic Competitiveness, located in the College of Business Administration. Our college has established a strong partnership with Orange County, and I am pleased to work together once again. Our faculty, students, alumni and constituents all benefit from this relationship. For example, the county supports research in our Institute for Economic Competitiveness. This commitment allows us to provide economic expertise to a statewide and national audience. Orange County has also enabled us to enhance our college by providing the support needed to create the Richard T. Crotty Orange County Endowed Chair. Our partnership with Orange County expands off-campus as well. The county sponsors events at our Small Business Development Center, and assists with the Advisory Board Council. The Council helps established Orange County businesses by matching them with a wide-range of experienced professionals who work together on a “custom-fit� advisory board. Orange County has a continuing relationship with the UCF Incubator and the Disney Entrepreneurship Center, which houses our Small Business Development Center. Further, we have all worked closely with the Metro Orlando Economic Development Commission. This Metro Orlando Cleantech study includes research that will benefit our growing region. The data and recommendations provided by our Institute for Economic Competitiveness will help attract and retain environmentally-friendly businesses to Central Florida. I am delighted that Orange County has been, and continues to be, such a vital partner in all our efforts. UCF Stands for Opportunity, and Orange County plays a critical role in providing opportunities for our college.

Thom as L . Keon Sincerely,

Thomas L. Keon Dean, UCF College of Business Administration


Table of Contents Executive Summary............................................................................. 5

Overall Economic Strength.......................................................128

CHAPTER 1: The Cleantech Revolution.......................................... 6

Population Growth.....................................................................129

What is Cleantech?......................................................................... 7

Cost of Living.............................................................................130

Cleantech Segments....................................................................... 8

Unemployment...........................................................................130

Industry Makeup............................................................................ 9

Income Growth..........................................................................130 Per Capita Metro Product.......................................................... 131

CHAPTER 2: Global Trends in Growth and Investment.............. 11

Cleantech Growth........................................................................ 11

Cleantech Patents......................................................................... 11

Global 2008 Investments.............................................................12

Global Investment Trends............................................................ 13

North America............................................................................. 14

China............................................................................................ 16

Europe.......................................................................................... 16

CHAPTER 3: The Cleantech Opportunity.................................... 17

Cleantech as an Engine of Growth.............................................. 17

What is Driving Cleantech?......................................................... 17

Building a High-Tech Economy................................................ 133

New Vision for Metro Orlando’s Economic Development........ 133 Metro Orlando and Renewable Energy.....................................134

Metro Orlando Economic Development Commission.............134

Central Florida Research Park................................................... 135

Recent Initiatives taken by Orange County Mayor Richard T. Crotty........................................................... 135 Strong Research and Technology Transfer................................136 Established Technology Clusters...............................................138 Skilled Labor.............................................................................. 139 Attractive Location for Entrepreneurs....................................... 140

Solar Energy.................................................................................22

Wind Power..................................................................................34

CHAPTER 10: Survey Findings and Priorities............................ 141

Biofuels......................................................................................... 42

Green Buildings........................................................................... 49

Smart Grid.................................................................................... 59

Personal Transportation............................................................... 71

Green-Collar Jobs........................................................................ 78

Cleantech Jobs..............................................................................80

Green-Collar Job Training.......................................................... 81

Green Job Policies......................................................................... 82

Main Cleantech Clusters in the U.S. ........................................... 85 Cleantech in Europe..................................................................... 93

What Are Emerging Economies Doing?..................................... 93

Policy as Crucial Factor in Cleantech Investment: The Case of California.................................................................. 94

CHAPTER 7: Metro Orlando: Assets and Resources.....................97

Natural Resources and Weather..................................................97

Metro Orlando Research Institutions........................................100

Supporting Organizations......................................................... 105

State and Local Cleantech Programs, Policies, and Initiatives............................................................................. 113 Market Analysis......................................................................... 119

Select Metro Orlando Cleantech Companies............................ 121

CHAPTER 9: Potential for Growth: Contributing Factors..........128

Economic Performance..............................................................128

Survey Key Findings.................................................................. 142

Third Orange County Cleantech Symposium Feedback........... 144

Priorities..................................................................................... 145

CHAPTER 11: Key Findings, Recommendations, and Proposals.............................................................................. 146

Findings...................................................................................... 146

Recommendations...................................................................... 149

Businesses...................................................................................150

17-Point Action Proposal........................................................... 151

Conclusion........................................................................................ 158 CHAPTER 12: Appendices

CHAPTER 8: Metro Orlando’s Cleantech Industry..................... 119

Survey Participants..................................................................... 141

Academia....................................................................................150

Clusters and Economic Growth...................................................83

Policymakers............................................................................... 149

CHAPTER 6: Cleantech Hotspots and Clusters............................83

Economic Outlook..................................................................... 131

CHAPTER 4: Clean Technologies and Sectors..............................22

CHAPTER 5: Jobs........................................................................... 78

Appendix A - Directory of Metro Orlando Cleantech Companies................................................................ 159

Appendix B - Municipal Solid Waste, Water, and Wastewater Departments.................................................... 167

Appendix C - Orange County Cleantech Symposium Participants............................................................. 168

Appendix D - Presenters at Orange County Cleantech Symposiums.............................................................. 169

Appendix E - Orlando's Cost of Living vs. Other Cleantech Cities......................................................................... 170

Appendix F - UCF Technology Incubator's Partners................ 171

Appendix G - CREOL'S Partners............................................. 172

Appendix H - Companies at the Central Florida Research Park............................................................................. 173

Appendix I - Florida High Tech Corridor Council Partners..... 174

Appendix J - Metro Orlando Cleantech Survey........................ 176

Institute for Economic Competitiveness Staff Bios......................... 182


Executive Summary Over the past several decades, climate change concerns have driven governments around the globe to introduce policies and pass very ambitious laws to encourage environmentally friendly technology— both for economic and security reasons. Consumers and businesses are demanding cleaner products and services that not only protect the environment but also cost less and use resources more efficiently. The response to climate change has also changed the agenda of many executives, from emerging growth companies to leading multinationals. As this shift is taking place in public policies, consumer demands, and business strategies, a new economy is evolving. This has facilitated the development of techniques that can increase resilience to the impacts of climate change. As those worldwide efforts continue to rise, innovative technology and research are considerably lowering the cost of environmental and green technology, providing a breakthrough in economic growth and business opportunities. Clean technology, or cleantech, is born. By recognizing the value of cleantech both as a key economic driver and a moral responsibility, countries, regions, and cities around the world are competing to transform their cities into “hubs of science and technology.” Government agencies, universities, national laboratories, and businesses are taking a proactive role to increase investment in clean technologies. In the U.S., state and local governments are joining the race by taking initiatives to develop cleantech clusters, spur economic growth, and create jobs. According to the Cleantech Group, global clean technology investments amounted to $8.4 billion in 2008, marking the seventh straight year of growth. Clean technology’s global market value is estimated at $284 billion and is expected to reach over $1.3 trillion in 2017. Many cleantech initiatives have been implemented, from San Diego,

California to Boston, Massachusetts, through Seattle, Washington and Austin, Texas, and cleantech clusters are thriving. Thanks to its evident strengths both in its research institutions and its industries, Metro Orlando is well positioned to achieve scientific preeminence in clean technology-based research, to develop and strengthen its cleantech industry, to attract major clean technology companies, and to create homegrown ones. The University of Central Florida (UCF) is one of the leading research universities in the country. With $123 million in grants awarded in 2008, a patent portfolio among the top ten in the nation, and many award winning faculty, UCF plays a critical role in the region’s human capital and innovation economy. UCF’s well-known departments and incubators generate many of the skilled scientists, engineers, and entrepreneurs vital to the high-tech companies that are part of the cleantech industry. Metro Orlando is home to various industries, such as Advanced Manufacturing; Agro Technology; Aviation and Aerospace; Financial Services and Financial Technology; Life Sciences and Biotechnology; Modeling, Simulation and Training; Optics and Photonics; and Software and Hardware. Such an environment prone to business and technology, supported by the Economic Development Commission, the UCF Technology Incubator, the UCF Venture Lab, the Institute for Economic Competitiveness, and many other organizations, creates the right climate of innovation and entrepreneurship to nurture and grow cleantech companies. The strong relationships that exist within the region among its academic institutions, business sector, and local governments provide a unique opportunity for Metro Orlando to create a positive environment that is conducive to the region’s continued economic success.

17-Point Action Proposal 1. Establish a Cleantech Leadership Council. 2. Build new marketing strategies to brand Metro Orlando as a serious cleantech cluster. 3.

Promote new partnerships between UCF and other regional academic and research institutions.

4. Enact comprehensive green building codes and ordinances. 5. Encourage more access to capital by creating targeted cleantech funds. 6.

Create the Clean Energy Challenge Grants to encourage researchers to develop and commercialize new technologies.

7. Promote the adoption of the Renewable Energy Portfolio Standard in Florida.

8. Promote the creation of a Florida Clean Energy Public Fund. 9. Develop cleantech cluster related strategies.

1 0. Create a Cleantech Incubator within the Business Incubator at UCF.

11. Undertake a smart grid initiative. 12. Promote a feed-in tariff system. 1 3. Create a Cleantech Center at UCF. 1 4.

1 5.

Fully integrate UCF cleantechrelated entities into Metro Orlando’s Economic Development Strategies and Programs.

Increase funding and support for UCF economic development programs supporting the creation and growth of cleantech companies.

1 6. Establish a permanent Green Jobs Steering Committee.

17. Encourage Green Transportation Initiatives. See page 151 for full Proposal.


The Cleantech Revolution During the past several decades, due to an increased awareness of environmental issues such as global warming, climate change, water and air pollution, and increased energy use, there has been a global, concerted effort by all sectors of society— governments, academic scientists, civil society, and businesses—to reduce greenhouse gas emissions worldwide. As climate change and other environmental challenges are getting widely recognized, more actions have been taken to not only address them, but also simultaneously explore the opportunities they present.1

1 6

The United Nations Environmental Programme (UNEP).

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


“So what’s the next big thing? I believe it is cleantech. If we are to further diversify our local economy, cleantech is at the top of the list. That’s what’s going to make us the community of tomorrow.” – Richard T. Crotty, Orange County Mayor. First Orange County Cleantech Symposium. Nov. 5, 2008

This shift, in turn, has facilitated the development of techniques that can increase resilience to the impacts of climate change. As those worldwide efforts continue to rise, innovative technology and research are considerably lowering the cost of environmental and green technology, providing a breakthrough in economic growth and business opportunities. Environmental issues are, thus, increasingly seen as opportunities for innovation, promoting new products, processes, markets, and business models.2 Consumers and businesses are demanding cleaner products and services that not only protect the environment but also cost less and use resources more efficiently. The response to climate change has also changed the agenda of many executives, from emerging growth companies to leading multinationals. As this growing shift is taking place in public policies, business strategies, and consumer demands, a new economy – a green economy – is evolving. Government agencies, universities, national laboratories, and venture capitalists are taking a proactive role to increase investment in clean technologies. Thus, cleantech is born. After the “dotcom” boom of the 1990s, cleantech promises to be the next industrial revolution that will affect our way of life: it will change where we live and work, the products and services we seek, research by scientists and university scholars, new business strategies and investments, and policy development by our nations, states, and cities alike.3 Cleantech has taken center stage in all major government, corporate, and research entities, in their search to offer goods and services that add profit and are safe for the environment. All in all, cleantech represents this new premise and paradigm shift that will determine the future of many generations to come. “It’s kind of everywhere. It’s kind of 2 3

Makower, Joel. 2009. Strategies for the Green Economy: Opportunities and Challenges in the new World of Business. McGraw-Hill. 2009 Ron Pernick and Clint Wilder. The Clean Tech Revolution: Discover the Top Trends, Technologies, and Companies to Watch. Harper Collins. New York. 2008.

mercurial. It’s across all economic sectors and up and down the ladder,” said John Lewis, Director, Orange County Office of Economic, Trade & Tourism Development.4

What is Cleantech? According to the Cleantech Group, cleantech is “new technology and related business models offering competitive returns for investors and customers while providing solutions to global challenges.”5 The concept embraces a diverse range of products, services, and processes across industry verticals that are inherently designed to provide superior performance at lower costs, greatly reduce or eliminate negative ecological impact, and improve the productive and responsible use of natural resources.6 The term emerged with the formation of the Cleantech Group, LLC, in 2002. Since its inception, the Cleantech Group, through its network, has been popularizing clean technology as the new wave of environmental and technological innovation, tracking investors’ and entrepreneurs’ activities throughout the cleantech industry. Pioneer in the cleantech sector, the Cleantech Group has been providing leading global market research in clean technology investments and markets since 2002. Their worldwide network of investors and entrepreneurs represents trillions of dollars in assets and has access to a great deal of information, including leading research data on venture capital, investment deals, sales leads, promotional opportunities, and special cleantech events. Many large corporations, as well as governments worldwide, consult with the firm for advisory services.7 Cleantech differs from its precursors primarily because clean technologies are market driven and add economic value for investors and businesses, while other 4

5 6 7

Lewis, John. Orange County Office of Economic, Trade & Tourism Development. Orange County First Cleantech Symposium. November 5, 2008. The Cleantech Group. http://cleantech.com The Cleantech Group. Ibid. Ibid. CHAPTER 1: The Cleantech Revolution

7


Figure 1.

This is a Venn diagram depicting the relationship between cleantech and greentech:

Primarily market driven

Clean Technology

technologies, such as greentech, are primarily regulated by the government. Clean technology is considered more sustainable because it offers investors the opportunity for greater financial returns than its counterpart and, therefore, is funded more prominently.8 To be considered “cleantech,” products and services must: •

• •

Optimize use of natural resources, offering a cleaner or less wasteful alternative to traditional products and services;

Have their genesis in an innovative or novel technology or application;

Add economic value compared to traditional alternatives.

Considering these, Cleantech Economic Development might be “attracting, creating, and growing highvalue innovative companies that produce the products and provide the services that allow us and the rest of the world to go green.”9

Cleantech Segments The cleantech industry can be divided into 11 segments.10 The following is a basic guide to these segments.11 These sectors encompass a wide range of industries to which clean technologies can be applied. 8 9 10 11

8

Ibid. Lewis, John. Ibid. Orange County Second Cleantech Symposium. January 21, 2009. The Cleantech Group. Ibid. Ibid.

Unlimited returns Greater sustainability

Concern for the environment

Energy Generation Among the fastest growing sectors with the greatest amount of investment capital, Energy Generation is one of the most important sectors in cleantech. It involves the production and conversion of renewable energy. This sector includes wind, solar/photovoltaic (PV), hydromarine, biofuels, geothermal, and other energy production sources. Energy Storage This sector involves the economically efficient methods for the storing of energy. This includes advanced batteries, including thin film and rechargeable; power quality regulation; flywheels; electro-textiles; fuel cells; and hybrid systems. Energy Infrastructure This sector deals with the effective management and transmission of energy. This involves wireless networks to utilities for advanced metering, power quality monitoring and outage management, integrated electronic systems for the management of distributed power, and demand response and energy management software.

Primarily regulatory driven Limited returns

Green Technology

Limited sustainability

Energy Efficiency Energy Efficiency is a management process for more effective use of renewable energy. It involves energy management systems, systems that improve output of power generating plants, intelligent metering, solid state micro-refrigeration, control technology for heating, ventilating, and air conditioning systems, and automated energy conservation networks. Transportation This sector includes hybrid vehicle technology, lighter materials for cars, smart logistics software, car-sharing, temperature pressure sensors to improve transportation fuel efficiency, and telecommuting. Water & Wastewater As an important sector for North America, Europe, and the Middle East, the Water & Wastewater sector deals with treatment and conservation. This sector involves water recycling and ultra-filtration systems—for example, ultraviolet membranes and ion exchange systems, sensors and automation systems, water utility sub-metering technology, and desalination equipment.

“Cleantech = Green + Innovation + Value Added. Clean is more than green. ” — John Lewis, Orange County Office of Economic, Trade & Tourism Development

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


Air & Environment The Air & Environment sector includes the cleanup and safety of air, emissions controls, government-business monitoring and control, and the trading and offsets market. This sector involves air purification products and air filtration systems, energy efficient HVAC (an acronym for “heating, ventilating, and air conditioning”), universal gas detectors, multi-pollutant controls, and fuel additives to increase efficiency and reduce toxic emissions.

Agriculture The Agriculture sector deals with natural pesticides, land management, and aquaculture. This sector includes bio-based materials, farm efficiency technologies, micro-irrigation systems, bio-remediation, non-toxic cleaners, and natural pesticides. This sector does not include organic or natural health products. Recycling & Waste The Recycling & Waste sector includes recycling technologies, waste treatment, Internet marketplaces for materials, hazardous waste remediation, and biomimetic technology for advanced metals separation and extraction.

Materials This sector includes biodegradable materials derived from seed proteins, micro-fluidics technology for conducting biochemical reactions, nano-materials, composite materials, thermal regulating fibers and fabrics, environmentally friendly solvents, nano-technology components for electronics, sensor applications and energy storage, electrochromic glass, and thermoelectric materials.

Industry Makeup According to the Cleantech Group, LLC’s Investment Monitor, recent venture capital in North American clean technologies has been highest in the Transportation sector. This sector has taken up nearly a quarter of the venture capital as of the second quarter of 2009. Following close behind Transportation is the Energy Efficiency sector. The next three major areas of spending are in Energy Generation, Energy Storage, and Energy Infrastructure. The following is a breakdown of the percentages of venture capital funds spent in the second quarter of 2009 in the 11 cleantech sectors in North America.

Manufacturing/Industrial The Manufacturing/Industrial sector includes advanced packaging, natural chemistry, sensors, smart construction materials, business process and data flow mapping tools, precision manufacturing instruments and fault detectors, and chemical management services.

Figure 2. North America 2Q09 Percentage of Total VC Investment by Sector 0.92% 1.32% 0.66% 4.75% 5.76% 23.95% Transportation

7.20%

Energy Efficiency Energy Generation Energy Storage Energy Infrastructure Air & Environment

15.06%

Materials Manufacturing/Industrial Water & Wastewater 20.50%

19.87%

Recycling & Waste

Source: Cleantech Investment Monitor 2009 Annual Review & 2Q09 Quarterly. Cleantech Group, LLC. 2009. p. 33

Cleantech Industry Segments Energy Generation Wind Solar Hydro/Marine Biofuels Geothermal Energy Storage Fuel Cells Advanced Batteries Hybrid Systems Energy Infrastructure Infrastructure Management Transmission Energy Efficiency Lighting Buildings Glass Transportation Vehicles Logistics Structures Fuels Water & Wastewater Water Treatment Water Conservation Wastewater Treatment Air & Environment Cleanup/Safety Emissions Control Monitoring/Compliance Smart Production Materials Nano Bio Chemical Manufacturing/Industrial Advanced Packaging Monitoring & Control Smart Production Agriculture Natural Pesticides Land Management Aquaculture Recycling & Waste Recycling Waste Treatment Source: www.cleantech.com

CHAPTER 1: The Cleantech Revolution

9


The following is a breakdown of the dollar amounts spent on each sector in North America in the second quarter of 2009. Table 1. Breakdown of North America Investments by Sector 2Q09

First Sector Seed $ DisC Round $ DisC Air & Environment – – – – Energy Efficiency – – $64 M 5 Energy Generation $1 M 3 $24 M 5 Energy Infrastructure $2 M 1 – – Energy Storage – – – – Manufacturing/Industrial – – $5 M 1 Materials – – $4 M 2 Recycling & Waste – – – – $1000 K Transportation 3 – – Water & Wastewater – – – – Grand Total

$4 M

7

$97 M

13

Followon $ DisC Total $ DisC $50 M 1 $50 M 1 $114 M 15 $178 M 20 $147 M 11 $173 M 19 $61 M 3 $63 M 4 $131 M 5 $131 M 5 $7 M 2 $12 M 3 $38 M 3 $41 M 5 $6 M 2 $6 M 2 $207 M 5 $208 M 8 $8 M 1 $8 M 1 $767 M

48 $868 M

68

Source: Cleantech Investment Monitor 2009 Annual Review & 2Q09 Quarterly. Cleantech Group, LLC. 2009. p. 33

In Europe, the concentration of venture capital in 2009 has been in Energy Generation. This sector takes up over half of the total venture capital funds. It is followed by Transportation with almost one-fifth of the venture capital. Energy Efficiency comes in third, with almost one-seventh of the funds. The following is a breakdown of the percentages of venture capital funds spent in the second quarter of 2009 in the 11 cleantech sectors in Europe. Figure 3. 2Q09 European VC Investment by Sector 1.90%

1.55%

1.49%

3.74%

3.97% 4.81% Energy Generation Transportation Energy Efficiency 13.35%

51.28%

Energy Storage Manufacturing/Industrial Water & Wastewater Air & Environment Energy Infrastructure Recycling & Waste

Source: Cleantech Investment Monitor 2009 Annual Review & 2Q09 Quarterly. Cleantech Group, LLC. 2009. p. 36

17.92%

The following is a breakdown of the dollar amounts spent on each sector in Europe in just the second quarter of 2009. Table 2. Breakdown of Europe Investments by Sector 2Q09

First Sector Seed $ DisC Round $ DisC Air & Environment – – – – Energy Efficiency $2 M 1 $1 M 1 $40 M 6 – – Energy Generation Energy Infrastructure – – – – Energy Storage – – – – Manufacturing/Industrial $2 M 1 – – Recycling & Waste – – – – Transportation $39 M 1 $12 M 1 Water & Wastewater $1 M 1 – – Grand Total

$44 M

4

$53 M

8

Followon $ DisC $5 M 1 $35 M 6 $106 M 6 $4 M 1 $14 M 1 $10 M 2 $4 M 1

$9 M

4

$188 M

22

Total $ DisC $5 M 1 $38 M 8 $146 M 12 $4 M 1 $14 M 1 $11 M 3 $4 M 1 $51 M 2 $11 M 5 $285 M

34

Source: Cleantech Investment Monitor 2009 Annual Review & 2Q09 Quarterly. Cleantech Group, LLC. 2009. p. 37 10

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

List of Works Consulted 1.

Cleantech Industry in San Diego. UC San Diego, 2007.

2.

Cleantech Investment Monitor 2009 Annual Review & 2Q09 Quarterly. Cleantech Group, LLC. 2009.

3.

Cleantech Group, LLC http://cleantech.com

4.

http://cleantech.com/about/ cleantechdefinition.cfm

5.

Lewis, John. Cleantech Reference Guide. Orange County Office of Economic, Trade & Tourism Development. 5 Nov 2008.

6.

Makower, Joel. 2009. Strategies for the Green Economy: Opportunities and Challenges in the new World of Business. McGraw-Hill.

7.

Ron Pernick and Clint Wilder. The Clean Tech Revolution: Discover the Top Trends, Technologies, and Companies to Watch. Harper Collins. New York, 2008.

8.

United Nations Environment Programme (UNEP) www.unep.org

9.

U.S. Department of Energy www.eere.energy.gov


Global Trends in Growth & Investment

Figure 2. Energy Infrastructure 4.3%

CLEAN TECHNOLOGY PATENTS, 1999 to 2008 Solar

Geothermal 0.8% Hydro 0.8%

Wind 5.0%

8.7%

Batteries 46.6%

Hybrid Systems 8.2%

SOURCE: Pew Charitable Trusts, 2009, based on data from 1790 Analystics; analysis by Pew Center on the States and Collabrative Economics.

Fuel Cells 25.6%

Figure 1.

Figure 3.

Global Clean-Energy Projected Growth 2008-2018 ($US Billions)

Biofuels

600

$105.4 $139.1

+96%

$50

Hybrid Systems

200

$80.6

$25

Fuel Cells

300

+147%

$29.6

$0

-33%

400

$51.4

Solar Power

Batteries

500

2008 2018

$34.8 Wind Power

TRENDS IN ENERGY STORAGE PATENTS, 1999-2008

100

$75

$100

$125

$150

$175

$200

$225

$250

$275

$300

0

$325

TOTAL

’00 ’02 ’04 ’06 ’08

’00 ’02 ’04 ’06 ’08

’00 ’02 ’04 ’06 ’08

SOURCE: Pew Charitable Trusts, 2009, based on data from 1790 Analystics; analysis by Pew Center on the States and Collaborative Economics.

$325.1 $115.9

Figure 4.

Source: Clean Edge, 2009

Cleantech drives new business and financial models. Already, the market for clean technology accounts for between 20 percent and 25 percent of all global energy investment.

Cleantech Growth In 2007, clean technology’s global market value was estimated at $284 billion, to reach over $1.3 trillion in 2017.12 Renewable energy sources will be the largest beneficiary sector of this investment, with more than one-third going to biofuels, solar, tidal, and wind power. From a growth standpoint, the outlook through 2018 is strong for clean technologies and is expected to grow at about 20.9 percent over the next decade. In 2008, revenue growth in the three main clean energy sectors – biofuels, solar, and wind – expanded by 53 percent.13 Indeed, according to Clean Edge, global revenues in solar, wind, and biofuels increased from $75.8 billion in 2007 to $115.9 billion in 2008 and 12 13

Cleantech: Current Status and Worldwide Outlook. Fuji-Keizai U.S.A., Inc. 2008. Makower, Joel, Pernick, Ron, Wilder, Clint. Clean Energy Trends 2009. March 2009.

are expected to reach $325.1 billion in 2018.14 See Figure 1.

Cleantech Patents A major indicator of the growth of cleantech is the trends in patent registrations. Patent registration statistics will indicate the future of technology and what will be introduced into the market in the coming years. The protection and control that a patent provides is a vital component to bringing a technology through the early steps of development. Particularly with cuttingedge clean technologies, patents are essential due to the large capital invested up-front.15 Between 1999 and 2008, 8,384 clean energy technology patents were registered in the United States.16 Figure 2 exhibits the spread of these patents over eight different areas of technology. Though battery technology has accounted for almost half of all registered patents, other technologies 14 15 16

Makower, Pernick, and Wilder. Ibid. The Clean Energy Economy. The Pew Charitable Trusts. June 2009. The Clean Energy Economy. Ibid.

GROWTH OF WIND AND SOLAR PATENTS, 1999-2008 100

80

Solar energy

Wind energy

-15%

+155%

60

40

20

0

’99 ’00 ’01 ’02 ’03 ’04 ’05 ’06 ’07 ’08

’99 ’00 ’01 ’02 ’03 ’04 ’05 ’06 ’07 ’08

SOURCE: Pew Charitable Trusts, 2009, based on data from 1790 Analystics; analysis by Pew Center on the States and Collaborative Economics.

have been advancing. While the battery sector has seen a minor decline in new patents, the fuel cell and hybrid systems sectors are seeing a significant increase.17 See Figure 3. Within the category of energy generation, solar technology has been the traditional leader. However, in recent years, the number of new patents has seen a slight decline. Many companies in the sector have focused on improving and implementing existing technology. By comparison, patents in the wind technology sector have seen a rapid increase.18 See Figure 4. 17 18

Ibid. Ibid.

CHAPTER 2: Global Trends in Growth and Investment

11


Global 2008 Investments The cleantech market is the third-largest venture capital investment category, behind only biotech and software.19 According to the Cleantech Group, global clean technology investments reached a record high of $8.4 billion in 2008, marking a seventh straight year of growth. “As expected, clean technology venture investing slowed in 4Q08, but it is important not to miss the forest for the trees,” said Nicholas Parker, Executive Chairman of the Cleantech Group. “In 2008, there was a quantum leap in talent, resources, and institutional appetite for clean technologies. Now, more than ever, clean technologies represent the biggest opportunities for job and wealth creation.”20

Table 1.

Top Venture Capital Clean Technology Sectors in 2008 Technology Sector Solar

Amount Invested $3.3 billion

% of total 40%

Biofuels (including ethanol, biodiesel, synthetic biology, algae)

$904 million 11%

Transportation (including electric vehicles, advanced batteries, fuel cells

$795 million

9.5%

Wind

$502 million

6.0%

Smart Grid

$345 million

4.1%

Agriculture

$166 million

2.0%

Water

$148 million

1.8%

Source: Cleantech Group

In mergers and acquisitions (M&A), cleantech raised an amount of $33 billion with 260 transactions in 2007, which represented a 46% annual increase in transactions and a 140% annual increase in transaction value. 21 Current cleantech M&A activity so far in 2009 has been $12 billion with 263 transactions. 22 But according to the Cleantech Group, 2008 cleantech M&A totaled an estimated 163 disclosed transactions totaling $40.4 billion, a 22% increase annual increase in value. 23 See Table 2 for the top M&A transactions. Fifty-seven global cleantech IPOs raised $17 billion in 2007, a 24% annual increase in transactions and a 98% annual increase in raised capital.24 But, according to the Cleantech Group, clean technology public offerings in 2008 totaled an amount of $5.1 billion in 16 IPOs.25 Current cleantech IPO activity as of the second quarter of 2009 has seen 7 IPOs totaling $369 million. 26

Table 2. Top 5 Clean Technology M&A Transactions in 2008 Acquiring Company Iberdrola SA

Target Company Energy East Corp.

Amount $4.6 billion

Type Acquisition

LBO France

Converteam Group SAS

$3.1 billion

Minority Stake

Scottish & Southern Energy Plc.

Airtricity Holdings, Ltd.

$2.6 billion

Acquisition

International Power Plc.

Trinergy Ltd.

$2.5 billion

Acquisition

Arcapita

Honiton Energy Ltd.

$2.0 billion

Joint Venture Source: Cleantech Group

Table 3. Top 5 Clean Technology IPOs in 2008 Company

IPO Date

Amount Raised

Exchange

EDP Renovaveis, S.A

06/04/2008

$2.4 billion

NYSE Euronext Lisbon

American Water Works Company, Inc.

04/23/2008

$1.2 billion

NYSE

SMA Solar Technology

06/26/2008

$570 million

Frankfurt

GT Solar, Inc.

07/24/2008

$500 million

NASDAQ

Energy Recovery, Inc.

07/02/2008

$69 million

NASDAQ

Source: Cleantech Group

19 20 21 22 23 24 25 26 12

Makower, Pernick, and Wilder. Ibid. Ritch, Emma. Record 2008 for Cleantech with $8.4B in Investments. Cleantech Group. January 6, 2009. Ernst and Young. Venture Insights, 2Q. 2008. Cleantech Investment Monitor 2009 Annual Review & 2Q09 Quarterly. Cleantech Group, LLC. 2009. p. 27 The Cleantech Group, LLC. www.cleantech.com Babiak, J. and Forer, G. Ernst & Young. Transformation Global Cleantech Insights and Trends Report 2008-2009. Cleantech Investment Monitor 2009 Annual Review & 2Q09 Quarterly. Ibid. p. 28 The Cleantech Group. Ibid. METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


Cleantech funding rounds in 2008 were dominated by U.S.-based solar companies: Table 4. Five Largest Clean Technology Rounds in 2008 Company

Description

NanoSolar (USA)

Thin-film solar (CIGS)

Amount Raised

Solyndra (USA

Thin-film solar (CIGS)

$219 million

SoloPower (USA)

Thin-film solar (CIGS)

$200 million

$300 million

WinWinD Oy (Finland) Wind Thurbines

$177 million

Solar Reserve (USA)

$140 million

Concentrated Solar Thermal

Source: Cleantech Group

Global Investment Trends The following is an international overview of the major trends in investment and growth in clean technology, with focus on the most influential regions in cleantech. Table 5. Historical Clean Technology VC Investment By Year North America, Europe & Israel, China, India 20 01

$506,780,774

2002

$883,269,409

2003

$1,258,565,762

2004

$1,398,256,823

2005

$2,077,524,074

2006

$4,520,208,949

2007

$6,087,179,844

2008 (preliminary)

$8,414,259,610 Source: Cleantech Group

Figure 5 below details venture capital investment by quarter from 2000 to 2Q09.

Billions

Figure 5. Cleantech Venture Capital Investment by Quarter Cleantech Venture Investment by Quarter $9.0 B $8.0 B $1.7 B $7.0 B

4Q

3Q

2Q

1Q

$6.0 B $1.7 B

$5.0 B

$2.8 B

$4.0 B $1.9 B

$3.0 B

$2.2 B

$2.0 B

$1.3 B

$1.0 B $1.1 B

$1.3 B $1.8 B

$1.1 B

$0.0 B 2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Source: Cleantech Investment Monitor 2009 Annual Review & 2Q09 Quarterly. Cleantech Group, LLC. 2009. p. 29

CHAPTER 2: Global Trends in Growth and Investment

13


Figure 6 below depicts VC investments by region. Figure 6. 2Q09 Cleantech VC Investment by World Region 10.01% 4.28%

North America 21.32%

Europe/Isreal

65.06%

China/HK/Taiwan India/South Asia

Source: Cleantech Investment Monitor 2009 Annual Review & 2Q09 Quarterly. Cleantech Group, LLC. 2009. p. 20

North America North American venture capital investment in cleantech dominates global investment. In 2006, North American investment in cleantech was $2.9 billion. In 2007, it was $3.9 billion, an increase of 38 percent. Cleantech investment in the United States, at $3 billion in 2007 alone, accounts for the majority of North American investment. This trend continued in 2008. U.S. companies raised $5.8 billion in 241 rounds, up 56% from 2007 and representing 68% of the global total.27 North America accounted for 67% or $1.6 billion of the amount raised in the first two quarters of 2009. Figure 7. North America Cleantech Venture Capital Investment 2Q01-2Q09 100

$1.8 B

90

$1.6 B

80

$1.4 B

70

$1.2 B

60

$1.0 B

50

$0.8 B

40

$0.6 B

30

$0.4 B

20

$0.2 B

10

$0.0 B

0

2Q 01 3Q 01 4Q 01 1Q 02 2Q 02 3Q 02 4Q 02 1Q 03 2Q 03 3Q 03 4Q 03 1Q 04 2Q 04 3Q 04 4Q 04 1Q 05 2Q 05 3Q 05 4Q 05 1Q 06 2Q 06 3Q 06 4Q 06 1Q 07 2Q 07 3Q 07 4Q 07 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 2Q 09

$2.0 B

Source: Cleantech Investment Monitor 2009 Annual Review & 2Q09 Quarterly. Cleantech Group, LLC. 2009. p. 32

27 14

Ibid. METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


Below is a breakdown by sector of cleantech VC investment in the U.S. in the second quarter of 2009. Figure 8. North America 2Q09 Percentage of Total VC Investment by Sector 0.92% 1.32% 0.66% 4.75% 5.76% 23.95% Transportation

7.20%

Energy Efficiency Energy Generation Energy Storage Energy Infrastructure Air & Environment

15.06%

Materials Manufacturing/Industrial Water & Wastewater 20.50%

Recycling & Waste Source: Cleantech Investment Monitor 2009 Annual Review & 2Q09 Quarterly. Cleantech Group, LLC. 2009. p. 33

19.87%

As a percentage of total venture investments, energy technology grew from half a percentage point in 2000 to 11.8 percent in 2008. 28 The following table taken from the Clean Energy Trends 2009, an annual report from Clean Edge, depicts the trends in energy-tech VC. Table 6.

Clean-Energy Venture Capital Investments in U.S.-Based Companies as Percent of Total

Year

Total Venture Investments (U.S. $ Billions)

Energy Technology Investments (U.S. $ Millions)

Energy Technology Percentage of Venture Total

2000

$105.1

$599

0.6%

2001

$40.6

$584

2.2%

2002

$22.0

$483

2.2%

2003

$19.7

$446

2.3%

2004

$22.5

$663

2.9%

2005

$23.0

$1,038

4.5%

2006

$26.5

$1,555

5.9%

2007

$29.4

$2,665

9.1%

2008

$28.3

$3,351

11.84%

Source: Clean Energy Trends 2009 28

Makower, J., Pernick, R., and Wilder, C. Clean Energy Trends 2009. Clean Edge. March 2009. CHAPTER 2: Global Trends in Growth and Investment

15


$900 M

80

$800 M

70

$700 M

60

$600 M

50

$500 M 40 $400 M 30 $300 M 20

$200 M

At a market value of $200 billion for renewable energy and environmental protection, the country with the largest market for cleantech in the world is China. Cleantech venture capital in China grew from $400 million in 2006 to $550 million in 2007 and is expected to reach over $720 million in 2008.29 China has also tripled its government investments on cleantech, boosting its share of GDP from 1.3 percent to 1.5 percent. Total cleantech investments include: $172 billion for environmental protection, $37 billion for desulphurization, $25 billion for industrial waste water treatment, $25 billion for vehicle exhaust gas, and $22 billion for municipal wastewater treatment.30

10

$100 M $0 M

2Q 01 3Q 01 4Q 01 1Q 02 2Q 02 3Q 02 4Q 02 1Q 03 2Q 03 3Q 03 4Q 03 1Q 04 2Q 04 3Q 04 4Q 04 1Q 05 2Q 05 3Q 05 4Q 05 1Q 06 2Q 06 3Q 06 4Q 06 1Q 07 2Q 07 3Q 07 4Q 07 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 2Q 09

0

Figure 10. 2Q09 European VC Investment by Sector 1.90%

1.55%

1.49%

3.74% 3.97% 4.81%

Energy Generation Transportation Energy Efficiency Energy Storage

13.35%

51.28%

Air & Environment Energy Infrastructure Recycling & Waste

List of Works Consulted 1.

3. 4. 5.

30 31 16

Huayu, Li. China has world’s largest cleantech market: Tsin Capital. China Daily. January 10, 2008 Huayu, Li. Ibid. The Cleantech Group. Ibid.

Source: Cleantech Investment Monitor 2009 Annual Review & 2Q09 Quarterly. Cleantech Group, LLC. 2009. p. 36

17.92%

2.

29

Manufacturing/Industrial Water & Wastewater

Europe In Europe, emulating the global trend, total VC investment in clean technology rose from $283 million in 2006 to $360 million in 2007.31 Although Europe’s total VC investment in cleantech is considerably smaller than U.S. investment, Europe is home to select cleantech component leaders. Germany, for example, is the world’s leader in solar energy production.

Source: Cleantech Investment Monitor 2009 Annual Review & 2Q09 Quarterly. Cleantech Group, LLC. 2009. p. 35

China

Figure 9. Europe Cleantech Venture Capital Investment 2Q01-2Q09 Millions

According to the same report, energy-tech venture capital figures include renewable energy, biofuels, low-carbon technologies, and the carbon markets. Venture capital figures are for development and initial commercialization of technologies, products, and services, and do not include private investments in public equity (PIPE) or expansion of capital deals.

6.

Babiak, J. and Forer, G. Ernst & Young. Transformation Global Cleantech Insights and Trends Report 2008-2009

7.

Cleantech: Current Status and Worldwide Outlook. 2008. Fuji-Keizai U.S.A., Inc.

9.

Enrst & Young. Venture Insights, 2Q , 2008.

11. www.chinadaily.com.cn energy/2008-01/10/ content_6384761.htm

Cleantech Group, LLC Website. www.cleantechnetwork.com

8.

Makower, J., Pernick, R., and Wilder, C. Clean Energy Trends 2009. Clean Edge. March 2009. Moresco, Justin. VC Pumps $3B in Cleantech in 2007. February 2008. www.redherring.com/Home/23845.

Ritch, Emma. Cleantech Group. Record 2008 for Cleantech with $8.4B in Investments. January 6, 2009.

Cleantech Investment Monitor 2009 Annual Review & 2Q09 Quarterly. Cleantech Group, LLC. 2009.

10. http://sacramento.bizjournals.com/ sacramento/stories/2008/01/21/daily7. html?surround=lfn

Huayu, Li. China has World’s largest cleantech market: Tsin Capital. China Daily. January 10, 2008

12. www.e2.org/ext/doc/ CleantechReport2007.pdf

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

13. www.businessgreen.com/businessgreen/news/2210890/report-clean-techinvestment


“This whole area of clean energy and cleantech is an opportunity for us to be on the leading edge. The future of Florida will be in an innovation and knowledge-based economy, and it is in this framework that cleantech will play a very important economic development role.”

The Cleantech Opportunity Cleantech as an Engine of Growth

Countries, regions, and cities around the world recognize the value of cleantech both as a social and moral responsibility and a key economic driver.32 That is why many regions around the world are competing to transform their cities into “hubs of science of technology.” In the U.S., state and local governments are joining the race by taking initiatives to develop cleantech clusters and make their regions leaders in clean technology. Cleantech is the industry that can simultaneously protect the environment, spur economic growth, and create jobs. Cleantech provides unprecedented opportunities for wealth and economic

development, as well as new solutions for a wide range of issues. At a time when the U.S. economy sputters in fits and starts and faces unprecedented challenges from high energy prices, depleted natural resources, volatile sources of foreign oil, record deficits, and unprecedented environmental and security challenges, clean tech promises to be the next big engine of business and economic growth. Companies, investors, entrepreneurs, job seekers, and governments have a choice to either embrace and lead in this brave new world of clean-tech innovation or risk falling behind a host of competitors. At stake: trillions of dollars in economic opportunity and prosperity for the companies and individuals at the

FOR IMMEDIATE RELEASE October 23, 2008 MAYOR CROTTY LAUNCHES CLEANTECH ECONOMIC DEVELOPMENT INITIATIVES Cleantech Benchmark Study / Cleantech Symposium Series Mayor Richard T. Crotty has announced a double-barreled Orange County initiative to target cleantech economic development—attracting, creating, and growing the companies that produce the products and provide the services that will help the world to go green. “With cleantech, going green makes good business sense,” said Mayor Crotty. “Increasingly, cleantech is becoming recognized as a cutting edge industry, the biggest thing since the dot com boom, and the greatest economic opportunity of the 21st century.” Source: Orange County News 32

Cleantech: Current Status and Worldwide Outlook. Fuji-Keizai U.S.A., Inc. 2008.

- Sena Black, Senior Vice President of Marketing and Strategic Development, Enterprise Florida. First Orange County Cleantech Symposium. November 5, 2009.

forefront of this next great growth and investment opportunity. 33

What is Driving Cleantech? In recent years, the response to climate change has changed the agenda of many executives from emerging growth companies to leading multinationals. ‘Climate-smart’ companies are taking the lead to partner with different stakeholders, invest in cleantech products and services, and influence policy. However, several global trends and factors are behind this shift:34 • Government policies, including incentives, regulations, and accelerator programs • Consumer demand due to increased energy costs • Technology innovation that provides cost reduction and efficiency improvements • Desire to pursue market opportunities • Accelerated rate of technology change and the pool of talented engineers and entrepreneurs • Increased venture capital Cleantech gurus Ron Pernick and Clint Wilder from Clean Edge identified 33

34

Ron Pernick and Clint Wilder. The Clean Tech Revolution: Discover the Top Trends, Technologies, and Companies to Watch. Harper Collins. New York. 2008. Babiak, J. and Forer, G. Ernst & Young. Transformation Global Cleantech Insights and Trends Report 2008-2009.

CHAPTER 3: The Cleantech Opportunity

17


six major contributing factors—they are called the six C’s—to the rapid growth of cleantech: costs, capital, competition, China, consumers, and climate.35 Costs. While conventional power technology is steady and predictable, the price of fuel is not. However, clean technologies, such as solar, wind, geothermal, etc., offer the opposite: While up-front investments in technology can be costly, the sun, the breeze, the heat of the earth, etc., do not cost a dime.36 Furthermore, clean technologies generally offer a price stability that is non-existent with fossil fuels. Phillip Fairey, Deputy Director of the Florida Solar Energy Center at the University of Central Florida, argues this well in his presentation at the First Orange County Cleantech Symposium:37 What we’ve seen with photovoltaics over the last 30 years is a rather dramatic decrease in the cost. We are seeing many, many programs throughout the United States, some in Florida, which are buying down that initial cost of photovoltaic systems by as much as half. The other kind of things that we’re seeing in our economy is that conventional power sources, the cost of conventional power sources, due to a number of things, are going up. There is an increase in the cost of fuels to produce the power, there’s a general increase in the cost of doing business within the electric industry. This is dramatically higher than the usual conventional cost of electricity production facilities in Florida. And so with those kind of costs going forward and with the serious historical decline, I will say, in the cost of photovoltaic power production, which we don’t see stopping, we see the cost of photovoltaic power production modules continuing to decline in the future. We’re clearly going to come to a point where the cost of conventional power and these solar power alternatives meets in the economic sector and the renewable energy alternatives become as inexpensive as the conventional alternatives, and at that time we will no longer call solar technologies alternatives, we will call them conventional because they will be cheaper in the in the marketplace. 35 36 37

18

Pernick and Wilder. Ibid. Ibid. Fairey, Phillip. Deputy Director, Florida Solar Energy Center at UCF. Orange County First Cleantech Symposium. November 5, 2008.

The amortized cost of solar hot water systems compared to electricity out of the wall is between 8 and 9 cents per kilowatt hour, so it is already less expensive than production using electrical means.

Capital. Money is pouring into cleantech at an unprecedented rate. As any major technology revolution, its success and expansion depends on capital, which has been abundantly received from various sources, whether private or public, from business corporations, government grants, or venture capitalists. Clean technology is no longer dominated by government R&D grants but by private investments pouring mainly from venture capitalists, multinational corporations, individual investors, and public finance.38 In 2008 alone, cleantech VC investments in North America, Europe, China, and India totaled a record $8.4 billion, up 38 percent from $6.1 billion in 2007.39 According to Cleantech Group, U.S. companies raised $5.8 billion in 241 disclosed transactions in 2008, up 56 percent from 2007, representing 68 percent of global investments. The total Canadian investments accounted for $159 million in 14 disclosed transactions, down 58 percent from 2007. European and Israeli companies raised $1.8 billion in 2008 in 146 disclosed transactions, up 43 percent from 2007. Europe and Israel accounted for 21 percent of the global total. Chinese cleantech companies raised $430 million in 18 disclosed transactions last year, up 22 percent from 2007. In the case of emerging economies, funding comes primarily from local governments or international multilateral organizations, such as the World Bank, particularly through its subsidiary International Finance Corporation (IFC) and its Global Environment Facility (GEF) programs.

competing to transform into cleantech clusters. The U.S. demand for oil is projected to increase at 15% by 2030 while domestic production has been declining steadily since 1975.40 In its search to find solutions to the economic and security threat of imported oil and to reduce greenhouse gas emissions, the U.S. government is ready to tap new ways of producing, storing, and using energy. However, beyond solving domestic challenges, cleantech also offers a unique economic opportunity to serve the world. As dependence on oil and the threat of climate change have become global challenges, all innovative energy technologies developed in the U.S. will find ready and enduring world markets.41 China. The recent, rapid economic development witnessed in both China and India—and some other developing countries—has been found by many to have a negative impact on the environment due to the more-than-ever increasing use of energy generated from fossil fuels. Nobody describes the role of the emerging economies of China and India in driving cleantech better than Thomas Friedman in his famous book Hot, Flat, and Crowded: What about flat? … A combination of technological, market, and geopolitical events at the end of the twentieth century had leveled the global economic playing field in a way that was enabling more people than ever, from more places than ever to take part in the global economy—and in the best of cases, to enter the middle class. … This flattening was a product of several factors. The first was the invention and proliferation of the personal computer. … Another big flattener was the emergence of the Internet, the World Wide Web, and the Web browser. … The third flattener was a quiet revolution in software and transmission protocols, which I call the “work flow revolution” … so Boeing could hire airplane designers in Moscow and integrate them with airplane builders in Wichita, and Dell could design computers in Austin and Taiwan and have them built in China and Ireland and serviced by technicians in India. …

Competition. Governments from all over the world are trying to create and build cleantech clusters to be competitive. Recognizing the value of cleantech both as a key economic driver and a moral responsibility, countries, regions, and cities around the world are 38 39

Pernick and Wilder. Ibid. Walko, John. Record VC Investments for Cleantech Seen in ’08. EETimes. January 6, 2009.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

40 41

The U.S. Department of Energy. New Science for a Secure and Sustainable Energy Future. December 2008. The U.S. Department of Energy. Ibid.


out, there are still 200 million behind them, and another 200 million behind them … all waiting their turn. Their governments will not be able to deny them, and they will not deny themselves, an American style of life. 43 Source: New Science for a Secure and Sustainable Technology, DOE

The big geopolitical flattener was the collapse of Communism and the fall of the Berlin Wall. … Put all of these flatteners together, and what you have is a much more seamless, unobstructed global marketplace. … The good news is that the end of Communism and the flattening in the world helped to lift 200 million people out of abject poverty in the 1980s and 1990s in China and India alone, according of the International Monetary Fund—and moved tens of millions more higher up the economic ladder into the middle class. But as they’ve come out of poverty, which usually is associated with a rural and agricultural way of life, these several hundred million new players have begun earning wages that enabled them to consume more things and produce more things. And all these consumers walked onto the global economic playing field with their own versions of the “American dream”—a car, a house, and air conditioner, a cell phone, a microwave, a toaster, a computer, and an iPod—creating a huge new demand for “things,” all of which devour lots of energy, natural resources, land, and water and emit lots of climate-changing greenhouse gases from the time they are produced to when they are discarded. This, of course, is stoking an unprecedented competition for energy, minerals, water, and forest products, as rising (and growing) nations like Brazil, India, Russia, and China pursue comfort, prosperity, and economic security for more and more of their people.42

Friedman further describes Dora, the capital of Qatar, and Dalian, known as China’s Silicon Valley, as two cities that he believes we should know if we want to understand how and why “the meeting of flat and crowded has helped tip us over into the Energy-Climate Era.” But this, alas, is not a tale of 42

Thomas Friedman. Hot, Flat, and Crowded. Farrar, Straus, & Giroux. New York. 2008. pp 30-31.

tourism. It’s a tale of energy consumption in a flat world, when so many more people are starting to prosper, consume energy, and emit carbon dioxide at the same levels as Americans. … I’m glad that many people in the United States and Europe have switched from incandescent light bulbs to long-lasting compact fluorescent light bulbs in their homes. That has saved a lot of kilowatts of energy. But the recent growth in Doha and Dalian just ate all those energy savings for breakfast. I’m glad that many people are buying hybrid cars. But Doha and Dalian devoured all those gasoline savings before noon. I’m glad that the U.S. Congress decided to boost U.S. mileage-per-gallon requirements up to European levels by 2020. But Doha and Dalian will have those energy savings for lunch—maybe just as the first course. I’m glad that solar and wind power are ‘soaring’ toward 2 percent of U.S. energy generation, but Doha and Dalian will guzzle all those clean electrons for dinner. I am thrilled that people are now doing the ‘twenty green things’ to save energy suggested by their favorite American magazine. But Doha and Dalian will snack on all those good intentions like popcorn before bedtime. … I certainly don’t blame the citizens of Doha and Dalian for aspiring to an American lifestyle or for opting to build it on the same cheap-fossil-fuel foundation that we did. We invented that system. We exported it. Others are entitled to it every bit as much as we are, if not more, since we’ve been enjoying this kind of growth and consumption for decades and other are just getting their first taste of it. Growth is not negotiable, especially in a flat world where everyone can see how everyone else is living. To tell people they can’t grow is to tell them they have to remain poor forever. … Yes, in India and China some 200 million people have emerged from poverty in the last thirty years, most of them moving from low-impact village life to middle-class life in urban areas. But, as economists point

Calling emerging middle-class world citizens “our carbon copies,” Friedman urges Americans to take the lead in the renewable energy era. We Americans are in no position to lecture anyone. But we are in a position to know better. We are in a position to set a different example of growth. We are in a position to use our resources and know-how to invent the renewable, clean power sources and energy efficiency systems that can make growth greener. Both Europe and Japan have demonstrated that it is possible to live a middle-class lifestyle with much less consumption. In a world that is both flat and crowded, if we, as Americans, do not redefine what an American middle-class lifestyle is—and invent the tools and spread the know-how that enable another two or three billion people to enjoy it in a more sustainable fashion—we will need to colonize three more planets. Because we are going to make planet earth so hot, and strip it so bare of resources that nobody, including us, will be able to live like Americans one day. … ‘Americans’ are popping up all over now—from Doha to Dalian and from Calcutta to Casablanca to Cairo, moving into American-style living spaces, buying American-style cars, eating American-style fast food, and creating American levels of garbage. The planet has never seen so many Americans. Cities all over the world have caught America’s affluenza— surely one of the most infectious diseases ever known to man. … The McKinsey Global Institute projects that from 2003 to 2020 average residential floor space in China will increase 50 percent and energy demand will grow 4.4 percent annually. … The oil producers are becoming increasingly thirsty consumers. Some experts predict that the soaring rates of domestic energy usage, for consumption and industry, by Russia, Mexico, and the OPEC countries could force those nations to reduce their crude exports by between two million and three million barrels a day 43

Friedman. Ibid. pp. 54 & 64. CHAPTER 3: The Cleantech Opportunity

19


Cleantech and its Affordability “Clean-energy critics are fixated on cost.” Author Ron Pernick makes the case in a Business Week article that despite the seemingly high costs of implementing clean technologies, the long-term implications lead to only one conclusion: We can’t afford not to utilize cleantech. According to Pernick, critics of cleantech say that renewable sources of energy “simply don’t make financial sense.” This thinking forces us into continual dependence on oil, coal, and natural gas. But cleantech is not just on the horizon anymore. “For the past decade, solar and wind have been averaging annual growth rates in excess of 30%. … It’s comparable to the expansion of the PC industry at the height of its growth.” This market growth for these renewables is approaching parity with carbon-emitting energy sources. Despite the financial crisis the United States is currently under, “revenue generated by four clean-energy markets—solar, wind, biofuels, and fuel cells—grew by 40% to $77.3 billion in 2007, from $55 billion in 2006.” An example of renewables being comparable to conventional energy is the costs of geothermal, wind, and solar power compared to nuclear power (considered one of the cheapest sources of energy). “The average up-front capital cost for a new 1-gigawatt nuclear plant, sufficient power for about 1 million U.S. homes, is $2 billion to $6 billion. The cost of 1 gigawatt of geothermal and wind power is less than $2 billion; the same amount of solar power cost $5 billion to $10 billion.” However, there is some difference in these sources. “Whereas coal, nuclear, natural gas, and geothermal plants are able to provide base-load power—that is, nearly continuous power—solar and wind are intermittent resources. To compete with conventional sources, solar and wind have to be paired with base-load power sources, or require the implementation of energy storage and so-called smart-grid capabilities such as devices that help users and utilities better conserve energy and reduce consumption during peak demand.” Pernick points out that new global investment in these technologies has “ballooned 60% to $148.4 billion in 2007, from $92.6 billion in 2006.” When it comes to government policies, Pernick illustrates the need for an extension of the production tax credit, to keep these investments coming. He states that “the tax credit now applies to a range of renewable energy projects and affords a 1.9¢ per kilowatt-hour benefit for the first 10 years of operation for a renewable-energy facility. Of course, critics of clean energy will point out that without such subsidies and other regulation, renewable sources would never get a foothold in the market. But that argument misses a critical point: There's no such thing as subsidy- and regulatory-free energy, and there never has been.”

Source: Ron Pernick, Clean Energy: It’s Getting Affordable. Business Week. March 17, 2008.

by the end of the decade—which in a tight global oil market will only drive prices up further. … Without a dramatic improvement in sustainable energy and resource productivity, China, India, and the Arab world’s strategy of just aping the resource-wasting development model of America is unviable. The old way is not replicable on the China-India scale in a flat world, without irreparable harm to planet earth. … Either they will devour themselves, or they will use globalization like a straw to suck every drop of resources out of the last corners of Africa, Latina America, and Indonesia, or, ideally, we will find a more sustainable growth model for world that is hot, flat, and crowded. … We wanted everyone to be converted to the American way of life, although we never really thought about the implications. Well, now we know. We know that in the Energy-Climate Era, if all the world’s people start to live like us—as growing numbers of Russians and Chinese and Indians and Brazilians and Egyptians are now starting to do—it would herald a climate and biodiversity disaster. … 20

Does that mean we don’t want people to live like us anymore? No, it means that we have we have to take the lead in redesigning and reinventing what living like us means—what constitutes the “American Way” in energy and resource consumption terms. … That is why it is essential going forward that a Code Green strategy be included in America’s gift bag to the world today, right along with the Bill of Rights, the Declaration of Independence, and the Constitution. Because without it, we are not going to be free much longer— and neither will anybody else. There will be too many Americans—old-style Americans. And the earth can’t handle that.44

Consumers. In this new green economy, amid growing consumer demands for cleaner and more efficient products, wasteful and polluting products and business processes are being replaced by more efficient ones that use cleaner

44

Friedman. Ibid. pp. 55-76.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

technologies.45 They are demanding products that protect the environment but also cost less. “Green is the New American Dream. Environmentally motivated consumers want to know not just the list of ingredients, but also the impact of the materials used, the waste generated, as well as the costs,” said Joel Makower, an entrepreneur, writer, and strategist on sustainable business and the environment.46 Climate Change. Climate change has been widely recognized as a major environmental issue. Steps are being taken worldwide—by governments, businesses, and individuals—to reduce greenhouse gas emissions. These practices also aim to reduce air pollution, increase the nation’s energy independence, and save money.47 Eurosolar President Hermann Scheer 45 46 47

Makower, Joel. 2009. Strategies for the Green Economy: Opportunities and Challenges in the new World of Business. McGraw-Hill. Makower. Ibid. U.S. Environmental Protection Agency.  www.epa.gov/climatechange


views climate change as an economic opportunity for a new clean technology revolution, and for this reason, he has been one of the fierce critics of the Kyoto Protocol. He believes that we are as close to the solar revolution now as we were a decade ago to the cell phone revolution:48 The protocol starts from the premise that the solutions to climate change will be an economic burden. So it is all about how we share this burden. But it is not an economic burden; it is a new economic opportunity. … The idea to issuing emission rights goes against all our experience on how technological revolutions happen. Of all the technological revolutions in the last 200 years, which of them happened because of an international treaty? Not one. They happened because they were accepted as important, superior and necessary for the future. … I see the opportunities for renewables. I see that they can provide 100 percent of our energy, and they can be introduced very fast. All the great technological revolutions happen much more quickly than even the experts and enthusiasts guess. The forecasts for the spread of cell phones and IT were all overtaken by the reality. The renewables revolution will be the same. 49

Government policies. Government policies have been playing a major role in accelerating the development of the cleantech industry. In the U.S., the Bush administration’s $700-billion financial bailout approved by the Senate included $100 billion in tax cuts for alternative energy. The tax breaks included $17 billion in energy incentives and business research credits. Both the energy and the research tax credits will provide a great breakthrough in the alternative energy industry, as they will boost cleantech efforts and bolster more mainstream businesses.50 The Obama Administration has taken even more drastic steps toward energy independence. Indeed, the American Recovery Act of 2009 signed into law by the current President includes more than $70 billion in direct spending for clean

48 49 50

Pearce, Fred. Bring on the Solar Interview with Hermann Scheer. New Scientist. May 21, 2008. Pearce. Ibid. Bailout Bill Includes $100B in Energy, Other Tax Breaks. South Florida Business Journal. October 2, 2008.

energy.51 The new stimulus package, combined with the administration’s recently passed policies, represents “the largest federal commitment in U.S. history for renewables, advanced transportation, and conservation initiatives.”52

going to be involved and we’re all going to move forward, I believe, on this journey to energy independence, energy security and long-term stability,” Ford CEO Alan Mulally told reporters at the White House.56

“Now is a particularly

List of Works Consulted

good time for pursuing energy technologies relative to the funding opportunities that will be coming out of the federal government.” - Frank Bevc, Director, Technology Policy and Research Programs, Siemens Power Generation. Second Orange County Symposium. January 21, 2009.

1.

2. Fred Pearce. “Bring on the Solar” Interview with Hermand Scheer. New Scientist. May 21, 2008. 3. Makower, J., Pernick, R., and Wilder, C. Clean Energy Trends 2009. Clean Edge. March 2009. 4. Makower, Joel. 2009. Strategies for the Green Economy: Opportunities and Challenges in the new World of Business. McGraw-Hill. 5.

“Out of the proposed $825 billion stimulus package, $54 billion is for cleantech investments, said Frank Bevc, Director of Technology Policy and Research Programs at Siemens Energy Orlando. “What is especially important to Siemens wind energy customers is the 3-year extension of the renewable energy Production Tax Credit.”53 The Administration just proposed in May 2009 a new CAFE standards program that includes a 39 MPG average for automakers’ passenger car lineups, plus 30 MPG for light trucks and 35.5 MPG overall—all by 2016.54 According to the Administration, the proposal would save 1.8 billion barrels of oil over the lifetime of the vehicles sold in the next five years.55 The plan sets a single national standard, and it is the first time that a national regulation links emission and fuel standards. “Clearly over time, the President is going to continue to work toward an integrated energy policy in the United States, the consumer is 51 52 53

54 55

Makower, J., Pernick, R., and Wilder, C. Clean Energy Trends 2009. Clean Edge. March 2009. Makower, Pernick, and Wilder. Ibid. Bevc, Frank. Director, Technology Policy and Research Programs. Siemens Power Generation. Second Orange County Cleantech Symposium. January 21, 2009. Garthwaite, Josie. Obama MPG Proposal Raises Stakes for Green Car Tech. Reuters. May 19, 2009. Hurst, Steven R. Obama Touts Plan for Cleaner, More Efficient Cars. Newsvine. May 19, 2009.

Bailout Bill Includes $100B in Energy, Other Tax Breaks. South Florida Business Journal, Thursday, October 2, 2008

Pernick, R. and Wilder, C. The Clean Tech Revolution: Discover the Top Trends, Technologies, and Companies to Watch. HarperCollins. New York. 2008.

6. U.S. Environmental Protection Agency. www.epa.gov/climatechange 7.

The U.S. Department of Energy. New Science for a Secure and Sustainable Energy Future. December 2008.

8. Thomas Friedmann. Hot, Flat, and Crowded. Farrar, Straus, and Giroux. New York. 2008. pp 55-76. 9.

Walko, John. Record VC Investments for Cleantech Seen in ’08. EETimes. January 6, 2009.

56

Hurst. Ibid.

CHAPTER 3: The Cleantech Opportunity

21


“We’re clearly going to come to a point where the cost of conventional power and these solar power alternatives meets in the economic sector and the renewable energy alternatives become as inexpensive as the conventional alternatives, and at that time we will no longer call solar technologies alternatives, we will call them conventional because they will be cheaper in the marketplace.” - Fairey, Phillip. Deputy Director, Florida Solar Energy Center. First Orange County Cleantech Symposium. November 5, 2008.

Clean Technologies & Sectors Solar Energy Why It Matters Solar Energy constitutes the most active and rapidly expanding sector in the cleantech industry. Its rapid expansion has been at a rate of more than 30% each year since the mid-1990s and 50% for the last two years, as noted by Ron Pernick and Clint Wilder in their book The Clean Tech Revolution. This sector continues to grow at an astounding rate.57 Figure 1. Percentage of Cleantech VC Investment by Technology 45%

40%

35%

30%

2008 Annual Report Cleantech Group Koren, D. 2009. Cleantech Investment Monitor 2008 Annual Review & 4Q08 Quarterly. Rep. Vol. 7. 4th Issue. Cleantech Group LLC. Solar Biofuels

25%

Transportation Wind Green Buildings

20%

Smart Grid Water & Wastewater

15%

Agriculture 10%

5%

0%

2000

2001

2002

2003

2004

2005

2006

2007

2008

The U.S. Department of Energy (DOE) has identified three major areas of solar technology with the greatest potential for development in the future—concentrating solar power (CSP), photovoltaics (PV), and solar heating and lighting. The U.S. DOE’s Solar Energy Technologies Program (SETP) conducts research in an effort to promote development in these three areas of solar technology. Each of these technologies makes use of sunlight to provide power for everyday use. Concentrating solar power, or CSP, captures thermal energy by converting solar energy into heat through the use of reflective mirrors to concentrate sunlight onto receivers. Solar photovoltaics, or PV, systems are the most widely used solar technology and convert sunlight into electricity through the use of solar cells. Solar heating technology uses thermal energy to provide energy for use in various 57 22

Pernick, R. and Wilder, C. The Clean Tech Revolution. HarperCollins, New York. 2008. p. 30.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


Figure 2.

VC Investment in Solar Technologies - By Year Billions

$3.5 B

$3.0 B $2.5 B

$3.3 B

2008 Annual Report Cleantech Group

120

108

Koren, D. 2009. Cleantech Investment Monitor 2008 Annual Review & 4Q08 Quarterly. Rep. Vol. 7. 4th Issue. Cleantech Group LLC.

100 87 80

$2.0 B

$1.8 B

60

57

$1.5 B 40

40

$1.0 B $0.5 B $0.0 B

9 $0.0 B

$0.1 B

$0.1 B

2003

2004

systems, including hot water heaters, space heaters, and pool heaters. Solar lighting technologies collect sunlight through the use of roof-mounted solar concentrators and use optical fibers to distribute the light to a building’s interior lighting fixtures.58 Another important technological distinction is between the two main types of solar PV panels—traditional silicon and thin-film nanotechnologybased. Silicon is the most widely used material in solar panel production and can produce very efficient solar panels, which are heavier and often expensive to make and difficult to install. Thinfilm solar panels were developed to overcome some of silicon’s shortcomings and are thin, flexible, easier to install, and cheaper to produce, but they are less efficient than silicon solar panels, and their efficiency can degrade with time.59

2006

• $300 million raised by NanoSolar; • $219 million by Solyndra;

• $200 million by SoloPower (all U.S. companies and all for thinfilm solar ventures);

The growth rate in solar energy has been quite extraordinary thanks to government incentives, rising energy costs, and environmental concern. The solar industry’s rapid growth is also largely a result of massive venture capital support, which has made solar energy the most invested-in of the cleantech U.S. Department of Energy. Energy Efficiency and Renewable Energy. Solar Energies Technologies Program.  www1.eere.energy.gov/solar/technologies.html Bennett, M. Clean Tech Intro: The Solar Family. CleanTechnica. July 21, 2008.

2005

sectors. Investment in solar technologies has shown rapid growth in recent years, from $0.7 billion in 2006 to $3.3 billion in 2008, according to Cleantech Group’s 2008 Annual Review. Solar energy’s share of cleantech VC investments has also seen tremendous growth in this time frame, accounting for 15 percent of all cleantech investments in 2006 to about 40 percent in 2008.60 According to the Cleantech Group, solar led total clean technology investment dollars in 2008, followed by biofuels at 11 percent ($904 million) and ventures focusing on transportation at 9.5 percent, or $795 million, which includes electric vehicles, fuel cells, and advanced batteries.61 The five largest VC investments included:

Overall Trends

59

20

$0.3 B

0 2002

58

$0.7 B

20

15

• $177 million raised by Finnish group WinWinD Oy for wind turbines; and

• $140 million by U.S. group Solar Reserve for concentrated solar 60 61

Fan, B. Cleantech Investment Monitor 2008 Annual Review & 4Q08 Quarterly. Rep. Vol. 7. 4th Issue. Cleantech Group LLC. 2009. Ritch, Emma. Record 2008 for Cleantech with $8.4B in Investments. Cleantech Group. January 6, 2009.

2007

2008

thermal.62

Germany is the top European country receiving venture capital in 2008, helped significantly by the region’s largest deal, a $133.7 million investment in Berlinbased solar thin-film manufacturer Sulfurcell Solartechnik.63 Investment in China went up 22 percent from 2007, with solar accounting for 60 percent of the total VC, reflecting the continuing migration of solar module manufacturing from Europe and the U.S. to China.64 Thin-film companies raised almost half of all VC investment within the solar sector in 2008, and concentrated solar thermal companies raised the second most, at approximately 19 percent of solar VC investment.65 According to Clean Edge’s 2008 report on clean energy trends, solar photovoltaic (PV) installations, which grew from 620 megawatts (MW) in 2003 to 2,821 MW in 2007, is expected to reach 22,760 MW by 2017.66 The current annual total manufacturing output can produce enough generation capacity to feed three cities the size of Atlanta.67 The rapid expansion of the solar 62 63 64 65 66 67

Walko, John. Record VC Investments for Cleantech Seen in ’08. EETimes. January 6, 2009. Ritch. Ibid. Walko. Ibid. Fan. Ibid. Makower, J. Pernick, R. and Wilder, C. Clean Energy Trends 2008. Clean Edge, Inc. 2008. Pernick and Wilder. The Clean Tech Revolution. Ibid. CHAPTER 4: Clean Technologies and Sectors

23


68 69 70

24

U.S. Department of Energy. Energy Efficiency and Renewable Energy. Solar America. 2008. Pernick, R. and Wilder, C. Utility Solar Assessment Study. Rep. Clean Edge, Inc. and Co-op America Foundation, 2008. Pernick and Wilder. Utility Solar Assessment Study. Ibid.

Figure 3. Millions

Investment in Solar by Technology 2008 Annual Report Cleantech Group

$1,800 M $1,586 M

$1,600 M

Koren, D. 2009. Cleantech Investment Monitor 2008 Annual Review & 4Q08 Quarterly. Rep. Vol. 7. 4th Issue. Cleantech Group LLC.

$1,400 M

48 $1,200 M

$1,000 M $800 M $645 M $600 M

$630 M $510 M

$504 M

$487 M

36

$402 M

$400 M

19 29

$200 M

15

15 23

$96 M

$128 M

$0 M 2007

2008

Thin Films

2007

2008

2007

Concentrated Solar Thermal

2008

2007

Systems

2008

$92 M

7

3

2007

2008

5

c-Si PV

Concentrated PV

Table 1.

Global Installation/Production Growth: Solar, Wind, Biofuels 2003

2007

2017 (est.)

Solar PV Installations

620 MW

2,821 MW

22,760 MW

Wind Power Installed

8000 MW

20,060 MW

75,781 MW

7 Billion Gallons

15.6 Billion Gallons

45.9 Billion Gallons

Biofuels Produced

Makower, J. Pernick, R. and Wilder, C. Clean Energy Trends 2008. Rep. Clean Edge, Inc. 2008.

Source: Clean Edge, Inc., 2008

Figure 4. Crystalline Silicon Shipment and Thin-Film Shipment Market Shares, 1998-2007 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%

Market Share

industry and VC investment in solar technologies have given way to technological developments in the form of improvements to existing technologies as well as the development of newer technologies. As a result of this rapid growth, companies have experienced major shortages in silicon supply. However, these shortages have opened the market for thin-film technologies, which are less expensive than the crystalline silicon, and this opportunity will help close the gap between the silicon-based and the nanotechnologybased PV.68 Solar technology development has been focused on achieving two major goals related to solar power—reaching cost parity with conventional electric rates and improving solar technology’s efficiency. In order to compete with conventional sources of energy, the cost of solar energy must be reduced, and this has, in fact, been the trend. According to Clean Edge’s Utility Solar Assessment Study, electricity from solar PV is still two to three times as costly as most retail electricity rates in the U.S., although technological advances, growth in the solar energy market, manufacturing economies of scale, and greater competition have all contributed to significantly lower costs for solar PV and are expected to continue to drive down costs. In fact, costs have dropped dramatically from around $30 per peak watt for energy from solar PV in 1980 to around $7 per peak watt today.69 The study identifies the growth in thin-film PV as having a major impact on reducing solar costs. Thin-film PV modules are currently being installed by First Solar, a leading thin-film producer, for around $5.50 per peak watt and are expected to be produced at an even lower cost in the near future.70 Pernick and Wilder identify circumstances where solar is currently price competitive: in areas where utility costs are high, in areas with generous solar rebates, at peak-demand times (like hot summer days), and in sunny regions. Pernick and Wilder also note that there has been a shift in the solar industry from

Crystalline Silicon

1998

1999

2000

2001

2002

Thin-Film

2003

2004

2005

2006

Source: Energy Information Administration (EIA) Form EIA-63B, “Annual Photovoltaic Module/Cell Manufacturers Survey.”

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

2007


Table 2.

Energy Type

Comparative Power Costs for Utility Deployment Coal

Capital Costs per $1 billion 1000 MW (U.S. - $3 billion 2007 Average)

Natural Gas Combined Cycle

Wind

Concentrating Solar Power (CSP)

Geothermal

Nuclear

Solar PV

$1 billion - $2 billion

$1.2 billion - $2 billion

$1.5 billion - $4 billion

$3 billion - $4 billion

$3 billion - $7 billion

$5 billion - $7 billion

Fuel Costs

Yes

Yes

No

No

No

Yes

No

Subject to C02 Regulations

Yes

Yes

No

No

No

No

No

Clean Edge Utility Solar Assessment: Pernick, R. and Wilder, C. Utility Solar Assessment Study. Rep. Clean Edge, Inc. and Co-op America Foundation, 2008.

Source: Clean Edge, Inc., 2008

71 72 73 74 75

Pernick and Wilder. The Clean Tech Revolution. Ibid. pp. 31, 37, & 43. Ibid. Defense Advanced Research Projects Agency, Strategic Technology Office. www.darpa.mil/ sto/smallunitops/vhesc.html Pernick and Wilder. The Clean Tech Revolution. Ibid. Anderson, Jeffrey. Associate Director of NanoScience Technology Center. Cleantech and Nanotechnology: Challenges and Opportunities. Orange County First Cleantech Symposium, November 5, 2008.

Figure 5.

44 40

Efficiency of 3rd Generation Solar Cells

36 Chystalline Si Cells

32

Efficiency (%)

dependence on subsidies, to a greater focus on reducing the bottom-line costs of solar energy.71 In order to become an increasingly viable energy source for the mass market, solar cells not only need to approach price parity, but they also need to become more efficient. Solar cell efficiency refers to the amount of sunlight the PV cell can convert into electricity. Today’s average of 17% efficiency in silicon-based PV cells means the average cell can convert 17% of the sunlight into electricity.72 The development of efficient solar cells has been largely driven by the militaryfunded Very High Efficiency Solar Cell (VHESC) program, which has a targeted efficiency rate of at least 50% in a PV device. The program’s research to date has resulted in prototype cells with over 40% efficiency.73 Replacements for polysilicon, the most widely used component for traditional PV technology, such as those used in thin-film technology production, while less costly, are considerably less efficient. The most developed thin-film technology, amorphous silicon, has only 11% efficiency, whereas polysilicon is 1522% efficient.74 The goal for many firms is to develop more efficient alternatives to polysilicon or to increase the efficiency of polisilicon-based solar cells. Figure 5 depicts the comparison of the three types of PVs.75

28

Thin-Film Technologies

(92x conc.)

(96x conc.)

24.7%

24 (14x conc.)

20

20.3% 19.9%

Emerging PV

16

(45 pm thin-film transfer)

(small-area)

(large-area)

(CdTe/CIS)

12

16.5%

12.1% 11.1%

(2 pm on glass)

8

5.4%

4 0

27.6%

(140x conc.)

1975

1980

1985

1990

1995

2000 2005 2010 Source: National Renewable Laboratory

Source: National Renewable Laboratory

Thus, solar cells are divided into three types: 1st generation solar cells, or silicon, with 27% efficiency in converting sun to energy, with much energy wasted; 2nd generation solar cells, or thin film, while costing less than silicon-based cells, are less efficient with increased toxicity; and 3rd generation solar cells, such as nanocrystal solar cells, which are less efficient than the other two but are very promising, with lowenergy and high-throughout processing technologies.76 Dr. Anderson from the UCF Nanoscience Technology Center compares the three generations of photovoltaics at his presentation during the First Orange County Cleantech Symposium, featured on page 26.

76

Anderson. Ibid. CHAPTER 4: Clean Technologies and Sectors

25


Cleantech & Nanotechnology According to Jeff Anderson at the UCF Nanoscience Technology Center, the production of electricity from photovoltaics is coming from a very tiny market that has a lot of growing interest. These new technologies are allowing greater utility to bring down the price in these systems. “There are three different generations of photovoltaics, or solar cells. The first is what we all know, is the silicone-based. The second are polymer or thin film technologies. And the third are these more advanced systems. The silicone systems are fairly efficient, but they’re expensive because you are actually using silicone that you can make computer chips from. The thin-film is less efficient, but less expensive because one can actually make just plastic rolls. And the third has the potential of being both efficient and easy to make, and that’s why we’re putting a lot of effort into that. First Generation: Silicone-based The silicone-based PV is about 25 percent efficiency of converting sunlight directly into electricity. However, much of the energy comes from higher energy protons, at the blue and violet end of the spectrum, and this energy is wasted as heat. Second Generation: Thin film advantages The second is thin film. They are easy to make. Practical to use make just rolls of these sheets to replace shingles. You can protect your roof, but also get a gain from this: the charge that’s produced by these systems when sunlight hits the surfaces. Problems. 15 percent less efficient. Now, some of the problems a lot of research is going into, it’s polymers, it’s plastics. There’s a degree of bleaching. They may not be as durable as the silicone; however, they are so much less expensive that they’re very attractive. Third Generation: More advanced systems The traditional photovoltaic cell is a single layer. Now what we want to do is make it multiple layers so it can pickup the spectrum of wave light that’s coming in and efficiently grab those electronic charges that are occurring by essentially creatively looking at these different variables. How can you use nanoelectronics in terms of the wiring, the actual pickup there? Make them very tiny, make them fibrous, fuzzy, so it’s just more efficient in that little—in that small space of the fuel cell. How can you link these together to more efficiently gather that electricity? Currently, at 10 percent efficiency the functional systems, the prototypes, are not as efficient as the other two systems. So you may think that it’s a waste of research money. But, actually, the theoretical efficiency is far higher: 40 percent, 50 percent, even 60 percent is envisioned and possible, again, through tweaking these systems. …” Outlook “It’s going to take a great deal of work, effort, and research to really garner the commercial opportunities that are there. But they are there. With biotech energy, we’re going to have utility that we never had before. … And once these systems are created, then from our perspective as a research center, we create patents, we share those licenses with those spin-off companies. We have disclosures that occur all the time: five, six patents established a year from our center and more. We’re growing now. We’ll probably take up in the next couple years 8 to 10 more faculty members to pursue these kinds of work. We work in a team-based approach looking at the basic mechanisms, the design of the plastics, the nanoelectronics, and then integrated device development and partnering with others to meet these energy needs of the country.” - Jeff Anderson, Associate Director at the UCF Nanoscience Technology Center, First Orange County Cleantech Symposium, November 5, 2008. 26

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


Many of the successful solar companies emerged from the computer and high-tech industries. There has been a trend for these computer and high-tech companies, familiar with silicon-based semiconductors, to adapt and apply their technologies to the solar industry. The semiconductor manufacturing technologies have immensely supported efforts to produce solar cells at reduced costs and on a larger scale. Two major companies in Santa Clara, California— Applied Materials and Miasolé—have transformed their companies from hightech and computer companies to leading solar companies. Applied Materials, originally a leading semiconductor manufacturer, has become a leader in thin-film manufacturing equipment. Initially, in the disk storage market, Miasolé applied its technology to develop high efficiency solar cells at a reduced cost.77 Pernick and Wilder further describe how the growth of the solar industry has resulted in changes in the industry’s landscape, transforming the solar industry from a niche industry to a mainstream business opportunity. Instead of being dominated by corporate research labs and the government, the solar industry is being led by visionary entrepreneurs and businesses with access to capital and knowledgeable management. Established multinational companies and large, publicly traded companies have begun to enter the solar market as well, giving individual investors the opportunity to invest in promising solar companies. Solar companies worldwide have had successful initial public offerings. The authors expect electronics giants, like Sanyo and SunPower, to lead the solar industry because of the nature of solar, as opposed to energy giants like BP and Shell.78 Companies are discovering innovative financing techniques to overcome the additional up-front capital costs for solar consumers. One such company, SunEdison, LLC, is a “utility” that generates power on the roof of its customer’s location. The Baltimorebased company secures customer financing for a given project, builds the solar PV panels on the customer’s roof, 77 78

Pernick and Wilder. The Clean Tech Revolution. Ibid. pp. 34 & 54. Ibid. pp. 30-31.

Figure 6.

3rd Generation Solar Cells ● Very different from previous solar cell devices ● Utilizes advanced polymer materials in a multi-layered hybrid design ● Utilizes quantum scale modeling to optimize design along with efficient nano-electronic circuits ● Many different approaches: - Nanocrystal solar cells - Gräetzel Cell - Dye-sensitized hybrid solar cells - Polymer solar cells Advantages ● Low-energy, high throughput processing technologies ● Polymer cells - solution processable, chemically synthesized with low cost Disadvantages ● Sunlight-to-electricity efficiency ratios are lower when compared with 1st generation silicon (wafer-based) solar cells or even 2nd generation thin film solar cells ● Degradation effects: efficiency is decreased over time due to environmental effects

Source: Dr. J. Anderson at the First Orange County Cleantech Symposium, November 5, 2008.

assumes the financial risks, and then sells the power generated from the solar PV panels to the customer at a fixed rate.79 MMA Renewable Ventures, located in San Francisco, California, is another company that has developed a business from similar innovative financing techniques. In 2006, it raised $100 million in funds from institutional investors.80 Utilities throughout the country, including Florida Power & Light Company (FPL), have begun to embrace solar power. As states shy away from coal-fired power, utilities are beginning to look to alternative sources for power, and as utilities are highly regulated, they are directly affected by public policies, renewable portfolio standards (RPS), and financial incentives.81 Federal tax credits and state utility commissions are considered to be largely responsible for helping or hindering solar development at the local level.

Challenges A major challenge facing solar energy development, as discussed earlier, relates to the cost of solar PV. Solar PV’s rapid industry growth led solar to become the largest user of silicon in 2006, surpassing the global semiconductor industry. 79 80 81

Ibid. pp. 42-43. Ibid. pp. 54. Pernick and Wilder. Utility Solar Assessment Study. Ibid.

This historic shift caught silicon manufacturers off guard, resulting in a severe shortage of silicon, which led to increased prices for solar PV worldwide. The silicon shortage is expected to last only a couple of years, however, and the cost of solar PV is expected to continue to decline as more silicon suppliers enter the market.82 For solar energy to become widespread and continue its rapid growth, utilities must embrace solar power in their facilities, but as the Utility Solar Assessment Study by Clean Edge describes, there are a variety of factors impeding utility companies’ widespread use of solar energy. The study lists five challenges to solar energy usage by utilities: utilities’ interpretation of their role as “protectors of reliability,” an outdated power grid, utilities’ organizational structure, the cost of solar PV (discussed above), and the lack of technological standards for solar integration.83 The utility industry has traditionally been focused on reliability first and foremost and, as a result, has shown hesitation at adopting new policies and utilizing new forms of energy. Because utility companies have a legal obligation to provide power at the lowest possible 82 83

Pernick and Wilder. The Clean Tech Revolution. Ibid. pp. 38-39. Pernick and Wilder. Utility Solar Assessment Study. Ibid. CHAPTER 4: Clean Technologies and Sectors

27


cost, there has been a tendency to rely on more established models of power generation than to instigate new ones. In some cases, utilities have even lobbied against policies and initiatives that support solar energy generation, seeing solar as a setback rather than an opportunity for growth. But attitudes are changing, and some utility companies are beginning to see solar as an essential alternative to fossil-fuel power plants. Another impediment to solar energy’s widespread usage is the outdated power grid in use today. The grid’s poor condition makes it difficult for utilities to incorporate alternative energy sources, such as solar, into the system. The power grid was originally designed to support one-way energy streams, from centralized power stations to customers. The grid is often ill-equipped to support localized energy sources like solar panels on rooftops. Investment in the smart grid, an electricity grid that is modular, will allow utilities to more effectively distribute solar energy. (See Smart Grid section on page 59). Utilities’ organizational structure also has been a barrier to the adoption of large-scale solar energy production. The traditional structure of management in utilities often does not lend itself to solar evaluations because there is often no one who is responsible for promoting solar in the company. Utility companies often lack knowledge about large-scale solar technologies, and as a result, fail to see their importance in energy generation and diversification. Utility management is also typically championed by mechanical engineers who value reliability and see solar as an impediment, not a viable option. While the actual cost of solar PV is an issue, utility perception of the costs of solar are often erroneous.84 In many cases, the use of solar PV is cost competitive today when you account for increasing traditional fuel costs, decreasing solar costs, and the cost to build fossil-fuel generation facilities. The absence of industry standards for the integration of solar power can hinder a utility’s ability to plan and implement solar power. Right now, there are little or no standards for reliability, solar interconnection, quality, or other critical 84 28

Ibid.

areas of solar energy implementation. National standards are necessary for the solar industry to flourish as other industries, such as the Internet industry, have.

Breakthrough Opportunities In the book The Clean Tech Revolution, Ron Pernick and Clint Wilder describe various business prospects they believe to be breakthrough opportunities.85 $2/Watt Solar PV Systems Achieving cost parity with conventional electricity is seen as the major challenge and, therefore, a major opportunity for growth in the solar energy industry. The first company to emerge with a solar cell or module that is truly cost competitive will thrive. Systems priced at about $2 per peak watt of solar energy, or less than 10 cents per kilowatt-hour, would compete with most utility rates in the U.S. Concentrating PV Another opportunity is found in the development of systems that concentrate the sun’s solar rays to get more power, called concentrating PV (CPV). CPV technology includes companies that are developing both high- and low-scale concentrations, as well as companies

that aren’t even using PV but are concentrating solar rays to create electricity by heating oil or water to turn turbines. Integrated Photovoltaics Integrated photovoltaics, or solar cells that are integrated into everyday products and services, such as portable electronic devices and residential roof tiles, are expected to be an important part of solar’s transition into a major energy market. Residential solar roof tiles are gaining popularity throughout the country, especially in places where solar incentives are sizeable, like California. There is potential for major growth in solar BIPV (buildingintegrated photovoltaics), possibly becoming a standard option for new homes throughout the country. Selling Electrons As discussed earlier, utility-scale solar power will be necessary for the widespread use of solar energy. If utility companies are able to overcome the numerous impediments to solar power, there is a great opportunity for growth in the solar industry. The combination of large solar PV and solar thermal systems with widespread small, rooftop PV systems will enable effective use by utilities for mainstream energy usage.

Figure 7.

Image source: www.allamericanpatriots.com/photos/microdish-cpv-system 85

Pernick and Wilder. The Clean Tech Revolution. Ibid. pp. 36, 39, 42, 44, & 48.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


Solar energy will also enable utilities to provide power with more efficiency on sunny days with high electricity demand. Utility-Scale Solar A report from the Basic Energy Sciences Advisory Committee emphasizes that the major breakthrough that will enable solar energy to be widely used will be the development of third-generation solar cells that are both low in cost and energy efficient.86 The development of this type of solar energy will enable solar to better compete with traditional forms of energy, while at the same time reducing or eliminating the negative impact on the environment. Although third generation cells remain in the early stages of development, the intrinsic opportunity in third generation cells is great.

Solar-Related Cleantech Jobs • • • • • • • • • • • • • • •

Crop and Slab Engineer Crystal Growing Engineer Laser Operations Technician Design Engineer Logistics Manager Module Manufacturing Engineer Production Planner/Scheduler PV Cell Product Development Engineer PV Installer Quality Insurance Manager Residential Solar Consultant Silicon Crystal Growers Solar Technician Sourcing Specialist Wire Technology Engineer

Major Players The solar industry has been dominated by leading international companies in Germany, Japan, and Norway. While these companies remain an influential force in the industry today, companies in California and China have shown rapid growth and are beginning to compete in the global solar market. In the The Clean Tech Revolution, Pernick and Wilder identify the following companies to 86

Basic Energy Sciences Advisory Committee. New Science for a Secure and Sustainable Energy Future. United States Department of Energy. December 2008.

watch in the solar industry:87 Sharp (Osaka, Japan), www. sharp.co.jp, the global leader in the solar industry until 2007, remains a powerful solar cell and module supplier, representing 15% of the solar cell and module supply in the global solar market today. The company is a leader in the U.S. market as well, but in 2007, it failed to maintain a supply of silicon feedstock and lost its spot as the top solar manufacturer in the world to Thalheim, Germany manufacturer Q-Cells. Q-Cells (www.q-cells.com) contributed to the global solar market by improving large-scale manufacturing and improving solar cell efficiencies, driving down the cost of silicon solar cells. REC (Høvik, Norway) is a welldiversified public company, producing from solar-grade silicon to cells, wafers, and modules. Considered an international leader in the solar industry, REC is self-sufficient in silicon supply and provides silicon to other companies, such as Sharp. In the United States, solar companies in California have dominated the solar industry to date. Applied Materials (Santa Clara, CA), www.appliedmaterials.com, in 2006, acquired Applied Films, a thin-film solar manufacturing equipment firm. Applied Materials is positioning itself “to do for solar what it did for the computer industry.” Miasole (Santa Clara, CA), www. miasole.com is using high-tech industry technology to develop low-cost, highefficiency solar cells. MMA Renewable Ventures (San Francisco, CA), www. mmarenewableventures.com. Once an innovative firm in project finance, MMA invests in on-site solar projects instead of companies. Formerly Renewable Ventures, the company added MMA to its name after acquiring in 2006 real estate financier Municipal Mortgage & Equity LLC, known as MuniMae. Nanosolar (Palo Alto, CA), www. nanosolar.com. In 2006, the company launched a plan to develop a 430-MW solar production facility in the San Francisco area, a very ambitious project. It is in the process of building two groundbreaking factories—in California, where the company is building the 87

Pernick and Wilder. The Clean Tech Revolution. Ibid. pp. 54-57.

world’s largest solar cell factory, and in Germany, where the company is building the world’s largest solar panel-assembly factory.88 SunPower (Sunnyvale, CA), www. sunpowercorp.com, has emerged as a leader in high-efficiency solar cell production. The company has also experienced rapid growth and has successfully produced high efficiency solar cells in large volumes at a low-cost. SunEdison (Baltimore, MD), www. sunedison.com, is remarkable for its innovation in solar systems. Suntech Power (China), www.suntechpower.com. As China develops a major solar market of its own, manufacturers are beginning to not only ship their products abroad but are also providing solar cells, modules, and services to Chinese who have no access to reliable electricity. Suntech Power and other Chinese manufacturers are known for their ability to reduce manufacturing costs and are positioned to benefit from the expanding domestic solar market and international market. Suntech Power is particularly known for being the first major solar company in China to go public on a U.S. stock exchange.

Metro Orlando and Solar Energy Solar energy is a clean, reliable alternative to conventional, nonrenewable sources of energy. As the need for U.S. energy independence and environmental sustainability becomes increasingly more apparent, utilizing a domestically available resource like solar energy is becoming progressively more important. Continued growth of the solar industry will benefit the region through the creation of solar manufacturing and installation jobs, greater diversification of the energy supply and the resultant reduction in the dependence on foreign energy supplies, and improved air quality. The Metro Orlando solar industry has a strong foundation of companies, government and private support research institutions, and an abundant natural resource that has allowed the market for solar energy to flourish. This will continue to aid in the development of the solar market. 88

Nanosolar, Inc. www.nanosolar.com/about.htm CHAPTER 4: Clean Technologies and Sectors

29


Research and Development at UCF “In the photovoltaics area, we are one of two universities that lead photovoltaic applications throughout the United States.” - Jim Fenton, Director, Florida Solar Energy Center at UCF. Orange County Second Cleantech Symposium. January 21, 2009.

“A study by the American Solar Energy Society reveals that renewable energy and energy-efficiency industries represented more than 9 million jobs and $1.04 billion in U.S. revenue in 2007 and could mushroom to as many as 37 million jobs by 2030.” - Sarah Sekula. Red Hot Green Jobs. First Monday. April 2009. Page 13.

Metro Orlando’s solar industry has also immensely benefited from partnerships with UCF and other research institutions. Innovative solar research and development activities are taking place throughout the university. Florida Solar Energy Center The Florida Solar Energy Center (FSEC) at UCF is responsible for conducting research, testing, and certifying solar systems as well as developing educational programs for the solar industry. As part of the Photovoltaics and Distributed Generation Division of the FSEC, PV components and systems are tested and certified. Through this testing and certification, the FSEC ensures the quality of the area’s PV systems. The FSEC also conducts research on thin-film PV production techniques, tests on long-term exposure, and researches materials in an effort to make inexpensive solar energy a reality.

Solar Energy Research Division The FSEC at UCF operates in a number of key research areas. “One research division that is very active at the Florida Solar Energy Center is the solar energy research division. This division concentrates on two areas of renewable energy. What is called photovoltaics energy, where you have semiconductor cells which produce directly from sunlight electrical energy in the form of direct current energy, and then that energy can be inverted into alternating current energy that can be used in conventional applications. The other area is solar thermal [heating.]

“The FSEC is also responsible for the certification, the rating, the testing, and the certification of all solar systems which are manufactured or sold within the state of Florida, and that is a function of our original charter that was created by the legislature in 1976 as a way of protecting consumers from fraudulent solar systems and devices. And so we’ve seen that effort that just simply the testing and certification of solar systems improved the performance of these systems … from about an average of 30 percent to more than 60 percent efficiency. That’s doubling the efficiency of the systems that are in the marketplace compared to what was in the marketplace 30 years ago when this effort first started.” - Phillip Fairey, Deputy Director of the Florida Solar Energy Center. Orange County First Cleantech Symposium. November 5, 2008.

30

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


The FSEC has a solar thermal program as well, which conducts research on a wide array of technologies, from commercial system design to solar ovens.89 Research in PV materials includes thin-film solar cells for terrestrial and space application, photoelectrochemical water splitting for hydrogen generation, module testing for long-term exposure, and high-voltage bias testing of thin-film PV modules.90 NanoScience Technology Center The NanoScience Technology Center at UCF is dedicated to research in different areas of renewable energy. “In the past ten to twenty years we have developed tools that enable us to visualize and manipulate on a very small level. It is an amazing new frontier,” said Dr. Jeff Anderson, Associate Director of the UCF NanoScience Technology Center. According to Anderson, nanoscience will impact all industries—including energy. “It is going to take a great deal of work, effort, and research to garnish the opportunities that are there—but the opportunities are there, such as increasing the efficiency of photovoltaics. We are working on it.”91 Current clean energy research activities include: • • • • •

Nanoscale Optoelectronic Materials and Device for Energy Conversion One Dimensional SemiConducting Architectures for Hybrid Solar Cells

Conductive Supramolecular Assemblies with High Charge Mobility

Computer Modeling for Energy Conversion Technologies of the Future Integrated Photovoltaic Device Development

Florida Power Electronics Center Since 1998, the Florida Power Electronics Center at UCF has been involved in research and development activities in different areas of power 89 90 91

Florida Solar Energy Center.  www.fsec.ucf.edu/en/research/index.htm Florida Solar Energy Center. Ibid. Anderson. Ibid.

The Florida Solar Energy Center at UCF Partners in PV: FSEC partners with Sandia National Laboratories (SNL), the Southwest Technical Development Institute, and the California Energy Commissions Public Interest Energy Research (CEC PIER) to characterize to test inverter and PV systems.

Since 1982, the FSEC has operated the U.S. Department of Energy’s Photovoltaic Southeast Regional Experimentation Station (SERES) and supported the national PV program, under the technical guidance of the Sandia National Laboratories, and in partnership with the Southwest Regional Experiment Station – SW Technology Development Institute at New Mexico State University. FSEC partners with public Florida municipal utilities and others to offer the SunSmart program, a first in the state of Florida to offer a unified, low-cost solution to providing electricity utilities customers with a green energy option. The FSEC also supports the Virgin Islands Energy Office in the development of design specifications and implementation of renewable energy projects for St. Croix, St. Thomas, and St. John islands.

Through the FSEC-governed Smart Schools program, elementary, middle, or senior high schools, vocational schools, or colleges and universities compete to receive a 1- or 2-kilowatt demonstration or a 10 kw emergency shelter PV system.

Source: FSEC

electronics for various industries and renewable energies. Communications According to Enterprise Florida, UCF Professor in Engineering and Computer Science and Florida Semiconductors PEC Director Issa Batarseh developed innovative power electronics for solar energy conversion, a “process needed to make the energy collected in Medical solar panels compatible with domestic electric grids.”92 This technology was licensed by Petra Solar and is now being used with the existing power grid. Florida and, therefore, Metro Orlando, is among the top places for solar energy because of its abundant access to an important natural resource—the sun. Averaging 240 days of sunshine each 92

Figure 8. Education

Nanoscale Science and Technology

Environment

Energy

Transportation Biotechnology Source: First Orange County Cleantech Symposium

Building a Foundation for Excellence in Clean Energy. Enterprise Florida. 2008 CHAPTER 4: Clean Technologies and Sectors

31


year, according to Enterprise Florida, the Sunshine State has unsurprisingly attracted a large number of solar companies, facilities, and research centers, and has received support from leading utility companies in the state.93 Solar America City Orlando was one of the first 13 U.S. cities to be designated by the U.S. Department of Energy (DOE) as a Solar America City in June 2007.94 The U.S. DOE recognized cities that showed commitment to solar energy usage through efforts to remove solar market barriers and to encourage solar energy adoption locally. Orlando is committed to integrating solar technologies into city energy planning, zoning, and facilities, and adopting regulations and practices that will promote solar technology among residents and businesses. Along with this recognition, the U.S. DOE granted the City of Orlando, in partnership with Orange County and the Orlando Utilities Commission (OUC), $200,000 for further solar development projects. The city has established a goal of installing 15 megawatts of solar energy by 2015 and has established its partnership with Orange County and OUC to meet this goal.95 In addition to the $200,000 grant, the DOE will provide the city with assistance in integrating solar technologies, streamlining solar regulations and practices, and in the adoption of technologies by local businesses and residents. Orange County Convention Center Major solar projects in the Orlando area serve to showcase the area’s prominent solar industry. The Orange County Convention Center is set to be the home to the largest solar project in the Southeast. The project, which is funded by a grant from the state and contributions from the OUC, among other sources, will provide one megawatt of solar power, generated by a rooftop PV system.96 In May 2007, the Orange 93 94 95 96

32

Enterprise Florida. www.eflorida.com/ ContentSubpage.aspx?id=6938 U.S. Department of Energy. Solar America Cities. http://www.solaramericacities.energy. gov/Cities.aspx City of Orlando Selected a “Solar City” by U.S. Department of Energy. City of Orlando Office of the Mayor. April 23, 2008. The OCCC Will Use Florida Sunshine to Make Electricity. Orange County Convention Center. November 4, 2008.

County Convention Center received the Market Transformation: Solar America Showcase (SAS) award. Through technical assistance, showcases aim at facilitating large-scale installations of cutting-edge technologies, novel applications of solar power, highvisibility sites, and/or high likelihood of replicability. Mitsubishi Power Systems According to Jim Williams, Vice President of Service and Manufacturing Operations at Mitsubishi is adding 200kW of solar panels to its Orange County facility this year. “If the market continues to increase, this will probably be the next product we integrate into our manufacturing in the United States.”97 The installation of solar panels at Mitsubishi this year is expected to produce a savings of $55,000 in energy costs annually, and reduce Mitsubishi’s carbon footprint in Orange County to 600 tons of CO2 annually. OUC Downtown Service Plaza Another major solar project in Orlando is part of the OUC’s new downtown service plaza. The building’s LEED gold standard of certification makes it the greenest building in downtown Orlando. Roof-mounted arrays are part of a 32 kilowatt PV system,98 and at least half of the building’s hot water demands will be met by the 160-square-foot solar thermal system pictured below.99 Figure 9.

Source: DOE www.solaramericacities.energy.gov/Cities. aspx?City=Orlando

Solar Incentives Incentives and other forms of funding 97

98 99

Williams, Jim. Vice President, Service and Manufacturing Operations. Mitsubishi Power Systems Americas, Inc. Second Orange County Symposium. January 21, 2009. OUC Dedicates Reliable Plaza: The Greenest Building Downtown. Orlando Utilities Commission. November 11, 2008. U.S. Department of Energy. Solar America Cities. www.solaramericacities.energy.gov/ Cities.aspx?City=Orlando

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

for solar projects in the Metro Orlando area have expedited the industry’s growth by making solar more affordable and cost efficient. Federal tax credits are available for the installation of photovoltaic systems and solar water heaters. Home builders are also eligible for $2,000 in federal tax credits for new homes that are 50% more energy efficient in heating and cooling, or $1,000 for new homes that are 30% more energy efficient in heating and cooling.100 Florida residents are eligible for rebates for solar PV systems, solar thermal systems, and solar thermal pool heating systems. Solar PV systems installed in homes and businesses are eligible for a $4-per-watt rebate. Residents who install solar thermal systems can receive a $500 rebate while businesses that install solar thermal systems can receive $15 per British thermal unit (Btu) of energy. Additionally, those who install thermal pool heating systems receive a $100 rebate.101 Orange County offers a $200 incentive for commercial and residential solar water heating systems, also as part of the county’s partnership with the Orange County Environmental Protection Division (EPD), Progress Energy, and OUC.102 Orlando Utilities Commission OUC has contributed to growth in Central Florida’s solar energy industry through its policies, programs, and partnerships. The utility company encourages solar energy usage through two major programs: a solar PV program and a solar thermal program. Solar PV systems generate electricity, while solar thermal systems generate heat for hot water systems.103 OUC customers install one of these systems in their homes and, in return, receive monthly credits for energy production, and any excess electricity from the systems is sold back to OUC at the standard retail rate. This process allows local customers to not only save on normal consumption but 100 Energy Star. Federal Tax Credits for Energy Efficiency. www.energystar.gov/index. cfm?c=products.pr_tax_credits#s1 101 Florida Department of Environmental Protection. Solar Energy System Incentives Program. www.dep.state.fl.us/energy/ energyact/solar.htm 102 Orange County Government, Florida. Solar Hot Water Incentive Program. www.orangecountyfl.net/cms/DEPT/CEsrvcs/ epd/SolarWaterProgram.htm 103 Orlando Utilities Commission. OUC’s Pilot Solar Programs. www.ouc.com/green/solar_ pilots.htm


also earn money for excess electricity generation. As part of OUC’s programs, the company has formed a partnership with the Orlando Federal Credit Union in order to provide residential customers with low interest loan options for their solar installations.

Examples of Solar Companies in Metro Orlando Allsolar Service Company, Inc. (Lake Mary, FL), www.allsolarflorida. com, specializes in solar hot water, pool heating, and electric systems for all types of applications—industrial, residential, and commercial. The privately owned company has installed more than 15,000 solar systems in the state since 1974 and is involved in many types of solar projects, from system design to installation. NovaSol Energy (Orlando, FL), www.novasolenergy.com, has a long history of working with the FSEC in engineering, research, and project management for solar installations. The

company’s research and development has focused on power control systems, and the company has developed solar systems for major utilities. NovaSol Energy has been installing solar energy systems for more than 10 years. Petra Solar (Orlando, FL), www.petrasolar.com, headquartered in New Jersey, opened its global R&D headquarters near UCF and formed a partnership with the university after receiving $14 million in VC funding.104 The company licensed UCF-developed technology and is now introducing products that are intelligent, digitally controlled, scalable, and distributable, with the goal of simplifying and reducing the cost of solar power installation.105 According to Enterprise Florida, solar electric systems that use Petra Solar products are more efficient and easier to build and maintain. Solar-BLUE, Inc. (Oviedo, FL), 104 Abney, B. UCF Technology Fuels Solar Panel Expansion. UCF Newsroom. November 8, 2007. 105 Building a Foundation for Excellence in Clean Energy. Ibid.

www.solarblue.org, has developed solar water heating systems and solar energy systems specifically for commercial business use, such as for hotels, restaurants, swimming pools, industrial facilities, and condominiums. The company manufactures, sells, and installs its solar systems, which require little maintenance and can operate for more than 20 years. Sowlar, Inc. (Orlando, FL), www.sowlar.com, develops and markets concentrating photovoltaic (CPV) modules for use in generating solar energy. The company’s objective is to provide the world’s most efficient and lowest cost per watt solar modules. Another company that specializes in solar electric, hot water, and pool heating systems is Superior Solar Systems, Inc. (Longwood, FL), www.superiorsolar.com. The company is one of the largest solar contracting firms in the nation, and it is known for installing these solar systems in residential and commercial settings.

List of Works Consulted 1.

Abney, B. UCF Technology Fuels Solar Panel Expansion. 8 Nov 2007. UCF Newsroom.

2. Anderson, Dr. Jeff. Associate Director, UCF NanoScience Technology Center. First Orange County Cleantech Symposium. November 5, 2008.

3. Basic Energy Sciences Advisory Committee. Dec. 2008. New Science for a Secure and Sustainable Energy Future. United States Department of Energy. 4. Bennett, M. 21 July, 2008. Clean Tech Intro: The Solar Family. CleanTechnica. www.cleantechnica.com/2008/07/21/ clean-tech-intro-the-solar-family/ 5.

Carbon Free Prosperity 2025. CleanEdge, Inc. and Climate Solutions. October 2008.

6. City of Orlando Selected a “Solar City” by U.S. Department of Energy. 23 April 2008. City of Orlando Office of the Mayor. 7.

Fan, B. and Koren, D. 2009. Cleantech Investment Monitor 2008 Annual Review & 4Q08 Quarterly. Rep. Vol. 7. 4th Issue. Cleantech Group LLC.

8. Federal Tax Credits for Energy Efficiency. Energy Star. www.energystar.gov/index. cfm?c=products.pr_tax_credits#s1

9.

Very High Efficient Solar Cells. Defense Advanced Research Projects Agency. Strategic Technology Office. www. darpa.mil/sto/smallunitops/vhesc.html

10. Makower, J. Pernick, R. and Wilder, C. Clean Energy Trends 2008. Rep. Clean Edge, Inc. 2008.

11. The OCCC Will Use Florida Sunshine to Make Electricity. 4 Nov. 2008. Orange County Convention Center. www.occc. net/global/press/press_full.asp?ID=102607 76&page=pressreleases

12. OUC Dedicates Reliable Plaza: The Greenest Building Downtown. 11 Nov. 2008. Orlando Utilities Commission. http://www.ouc.com/news/ releases/20081111-reliable_dedication.htm 13. OUC’s Pilot Solar Programs. OUC, The Reliable One.

14. Pernick, R. and Wilder, C. 2008. The Clean Tech Revolution. HapperCollins, New York.

15. Pernick, R. and Wilder, C. Utility Solar Assessment Study. Rep. Clean Edge, Inc. and Co-op America Foundation, 2008. 16. Research. Florida Solar Energy Center. www.fsec.ucf.edu/en/research/index.htm

18. Solar Energy. Enterprise Florida, Inc. www.eflorida.com/ContentSubpage. aspx?id=6938

19. Solar Energy System Incentives Program. Florida Department of Environmental Protection. www.dep.state.fl.us/energy/ energyact/solar.htm 20. Solar Energy Technologies Program. U.S. Department of Energy. Energy Efficiency and Renewable Energy. www1.eere.energy.gov/solar/technologies. html 21. Solar Hot Water Incentive Program. Orange County Government, Florida. www.orangecountyfl.net/cms/DEPT/ CEsrvcs/epd/SolarWaterProgram.htm 22. Williams, Jim. Vice President, Service and Manufacturing Operations. Mitsubishi Power Systems Americas, Inc. Second Orange County Symposium. January 21, 2009

Source: New Science for a Secure and Sustainable Technology, DOE

17. Solar American Cities. U.S. Department of Energy. Energy Efficiency and Renewable Energy. www. solaramericacities.energy.gov/Cities.aspx CHAPTER 4: Clean Technologies and Sectors

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“We are nearing the point in wind power generation where subsidies will no longer be needed. Wind energy is becoming a much larger part of America’s energy generation resources and is growing in size.” - Frank Bevc, Director, Technology Policy and Research Programs, Siemens Power Generation. Second Orange County Cleantech Symposium. January 21, 2009.

Wind Power Why It Matters Wind turbines are the only method of electricity generation that does not expend water at any stage of the production cycle. This allows the use of wind technology in areas where there are significant water shortages or where water is heavily consumed by other industries such as farming, or by the human population. 106 Wind power provides a unique opportunity for small-scale electricity generation. Small farmers, whose bottom line is weather-dependent and who have to compete with large-scale farming corporations for governmental subsidies and on the commodities market, are now taking the opportunity to receive an additional revenue stream. By allowing the power-generating companies to install wind turbines on their land, farmers can receive much-needed cash by selling the unused power back to the grid. In areas where climate conditions cause steady winds, some farmers even make power generation their primary business, converting agricultural farms to wind farms, with wind energy providing for a steadier source of income.107 Wind power is another step in the direction of achieving two strategic goals – eliminating U.S. dependence on foreign oil and gas, and providing climate-neutral means of power generation – making wind technology an invaluable tool in curtailing global warming. With the cost of electricity generated by wind being 106 U.S. Department of Energy. Wind Energy Benefits. 107 Florida Farm Bureau. www.floridafarmbureau. org/about_ffb/history 34

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

comparable to that generated by burning imported hydrocarbons, market forces should provide an additional stimulus to the widespread adoption of wind technology.108

Trends According to Clean Edge, in 2007 the global market for wind power was $30.1 billion, making it one of the two fastest growing sectors for energy globally.109 This figure is estimated to more than double and reach $83.4 billion by 2017. In 2007, it was announced that a wind farm covering 200,000 acres and generating 4,000 megawatts of energy would be built in Texas.110 The total cost of the project will be $10 billion and will be the largest wind farm in the world. According to the Global Wind Energy Council, total installations of wind power in 2008 were 120.8 gigawatts, an increase of almost 30 percent from the year before.111 One of the most recent developments is that in 2008, the U.S. finally surpassed Germany in this sector, making the U.S. the global leader in wind power generation.112 In 2008 alone, it was estimated that about 35,000 new jobs were created in this sector because of the U.S.’s push toward advancing the industry. 108 U.S. Department of Energy. Ibid. 109 Pernick, R. and Wilder, C. The Clean Tech Revolution. HarperCollins, New York. 2008. 110 Pernick and Wilder. Ibid. 111 Wind Energy Update. http://social. windenergyupdate.com/ 112 Wind Energy Update. Ibid.


In Europe, wind power is excelling. Germany is the leader in wind energy in the European Union, generating 22,247 megawatts in 2007. Internationally, the first offshore wind farm, generating 1,000 megawatts of power, is expected to be built in the Thames River.113 The companies involved in this major project include Shell WindEnergy, DONG Energy, and E.ON. In Germany, the company Enercon has already built the world’s largest wind turbine, sized at 7 megawatts, to be used on an offshore wind farm.114

Figure 1. Wind Farm

Challenges Despite its numerous benefits, wind power also faces several challenges, according to Pernick and Wilder. To begin, in the U.S., there exists a subsidy known as the Production Tax Credit (PTC) that gives energy companies and organizations a per kilowatt credit of 1.9 cents, but it is not continuous.115 In other words, every few years, these tax credits expire, and the government has to reapprove them for the next time period. Because of this, the industry has not shown continuous growth like the other clean energy sectors. In order to become competitive, the wind industry needs this tax to be reliable and steady to promote solid growth in the future. Another challenge to wind energy is risk. Companies located in countries that have solid patent laws and technology protection do not have to worry about having their ideas stolen. However, in countries such as China, many foreign wind power companies are afraid that their technology will be pirated due to less stringent enforcement of anti-piracy.116 A third challenge to wind power deals with materials in the production process. Recently, there have been shortages in key inputs to wind turbines, such as steel, causing prices for these inputs (and consequently, the final outputs), to increase. In order to deal with this, companies in this sector, like companies in so many other sectors, are turning toward innovation in nanotechnology. Also, demand for wind turbines continues to increase, and some companies are falling short in meeting 113 114 115 116

Source: www.strings.ph.qmul.ac.uk/~ramgosk/wind_farm_4_hnd.jpg

Figure 2.

Pernick and Wilder. Ibid. Ibid. Ibid. Ibid. CHAPTER 4: Clean Technologies and Sectors

35


Figure 4.

Figure 3. Annual U.S. Market Share of

Wind Manufacturers by MW 2007 Annual U.S. Market Share of Wind Manufacturer by MW 2007

Siemens 16%

Vestas 18%

% bishi 7 Mitsu Suzlon 4%

GE Wind 44%

Gamesa 11%

Clipper 1% Nordex 0.05%

ource: Annual Report on U.S. Wind Power (AWEA)

Source: Annual Report on U.S. Wind Power (AWEA) www1.eere.energy.gov/windandhydro/wind_2030.html

that demand. This inability to meet demand could potentially give large, established wind turbine manufacturers the edge in the industry, weeding out smaller companies in wind power. In economics, this is known as a natural monopoly, which is formed when the capital costs of entering into an industry are too high for new firms. Given the large size of these wind turbines, transportation is proving difficult. Unfortunately, many ideal, high-wind resource locations for these wind farms are located in remote areas. Because of this, companies face a lack of roads and other necessary elements in transportation to get the large turbines to their desired location. Therefore, many companies have been forced to decrease the size of the turbines to make transportation more feasible, despite the fact that larger turbines are more cost effective. “Transportation becomes a very important factor in the location of plants manufacturing the very large components of wind energy turbines,” said Jim Williams, Vice President of Service and Manufacturing Operations at Mitsubishi Power Systems Americas, Inc.117 A potential problem that may arise involving the placement of wind farms relates to their appearance and noise. Placing wind farms near tourist sites, especially for natural areas, could 117

36

Williams, Jim. Vice President, Service and Manufacturing Operations, Mitsubishi Power Systems Americas, Inc. Second Orange County Cleantech Symposium. January 21, 2009.

Source: www.awea.org/images/usamap.gif

potentially decrease tourism in that area. Combined with the problem of wind speed issues (described later in detail), these problems together decrease even further the options wind farm owners have in placement of their turbines. Animal rights groups and other organizations have brought up concerns about the welfare of animals that fly near these large turbines. When the wind turbines are off, some birds make nests on them, and when the turbines turn on, these nests are destroyed, and sometimes the birds are killed. This could be a challenge to wind farm developers when obtaining permission to locate in areas that may have animal preservation spots or just a high level of bird activity. Another key issue is wind speed. Companies are very careful about where to place their wind farms based on wind speeds throughout the day and throughout the year. Some areas, notably the southeastern U.S., have extremely low wind speeds for the purpose of powering a wind turbine, and are, therefore, avoided as sites for farms. This problem gives wind farm owners a limited area in which they

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

are able to locate. Also, some sites are ideal for certain times of the day, but variable speeds throughout the day make the turbines less efficient during some periods. Research into areas with reliable speeds needs to be done to ensure the highest efficiency of the turbines. Figure 4 details wind speeds across the U.S. Wind speeds are divided into seven “power classes,” with seven being the highest category and one being the lowest.

Breakthrough Opportunities Community Wind Farms According to Windustry, a community wind farm is defined as follows: “Locally-owned, commercial-scale wind projects that optimize local benefits. Locally-owned means that one or more members of the local community has a significant direct financial stake in the project other than through land lease payments, tax revenue, or other payments in lieu of taxes. The term “community wind” refers to the method and intention of development rather than


the size of the project.�118

Figure 5.

Owners of these community farms can be local business owners, farmers, Native American tribes, and others. The wind farms in these communities tend to be smaller than the large turbines of corporate wind farms with each turbine generating less than 10 megawatts of energy.119 As mentioned earlier, communities that own wind farms generate income for their area, strengthening the sustainability of the community.120 With respect to investors, this area of wind power is attractive because of the 1978 Public Utilities Regulatory Pricing Act, which has stated that investors do not have to pay anything until power has begun being generated. This offers a huge deal for investors, as they have no up-front costs. Variable Length Blades One of the challenges mentioned above was in regard to variable wind speeds. In response to this problem, a company known as Energy Unlimited has invented a wind turbine whose blades are able to adjust length based on the wind speed at a given time. The company began development in 2002, and the product is known as the Variblade.121 During low wind speeds, the blades extend, and during high wind speeds, the blades contract, increasing efficiency. These variable blades are expected to provide an increase in energy generation of 33 percent over fixed blade turbines currently on the market.122 Hybrid Wind-Hydroelectric Hybrid wind-hydroelectric systems were developed in response to wind power intermittent operations due to varying wind speed. Combining a hydroelectric power station with a wind turbine would provide a more dependable energy source. Some regions have access to both reliable wind and hydroelectric resources. But smaller, on-site generation-to-power farms or villages have the opportunity to combine wind turbines with a solar PV or a biodiesel generator supported hybrid system. Wind Industry. Community Wind.  www.windustry.org/community-wind 119 Pernick and Wilder. Ibid. 120 Wind Industry. Ibid. 121 Pernick and Wilder. Ibid. 122 U.S. Department of Energy. Variable Length Wind Turbine Blade. 2005.

Source: www.worldarchitecturenews.com/project/uploaded_files/935_385%20Bahrain.jpg

Building-Integrated Wind Wind-power generators worked into existing architecture have the potential to solve one of the major challenges of wind power, which is location. One company in this area is Ecofys, and the name of their product, Urban Turbines, describes exactly what the product is.123 Turbines are installed onto existing infrastructure in urban areas. The technology for these areas is still early in development for most companies; however, it offers the potential for gaining access to industrialized areas for wind generation, making it potentially the key to the future of wind power generation. Figure 5 above shows a buildingintegrated wind turbine structures on the Bahrain World Trade Center in the Middle East that was installed in 2007.124 The building is expected to generate about 11-15 percent of the energy needed for the trade center.125

118

123 124 125

Pernick and Wilder. Ibid. http://blog.b-e-f.org/2008/08/20/ urbanturbines-and-other-announcements-atthenational-clean-energy-summit/ www.treehugger.com/files/2007/03/bahrain_ install.php

Major Players

The following companies were taken out of the ten-to-watch list from The Clean Tech Revolution.126 For Metro Orlando, Florida Power and Light (Juno Beach, FL), www. fpl.com is probably the most interesting company to pay attention to. The reason is because the company owns the most wind farms in the United States, yet the area in which the company operates (Juno Beach, Florida) has absolutely no wind farms. In fact, Florida is among the very bottom of North American states in wind resources. Despite this, FPL has become a leader in the field, suggesting opportunities for Metro Orlando companies that could team up with FPL in the production of wind turbines or other areas. Another company to pay attention to is General Electric (Fairfield, CT), www.ge.com. Located in Connecticut, the company manufactures turbines. Because of its grand size as a company, it capitalizes on economies of scale, positioning itself to lower per unit costs of production and meet growing 126

Pernick and Wilder. Ibid. CHAPTER 4: Clean Technologies and Sectors

37


Related Cleantech Jobs • • • • • • • • • • • •

demand for wind turbines. In fact, in November 2008, the company shipped its 10,000th 1.5 megawatt wind turbine, setting a global record.127 The company has invested over $800 million in wind power since it entered the industry less than a decade ago.128 This company provides more than 66 percent of the U.S. market with wind power. The acquisition by Goldman Sachs in 2005 of Zilkha Renewable Energy, to be renamed later Horizon Wind Energy (Houston, TX), www.horizonwind. com was seen by many a turning point in cleantech and was considered Wall Street’s first stamp of approval in the industry. The company was sold two years later to a Portuguese utility Energias de Portugal for more than $2 billion, again sending another signal that cleantech investments could be lucrative. Outside of the realm of large corporate wind turbine manufacturers is a small 127 128

company from Arizona, Southwest Windpower (Flagstaff, AZ), www. windenergy.com, and its small, single turbines have allowed it to enter the market because of larger companies’ lack of focus on this product segment. In 2006, this company captured 65 percent of the small-scale wind power market. In comparison to GE’s 1.5 megawatt wind turbine, Southwest Windpower’s turbine is at a size of 1.8 kilowatts-much smaller! Another big name in wind power is Austin Energy (Austin, TX), www. austinenergy.com. Considered the leader in green power, this company generates 665 million kWh a year of clean energy, mostly in wind power, representing 10 percent of the country’s entire green power currently sold, making Austin Energy the “unequivocal leader in green power.”

Senior Risk Management Analyst Wind Consultant Wind Energy Field Engineers Wind Energy Forecasting & Resource Assessment Wind Energy Sales Specialist Wind Farm Electrical Engineer Wind Farm Estimator Wind Project Developer Wind Resource Analyst Wind Turbine Engineer Wind Turbine Sales Manager Wind Turbine Technician

Internationally, Vestas Wind Systems (Randers, Denmark) www.vestas. com, is the number one in global windturbine manufacturing with 35,000 wind turbines installed in 63 countries, 23% of market share. Iberdrola of Spain (Madrid, ES), www.iberdrola.com, has been recognized as producing the most wind energy in the world. Also from Spain, Acciona (Madrid, ES) www.acciona. com, opened the largest wind-turbine factory in China. Gamesa (Madrid, ES) www.gamesa.es, is competing with GE or Germany’s Enercon for the no. 2 spot among global wind-turbine manufacturers. Its U.S. headquarters is in Pennsylvania.

GE Energy. www.gepower.com GE Energy. Ibid.

“The industry, according to the American Wind Energy Association, currently employs some 50,000 Americans and added 10,000 new jobs in 2007.” - Sekula, Sarah. Red Hot Green Jobs. First Monday. April 2009. Page 16.

38

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


Metro Orlando and Wind Power

Figure 6.

UCF Center for Advanced Turbines and Energy Research Central Florida has a unique position in the world as a hub for Turbine Energy and Space Technologies.129 The University of Central Florida has been dominant in federal and industry research funding in turbines in Florida ($4.6M since 2000).130 The Center for Advanced Turbines and Energy Research (CATER) at the University of Central Florida has the opportunity to take leadership in innovation and advanced technology development in turbines for propulsion as well as power generation. CATER scientists partner with many industry companies, such as Siemens Power Generation, Pratt & Whitney, Mitsubishi Power Systems, Boeing, Lockheed Martin, and others. Recently, through a partnership with Siemens, CATER was expanded. “This technical collaboration should establish UCF and Siemens as academia-industry partners in the betterment of Florida’s economy,” said Randy Zwirn, President and CEO of Siemens Westinghouse Power Corporation.131 This expansion involves research in different areas, including aerodynamics, heat transfers, materials, sensors, and thermodynamics. “Before the expansion, the Siemens Energy Center only had space for one UCF faculty member and 12 students to do research. With the new added lab space, six UCF faculty members and 35 students will be able to work there,” said Jay Kapat, UCF’s director of the Center for Advanced Turbines and Energy Research.132 “That research is important, because turbines are involved in 98 percent of the electricity produced on the grid, whether a nuclear, steam or other type of power plant is involved,” said Kapat. CATER is considered very competitive 129

UCF Center for Advanced Turbine and Energy Research. http://mmae.ucf.edu/Research/ CATER/Index.html 130 Florida Solar Energy Center (FSEC). Significant Industrial Partnership in Energy. www.fsec.ucf.edu/En/media/events/ esummit/gallagher.pdf 131 Florida Solar Energy Center (FSEC). Ibid. 132 Azam, Melanie. UCF, Siemens Expanding Energy, Turbine Research. Orlando Business Journal. Oct 17, 2008.

Florida’s Opportunity in Turbine/Energy Industry OEM’s for Turbines for Power and Aviation: Large frames for Power 1. 2. 3. 4.

Siemens (Total: $130B, Energy: $30B) General Electric Mitsubishi (MHI: $30B, MElec: $40B) Alstom ($26B – all energy)

A 9

7

8

2 52 4

12 4, 6

B 2 1, 3

10, 6, 4 C, D, E, F 1. Aviation turbines 2. General Electric 3. Rolls Royce / Allison Integrated Gasification Combined Cycle (IGCC) 4. Pratt & Whitney based on Clean Coal technology - Out of ~30 5. Medium frames for Power (besides above) worldwide IGCC power plants (12 in USA). 6. Solar Turbines F: The first commercial plant 7. Honeywell Microturbine for Power 8. Capstone Top Utility Companies: 9. Elliott 10. Bowman A. Exelon (#1 – $19B) B. Dominion (#2 – $16B) 11. Ingersoll Rand C. Southern (#3 – $15B) D. FPL (#4 – $15B) 12. Honda

E. Progress Energy (#14 – $11B) F. TECO Electric (#29 – $3.5B) Source: Jay Kapat, Director, UCF CATER. First Orange County Cleantech Symposium. Nov. 5, 2008.

Figure 7.

Source: Orange County First Cleantech Symposium

within the research sector. Figure 7 depicts a comparison of federal grants for turbine research at different U.S. universities.133 The center works in partnership with research institutions both within and outside UCF.134 133

134

Kapat, Jay. Director, UCF Center for Advanced Turbines & Energy Research. Orange County First Cleantech Symposium. November 5, 2008. Kapat. Ibid.

Metro Orlando is also home to many successful business leaders coming from all parts of the globe and serves as a U.S. headquarters base for foreignbased companies,135 which are the forefront of the cleantech industry. Two of these companies are Siemens Power 135

Orlando Economic Development Commission. International Success Stories. www.businessorlando.org/Relocate-Expand/InternationalBusiness/intlsuccessstories.shtml CHAPTER 4: Clean Technologies and Sectors

39


Generation, Inc. and Mitsubishi Power Systems, Inc. They have both maintained partnerships with UCF. Siemens Power Generation, Inc., is the regional business entity in the Americas for global fossil power generation.136 In 2007, Siemens Power Generation announced that its wind power developments had reached 1,400 MW with a total order volume in the range of $1.7 billion.137 “Once all of the Siemens units are completed and operating at Sweetwater, the United States will have surpassed the 10,000 MW mark in wind energy,” said Randy Zwirn, President and CEO of Siemens Power Generation. Now the U.S. has reached 11,350 MW. Siemens has partnered with UCF for the past 25 years, donating more than $3 million for research and development in the past decade.138 Their latest collaboration includes Siemens Power Generation and the Siemens Center for Advanced Turbines and Energy Systems Research at UCF. “The typical wind farm order that we have these days is several hundred megawatts in size, so it is essentially at the same scale as the traditional coal fired power plant was maybe twenty or thirty years ago,” said Frank Bevc, Siemens Director of Technology Policy and Research Programs. “So wind energy is becoming a much larger part of America’s energy generation resources, and certainly growing in size. Florida’s best wind resources are offshore, and that is the area where we see market development for wind energy in Florida.” 139 Headquartered in Orlando, Mitsubishi Power Systems has brought wind turbines to the U.S. with 2000 kW designs into development. The company’s turbine innovations include lightweight blades with fullspan pitch control and advanced noise reduction technology. It has maintained partnership with the UCF CATER for research on wind turbines. Mitsubishi also operates a power systems service and

136 137 138 139

40

Orlando Economic Development Commission. Ibid. Siemens Wind Power Exceeds 1,400 MW of Orders in the U.S. Renewable Energy World. January 12, 2007. Azam. Ibid. Bevc, Frank. Director of Policy and Research Programs, Siemens Power Generation. Second Orange County Cleantech Symposium. January 21, 2009.

manufacturing center in the region.140 “We sold our first wind turbine in the United States in the 1980s, and this has been our largest growing product line over the past two years,” said Jim Williams, Vice President of Service and Manufacturing Operations at Mitsubishi Power Systems Americas. “The 2.4 megawatt wind turbine will probably be the only wind turbine we sell in the United States by 2012—which is about one football field in diameter. Most of these are manufactured in Japan, with the blades and towers here in the United States.”

“The 5 megawatt offshore wind turbine looks to be the next opportunity for us. Europe already has these. … There may be an opportunity to manufacture wind turbines here in the southeast.” - Jim Williams, Vice President, Service and Manufacturing Operations, Mitsubishi Power Systems Americas, Inc. Second Orange County Cleantech Symposium. January 21, 2009.

As mentioned earlier, Florida Power and Light (FPL) has a major presence in the U.S. Though not located in Metro Orlando, the company is just a few counties away. Metro Orlando companies could develop partnerships with the company in order to expand their businesses. Currently, there are no wind farms in the state of Florida. However, in the past few years, FPL has been working on potentially establishing a wind farm site in St. Lucie, Florida.141 The wind farm would consist of six turbines. Generated electricity will amount to up to 13.8 megawatts. This project represents a major stride by FPL to advance renewable wind power generation in the state. In a survey given to St. Lucie County residents, the project 140 Orlando Economic Development Commission. www.orlandoedc.com 141 Florida Power and Light (FPL). St. Lucie Wind Project. www.stluciewind.com

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

garnered approval from 80 percent of respondents.142 This new development challenged old myths that low wind speed states are unable to harness wind power. Technological advances are making it possible. As an example of its commitment to renewable energy, Progress Energy Florida will pursue a research and development project that will examine potential for wind generation using small-scale turbines throughout its various service locations in Florida.143 The study is partly funded by the Florida Department of Environmental Protection. “We believe small-scale wind generation could play an important role in meeting Florida’s renewable-energy needs,” said John Masiello, director of Alternative-Energy Strategy for Progress Energy Florida.

Examples of Wind Power Companies in Metro Orlando Metro Orlando is the headquarters for Siemens Power Generation, Inc., while Germany is the headquarters of Siemens Worldwide. Siemens Energy is one of the premier companies in the international power generation sector, providing leading power and energy solutions. Siemens Power Generation develops and builds fossil fuel power plants and power-generating components as well as wind turbines, turbines for use as mechanical drives, and compressors for industrial applications. Instrumentation and control systems, fuel cell technology, and extensive services round out the portfolio. Mitsubishi Power Systems is the local presence of Mitsubishi Heavy Industries (MHI) in the Western Hemisphere. MHI is a Fortune Global 150 company with more than $25 billion in annual revenues and more than 40,000 employees worldwide. Since the 1980s, Mitsubishi Power Systems has pioneered the development of high-efficiency wind turbines that make wind generation more productive and profitable. More than 1,380 wind turbines are in operation worldwide. 142

143

Survey finds more than 80 percent of St. Lucie County residents support wind turbines on Hutchinson Island. FPL. April 2, 2008.  www.fpl.com/news/2008/040208.shtml Progress Energy Florida to Study Wind, Promote Solar Power. PEF News Release. March 3, 2008.


List of Works Consulted 1.

2008, Carbon Free Prosperity 2025. Clean Edge, Inc. and Climate Solutions. October 2008.

16. Renewable energy sources in figures – national and international development. June 2008.

2. Azam, Melanie. UCF, Siemens Expanding Energy, Turbine Research. Orlando Business Journal. Oct. 17, 2008.

17. Siemens Wind Power Exceeds 1,400 MW of Order in the U.S. Renewable Energy. January 12, 2007.

3. Bevc, Frank. Director of Policy and Research Programs, Siemens Power Generation. Second Orange County Cleantech Symposium. January 21, 2009.

18. Survey finds more than 80 percent of St. Lucie County residents support wind turbines on Hutchinson Island. Florida Power and Light. www.fpl.com/ news/2008/040208.shtml

4. Carbon Free Prosperity 2025. CleanEdge, Inc. and Climate Solutions.

19. Thresher, R. and Laxon, A. Advanced Wind Technology: New Challenges for a New Century. National Renewable Energy Laboratory. June 2006.

5.

Center for Advanced Turbine and Energy Research Website at UCF

6. Community Wind. Windustry. www.windustry.org/community-wind 7.

Enterprise Florida at www.eflorida.com

8. Global Wind Energy Milestone: GE Energy Ships its 10,000th 1.5-Megawatt Wind Turbine. GE Energy. November 2008. http://www.gepower.com/about/ press/en/2008_press/111708.htm 9.

Global wind energy capacity grew by 28.8 percent in 2008. Wind Energy Update. http://social.windenergyupdate. com/content/global-wind-energy-capacitygrew-288-percent-2008

10. Jacobson, D. and High, C. Wind Energy and Air Emission Reduction Benefits: A Primer. National Renewable Energy Laboratory. February 2008. 11. Kapat, Jay. Director, UCF CATER. First Orange County Cleantech Symposium. November 5, 2008. 12. Orlando Economic Development Commission. www.orlandoedc.com 13. Parsons, B. Wind Energy Status and R&D Challenges. National Renewable Energy Laboratory. March 2006. 14. Pernick, R. and Wilder, C. 2008. The Clean Tech Revolution. HarperCollins, NY

20. Urban Turbines and Other Announcements at the National Clean Energy Summit. Bonneville Environmental Foundation. August 2008. http://blog.b-e-f. org/2008/08/20/urban-turbines-andother-announcements-at-the-nationalclean-energy-summit/ 21. Variable Length Wind Turbine Blade. U.S. Department of Energy. 22. Wind Energy Benefits. U.S. Department of Energy. April 2005. 23. Wiser, R. and Bolinger, M. Annual Report on U.S. Wind Power Installation, Cost, and Performance Trends: 2007. U.S. Department of Energy. May 2008. 24. World’s First Building-Integrated Wind Turbines. Treehugger. March 2007. 25. www.indeed.com for cleantech-related jobs. 26. www.treehugger.com/files/2007/03/ bahrain_install.php. 27. www.windustry.org/community-wind 28. www1.eere.energy.gov/windandhydro/ wind_2030.html 29. www.floridafarmbureau.org/about_ffb/ history

15. Project Information. St. Lucie Wind. www.stluciewind.com/project_info.shtml

CHAPTER 4: Clean Technologies and Sectors

41


“We excel in organic thin-film layers upon which we grow organic, solar, and carbon capture cells—we are an algae firm, growing and harvesting algae. We are a water remediation firm. We clean water. We have twenty-three patents and twenty-one patents pending. We produce tons and tons of biomass, which is a key to alternative energy.” - Tom Bland, Chairman and CEO, Aquafiber Technologies Corporation, First Orange County Cleantech Symposium.

Biofuels Why It Matters With the promise of cleaner fuel and a significantly reduced dependence on foreign oil, biofuels, such as ethanol and biodiesel, represent a rapidly expanding market. According to a 2009 report from Clean Edge, the market for biofuels alone is projected to expand from a $34.8 billion market in 2008 to a $105.4 billion market by 2018.144 Figure 1.

and fine particle emissions by as much as 50%.145 Ethanol is currently made primarily from common crops, such as sugar cane and corn, although the goal for many innovative companies is to make the transition to non-food crops. The implications of the production of biofuels are great in the U.S., a country that consumes one-fourth of the world’s oil yet only has about 3% of the world’s petroleum reserves.146 According to Jeff Anderson, Associate Director at the UCF NanoScience Technology Center, 85% of U.S. energy is from fossil fuels: 37% oil, 25% coal, and 23% gas.147

Overall Trends

Biofuels are carbohydrate-based instead of non-renewable, hydrocarbonbased fossil fuels and are made from plant crops. According to the Renewable Fuels Association, ethanol reduces carbon monoxide emissions up to 29% 144 Makower, J. Pernick, R. and Wilder, C. Clean Energy Trends 2009. Clean Edge, Inc. 2009. 42

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

The market for ethanol, at more than 13 billion gallons in 2007, is currently much larger than the market for biodiesel, at approximately 2 billion gallons. Brazil is the world leader in ethanol production and usage and the first country to boast widespread use of biofuels. In fact, in 2005, 70% of new cars sold in Brazil were flex-fuel vehicles, or FFVs, capable of using both regular gasoline and ethanol blends. In the United States, ethanol blends 145

Renewable Fuels Association. Ethanol Facts: Environment. www.ethanolrfa.org/resource/ facts/environment/ 146 Pernick, R. and Wilder, C. The Clean Tech Revolution. HarperCollins, New York. 2008.  p. 93. 147 Anderson, Jeffrey. Associate Director of NanoScience Technology Center. Cleantech and Nanotechnology: Challenges and Opportunities. Orange County First Cleantech Symposium, November 5, 2008.


Figure 2.

Source of Energy: > 85% from fossil fuels Oil 37%

Coal 25%

Gas 23%

Nuclear 6%

Biomass 4%

Solar heat 0.5%

Wind 0.3%

Hydro 3%

Source: First Orange County Cleantech Symposium

Geothermal 0.2% Biofuels 0.2% Solar photovoltaic 0.04% Table 1.

Global Installation/Production Growth: Solar, Wind, Biofuels 2003

2007

2017 (est.)

Solar PV Installations

620 MW

2,821 MW

22,760 MW

Wind Power Installed

8000 MW

20,060 MW

75,781 MW

7 Billion Gallons

15.6 Billion Gallons

45.9 Billion Gallons

Biofuels Produced

Source: Makower, J. Pernick, R. and Wilder, C. Clean Energy Trends 2008. Rep. Clean Edge, Inc. 2008.

are typically 10% or less; conversely, Brazilian ethanol mixes go up to 100%.148 U.S. ethanol blends in the mass market have not reached the same height as those in Brazil, in part because of the lack of cars in the U.S. capable of running on more than a 10% ethanol blend. Ethanol blends and biodiesel have trended toward price parity as a result of manufacturing economies of scale and have even achieved price inversion (meaning the price of fuel blends fell below the price of regular gasoline) in several states during brief periods in 2005. Competitive prices for biofuels 148 Pernick and Wilder. The Clean Tech Revolution. Ibid. pp. 84-86

are most commonly seen in the Midwest where most of the nation’s corn and ethanol is produced. The most volatile factor that affects the price of biofuels is commodity prices like feedstock, which accounts for more than half the cost to produce biofuels. So, when the price of corn or soybean spikes, economy of scale in biofuels production cannot always outweigh rising input costs.149 The biofuels industry is not a new industry, and its current and expected rapid growth in the future is a result of a variety of factors, including the rising cost of oil, the increasing costs related to national security, recent technological breakthroughs, and the fact that biofuels 149 Ibid. 88-89

are beginning to compete in price with gasoline. Today’s biofuel industry differs from that of the past also in federal government support. A large reason biofuels were not popularized earlier was the federal government’s support for lead-based additives in motor engines over ethanol-based additives from the 1930s until 1987, when lead additives were banned for their high levels of toxicity.150 Government policies and support have contributed considerably to the growth of biofuels in the U.S. and will be essential to its continued development. State-imposed requirements on the amount of fuel that must be derived from ethanol and biodiesel have fostered the growth in biofuels development. In a consistent move away from dependence on fossil fuels, many states have imposed renewable fuel standards with varying targets. Governor Schwarzenegger ordered the California State Energy Commission to develop plans to get 20% of the fuel supply to come from ethanol and biodiesel by 2010 and 40% by 2020. Minnesota has an RPS that calls for 20% of its transportation fuel to come from ethanol by 2013. Iowa’s RPS goal is 25% by 2019, while Montana and Hawaii are targeting a goal of 10%.151 Government support has also been seen at the national level through policies like the nation’s renewable fuel standard, the 52-cent tax credit for the biofuels market,152 and the Energy Independence and Security Act of 2007, which called for at least 36 billion gallons of fuel to be from biofuels by 2022, more than half of which must come from cellulosic feedstocks like corn stover or switch grass.153 According to the Cleantech Group, venture capital investments in biofuels reached $904 million in 2008.154

Challenges One inherent disadvantage that ethanol faces is reduced energy content compared to regular gasoline, typically getting only 80% of the

150 151 152 153

Ibid. p. 90 Ibid. pp. 93-94 Ibid. p. 107 Renewable Fuels Association. Renewable Fuels Standard. www.ethanolrfa.org/resource/ standard 154 Koren, D. 2009. Cleantech Investment Monitor 2008 Annual Review & 4Q08 Quarterly. Rep. Vol. 7. 4th Issue. Cleantech Group LLC CHAPTER 4: Clean Technologies and Sectors

43


Figure 3.

VC Investment in Biofuels - By Year Millions

$1,200 M

70 63 $988

$1,000 M

60 $904 50

$800 M

52 46

$661

40

$600 M 26

$200 M

18

8

$151

8

$61

2002

155

44

Pernick and Wilder. The Clean Tech Revolution. Ibid. p. 100

0

2003

energy per gallon that gasoline gets.155 Companies are working to overcome this disadvantage, and cars have been developed that actually achieve better mileage with ethanol blends than with gasoline. Technological breakthroughs in this field offer great opportunities for growth for car companies and scientific researchers. Another significant obstacle in furthering the production of ethanol is the limited displacement of oil by corn. In order for ethanol to significantly reduce dependence on oil, feedstock must shift from grains, like corn, to cellulose, like wheat straw, rice husks, or corn stover. Scientists must develop a way to efficiently enable the conversion from cellulose to ethanol. Figure 4 depicts the biofuels production cycle. An unfortunate by-product of the international biofuels industry relates to the fact that crop production in some countries, including Malaysia and Indonesia, has resulted in deforestation and the loss of biodiversity, much to the dismay of those in the industry whose goal is to solve environmental issues. The use of GMOs, or genetically modified organisms, in the development of crops for biofuels has also become an issue in the international biofuels market. While GMOs are used in the majority of

10

$35

$5

$0 M

20

2004

2005

2006

corn and soybean feedstock in the U.S., most European countries have bans on GMOs and demand that their biofuels are free of them.156 To avoid competition for land between food and fuel, some critics argue against growing biofuels from food land, such as turning corn into ethanol in the U.S. Rather, they recommend using residues from food production.157 “Ninety percent of the biomass, like straw, is not Figure 4.

2007

Source: Cleantech Group

$400 M

30

2008

used for food,” said Hermann Scheer, General Chairman of the World Council for Renewable Energy. “Refining it to make biofuels would provide a second income for farmers, and the waste from biorefineries, like ash, could be used to replace chemical fertilizers. In this integrated system, biofuels would be the basis for organic agriculture, and there would be no competition for land between food and fuel.” In order for the U.S. market to make the shift from fossil fuels to biofuels, major changes need to occur not only in the development of the fuels themselves but also in the types of cars and gas station pumps available to consumers. Car companies must make FFVs readily available to consumers, and thousands of ethanol-fueling stations must be in place in order for ethanol use to become widespread.

Breakthrough Opportunities

Source: http://keetsa.com/blog/wp-content/ uploads/2007/08/co2cycle.jpg

156 157

Ibid. pp. 99-100 Pearce, Fred. Bring on the Solar Interview with Hermann Scheer. New Scientist. May 21, 2008.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

Moving toward cellulose ethanol The main challenge and, therefore, the main source of opportunity in the ethanol industry is finding a way to move away from using corn and other virgin feedstock in ethanol production and, instead, move toward cellulosic ethanol, which comes from corn stover (the remaining corn stalks after corn is harvested), wood residues and forestry


wastes, and switch grass, among others. In order to use cellulose in ethanol production, scientists must develop a process that turns biomass into ethanol. Companies are working to produce enzymes that could enable this conversion. Scientists are also looking to certain forms of algae as a potential non-grain source for biofuels. GreenFuel Technologies , based in Cambridge, Massachusetts, is working to develop technology that will use algae to convert power plant emissions into biofuels. Bill Gates and Boeing have joined the race to find a cost-effective and environmentally-friendly ways to turn algae to fuel for cars, trucks, airplanes, and boats. In their fierce efforts to encourage the speedy development of algae fuel, businesses are forming alliances with algae academics and are tapping graduate students before they complete their degrees.158 In 2007, $32 million was invested into algae fuel by VC. Through the beginning of October 2008, that number has reached $184 million worldwide, according to the Cleantech Group.

Dr. Rose Ann Cattolico, a University of Washington botanist and algae expert, is growing dozens of different kinds of algae at her UW lab to find the right ones for turning into different kinds of fuels that can power cars, trucks, airplanes and boats.

Source: Scott Eklund/Seattle Post-Intelligencer

Figure 5.

The oil made from algae can be used in the following applications: 1) transportation and home heating fuels, 2) bioplastics, 3) petrochemicals, 4) nutraceuticals, 5) pigments, and 6) cosmetics.159 However, the greatest 158

159

Stiffler, Lisa. Algae Fueling the Green Revolution: Big Bucks Behind the Search for New Power. Seattle Post Intelligencer. October 6, 2008. PetroAlgae. www.petroalgae.com

benefit from algae exists in the field of petroleum fuel substitution. The oil production process results in high yields—200 times more oil per acre than traditional biofuel crops, such as soybeans and corn. With this productivity and the system’s lack of need for arable land for production, the acreage needed for algae growth and conversion would be less than 2% of the land currently suitable for traditional biofuel crop growth in the United States and the European Union.160 The overall benefits of the algae oil as a fuel are: 161

Figure 6.

Orlando Traffic www.dkimages.com

Figure 7.

• It is renewable and sustainable. • It is essentially carbon neutral.

• It reduces other harmful emissions.

• It does not compete for land used by traditional oil crops like soybeans, rapeseed, or palm kernel. • It uses water efficiently and has the ability to clean it as well.

Limiting fossil-fuel inputs in nextgeneration biorefinieries Critics of biofuels production have questioned whether or not the production of biofuels is more energy efficient and cost effective than oilbased products, claiming that by the time all factors of production have been accounted for, biofuels are no more energy efficient than regular gasoline. Although most assertions like these have been disproved, there is an opportunity for distillers to overcome the need for fossil-fuel inputs during the refining process of biofuels production. In Houston and Nebraska, biomass-fueled ethanol refineries have been developed to reduce or eliminate local ethanol distilleries’ dependence on oil by using cow manure to power the facilities. Close-looped systems like the ones in Houston and Nebraska are expected to become increasingly popular as the system reduces input costs and makes ethanol production cleaner.162

Corn: A Common Biofuels Feedstock http://renewablefeed.googlepages.com/biofuels

Figure 8.

Algae Used in Biofuels www.treehugger.com/aglae-biofuels-tt001.jpg

Local production Companies are also reducing the cost and environmental impact of biofuels production by making the entire process, from farming to refining and using,

local.163 Currently, many biofuels are transported over long distances, effectively imposing a high energy cost. By establishing regional biofuels production facilities, companies and organizations can take advantage of the rapidly expanding alternative fuels market and unearth new, more effective production and distribution methods.

160 PetroAlgae. Ibid. 161 Ibid. 162 Pernick and Wilder. The Clean Tech Revolution. Ibid. pp. 91-92

163

Ibid. pp. 102-103 CHAPTER 4: Clean Technologies and Sectors

45


Branded Biofuels Distribution Another growth opportunity, branded biofuels distribution, has arisen from the deficiency of clear, easy access for consumers to high blends of biofuels. Most people do not know exactly who offers high blends of biofuels, so companies new and old who differentiate themselves by consistently offering biofuels blends have the opportunity to stand out to consumers. Some companies already have plans to take advantage of this, including SeQuential Biofuels, a company that aims to open multiple stations across the Northwest that offer biofuels, and Wal-Mart, which aims to sell biofuels blends at up to 400 of its Wal-Mart or Sam’s Club gas stations.164

Related Cleantech Jobs • • • • • • • • •

Ethanol Farmer Scientific Researchers Car Manufacturer Biodiesel Chemical Engineer Lab Technicians Chemists Ethanol Plant Operator Biofuel Process Engineer Feed Mill Manager

Major Players Individual companies and institutions are leading the way in biofuel research, production, and distribution. In the book The Clean Tech Revolution, Pernick and Wilder identify companies to watch in the solar industry.165 In California, companies like Cilion (Menlo Park, CA), www.cilion.com, and Verenium Corporation (San Diego, CA), www. verenium.com, are forerunners in the research and development process. Cilion, a start-up company that has received massive VC funding, upward of $240 million, is working on deploying 55-million-gallons per year ethanol plants with the intention to produce cheaper and greener ethanol than standard plants. Verenium is developing enzymes it hopes will convert plant material to ethanol. The enzymes are necessary for cellulosic ethanol and nextgeneration processes. Novozymes, (Bagsvgerd, DK), www. novozymes.com is the world leader in the production of enzymes and is working 164 Ibid. p. 108 165 Ibid. pp. 111-115 46

to grow its ethanol portfolio. The company’s enzymes are used in a variety of ways, from wastewater treatment to renewable fuels. In a partnership with China Resources Alcohol Corporation, the company is conducting research on rice straw-to-ethanol conversion. In Ontario, another biotech company, Iogen, is working to supply the world with lower-cost cellulosic ethanol from wheat straw and other agricultural residues. The company had a long history of supplying enzymes to various industries, giving it a head start in enzyme production. Range Fuels (Broomfield, CO), www.rangefuels.com, also has its eye on cracking the cellulosic code. But Range Fuels has differentiated itself by actually building a cellulosic ethanol refinery, one of the first in North America, with the goal to use waste streams for its source of feedstock. In the spring of 2008, the company received more than $100 million in financing, giving it the position as one of the top-financed startups in the cellulosic ethanol field. VeraSun Energy Corporation (Brookings, SD), www.verasun.com, a public ethanol company and leading ethanol producer, claims it can turn ethanol’s major coproduct, distiller’s grain, into biodiesel. This breakthrough could revolutionize the biofuels industry because both ethanol and biodiesel could be made from one feedstock. Imperium Renewables (Seattle, WA), www.imperiumrenewables.com, the first U.S. biodiesel company to receive VC investment, makes biodiesel for use in industrial motors, home-heating oil, and diesel cars and trucks. The company successfully produces biodiesel at a lower cost, largely as a result of its continuous flow process. Japanese auto giant Toyota has taken a major role in FFV production and is expected to continue to lead the world’s automakers in the production and development of environmentally sound vehicles.

Metro Orlando and Biofuels Metro Orlando has yet to develop a strong market for biofuels, but growing government and private support has set the stage for growth in the local biofuels industry. “Florida is stepping onto the world stage as a major marketplace for advanced energy technologies,”

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


said Governor Charlie Crist. “We are excited about New Generation Biofuels establishing their headquarters in Florida, and we look forward to their being a part of Florida’s renewable energy future.”166 As Florida is the leading producer of oranges, many researchers are exploring the possibility to produce ethanol from citrus peel waste.167 Local government support for biofuels has been seen in the transportation “pillar” of Orlando Mayor Buddy Dyer’s Green Works Orlando program, which is a comprehensive environmental action agenda for the City of Orlando. Part of the Green Works Orlando agenda states that within the next five years, the entire city fleet must be flex-fuel or hybrid vehicles that use biodiesel or other alternative fuels.168 In order to meet this goal, the City of Orlando began testing new biofuels from New Generation Biofuels Holdings, Inc., on a city vehicle in November 2007 and began replacing five of the city’s vehicles with flex-fuel vehicles in December 2007. In January 2008, the city council approved a contract for 86 of the city’s police vehicles to be replaced by flexfuel vehicles.169 OUC has also made a commitment to reduce its fleet’s emissions and has begun using biodiesel blends in some of its vehicles.170 Biofuel companies that are established in Metro Orlando also have access to a variety of tax incentives at the state and the federal levels. Provisions for sales and corporate income tax exemptions for the biofuels industry were included as part of the Florida Energy Act of 2006. The sale or use of materials used in biodiesel and ethanol distribution, as well as ethanol fueling station retrofits, qualify for the state’s tax exemption. As part of the state’s tax credit program for infrastructure investment, 75 percent 166 State of Florida Department of Management Services. Governor Crist Welcomes New Generation Biofuels in Florida. September 12, 2008. 167 U.S. Department of Energy. Energy Information Administration. State Energy Profiles. 2008. http://tonto.eia.doe.gov/state/ 168 City of Orlando, Florida. Green Works Orlando Pillars-Transportation. http://www. cityoforlando.net/elected/greenworks/pillars/ transportation.htm 169 City of Orlando, Florida. Green Work Orlando Green Updates Archive. http://cityoforlando. net/elected/greenworks/green_updates/ index.htm 170 Orlando Utilities Commission. OUC Hits the Road with Biodiesel Fuel.  www.ouc.com/green/green-biodiesel.htm

of all capital, operation, maintenance, research, and development costs related to the production, distribution, and storage of ethanol and biodiesel are eligible for a tax credit.171 The Florida Farm to Fuel Grant program was created to enhance the market for and promote the production and distribution of renewable energy from Florida-grown crops, agricultural wastes and residues, and other biomass and to enhance the value of agricultural products or expand agri-business in the state.172 “Florida can be a leader in the effort of producing energy from crops and timber because of the vast amount of farm acreage in the state and its mild climate, which permits crops to be grown virtually year round,” said Florida Agriculture and Consumer Services Commissioner Charles H. Bronson.173 Federal tax incentives for biodiesel and ethanol fuels, which were made available through the American Jobs Creation Act of 2004, were extended by the Energy Policy Act of 2005 and were recently extended further as part of the Emergency Stabilization Act of 2008. The Emergency Stabilization Act of 2008 allows taxpayers to write off 50 percent of the cost of cellulosic biofuels production facilities, and biodiesel producers are eligible for a $1/ gallon tax credit through December 31, 2009. Small biodiesel producers are also eligible for a 10 cents/gallon tax credit.174 Federal grants are also available as part of the Energy Independence and Security Act of 2007. $500 million each year is authorized for advanced biofuels production that reduces lifecycle GHG emissions by at least 80 percent compared to current fuels. Another $25 million each year is sanctioned for the research, development, and commercial application of biofuels production in states where there is little or no ethanol production. A grant amount of $200 million was designated for an E-85 refueling infrastructure installation

171 172 173 174

Florida Department of Environmental Protection. Energy Act Tax Incentives Program. Florida Department of Agriculture and Consumer Services. Florida Farm to Fuel. www.farmtofuel.com Florida Department of Agriculture and Consumer Services. Ibid. U.S. Department of Energy. Tax Breaks for Utilities, Business, and Government.  www.energy.gov/additionaltaxbreaks.htm CHAPTER 4: Clean Technologies and Sectors

47


List of Works Consulted 1.

Energy Act Tax Incentives Program. Florida Department of Environmental Protection. www.dep.state.fl.us/energy/ energyact/incentives.htm

2. Ethanol Facts: Environment. Renewable Fuels Association. www.ethanolrfa.org/ resource/facts/environment/

3. Fan, B. and Koren, D. 2009. Cleantech Investment Monitor 2008 Annual Review & 4Q08 Quarterly. Rep. Vol. 7. 4th Issue. Cleantech Group LLC.

program from FY08 to FY14.175

Examples of Biofuel Companies in Metro Orlando Aquafiber Technologies Corp. (www. aquafiber.com) utilizes strains of algae and an ozone application to remediate all types of surface water. This technology reduces pollution in water by removing organic nutrients, metals, toxins, and coliforms. Additionally, the biomass is used for soil amendment and has been used to produce ethanol. New Generation Biofuels Holdings, Inc. (www.newgenerationbiofuels.com), based in Lake Mary, is an advanced biofuel technological company. It manufactures new generation biofuels (NGB) that have less of an environmental impact and are at a lower cost than traditional, first generation biofuels. The company, formerly known as H2Diesel Holdings, Inc., uses vegetable oil and animal fat as feedstock and does not produce by-products or require the use of complicated chemical reactions in its production of NGB. New Generation Biofuels has a commitment to the community to create at least 20 new high-paying professional jobs in Central Florida. The company plans to establish relationships with the local academic and business community to continue to solidify Florida’s position as a renewable energy leader.176 Central Florida-based PetroAlgae (www.petroalgae.com) is a groundbreaking company in the field of biofuels and renewable resources. The 175 176

48

company is commercializing a process that grows and harvests oil from algae, and is developing a commercial, scalable solution to meet this need through the commercial-scale production of feedstock oil which can be used to produce biodiesel. Through breeding natural strains of micro-algae, rapid growth and high oil yield can be achieved. The bioreactor system is ideal for commercialization and can be built and operated on a massive scale. Of additional environmental benefit, the algae are a natural absorber of carbon dioxide in the atmosphere and contaminants in wastewater. Summit Biodiesel (www. summitbiodiesel.com) is a biodiesel plant that has diversified its feedstock and can support feedstock from vegetable oils, used cooking oils, and animal fat. The company has a 1,800,000-gallon biodiesel facility in Orlando. Xenerga, Inc., which is based in Orlando, has become an industry leader by combining efficient biodiesel production facilities with low-cost feedstock. The company has been involved in the development of more than 160 biodiesel plants internationally, and instead of building massive production facilities, it has focused on developing numerous, efficient, smaller facilities that are located wherever feedstock is. The company is also very involved in biofuel research and development, from algae production to feedstock plantations.

Renewable Fuels Association. Ethanol Facts: Environment. www.ethanolrfa.org/resource/ facts/environment State of Florida Department of Management Services. Ibid. METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

4.

5.

Green Works Orlando PillarsTransportation. City of Orlando, Florida. http://orlandoalert.net/elected/greenworks/ pillars/transportation.htm Green Works Orlando Green Updates Archive. City of Orlando, Florida. www.ci.orlando.fl.us/elected/greenworks/ green_updates/index.htm

6. Makower, J. Pernick, R. and Wilder, C. Clean Energy Trends 2008. Rep. Clean Edge, Inc. 2008. 7.

OUC Hits the Road with Biodiesel Fuel. OUC, The Reliable One. www.ouc.com/ green/green-biodiesel.htm

8. Pernick, R. and Wilder, C. 2008. The Clean Tech Revolution. HapperCollins, New York. 9.

Renewable Fuels Standard. Renewable Fuels Association. www.ethanolrfa.org/ resource/standard/

10. Tax Breaks for Utilities, Businesses, and Government. U.S. Department of Energy. www.energy.gov/ additionaltaxbreaks.htm


The first 460,000 square foot building of the new Darden Restaurants headquarters campus in Orange County is environmentally friendly and aims for LEED certification. Construction waste is recycled, restrooms use reclaimed water, and a special “ biosoil” promotes reabsorption and prevents runoff.

Source: Darden Restaurants, Inc.

Green Buildings Why it Matters The built environment, consisting of residential, commercial, and industrial buildings, is responsible for about 76 percent of electricity demand and half of all energy usage in the U.S. Green buildings are more energy efficient, typically using 30% less energy than non-green buildings, with many using much less than that.177 Governments around the world are beginning to see energy efficiency in buildings as both a means to reduce energy dependence and as an essential part of maintaining economic competitiveness. Green buildings are often more cost effective than their non-green counterparts, frequently requiring little or no additional cost upfront and paying back in energy savings, or even costing less. Studies have also shown that the improved lighting and air quality in green buildings leads to happier, healthier employees and greater employee retention, attendance, and worker productivity.178

Overall Trends As the world moves toward embracing environmental awareness, people are looking toward energy efficiency in their homes and places of work. Pernick 177 178

Pernick, R. and Wilder, C. The Clean Tech Revolution. HarperCollins, New York. 2008.  p. 121. Pernick and Wilder. Ibid. p. 124

and Wilder discuss how there has been a break from the traditional, “cutting back” and “going without” mode of going green in favor of greater energy efficiency in residential and commercial buildings. Instead of turning down the thermostat, people are finding ways to use today’s technology to reduce the amount of energy needed to heat or cool the building in the first place.179 The solution to greener buildings is often found in better use of natural resources. Instead of trying to overcome nature, such as in heating or cooling, green buildings are designed to use natural elements to offset the need for energy. Examples of this include using skylights instead of light bulbs, capturing rainwater instead of relying on the city’s water supply, and using outside breeze to supplement air conditioning. While a number of rating systems have been developed to rate a building’s energy efficiency, the U.S. Green Building Council (USGBC), a non-profit organization devoted to the expansion of sustainable building practices, developed LEED green building standards that have become nationally accepted as a benchmark for green building design and development. The Leadership in Energy and Environmental Design (LEED) Green Building Rating System™ is the most widely used in the U.S. The LEED rating system considers a vast array of criteria in considering the environmental impact of a building, including type 179

and source of building materials, energy efficiency, emissions, construction techniques, and water usage.180 The LEED rating system is unique in that it considers more than just the energy a building requires to operate but also considers the energy required in the construction of the building and transportation of building materials. In order to achieve greater energy efficiency beyond the energy consumed in operation, builders have looked to waste products from other industries to help meet their energy needs. Fly ash, which is waste residue from coalpowered power plants, can be used in the production of energy-intensive cement, for example, and roof shingles can be made from polyvinyl chloride (PVC) pipe scraps.181 Buildings that meet some or all of LEED criteria are certified at differing levels of certification from LEED Certified to LEED Platinum. City governments across the nation have adopted LEED standards for city 180 U.S. Green Building Council. LEED Rating Systems. www.usgbc.org/DisplayPage. aspx?CMSPageID=222 181 Pernick and Wilder. Ibid. p. 123

“Many people don’t know this, but 84 percent of the electricity consumption in the state of Florida goes to building energy use. That is a gigantic piece of the electricity pie. We know from the research that we’ve conducted over the years that we’re fully capable of reducing the energy use very cost effectively in the building sector for all of the buildings that currently exist by between 25 and 30 percent.” - Phillip Fairey, Deputy Director, Florida Solar Energy Center. First Orange County Cleantech Symposium. November 5, 2008.

Ibid. p. 117 CHAPTER 4: Clean Technologies and Sectors

49


182 183

50

Ibid. p. 124 The Durst Organization. Bank of America Tower at One Bryant Park. www.durst.org/i_ bp_env.asp

Figure 1.

Commercial LEED Certified Projects (cumulative)

2,384*

* As of February 2009

2005

2006

2007

2008

Source: USGBC

2009

© U.S. Green Building Council, 2009

www.usgbc.org/DisplayPage.aspx?CMSPageID=1720 (About LEED Powerpoint)

Warm exhaust

Figure 2. One Bryant Park Combined Heat and Power (CHP) Technology Schematic Natural gas Compressor

Combustion air

Gas turbine

Hot exhaust

Air intake cooler

Congeneration plant Building Transformer

Chilled water

Absorption chiller

Building energy demands

Heat-recovery steam generator

Condensate return

Generator

Low-pressure steam

Electricity

Street

buildings, and many builders are beginning to see the benefits of building green. Innovation in building construction is becoming a big part of energy efficiency in buildings as well. Two examples include: aluminum sheaths below roofs, which save on air conditioning by blocking out the heat; and T-MASS walls, which are comprised of a Styrofoam layer sandwiched between concrete to double or triple the amount of insulation a wall provides. At the 16-story Center for Health & Healing at Oregon Health & Science University, solar panels have been positioned to not only generate on-site power but to provide shade as well. The center features water-chilled beams that replace fans and air-conditioning in some areas, stone slabs on the ground floor that store heat, stairwells that use outside breezes for ventilation, and toilets that use captured rainwater. And to top it off, the center will save an estimated $400,000 a year in electricity and use 56 percent less drinkable water, and the mechanical, electrical, and plumbing systems cost 10 percent less than comparable office buildings.182 Another outstanding green building is the 54-story Bank of America tower at One Bryant Park, which is being built in New York. The tower, which is being constructed by the Durst Organization, aims to meet a multitude of environmental goals, including reducing energy consumption by at least 50%, using recycled material for half of all material used in construction, and cutting potable water consumption in half. The tower is expected to be the most environmentally conscientious high-rise office structure in the world and will be the first high-rise to receive a LEED Platinum rating. The tower will feature higher ceilings and insulating glass to maximize daylight and energy efficiency, wall technology that dissipates the sun’s heat, waterless urinals, an on-site co-generation plant that will provide for the building’s power, and a water system that captures rainwater and wastewater for reuse.183

Pressure break (heat exchanger)

http://construction.com/CE/articles/0803edit-5.asp

Challenges One challenge to greater energy efficiency in buildings exists in the positive relationship between profits and utility sales, which encourages utility companies to sell more, not less, energy to consumers.184 The Northwest has taken steps to diminish this relationship 184 Secretariat of the Commission for Environmental Cooperation. Green Building in North America: Opportunities and Challenges. Commission for Environmental Cooperation. 2008.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

by creating financial incentives for utility companies to save energy. Power generators in the region are allowed to share customer savings from reduced electricity usage under The Northwest Power Act of 1980. But in most regions, efforts have not been made to decouple the correlation between profits and utility sales.185 In the report Green Building in North America, the Secretariat of 185

Pernick and Wilder. Ibid. p. 132


Figure 3.

Figure 4.

Factors Discouraging the Construction of Green Buildings Percent Rating Factor as Extremely or Very Significant Cost and documentation for LEED certification

54%

Higher construction costs

50%

Payback too long

50%

Lack of awareness of benefits Difficulty quantifying benefits

48% 43%

Short-term budget horizons

41%

More complex construction

28%

Increased operating costs

23%

Source: 2008 Green Building Market Barometer. 2008. Turner Construction Company.

the Commission for Environmental Cooperation (CEC) outlines a number of challenges facing the green building industry. Some of the challenges discussed in the report relate to the cost of green buildings. One impediment to green building development is the fact that, while the builder or developer must pay any additional costs associated with green buildings, they are often not the one capturing the financial rewards in the end. This is especially a problem in buildings with high turnover rates, whose owners want energy-saving investments with shorter payback periods. Another cost-related challenge involves overestimated construction costs by individuals and builders. According to an August 2007 study by the World Business Council on Sustainable Development, the cost of green building was overstated by individuals in the real estate industry by an average of 300 percent.186 The uncertainty that clouds green buildings is another challenge the report references. Uncertainty about costs of developing green buildings, the reliability of the technology in green buildings, the actual economic benefits of owning green real estate, and the performance of green buildings over time have resulted in hesitations in the real estate and development industry. Another major challenge for the green building industry is the lack of an experienced workforce. While the industry is experiencing rapid expansion,

there have not been enough experienced workers to meet the growing demands, intensifying the risk of untrained or inexperienced workers entering the market.

186 Secretariat of the Commission for Environmental Cooperation. Ibid.

187

Breakthrough Opportunities As the price of conventional fuels continues to rise in the long run, the opportunities for growth in the field of green buildings have proliferated. Large and small businesses are finding market prospects in innovative, energy-efficient technologies. The green building market encompasses everything that makes a building more energy efficient or that generates clean energy, so there will be demand for a wide variety of skill sets and specific areas of expertise. In The Clean Tech Revolution, Pernick and Wilder expand on a variety of areas in green building they believe to be breakthrough opportunities, including green design, next-generation insulation, LED lighting, and energy management systems.187

Green Design A great business opportunity has developed in the field of green design. As the benefits of green buildings become clear to builders and developers, the demand for green building consultants and advice has flourished. Firms and individuals with specific areas of expertise in green building architecture, design, engineering, Pernick and Wilder. Ibid. pp. 121, 128, 130, & 132-133

Source: Marty Wanielista, Director of UCF Stormwater Academy. Hardin, M., First Orange County Cleantech Symposium. November 5, 2008.

technologies, and project management will be in demand. Next-Generation Insulation Next-generation insulation is another area of cleantech that presents a breakthrough opportunity in the cleantech sector. Nanotechnology-based insulation products, such as Aerogel, weigh little more than air yet offer insulation that is two to eight times more effective than ordinary insulation. This unique material is still too expensive to be used in most buildings today, but could one day be seen in the building market as a high-performance, competitively-priced alternative. LED Lighting Lighting is estimated to account for 22 percent of worldwide electricity usage, so energy-efficient lighting is expected to present a long-term opportunity for firms. LED lighting uses 10-30% less electricity than the compact fluorescent light bulb and is up to 10 times more efficient than traditional incandescent lights. The lights are expensive up front, which is why they have yet to succeed in the mass market, but they last 10 to 15 years and are expected to see success in the mass market in years to come. Energy Management Systems Energy management systems have become a major growth opportunity in cleantech, as companies look for ways to save on energy costs in their buildings and operations. Companies that develop technologies to aid enterprises in the management and conservation of their energy resources have found increasing demand for their products. Companies like MACH Energy of Walnut Creek, California have developed software CHAPTER 4: Clean Technologies and Sectors

51


Figure 5.

Figure 6.

Figure 7.

OHSU Center for Health and Healing www.brightworks.net/images/projects/OHSU%20 CHH.jpg

Rooftop Solar Panels http://static.howstuffworks.com/gif/ten-sustainablebuildings-6.jpg

Natural Lighting: Skylights http://mygreenhomeblog.com/wp-content/ uploads/2007/11/skylight.jpg

that uses pattern recognition to identify potential electricity savings and to determine how to reduce demand accordingly. Consumer Powerline in New York analyzes customers’ operations and energy demand patterns and earns revenue by sharing the energy savings with their customers. Tankless Water Heaters Another up-and-coming opportunity in green buildings is tankless hot water heaters, a common technology in Europe that is starting to take off in the U.S. The tankless system uses a compact, gasfired heat exchanger in the water system and heats the water only when needed instead of the traditional gas-heated and electric hot water systems. By only heating the water when needed, the system uses up to 70 percent less energy than electric systems and 50 percent less energy than gas-heated systems, and you never run out of hot water.188 Superefficient Housing Developments Superefficient housing developments are taking shape throughout the country, along with the emerging production of clean products and increasing environmental awareness among homeowners. This growing field is a way for builders to remain competitive as individuals look to reduce their own

carbon footprint. Many see green projects as having better returns on investment as well, due to the of costsaving benefits mentioned previously, and because of increased resale value. Clarum Homes is one of the first companies to build green and LEED Gold certified zero energy residential buildings.

Related Cleantech Jobs • Building Energy Analyst

• Design Simulation Professional • Energy Engineer/Building Scientist • Green Building Analyst

• Green Building Architect

• Green Building Project Manager • Green Building Designer

• Green Housing Developer • Green Project Manager

• Home Energy and Green Rating Professional • LEED AP

• LEED Certification Coordinator • Resource Efficiency Consultant • Sustainable Building Engineer

188 Ibid. p. 126 52

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

Major Players Building developers have taken the lead in green building development worldwide, although regional government support has played a major role as well. In the book The Clean Tech Revolution, Pernick and Wilder identify companies to watch in the green building field.189 Leading green building developers in the U.S. include Clarum Homes (Palo Alto, CA), www.clarum.com, the Durst Organization (New York), www.durst. org, and Turner Construction (New York), www.turnerconstruction.com/ greenbuildings, in New York. Clarum Homes is a leader in residential, energyefficient design, and every new home the company builds gets high ratings for efficiency. The Durst Organization is known for opening the world’s first green skyscraper and is now co-developing a 54-story, green Bank of America tower. Also located in New York, Turner Construction, a company that recognized the growth opportunity in green building early on, remains a leader in green building development today. The construction company has built, or is in the process of building, more than 200 buildings that are considered green and/ or LEED certified. Interface Engineering (Portland, OR), www.interfaceengineering, is an 189 Ibid. pp. 140-143


• Electricity consumption in commercial buildings accounts for 18% of U.S. greenhouse gas emissions; Residential buildings account for 17%.

Figure 8. The ENVIRO-HOME™ by Clarum Homes: Environmentally Friendly, Energy Efficient and Economical Solar Electric Home Power System • Convert sunlight instantly into electric power. • Spin your utility meter backwards, lowering electric bills. • Increase energy independence by reducing your reliance on your local utility. • Reduce electricity consumption from the grid during times of peak demand (daytime). Water Conserving Fixtures • Replace your most-expensive utility-generated electricity. • Low flow showers and • Meter allows monitoring of electricity consumption and generation. toilets in each bathroom • Requires no fuel. Makes no noise. Virtually maintenance free. conserve water and save • System warranted for 5 years. Modules warranted for 25 years. you money. Ceiling Fan Outlets (optional item) • Reduces the need for air conditioning and helps to circulate air.

Improves energy efficiency.

Promotes water conservation.

High-Efficiency Furnace and Programmable Thermostat • Carrier 90% Annual Fuel Utilization Efficiency furnace. • 7-day Energy Star Programmable Thermostat • Conserves energy and saves money without sacrificing comfort.

Improves indoor air quality.

Environmental Innovations in Homebuilding

Earth friendly building materials. Engineered Wood • Replaces old-growth dimensional lumber. • High-performance lumber uses 30% more of each tree, reduces waste and is virtually defect free

Radiant Roof Barrier Sheathing • Reflects up to 97% of the sun’s heat and radiant energy away from your home. • Attic temperatures are reduced by as much as 30 degrees. • Less heat transfers to the living space and your home stays cooler.

• Energy Star reports 10-20% lower operating costs in Energy Star rated buildings, improving operating income even more.

Structured Plumbing • Recirculating pump moves the ambient temperature water in the hot water pipes back to the water heater. • Hot water arrives at fixtures 4-5 times faster

Fluorescent Light Bulbs • Uses less energy and last ten times longer than standard light bulbs.

Tightly Sealed Ducts • Sealed ducts ensure optimum heating efficiency and reduce heating costs. • Reduces duct leakage and dust.

Increased Insulation • Increased wall and ceiling insulation reduces heat gain and loss.

• LEED buildings command rent premiums of $11.33 per square foot over their non-LEED peers and have 4.1 percent higher occupancy.

Water Conserving Laundry Equipment (optional item) • Front loading washers reduce water use.

Energy Efficient Windows • Low-E windows reduce heat and U.V. rays from the sun. • Greatly increases your home’s energy efficiency. • Keeps home cooler in the summer and warmer in the winter. • Reduces sun damage to rugs and furniture.

Environmentally Friendly Paint (optional item) • Air safe and environmentally friendly. • Odorless, free of polluting solvents and contains low volatile organic compounds.

• Rental rates in Energy Star buildings represent a $2.40 per square foot premium over comparable non-Energy Star buildings and have 3.6 percent higher occupancy.

Eco-Cabinets • Cabinets are constructed with \ formaldehyde-free wheatboard frames.

Water Conserving Landscape • Front yards have been professionally designed to use 25% less water with drought resistance shrubs and ground cover.

Fiber Cement Siding • This alternative to wood siding is fire and termite resistant.

Tankless Water Heater • Endless hot water – 6.5 gallons per minute. • Heats water only when you need it. • Reduces energy use and saves you money. • Control unit allows you to heat water at variable temperatures. • Saves space, no pilot light and comes with 10 year warranty.

Gray water system (optional item) • Recycled shower, bath and laundry water can be used to irrigate landscaping.

Satellite linked Irrigation Controller • Monitors weather and Environmentally Friendly Flooring adjusts irrigation system (optional items) to run only when needed. • Recycled content carpet is strong, long lasting, stain resistant and made from recycled plastic Construction Materials Recycling bottles. • Construction material reuse and recycling Whole house vacuum (optional item) • Bamboo flooring, a renewable resource, is strong, prevents pollution and waste generation. • Reduces dust in the home and resists moisture and insects, and is easy to maintain. • Reduces landfill disposal and expansion. improves indoor air quality. • Harvested from the cork tree, cork flooring is an environmentally friendly material that provides a unique Integrated pavers (optional item) look, and a low maintenance and comfortable • Permeable concrete pavers improve landscape drainage. flooring option.

Foam Wrapped Building Envelope • Reduces heating costs. • Keeps house cooler in the summer. • Reduces cracking in stucco exterior.

• Energy Star buildings are selling for an average of $61 per square foot more than their peers, while LEED buildings command a remarkable $171 more per square foot.

Recycled Content Decking • Trex® Decking is made from reclaimed waste materials. • No moisture, U.V. or insect damage. • No time-consuming sealing or staining.

Fiberglass Doors • Six-panel fiberglass entry doors give the rich look of wood without sacrificing trees.

Clarum Homes reserves the right to revise the specifications presented herein.

Source: www.clarum.com

engineering design consultant that provides expertise on green building design and energy efficiency. The company has worked on major green projects throughout the Northwest, including the 16-story Center for Health & Healing at Oregon Health & Science University described previously. Aspen Aerogels (Northborough, MA), www.aerogel.com, and Ortech (Braeside, AU), www.ortech.com. au, are pioneering green technology companies. Aspen Aerogels, which invented a light, highly insulating material, is looking to nanotechnology for insulation breakthroughs that will make the insulation cost competitive. Ortech replaces traditional drywall with ceiling and wall panels made from wheat or rice straw. The panels have been used in airports, hotels, IMAX theatres, and sports arenas. Cree (Durham, NC), www.cree.com, is very competitive with the giants, such as GE, OSRAM, and Philips in the market for LED technology-based lighting products. PanaHome (Osaka, JP), www. panahome.jp/english, a leading residential builder that specializes in energy efficient homes, has capitalized on Japan’s place as the world’s second largest market for solar energy and features 35 percent of its portfolio as environmentally friendly housing. Japan is also home

to Rinnai (Nagoya, JP), www.rinnai. co.jp, the world’s largest gas appliance manufacturer and a leader in energy efficient products, including tankless water heaters. Finally, in 2007, Wal-Mart Stores (Bentonville, AR), www.walmartstores. com, decided to expand and implement their 2005 massive efficiency initiative, which raised some eyebrows. Through “Sustainability 360”, the retailer giant would spend $500 million a year in efficiency, waste elimination, and GHGreduction efforts in store and warehouse design, operations, and transportation; and to give shelf preference to suppliers who also set efficiency standards. These measures, even if small, are believed to have a great multiplier effect in view of the company’s size and scope in the world market.

Green Building Costs One of the major concerns over green buildings has been the issue of cost. Average up-front cost of a LEEDcertified building, as opposed to a traditional building is about 4% higher, but the operating costs are significantly lower, and the revenue is higher. Here are some statistics from CoStar Group’s Green Study:190 190 CoStar Group. Green Study. April 2008.

Green Building Initiatives Many cities across the United States are going a step beyond the Metropolitan Orlando region in adopting green building codes and ordinances for new construction and renovations—from New York City to Ashville, NC to Scottsdale, AZ. More and more cities are making efforts to reduce their carbon emissions and environmental impact by instituting green building codes. “Nationwide, buildings account for 72 percent of electricity consumption. Depending on how that power is made, buildings can account for anywhere from 30 percent to 70 percent of a city’s carbon dioxide emissions.”191 Working for efficiency toward a sustainable future, some green building programs are sponsored by local governments, while others are managed by home building associations or non-profit groups.192 The House of Representatives recently passed the American Clean Energy and Security Act of 2009. The U.S. Green Building Council will be an active participant in the implementation of the provisions of the Act. One of the 191 192

Planetizen. Building Codes Gone Green.  www.planetizen.com/node/37217 Smart Communities Network. Community Green Building Programs. www. smartcommunities.ncat.org/buildings/ gbprogrm.shtml CHAPTER 4: Clean Technologies and Sectors

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initiatives is the Retrofit for Energy and Environmental Performance (REEP) program, which is focused on the retrofitting of buildings throughout the U.S., both residential and commercial. This new legislation is expected to pave the way for more serious green buildings initiatives throughout the country.

Some Quick Facts: •

California is the first state to adopt green building standards.193

Boston, MA was one of the first U.S. cities to impose LEED green building standards on all new developments over 50,000 square feet, whether public or private.

Chicago, IL is one of the first cities to offer residential and commercial developers an expedited permitting process (30 days instead of 100) and a free design review (which can run from $5,000 to $50,000) if they build with green standards.194

Denver, CO adopted green building codes for affordable housing.

New York City leads in green building square footage.195

Portland, OR leads in number of green buildings and certified green architects and designers per capita.196

San Francisco, CA adopted the strictest codes so far, requiring green building for any residential construction over 75 feet and any commercial buildings over 5,000 square feet.197

Scottsdale, AZ is the first U.S. city to adopt the Gold Standard for green buildings.

Florida On April 4, 2009, Jacksonville’s Sustainable Building Ordinance was voted in by the City Council. This legislation commits the city government to use LEED-certified construction for all new projects. Furthermore, builders who voluntarily decide to get LEED certification on their construction will receive a $1,000 incentive as well as priority status in permitting.198 “Green 193

Hoge, Fenton, Jones & Appel, Inc. Attorneys at Law. California Becomes First State to Adopt Green Building Standards. July 24, 2008. 194 Pernick and Wilder. Ibid. 195 Ibid. 196 Ibid. 197 Planetizen. Ibid 198 Patterson, Steve. Council bill to encourage green building in Jacksonville. The Florida Times-Union. March 22, 2009.

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buildings would have priority over non-green projects,” said Szakonyi from Jacksonville Business Journal.199 The City of Pembroke Pines has proposed a new ordinance in Green Buildings that would provide expedited service to builders with green building certification and require all city building to have LEED certification. Broward County offers speedy plan review (less than five business days) to developers whose plans are certified as “green.”

“One of Central Florida’s first LEED certified buildings is the 80,000 square-foot Science & Allied Health Building on Valencia’s West Campus. Construction began in August 2007 and was completed in August 2008.” - Valencia commits to LEED. First Monday. April 2009. Page 20.

Other States/Cities The following is a list of initiatives as described on the Smart Communities Network Website:200

Arizona: Scottsdale Green Building Program encourages a whole-systems approach through design and building techniques to minimize environmental impact and reduce the energy consumption of buildings while contributing to the health of occupants. The program rates homes on various environmental impacts. Colorado: Built Green Colorado was originally developed to highlight green builders in the Denver Metro Region, and now applies statewide. The program is voluntary and serves as a guide and a marketing tool for homes that meet certain green criteria. Builders and remodelers that participate in the program receive technical assistance, 199 Szakonyi, Mark. City could give preferences to green buildings. Jacksonville Business Journal. December 10, 2007. 200 Smart Communities Network. Ibid.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

discounts on educational seminars, and other benefits. Green Points Building Program is a green builder program in Boulder, Colorado that applies to both new construction and remodeling projects. The first of its two components is the Green Points New Home Program which applies to new construction and additions larger that 500 square feet. It requires building permit applicants to earn “points” by selecting optional measures in order to receive a building permit. The second component is the Green Points Remodeling Program. The program is voluntary and applies to remodeling projects and additions less than 500 square feet. Homeowners and contractors are encouraged to include as many green options in their projects as possible.

California: California Green Builder Program is a voluntary program, developed by the Building Industry Institute that sets standards for improvements in energy efficiency, reduction in air emissions, on-site waste recycling, and reduction in water use. Green Building is a city program in San Jose, California that has been created to encourage and facilitate new construction or remodeling of homes or workplaces into spaces that are healthier for people and the planet. Program policies are available online. Green Building Design and Construction, a program of the California Integrated Waste Management Board, not only provides information for the sustainable construction of state facilities, but also offers a Sustainable Building Tool Kit for project managers, as well as green building case studies. Marin’s BEST (Building Energy Efficient Structures Today), a program of the Marin County Board of Supervisors, exists to enhance energy efficiency and conservation in residential, commercial, and community facilities. The program offers green building guidelines, technical assistance, incentives, and rebates. Georgia: Earth Craft House Program is a program of the Greater Atlanta Home Builders Association that provides training, design and


construction technical assistance, marketing materials, and direct referrals to participating builders. Building projects earn points by implementing a range of options for site planning, energy efficiency, waste reduction, water conservation, and indoor air quality.

Maryland: Green Building Program works with county and municipal planners to evaluate and modify codes, ordinances, and policies that foster green building and green development. It also coordinates a traveling green building exhibit and sponsors workshops. Maryland also offers a Green Building Tax Credit on commercial construction. New Jersey: Green Homes Office is working to fundamentally improve the environmental performance, energy efficiency, quality, and affordability of housing in New Jersey. Through advocacy, education, and technical assistance they are accelerating the use of innovative green design and building technologies, raising building standards and creating consumer demand for efficient and environmentally responsible high performance homes. New York: The Battery Park City Green Guidelines establish a process for the creation of environmentally responsible residential buildings that are appreciably ahead of current standards and practices. The guidelines were developed by the Hugh L. Carey Battery Park City Authority. New York State Green Building Initiative offers a tax incentive program for developers and builders of environmentally friendly buildings. Oregon: City of Portland’s Green Building Program is an integrated, conservation-based effort to promote resource-efficient building and sustainable site design practices throughout the city. Coordinating the expertise and resources of six city bureaus, this initiative sets aggressive goals and recommends a carefully selected set of strategies to leverage local expertise and develop cost-effective solutions for builders, developers, and building owners and users.

Texas: City of Austin Green Building

Program is a voluntary program that certifies green homes on a scale of one to four stars, with more stars being awarded to homes with more green features. The program also provides assistance to building professionals, such as architects, engineers, and builders, in exchange for offering and promoting green building practices.

Virginia: Arlington County offers both a Green Choice Home program that promotes green residential construction and a Green Building Incentive Program that requires all site plan applications in the county to include a completed LEED™ scorecard. Washington: Build a Better Kitsap program promotes environmentally friendly construction, energy-saving concepts, and use of natural resources in Kitsap County, Washington. The program establishes “Code Plus” standards to improve a building’s performance and provide significant economic and environmental benefits to the owner and future generations. Features include point weighting for items, and a handbook with carefully linked content areas and local resources. Built Green is a program of the Master Builders Association of King and Snohomish Counties, Washington, designed to provide Puget Sound homeowners with comfortable, durable, environmentally friendly homes. The program has a menu of actions that builders use to certify homes called the Built Green Checklist. Seattle Sustainable Building, in the City of Seattle, Washington, implements the city’s Sustainable Building Policy, provides guidelines for city facilities, and offers technical assistance and incentives. Associations and Non-Profits Florida Green Building Coalition Green Home Designation Standard is a standard for green homes, available online in checklist or complete form. The Florida Green Building Coalition also has a broader Green Development Designation Standard. Governor’s Green Government Council, in Pennsylvania, offers HighPerformance Green Building Guidelines, as well as numerous online resources, reports, and a green building database.

Green Building Guidelines is the second generation of sustainable residential design guidelines from the Sustainable Buildings Industry Council, in cooperation with the National Association of Home Builders. With illustrations, case studies, and checklists, the six-chapter book is a valuable resource for builders and even buyers interested in producing or purchasing energy- and resourceefficient homes. The book can be ordered from the Sustainable Buildings Industry Council, which also offers a companion workshop. Green Built Home, a green building initiative that reviews and certifies homes that meet sustainable building and energy standards, is a voluntary program of Wisconsin’s Environmental Initiative and is sponsored by participating home builder associations in cooperation with leading utilities, organizations that promote green building practices and energy efficiency, and the State of Wisconsin. HAWAII Built Green is a voluntary green building program of the Hawaii Building Industry Association.

Metro Orlando and Green Buildings Metro Orlando has seen strong support for green building development from the government, academic, and private sectors, and as a result, the city has the resources and potential to develop into a major hub for future green building development. If the area’s green building assets and potential are fully utilized, and if the government continues on its path to encourage green building, making it economically viable and profitable, the Orlando area is set to become a leading cluster for green building development. Green Works Orlando Much of the growth of Orlando’s green building market has stemmed from Orlando Mayor Buddy Dyer’s implementation of Green Works Orlando, a comprehensive environmental action agenda. Green Works Orlando has five “pillars” of focus, one being energy efficiencies and green buildings. The plan’s initiatives include designing all new city buildings to meet LEED standards, the creation of a green CHAPTER 4: Clean Technologies and Sectors

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building program to create and encourage standards for green buildings, expedited permitting for LEED projects, and the creation of green building standards for homes.201 The Green Works Orlando plan has led to many accomplishments in green building for the city, including the development of numerous green building programs and other green building achievements, and has developed many opportunities for further growth in the industry.202 The program’s accomplishments include the development of the first LEEDcertified fire station in Florida. The city has built another LEED-certified fire station since then and is in the process of building more. Other green projects are on the way, including an Orange County Medical Examiner Facility and an Orange County Sheriff Sector II office building, both of which are expected to be LEED certified. The city has incorporated educational components into its Green Works Orlando agenda, hosting a two-day training course in LEED-NC (Leadership in Energy and Environmental Design-New Construction), in which both city and Orange County staff participated. The course familiarized attendees with LEED-NC standards, incorporating LEED features in public buildings, instituting green building programs, and discussing how to assist the private sector in the LEED process. Through the Green Works Orlando programs, a number of city employees have received LEED Professional Accreditation from the U.S. Green Building Council’s program. The Green Works Orlando plan has also led to important partnerships with the city, including the city’s partnership with the Orlando Utilities Commission, which has resulted in numerous green building programs and accomplishments. This partnership resulted in energy efficiency improvements in the form of improved lighting in the City Commons Garage. The new lighting system will reduce the building’s energy 201

City of Orlando, Florida. Green Works Orlando Pillars- Energy Efficiencies and Green Buildings. www.cityoforlando.net/elected/ greenworks/pillars/nrgefficiency.htm 202 City of Orlando, Florida. Green Works Orlando Green Updates Archive. http://cityoforlando. net/elected/greenworks/green_updates/ index.htm 56

consumption by 751,368 kWh (kilowatt hours) each year, or about $55,601. The OUC has shown its commitment to green buildings by building one of its own—a new service center, the Reliable Plaza. The building, which uses 28% less energy and 40% less water than similar buildings, meets LEED gold standards, making it the greenest building in downtown Orlando. OUC also supports green building development through a partnership with the Orlando Federal Credit Union, which allows OUC customers to finance solar installations and to sell back any excess energy produced by the solar system to the company.203 Figure 9.

OUC’s Reliable Plaza in Downtown Orlando www.ouc.com/green/images/reliable_plaza.jpg

Orange County’s Orange to Green Development Program Orange County has taken steps to encourage green building development as well. As part of the county’s Orange to Green Development Program (OGDP), which was approved in March 2008, incentives are available for building owners who choose to use components of green building design and construction in their projects. Incentives include assistance with the permit application process, expedited permitting, and community recognition in the form of awards and displayed project information.204 Metro Orlando has access to a variety of green building incentives, from federal tax credits to Orange County incentive programs. Federal tax credits are available for new home builders 203 Orlando Utilities Commission. OUC’s Pilot Solar Programs. www.ouc.com/green/solar_ pilots.htm 204 Orange County Government, Florida. Green Building. www.orangecountyfl.net/cms/DEPT/ growth/building/greenbldg.htm

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

for the installation of geothermal heat pumps, photovoltaic systems, and solar water heaters. Home builders are also eligible for $2,000 in federal tax credits for new homes that are 50% more energy efficient in heating and cooling, or $1,000 for new homes that are 30% more energy efficient in heating and cooling.205 Orange County offers a $200 incentive for commercial and residential solar water heating systems.206 Government incentives will be covered in detail in the State and Local Policies/Initiatives section.

Research and Development The Orlando area also benefits from access to its local research institution, the University of Central Florida, as well as top technology companies. These institutions present opportunities for Metro Orlando to develop green building technology and to grow the local green building market. Many of the breakthrough opportunities discussed earlier involve technological innovation and research, and partnerships with UCF and top tech companies, coupled with funding for green building technology, have helped the area to grow its green building market. The Florida Solar Energy Center (FSEC) at UCF is responsible for conducting research, testing, and certifying solar systems, as well as for developing educational programs. However, part of the FSEC, the Building Science Program, is involved in research and development of strategies that improve a building’s energy use.207 “We’re the only university that leads a DOE-sponsored Building America program,” said Jim Fenton, Director of the FSEC, at his presentation at the second Orange County Cleantech Symposium.208 The Building America program is industry-driven and sponsored by the U.S. Department of Energy. It is 205 State of Florida Department of Environmental Protection. Solar Energy System Incentives Program. 206 Orange County Government, Florida. Solar Hot Water Incentive Program. www.orangecountyfl.net/cms/DEPT/CEsrvcs/ epd/SolarWaterProgram.htm 207 Florida Solar Energy Center. Research in Buildings. www.fsec.ucf.edu/en/research/ buildings/ 208 Fenton, Jim. Director, Florida Solar Energy Center at UCF. Second Orange County Cleantech Symposium. February 18, 2009.


Figure 10.

“The third area of research that we have very active involvement in is buildings research, and that is our largest research division … If we could take 25 to 30 percent of the existing building energy use and convert it to efficiency, that would be 25 to 30 percent of 84 percent of the electricity that the state produces. And we can do this cost effectively. And so, in terms of cleantech technologies, this is the most cost-effective place to go right off the bat. The center is involved not only in research in buildings energy efficiency but also in all of the allied stuffs that is associated with that, including very significant involvement in both the state and national building energy code making processes. We have individuals that serve on these code making bodies. We also provide services on the governor’s action team, the technical working groups that are associated with the action team, the committees of the Florida Energy Commission over the last couple of years. And so we are seen by many people as the expertise that can be counted on within the state to tell you what’s actually happening rather than what people claim to be happening. And so that’s one of the other services that we provide. And energy efficiency is, as I said, critically important and particularly in the building sector.” - Phillip Fairey, Deputy Director of the Florida Solar Energy Center. First Orange County Cleantech Symposium. November 5, 2008. “Of our 40 employees working on performance buildings, two architects work full time on Habitat for Humanity homes throughout the whole United States. So, we are making those homes energy efficient. This isn’t just for the wealthy.” - Jim Fenton, Director, Florida Solar Energy Center at UCF. Second Orange County Cleantech Symposium. Feburay 18, 2009 “designed to accelerate the development and adoption of advanced building energy technologies in new and existing homes.”209 In November 2007, the FSEC released EnergyGauge Summit Premier at the Greenbuild Conference in Chicago, IL. Produced and distributed by FSEC, EnergyGauge Summit Premier is an engineering software that allows construction professionals “to substantially reduce the time required to complete energy modeling for the commercial construction LEED rating system.”210 The software also automatically creates the American Society of Heating, Refrigerating and Air Conditioning Engineers (ASHRAE) 209 U.S. Department of Energy. Energy Efficiency and Renewable Energy. Building for America. http://www1.eere.energy.gov/buildings/ building_america/ 210 UCF News. Florida Solar Energy Center Releases EnergyGauge Summit Premier 3.13. November 8, 2007.

standard 90.1 2004 baseline building, calculates the points achieved for LEED energy optimization, and is DOE approved to calculate energy savings for the energy-efficient, commercialbuilding tax deduction under Internal Revenue Code 179D.211 Besides EnergyGauge Summit Premier for commercial buildings, EnergyGauge software includes EnergyGauge USA for residential buildings nationwide, and EnergyGauge 211

UCF News. Ibid.

FlaRes for Florida’s residential code compliance.212 The Advanced Materials Processing Analysis Center (AMPAC). In his presentation at the first Orange County Cleantech Symposium, Dr. Show presented the following research achievement by Dr. Sudipta Seal, UCF Professor, Department of Mechanical, Materials, and Aerospace Engineering in the College of Engineering and Computer Science. The Metro Orlando green building industry is also supported by the Florida Green Building Coalition (FGBC), a nonprofit corporation that works with green builders, developers, and consumers, as well as local governments to define, promote, and encourage sustainable green building practices.

Examples of Green Building Companies in Metro Orlando Building Energy Consultants, (Winter Garden, FL), www. buildingenergy.net, specializes in energy efficiency in residential and commercial building. It utilizes leading green building technologies in every one of its products, from using closed cell foam insulation to installing solar heating and electrical systems. Building Energy Consultants prides itself in reducing energy costs for clients by half, while at the same time, upholding the highest standards for comfort and clean air. Beyond the design and application of cutting-edge, energy-efficient systems in residential and commercial projects, the company provides energy audits for Figure 11.

Source: DOE Building America Program

212

Ibid. CHAPTER 4: Clean Technologies and Sectors

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Figure 12.

List of Works Consulted 1.

Replacement of cement by zero-carbon emission ZeroCrete

“There’s a company already doing this called Nanoholding. The subcompany under Nanoholding is called nSolGel. The specific work is to create a cement based on fly ash. So Dr. Seal can take those and do some nano scale surface modifications using the solgel technique and can make them comparative and can replace cement. The cement industry produce 6 to 8 percent of the world’s CO2, CO3 emission. So the replacement of this cement—ZeroCrete—has zero carbon emissions.” - Louis Chow, Director/Professor, AMPAC. First Orange County Cleantech Symposium. November 5, 2008.

individuals and businesses. Another green building consulting firm in Metro Orlando is Green Building Services’ Orlando office, www.greenbuildingservices.com. The company, which is based out of Portland, Oregon, supports all phases of green building design and construction, from the initial design to after the building’s completion. The company specializes in helping clients incorporate sustainability in their building design and getting clients through the LEED certification process. Green Building Services focuses on commercial green buildings, including education facilities, retail, municipal, and office buildings. The Central Florida Chapter of the United States Green Building Council, http://chapters.usgbc.org/centralflorida/ default.html, is a diverse group whose membership includes engineers, building owners, architects, contractors, builders, and universities, among others. The chapter works to promote and develop sustainable green building standards, design and technologies, and to reach out and educate council members as well as the community. The Central Florida chapter hosts green building events and supports green building education through classes, study groups, and certification. nSolgel, LLC created methods that convert fly ash, the waste product of coalfired electric generation, into a cement substitute called ZeroCrete. ZeroCrete uses little energy and releases no carbon dioxide in its production, while also delivering equal or better performance than Portland cement. 58

ZeroCrete has accomplished compressive strength of 3,700 psi. ZeroCrete sets extremely rapidly. ZeroCrete’s process consists of two basic steps that produce the functionalized fly ash. - Louis Chow, Director/Professor, AMPAC. First Orange County Cleantech Symposium. November 5, 2008. Stormwater Treatement Environments (STE, Inc.), www. stormwaterenvironments.com, offers green building design through green roof solutions for commercial properties. This firm is led by Dr. Marty Wanielista, former dean of the College of Engineering at UCF, and current Director of the UCF Stormwater Management Academy.

“USA Today said, Florida’s showcase green envirohome is the best designed, energy efficient and water efficient home in the United States.” - Marty Wanieliesta. Director of UCF Stormwater Academy. Orange County First Cleantech Symposium. November 5, 2008.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

About Building for America. DOE. Energy Efficiency and Renewable Energy Website.

2. Bank of America Tower at One Bryant Park Environmental Fact Sheet. The Durst Organization. www.durst.org/i_bp_env. asp 3. 4. 5.

Buildings. Florida Solar Energy Center. www.fsec.ucf.edu/en/research/buildings/ index.htm Chow, Louis. Director/Professor, AMPAC. First Orange County Cleantech Symposium.

2008, Carbon Free Prosperity 2025. CleanEdge, Inc and Climate Solutions. October 2008.

6. Florida Green Building Coalition. http:// greencities.com/partners-in-education/usa/ florida/florida-green-building-coalition 7.

Green Building. Orange County Government, Florida. www. orangecountyfl.net/cms/DEPT/growth/ building/greenbldg.htm

8. 2008 Green Building Market Barometer. Turner Construction Company. www.turnerconstruction.com/ greenbuildings/content.asp?d=6552 9.

Green Building in North America: Opportunities and Challenges. 2008. Secretariat of the Commission for Environmental Cooperation. Communications Department. www.cec.org/pubs_docs/documents/index. cfm?varlan=english&ID=2242

10. Green Works Orlando Pillars-Energy Efficiencies and Green Buildings. City of Orlando, Florida. www.ci.orlando.fl.us/ elected/greenworks/pillars/nrgefficiency.htm 11. Green Works Orlando Green Updates Archive. City of Orlando, Florida. www.ci.orlando.fl.us/elected/greenworks/ green_updates/index.htm

12. LEED Rating Systems. U.S. Green Building Council. www.usgbc.org/ DisplayPage.aspx?CMSPageID=222

13. OUC’s Pilot Solar Programs. OUC, The Reliable One. www.ouc.com/green/ solar_pilots.htm 14. Pernick, R. and Wilder, C. 2008. The Clean Tech Revolution. HapperCollins, New York.

15. Solar Energy System Incentives Program. Florida Department of Environmental Protection. www.dep.state.fl.us/energy/ energyact/solar.htm 16. Solar Hot Water Incentive Program. Orange County Government, Florida. www.orangecountyfl.net/cms/DEPT/ CEsrvcs/epd/SolarWaterProgram.htm

17. Wanieliesta, Marty. Director of UCF Stormwater Academy. Orange County First Cleantech Symposium. November 5, 2008.


“The interesting thing is, if you want to look at things like energy, we tend to get focused on the manufacture of energy, the production of energy. I’m going to try to get you more focused on the efficient use of it. The best energy is the one you don’t use.” - James Fenton, Director, Florida Solar Energy Center. Second Orange County Cleanteach Symposium. January 21, 2009.

Smart Grid Why It Matters Smart Grid is by far the most revolutionary cleantech concept. If a cleantech revolution is to occur, a smart grid will be the engine of such a transformation. Researchers, such as the late Richard Smalley, Nobel Prize winner, have been developing ideas over the past decade for the future of the nation’s electrical supply.213 They have designed an electrical energy system where power is transported and stored by a vast network of highly efficient and energy-dense nanowires. This system would move electrons over far greater distances than possible today. Ron Pernick and Clint Wilder, authors of The Clean Tech Revolution, present the possibility of a highly advanced, newly constructed electricity grid that will forever change the way we obtain and use power. They compare the current grid to the smart grid as follows.214

The Current Grid The first problem with our current electrical grid is the materials it is made of—copper and aluminum cable wires are not sufficient for sending hundreds of gigawatts over thousands of miles. The average distance possible on today’s grid reaches about two hundred miles, with 213 214

Pernick, R. and Wilder, C. The Clean Tech Revolution. HarperCollins, New York. 2008.  p. 171. Pernick and Wilder. Ibid. pp. 171-190

double the amount only a possibility. What is the problem with this reach? If one wanted to properly take advantage of clean, renewable energy by establishing solar power stations in areas like Arizona, the electricity could never reach the less sunny New York City. The second problem with the current electrical grid is its wastefulness. According to Pernick and Wilder, the grid in North America loses and wastes up to 20% of the energy transmitted through the power lines. Because the system is so old, transmission and distribution systems “not only leak energy but also no longer provide the quality of electricity demanded by our information-intensive digital society.”215 Additionally, power outages such as those during hurricanes and disturbances, are estimated to cost between $50 billion and $100 billion annually. Just how old is the current

grid? Its components have existed in their current state for 25 to 40 years, all based off of technology that was created and developed more than 100 years ago. Our current technology is from the era of Thomas Edison, Nikola Tesla, and George Westinghouse. 216 The third problem with the current electrical grid is the fact that the fuels—heavy, polluting, carbon-based masses of coal, oil, and gas—need to be transported from their sources to the regional power plants across the country. This transportation of fuels is not only time consuming and expensive but also extremely bad for the environment. These fuels are commonly transported via truck and train, a process that burns vast amounts of petroleum fossil fuels. On top of this is the fact that the fuels are pollutants themselves. Figure 1, from General Motors, demonstrates the portions of electricity 216

215

Ibid. p. 175

Ibid. p. 176 CHAPTER 4: Clean Technologies and Sectors

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Figure 1. Sources of energy for the current electric grid Total = 3,883 Billion Kwh Electric Utility Plants = 63.4% Independent Power Producers & Combined Heat & Power Plants = 36.6%

Other 0.2% Nuclear 19.7%

Hydroelectric 6.9% Coal 50.8% Petroleum 3.1% Other Gases 0.4%

Source: www.gm-volt.com/index. php?s=renewable

Natural Gas 16.7% Other Renewables 2.3%

obtained from the various sources of power. The fourth problem with the current grid is its inefficiency. Pernick and Wilder compare the grid to a “massive one-way freeway with thousands of off-ramps onto all one-way streets. Unlike the Internet, which is built on a network of millions of connected, yet independent, nodes, each one able to send and receive information, the massive electric system network has little two-way capability or redundancy built in. If one tributary or the main line goes down on the grid, it impacts everything downstream.”217 The damages that power outages cause can be seen in the examples and facts that Pernick and Wilder give: “The East Coast power outage of August 2003 plunged more than 50 million people into darkness, claimed eight lives, and racked up an estimated $6 billion in economic losses. Two years later, Hurricanes Katrina, Rita, and Wilma left millions of people without electricity for weeks and took a huge toll on regional economies. EPRI … estimates that the total cost for such grid failures across the United States is a staggering 217 60

Ibid. p. 176

$50 billion to $100 billion a year.”218

The Smart Grid Researchers have developed a groundbreaking alternative. The future they envision is of a centralized, distributed renewable energy sources that could feed a grid reaching thousands of miles. The electricity could be stored on-site in nano-based batteries and other backup systems in the millions of locations connected by the grid. Researchers call this distributed storage generation grid the “smart grid.” This proposed plan will involve the mass reworking of a system worth more than $100 billion.219 “In North America alone there are more than 3,000 electric utilities serving nearly 140 million residential, commercial, and industrial customers,” said Pernick and Wilder. “The North American utility industry represents about $275 billion in annual sales. That makes it 30% larger than the auto industry and roughly twice as large as the telecommunications business.”220 The actual grid line, from generation to transmission to distribution, is only the first big step. 218 Ibid. pp. 175-176 219 Ibid. p. 175 220 Ibid. p. 177

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

To be addressed next is the receptivity of the new power. This will involve compatible “smart” appliances, wireless devices, and on-location storage and backup devices. This electricity revolution will take what is currently a large, centralized production, top-down organization, and flip it to work from the bottom up. The new grid will be designed to look more like the Internet and will reflect the previous Internet revolution of the 1990s, in both distributed business models and practical application. The grid will be a “massive two-way network that is flexible, secure, and imminently redundant.”221 The new grid will be operated and directed by a “new breed” of entrepreneurs, electronics and semiconductor manufacturers, information technology managers, and other pioneers who will develop new ways of sourcing, processing, generating, transmitting, distributing, and storing energy. The smart grid will completely revolutionize the industry and will “look nothing like the oil and utility barons of old.”222 What will this revolution look like in the homes of the average person? There will be “rooftop-based solar modules powering not tens of thousands, but tens of millions of homes and businesses during the day and storing backup energy for use during electricity shortages and unexpected power outages.”223 The benefits of this backup capability would be a huge improvement on the current state of blackouts and brownouts. Advanced fuel-cell systems would provide homes with electricity and heating for water and air conditioning. At the end of the system would be the “smart” appliances in the homes—these would be name-brand refrigerators, washing machines, and more that would be engineered to power up and down based off of supply and demand schedules. These “smart appliances” would allow utility companies to manage the electricity supply and would reduce the amount residents spend on their utility bills. As Pernick and Wilder put it, “A true bottom-up revolution!”224 As mentioned, the smart grid will look more like the Internet and will be 221 222 223 224

Ibid. p. 173 Ibid. p. 173 Ibid. p. 173-174 Ibid. p. 174


very different from the grid currently established. Utilities will be able to “more efficiently deploy both centralized and distributed energy, and for customers to more efficiently and economically monitor and manage their energy usage, adjust their consumption behavior, and more easily feed electrons from solar PV systems, fuel cells, and other distributed clean-energy sources into the grid.”225 The U.S. Department of Energy’s National Energy Technology Laboratory has described the major characteristics of the ideal smart grid system. These characteristics include the following:226 •

• •

Self-Healing: A grid that can rapidly detect, analyze, and respond to problems, and restore service quickly.

Empowering the consumer: A grid able to incorporate consumer equipment and behavior into its design and operations. Tolerant of attack: A grid that stands resilient to physical and cyber security attack.

Twenty-first-century power quality: A grid that provides a quality of power consistent with Digital Age consumer and industry needs.

Generation options: A grid that accommodates a wide variety of local and regional generation technologies, including cleanenergy sources such as solar, wind, biomass, geothermal, and smallscale hydroelectric.

According to a press release by the U.S. Department of Energy in January 2009, “by 2025, smart grid technologies could cut U.S. electricity consumption by 10%-15%, cut peak power demands by 25%, cut greenhouse gas emissions by 20%, drastically reduce power disturbances for businesses, and enable the delivery of high-quality power for digital electronic needs.”227 In his book Hot, Flat, and Crowded, Thomas Friedman vividly describes a real green revolution life in the “year 20 E.C.E.—Energy-Climate Era.”

225 Ibid. p. 177 226 Ibid. p. 178 227 U.S. Department of Energy. Energy Efficiency and Renewable Energy. Report Notes Surging Utility Investment in Smart Grid Technologies. January 28, 2009. http://apps1.eere.energy. gov/state_energy_program/news_detail.cfm/ news_id=12209

Hot, Flat, and Crowded: The Future of the Smart Grid “Everyone now has a Smart Black Box—or SBB—your own personal energy dashboard … Just as when you sign up for cable television you get a set-top box or digital recorder with it, now, when you sign up for the Energy Internet with a progressive utility … you get an SBB. It is a microwave-oven-size black box that sits in your basement and integrates the controls and assures the interoperability of all your energy, communications, and entertainment devices and services. That includes your temperature settings and other energy preferences in every room, your lighting, your home alarm system, your telephones and computers and Internet connections, all your appliances, all your entertainment devices, and your plug-in hybrid electric car and its storage battery. The SBB’s digital touch screen can tell you exactly how much energy any of these devices is consuming at any moment. Your car, by the way, is no longer called a “car.” It is now called a RESU, or rolling energy storage unit. … You and your utility now have two-way communications. Now that the Smart Grid is in place, though, we can control demand. … The Energy Internet has become smart about when you want to use power or when it would have to sell you power or when it could buy power off your car battery or home solar system that the load has become much more constant 365 days of the year. The “flatter” that any utility grid can make its load profile throughout the day for all its customers—so that its peaks are not very high or are eliminated altogether—the fewer backup power plants it needs to build or operate. It is, in effect, substituting energy efficiency for new power generation. That is what the Energy Internet has made possible. But it didn’t only increase energy efficiency. It has also made large-scale renewable energy practical for the first time ever. … So there is now a direct correlation between how smart your grid is, how much energy efficiency it can generate, and how much renewable power it can use. Like all revolutions, though, this one changed many things at once. When the smart grid extended into a smart home all the way to a smart car, it created a whole new energy market on the other side of your electric meter … Some utilities have decided to step into that market and help you optimize your smart home to get the most cooling, heating, and other electricity services from the cleanest, fewest, cheapest electrons. Most utilities, though, have decided to serve as facilitators for this whole new industry—energy efficiency service companies, EESCs. These EESCs have emerged—just like Internet providers that crept up alongside the traditional phone companies—to help you optimize the smart grid for your home. The utility has created this market by telling you, the customer, that it will give you big discounts, even subsidies, for installing energyefficient appliances or weatherizing your home to lower your consumption of electrons. This is because the government regulator has cut a new deal with the utility, whereby the utility is now being paid for how much energy it can help its customers save—rather than consume! … Because the cash flow from all these efficiency deals is very predictable, the EESCs can sell them to investment banks, which turn them into green savings bonds. … After you showered and ate breakfast, you decided to head for the office for your first meeting. This involved taking a short walk—about twenty paces—down the hall to your home office, holding your Smart Card in your hand. Your Smart Card, which is sponsored by Visa and United Airlines Mileage Plus, looks just like a credit card, only slightly thicker. You start your workday by putting it into the docking bay of the Sun Ray terminal, made by Sun Microsystems, on your home office desk. That Sun Ray terminal uses only four watts, compared to fifty watts or more in your standard PC. The reason is that there is no hard drive sucking up energy. The Sun Ray terminal is just a screen with a slot beneath it, but as soon as you put the Smart Card into the slot, it connects you to the “network cloud,” where all your software programs, e-mail, Internet applications, and personal files are located. The “cloud” is a data center, packed with servers, that is located close

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Overall Trends to a dam on the Columbia River, which is providing it with clean hydropower to run all your programs (and those of millions of other people) and to call all those servers. … Normally, your company encourages you to work from home as much as possible. But today, on the Sun Ray terminal, you found a message from your boss saying that a teleconference would be held downtown at 10:30 a.m., between your management team and your colleagues in Chennai, India, where your company is involved in a huge real estate development. At 9:45 a.m. you get in your Ford Mustang RESU. It is a plug-in hybrid electric that gets the equivalent of 100 miles per gallon. Plug-in hybrid electric vehicles are like regular hybrid but with larger batteries and the ability to recharge from a wall outlet. As a result, all your local travel is electric, but you always have a gas tank backup. The battery is charged every night, or whenever it needs juice, and, like your dryer and other appliances, automatically interacts with your electric utility to buy the lowest-cost electrons available during the depths of nighttime off-peak hours. As you set out to the office, the GPS map in the car flashed a message that there was an accident on the highway that you normally use to get to the office and proposed an alternative route. To enter the downtown area, you had to pass through an electronic gateway, which automatically charged you $12 for entering the city between 10:00 a.m. and 2:00 p.m. (It costs $18 at rush hour.) This is another reason you work from home as often as you can, carpool, or take the bus to work. It’s all part of the new congestion-pricing system that has dramatically reduced the number of cars coming into the city and thereby created more room for electric buses and other forms of mass transit, which can now take more people to more places faster than ever before … When you arrived at the office, you docked your car at a parking ramp where you can both charge your car battery and sell electricity into the grid. There is a universal two-way plug in every home and parking lot in America now. You decided to park at this ramp after it won a bidding contest against the parking ramp around the corner. These building contests between parking ramp owners are now very common. Your ramp won by throwing in four free-parking days a month a car wash every Friday. … After the meeting, you returned home and docked your car back in the garage, around 4:00 p.m. As you were mowing the lawn with your all-electric mower, your kids came home on their hybrid electric school bus, just another big rolling energy storage and selling clean electrons the way you do. The neighborhood school is now a dual-use education and commercial center—a DUECC. That is, the school kitchen, as soon as it is finished serving lunch, is taken over by Einstein Bros. Bagels. Dual-using has become a huge a trend, saving enormous amounts of electricity, land, and new construction, and, by the way, earning the school extra cash to hire more teachers … Domino’s has not leased or built a new commercial kitchen in years. The school is also a net-zero building. It was designed and built so that all the parts—walls, windows, the lighting system, the waterhandling system, the air-handling system—are both individually and collectively super-energy-efficient. At the same time, the external roof and walls of the school building are a mini-utility—a combination of solar panels, solar thermal generation, and passive lighting through smart windows that let maximum light in during the day to replace bulbs. As a result, during working hours, the school is a net energy producer, and it sells its excess electrons into the grid. At night when Einstein is cooking the next day’s bagels in the kitchen, the school buys whatever electricity it needs from the grid at low, off-peak rates. At the end of the each month, its utility bill reads “net zero.” You cannot get a building permit in your city any longer unless your building is energy “net zero.” … Once we realized how much of both we could save from smarter cars and smarter building, building standards became as important as mileage standards.” — Thomas Friedman. “The Energy Internet: When IT Meets ET.” Hot, Flat, and Crowded. Farrar, Straus and Giroux. New York. 2008. pp. 225-236.

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METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

Smart grid technologies have begun to draw in investments, even in the absence of federal incentives. Some of these technologies include new smart meters, remote sensors, energy-management systems, better transmission lines, and advanced storage technologies that will optimize electricity generation, transmission, and usage. However, things are beginning to change with President Obama who made upgrading the current grid a central part of his campaign and now of his stimulus package. Indeed, the current administration has set the goal to double the U.S. renewable energy production in three years, and Congress has passed the incentives as part of the $787 billion stimulus package.228 The American Recovery and Reinvestment Act contains $4.5 billion for smart grid projects, and the bill includes other funding provisions estimated at $36 billion that could support smart grid investments.229 According to Smart Grid News, the State Science Technology Institute Weekly Digest has identified the following provisions in its February 19, 2009 issue:230 •

$16.8 billion to DOE for energy efficiency and renewable energy, including block grants for energy efficiency and conservation, a Weatherization Assistance Program, a State Energy Program, grants for advanced battery manufacturing, grants for alternative-fueled vehicle pilot programs, transportation electrification, Energy Efficient Appliance rebate and Energy Star programs, among others; $3.4 billion to fossil energy projects, including Carbon Capture and Energy Efficiency Competitive Grants, Fossil Energy R&D, Clean Coal Power Initiative, among others;

$1.6 billion to the DOE Office of Science.

228 Doggett, Tom. U. S. Renewable Energy faces Weak Economy, Old Grid. Reuters. February 23, 2009. 229 Smart Grid Stimulus money comes in many forms … Money to flow by April … Smart Grid a better 2009 investment than alternative energy. Smart Grid News. February 24, 2009. 230 State Science and Technology Institute (SSTI) Weekly Digest. Special Stimulus Package Issue. February 19, 2009.


• •

• •

$400 million to Advanced Energy Projects Agency; $10 million to the Western Area Power Administration for upgrading the grid, following a review of the effect of transmission issues on renewable energy sources, as well as another $3.25 billion in borrowing authority to both WAPA and the Bonneville Power Administration; $6.1 billion to the DOE for various environmental clean-up projects, uranium enrichment decontamination and decommissioning, and money for the Office of the Inspector General;

$300 million to the Department of Defense to assist in developing energy efficiency technology; and $6 billion to the DOE to cover the cost of guaranteeing loans through the new Innovative Technology Guarantee Program for supporting renewable energy and transmission technologies and to the existing Advanced Technology Vehicles Manufacturing Loan program.

According to SSTI, DOE anticipates guaranteeing more than $60 billion in loans to renewable energy projects.

Smart Meters One of the most important trends in this industry is the development of new smart meters. According to Grid Net, a “collaboration of industry veterans from the enterprise software, telecommunications, wireless networking, and utility industries” meters have traditionally been “low cost devices with a single, dedicated function. However, in the smart grid, the meter becomes an intelligent, strategic pointof-sale and service delivery mechanism between the utility and its customers. Over time, the Smart Meter must be able to adapt its capabilities so that utilities can improve methods of energy delivery, help customers manage their own energy consumption more effectively, and introduce and manage new energy services to customers.”231 Grid Net stresses the importance of “future231

Grid Net. www.grid-net.com/smart-grid

proofing” the smart meters to ensure that the meter meets today’s and tomorrow’s needs. Some companies are already beginning to provide advanced data metering and management for electric and water utilities. Washington-based company Itron is the leader in this market. Its automated meter reading (AMR) devices allow for the collection of data more accurately, efficiently, and more frequently, while utilizing wireless communication networks. The data can then be used for customer service and energy delivery applications. These include time-of-use rates, demand response, and utility asset management. Itron’s profits have gone from $180 million in 2000 to $1.5 billion in 2007. 232 Computer giant IBM is now branching into the field of smart meters. It has joined with Pacific Northwest National Laboratory (PNNL) and the GridWise Alliance in the Northwest U.S. to develop a system utilizing consumer access to real-time information via the smart meters. The end result will be consumers better managing their energy consumption.233 Comverge, located in New Jersey, is expanding on the idea of smart metering by offering a wide suite of services to utility companies. These services include load and voltage control, fullscale metering and monitoring, and grid-management services. Utility companies have an additional reason to be interested: Comverge’s innovative business model “takes the risk of implementing new technologies away from the utility.” By providing “virtual peak power” to the utility company through “tweaking participating customers’ thermostats on the highestdemand days and aggregating this saved energy,”234 Comverge saves utility companies from having to build new and expensive power-generation facilities or otherwise purchase power from other companies during peak times. A press release by the U.S. Department of Energy in January 2009 reported that the Federal Energy Regulatory Commission’s third annual report on smart meters notes that 4.7% of the electrical meters in the United States are now advanced meters, up from 232 Pernick and Wilder. Ibid. pp. 181-182 233 Ibid. p. 182 234 Ibid. p. 183

less than 1% in 2006. Likewise, 8% of energy consumers in the United States are now participating in some type of demand response program.235

Backup Power Washington, D.C.-based GridPoint is offering a solution to energy conservation on the other side of the providerconsumer relationship. While many companies are working to develop technologies that assist better energy production and delivery, GridPoint is creating technologies that help the consumers “reduce energy costs and itemize energy consumption.”236 Called “the TiVo of energy management” by GridPoint President and CEO Peter Corsell, the appliance the company provides is about the size of a refrigerator and, utilizing traditional and renewable energy, provides users with “instant, automatic plug-and-play backup power with a unique softwarecontrolled, battery-based technology.”237 This appliance will allow both residential and commercial customers to store energy during inexpensive off-times for later use during expensive peak times and unexpected outages, and it will also “provide demand-response, energyconservation, and load-shaping solutions to utilities.”238 Of additional benefit is that the appliance easily works with renewable-energy sources, such as a home-based solar energy system, and can sell the excess power back to the utility company.

Quantum Wires If the new smart energy grid is to be modeled after the Internet, as mentioned, then its design must be both efficient and effective. Massive amounts of electricity will need to travel through the power lines over long distances. Though the current grid has done this, it is no longer keeping up with the times. Renewable resources are evolving and will become a major source of power. The current grid is not necessarily properly established to transport the power from these sources to consumers.239 New electric transmission lines 235 236 237 238 239

U.S. Department of Energy. Ibid. Pernick and Wilder. Ibid. p. 183 Ibid. pp. 183-184 Ibid. p. 183 Ibid. p. 184 CHAPTER 4: Clean Technologies and Sectors

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will be needed, first and foremost. According to Pernick and Wilder, investors, researchers, and entrepreneurs are assessing this need by going as far as to research new ways to transport electrons. The earlier mentioned Nobel Laureate Richard Smalley began a team at Rice University in Houston, which has continued his work in developing “quantum wires” made of carbon nanotubes that would be more efficient and would transport power further than today’s copper wires. These wires have the potential to be ten times more efficient at conducting electricity and would additionally weigh one-sixth the weight of the modern copper wires.240

Protocols The Internet grew to become the beast that it is today because of standard protocols that enabled data to be transmitted and spread worldwide. These protocols are rules that provide the Internet with its infrastructure and base. The same idea will have to go behind the creation of a digital smart grid. The same planning by protocol-making authorities will be necessary for smart grin interoperability.241 Currently, the IntelliGrid Consortium within the Electronic Power Research Institute (EPRI), which is “the electric utility industry’s leading think tank in Palo Alto, California,”242 is working on establishing an open standard on which the grid will operate. Meanwhile, the GridWise Alliance, working with the U.S. Department of Energy and the PNNL, is working on supportive open standards and guidelines.243 According to Grid Net, the smart grid will need to be “built on open standards and protocols, so that utilities can choose the most innovative and cost effective solutions, and avoid “single vendor, proprietary product lock-in” seen in today’s solutions.” Additionally, the system must be “integrated, interoperable and optimized, to leverage innovations from all technology and product providers, vendors, customers, and standards groups.”244

240 241 242 243 244 64

Ibid. pp. 184-185 Ibid. p. 186 Ibid. p. 176 Ibid. pp. 186-187 Grid Net. Ibid.

Challenges Transition Costs The biggest and most difficult challenge to making the smart grid a reality is the cost of implementing such a system. The EPRI estimates that the total cost of constructing what they call the IntelliGrid will reach $160 billion in the United States alone by 2025. This huge financial cost has an upside providing some relief. The cost will be instantly offset by reduced losses of power, due to avoided outages and wastefulness. The new valueadded, information-rich services are an additional benefit that will be provided to customers. Some companies have already jumped on the opportunity, by spending nearly $10 billion annually, it is estimated, on smart technologies, such as automated meters that are digital, selfmonitoring, and adaptive. Even with the investment into these technologies, utilities still have a long way to go. For various reasons, utilities are slow to adopt new technologies and spend less than 1% on average in research and development.245 Despite the Obama administration’s investment in smart grid, some are concerned that the current recession may slow down the process. “It’s a million dollars a mile to build that transmission,” said Denise Bode, CEO of the American Wind Energy Association.246 Credit is tight. Oil prices have decreased more than $100 a barrel since summer 2008, making renewable energy projects less competitive. However, “What we have to do as well is figure out how we’re going to get the grid upgraded, which is part of the economic recovery package so that we can get the energy from where it is being produced to the areas where it will be consumed,” said U.S. Interior Secretary Ken Salazar, who oversees the federal lands where new transmission lines may be built.247 Regulations Pernick and Wilder describe the next challenge to the formation of the smart grid: governmental regulations. The current regulations that have been in place have been a huge road block in the process of transitioning into a more intelligent electrical grid. They 245 Pernick and Wilder. Ibid. p. 179 246 Doggett. Ibid. 247 Ibid.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

strip investors of the motivation to feed capital into energy efficiency and grid management initiatives. The “incumbent regulations” and policies at regional and national levels deal mainly with adding more generating capacity for electricity. This supports investment into new coal and natural gas-fired power plants. Investors have been unmotivated to put money into smart grid projects that are unlikely to be picked up, in favor of projects that only perpetuate the old, inefficient system.248 A solution to this problem, according to the authors, is something industry experts have been calling for already. If a “decoupling of profits from generation” was to occur, the “perverse incentive for utilities to deploy new, costly, often polluting energy sources instead of focusing on energy efficiency and smartgrid appliances” would be overcome.249 Experts cite California as a large-scale success story in this aspect, as the state was one of the first places in the world to participate in the decoupling of profits from large-scale generation. Thus, California has become “one of the best opportunities for companies and investors interested in the nextgeneration grid.”250 As recently as February 2009, members of the U.S. Congress are seeking to eliminate these roadblocks to deregulation. U.S. Senate Majority Leader Harry Reid plans legislation that would lead to federal deregulation “trumping” state laws. The legislation Reid plans to introduce will “speed the building of transmission infrastructure to bring remote solar-thermal, wind and geothermal power sources to population centers — and the bill would, among other things, seek to give the federal government the authority to build new transmission lines whether or not states like it.”251

Breakthrough Opportunities Smart Appliances In a fully functioning smart grid system, the power lines and infrastructure technology are only the first part of the challenge. If homes continue to use electricity on old248 249 250 251

Pernick and Wilder. Ibid. p. 180 Ibid. p. 180 Ibid. p. 180 St. John, Jeff. Sen. Reid: Feds Should Trump State Regulations in Building National Smart Grid. Seeking Alpha. February 24, 2009.


fashioned, energy inefficient appliances, the point of a universal smart grid system is all but moot. Consumers everywhere will need “smart appliances” and devices that can communicate with the new, advanced grid to power up and power down as needed.252 These appliances are still for the most part in the development stage. Researchers currently working on their development include PNNL, Bonneville Power Administration, and the EPRI. According to Pernick and Wilder, “the likely winners in this arena will be in two groups: the utilities that adopt smartappliance standards and capabilities and the companies that provide the wireless sensors, software, and intelligence to operate such devices.”253 Some of the companies that have taken an early lead in smart appliance development include: Invensys Controls, IBM, Whirlpool, and GE. These companies have been working on technology to enable smart appliance testing, deployment, and adoption. The GE suite of smart appliances will also include ranges, dishwashers, microwave ovens, and clothes washers and dryers.254 Grid Monitoring A major part of the new smart grid system and a key component of defining what is so revolutionary about the concept, is the idea of advanced grid monitoring. Pernick and Wilder name CURRENT Communications of Maryland and BPL Global of Pittsburgh, PA as two of the companies developing broadband over power line (BPL) tools, which will track electrons through monitoring their flow and use over the same power lines used to provide electricity to homes and businesses. This network will be overlaid on the existing electric power infrastructure. CURRENT claims that this solution “incorporates advanced digital communication and computing capabilities that [will] provide real-time monitoring.” Additionally, this system will be able, through the same technology, to offer broadband services, such as high-speed Internet to customers. 255

252 253 254 255

Pernick and Wilder. Ibid. p. 174 Ibid. p. 174 U.S. Department of Energy. Ibid. Pernick and Wilder. Ibid. pp. 176-177

One problem that this technology must overcome was noted in an informational document released by the U.S. Department of Energy in 2007 reviewing the “R&D needs and describing some pathways to promising solutions” when it comes to energy solutions. The DOE states that “this technology has faced technical issues, including interference with other radio spectrum users and interference from loads.”256 Automated Meter Reading The technology involved in automated meter reading, or AMR, has been discussed previously in the smart meters section. This technology has, only recently, begun to pick up pace with implementation. The market is fast-growing and will provide great opportunities for investment. Already, some areas in North America are recognizing the importance of AMR, including Ontario, Canada, where there is a required installation by 2010, and California, where 9 million meters are planned to be introduced. UtiliPoint, an electric utility research firm, forecasts the AMR market will “grow from $25 million per year in 2005 to more than $200 million annually by 2015.”257 Super Conductors The “quantum wires” that would allow for large amounts of electricity to travel over long distances could be rivaled by another breakthrough technology. Superconductive materials that can be used in energy storage, transmission, and distribution can be used to create grid wires to serve a variety of functions. American Superconductor in Massachusetts is developing “hightemperature superconductor wires [that can be used for] power cables, motors, generators, and specialty magnets,” among others.258 The first commercial overhead power line in the U.S. made from superconductor materials was installed by 3M in 2005. Opportunities in this field are vast, as the use of these materials is still far from extensive. However, if the costs to use these materials were to drop and the technology needed to manufacture them into utility lines was 256 U.S. Department of Energy. 257 Pernick and Wilder. Ibid. pp. 182-183 258 Ibid. p. 185

to improve, they could be of significant advantage.259

Related Cleantech Jobs • AMI (Advanced Metering Infrastructure Specialist) • Program Manager

• Hardware Product Manager • Electrical Engineer

• Technology Energy Systems Administrator • Control Engineer

• Smart Grid Consulting Manager • Environmental Planner • Smart Grid Engineer • Field Technician • Smart Grid Lead

• Network Administrator

• Senior Software Engineer • Photovoltaic Engineer

• Utility Program Manager

• Power Electronics Engineer • Wind Turbine Engineer

• Meter Technician

Major Players Pernick and Wilder have identified the following companies as the ones to watch for in this sector. They are the major companies and organizations that have had influence in the field of cleantech smart grid concepts, as stated in The Clean Tech Revolution. BPL Global (Pittsburgh, PA), www. bplglobal.net. BPL Global is a leader in software design and systems integration, aimed at making broadband over power line (BPL) grid management a reality. The company closed more than $25 million in Series C venture financing in late 2006 and works extensively in demand-side management. Comverge (East Hanover, NJ), www.comverge.com. Comverge operates a unique business model. Instead of charging utility companies up-front for their products and services, the company profits off the electricity costs that it saves consumers.

259 Ibid. p. 185 CHAPTER 4: Clean Technologies and Sectors

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CURRENT Communications (Germantown, MD), www.current.net. CURRENT is the leading BPL provider in the U.S., with investors that include TXU Electric Delivery, GE, EarthLink, Goldman Sachs, Google, and Duke Energy. Due to high costs and other hurdles, CURRENT, while promising, still faces challenges. Electric Power Research Institute (EPRI) (Palo Alto, CA), www.epri. com. An institute rather than an actual company, this organization of utilities and companies has great influence and power to bring the market toward a smart grid. It is both a think tank and an R&D shop. EnerNOC (Boston, MA), www. enernoc.com. Another demand-responsive company, EnerNOC created the Negawatt Network of distributed-energy resources, which monitors and controls customers’ energy assets. The company’s market capitalization in early 2007 was nearly $1 billion. GridPoint (Washington, D.C.), www. gridpoint.com. This company’s main product it is pushing is a refrigeratorsized appliance that provides consumers with three things: renewable-energy integration, online energy management, and battery-based backup power. The company still needs to improve on its business model to sell units in the tens of thousands, not hundreds. Hunt Technologies (Pequot Lakes, MN), www.hunttechnologies.com, serves 500 utility companies around the world with AMR technology solutions. It is currently an independent operating unit of Australian-based Bayard Group, who has committed over $1 billion to the energy measurement and efficiency sector worldwide. IBM (Armonk, NY), www.ibm.com, is applying its computing and consulting expertise to smart grid development. It works with the U.S. Department of Energy through PNNL to test a system that empowers residential consumers to track their energy usage. It is also involved in a number of other projects. Itron (Liberty Lake, WA) www. itron.com. The company’s goal is to make AMR an industry standard. It is North America’s leading provider of advanced data metering and management. It serves about 8,000 utility customers and has tens of thousands of devices in use world wide. 66

SmartSynch (Jackson, MS), www. smartsynch.com. Unlike other AMR companies, SmartSynch is focusing on wireless solutions for commercial and industrial markets. The company bases its technology on open-systems architecture over a municipal Wi-Fi network.

Smart Grid and Metro Orlando The Necessity of a Reliable Grid It is clear that Metro Orlando and the state of Florida are in a precarious situation when it comes to the potential for power outages and blackouts, particularly during hurricanes or tropical storms. According to the Energy Information Administration, the State of Florida’s per capita residential electricity demand is among the highest in the nation, due in part to the heavy use of air-conditioning during the summer and the widespread use of electricity during winter months. Nine of ten households, or 87% of the state, use electricity as their main source of energy for heating compared with 30% of U.S. households.260 One megawatt generator in the South is capable of serving almost half as many households as in the Northeast because the latter consume half the amount of electricity as those in the South. Therefore, in determining what a megawatt is worth in terms of how many equivalent homes it serves, it is important to know not only the plant’s rating and capacity factor, but also its location, as the amount of electricity consumed varies dramatically across the nation.261 Furthermore, natural gas and coal account for two-thirds of the state net electricity generation, with nuclear and petroleum-fired power plants accounting for the remaining electricity production.262 With Florida comprising of over 18 million people and ranking as the fourth-largest state in the 2008 Census Bureau’s National and State Population Estimates, 263 a smart grid system, implemented at the state level, 260 U.S. Department of Energy. Energy Information Administration. State Energy Profiles. 2008. http://tonto.eia.doe.gov/state/ 261 Bellemare, Bob. Issue Alert: What is a Megawatt? Utilipoint International, Inc. 2008. 262 U.S. Department of Energy. State Energy Profiles. Ibid. 263 U.S. Census Bureau. National and State Population Estimates. www.census.gov/ popest/states/NST-ann-est.html

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

would be a significant advantage.

Research and Development at UCF Solar Energy Grid Integration Systems (SEGIS) The Florida Solar Energy Center (FSEC) at UCF, based in the Metro Orlando area, was one of the 12 Solar Energy Grid Integration Systems (SEGIS) award recipients from the Department of Energy for the current fiscal year. The U.S. Department of Energy made plans in 2008 to invest up to $24 million over the coming years to assist in the research and development of new solar energy technologies, which would include solar energy’s impact on the smart grid concept. According to the DOE, SEGIS is a critical step toward achieving net-zero-energy homes, buildings, and communities. Through R&D collaboration, intelligent controls, and management efforts, SEGIS enables teams to integrate PV systems in household and commercial smart grid systems, developing more efficient and better performing products that will interact between solar energy systems and plug-in hybrid vehicles and provide secure backup power sources during outages. The goal of this research is to “make PV systems more practical for home and business owners, as well as for utilities, by improving the operational characteristics of the systems.”264 This is a very important part of the journey to a smart grid system. The smart grid vision incorporates, to a great degree, renewable technologies as a source of energy to feed the grid. FSEC’s project will focus on bringing solar photovoltaic (PV) systems closer in operation to conventional generators that utility companies are set up to work with. This will allow for the technologies to “interact seamlessly with the utilities’ electric grid.”265 As stated, one of the benefits of a smart grid would be an improved system that would prevent outages during grid disturbances. FSEC’s configuration of PV systems “continue to operate during grid disturbances, such as the loss of other power plants, unlike the current 264 Florida Solar Energy Center. FSEC to Lead Team for DOE Project, Making Solar More Practical. The Energy Chronicle. August 18, 2008. 265 Florida Solar Energy Center. Ibid.


Figure 2.

Source: Department of Energy

A schematic depiction of the Solar Energy Grid Integration Systems (SEGIS) concept

grid-tied PV systems that automatically shut down during grid disturbances.” With this planned system, there will be greater control of voltage and other critical parameters of overall grid health and stability.266 According to The Energy Chronicle, a news source from the FSEC, “the FSEC will lead a team of solar manufacturers and electric utilities throughout the country, including SatCon, Sentech, Inc., EnFlex, SunEdison, Northern Plains Power Technologies, Lakeland Electric Utilities, and other utilities. This team may receive up to $2.9 million to develop new grid integration concepts for PV systems that utilize optional battery storage, utility control, communication and monitoring functions, and building energy management systems.”267

Florida Center of Excellence in Ocean Energy Technology The University of Central Florida has been one of six Florida universities to receive a Florida Center of Excellence in Ocean Energy Technology. The centers, each funded with $5 million, will address Florida’s energy crisis by looking at South Florida’s ocean currents, specifically the Gulf Stream—the world’s most energy dense ocean current—as an abundant renewable energy source.268 Other universities include the University of South Florida, Florida Atlantic University, the University of Florida (two centers), and Florida State University. They will work with the U.S. Navy, the U.S. Department of Energy, the National Renewable Energy Laboratory, Florida Power & Light, Ocean

Renewable Power, Lockheed Martin, Clipper Windpower, Oceaneering, Aquantis, Nova Southeastern University, and Harbor Branch Oceanographic Institutions. According to the Cleantech Group, as one of the fastest growing states, Florida is estimated to increase its consumption by 30 percent over the next 10 years.269 However, due to limited in-state production (less than 1 percent of consumption), the state is heavily dependent on imported sources of energy. Ocean-generated electricity would have a significant economic impact for Florida. “The first steps could be right around the corner,” said Frederick Driscoll, Director of the FCEOET at Florida Atlantic University at a congressional briefing sponsored by

266 Ibid. 267 Ibid.

268 Kachan, Dallas. Florida kick-starts local ocean power research. Cleantech Group, LLC.

269 Kachan. Ibid. CHAPTER 4: Clean Technologies and Sectors

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Rep. Ron Klein, D-Fla.270

Florida has an advantage in the field of smart grid technology. Jesse Berst of Smart Grid News interviewed various smart grid experts across the country, asking which states they felt were leading the way. In his article Smart Grid Leadership: The Top Ten “Smartest” States in 2009, he reported on the opinions of the experts, finding that “there was a strong consensus about who’s leading the charge toward a modernized electricity

system.”273 The top states, beginning with the “smartest” are: California, Texas, Florida, Illinois, Pennsylvania, West Virginia, Ohio, New Jersey, Connecticut, and Colorado, and with honorary mention going to Michigan, New York, Hawaii, and Indiana. With the states separated into three tiers, Florida leads Tier 2. According to Berst, “The Sunshine State has established a strong build out for the smart grid – especially in the area of load control and communications infrastructure. A major utility, FP&L, has many substantive programs and is planning a number of new rollouts that will advance smart grid efforts.”274 For Florida to be as successful as California and Texas, some catching up will have to be done. In California, regulators are in action, pushing for new smart grid practices on the policy side of the issue, and there is support from Governor Schwarzenegger. The state’s three big utilities have developed advanced plans and frameworks that will take California into a smart grid system, and help the rest of the country see the advantage of a smart grid system. In Texas, though policy is not as progressive as in California, the top utility companies in the state are national leaders in the industry. Central Florida will have some examples to follow from within the state itself. The University of South Florida’s Power Center for Utility Explorations (Tampa, Florida) and Progress Energy “have been selected by Florida’s Energy and Climate Commission to build an electric grid that relies on alternative energy sources.”275 The contract is for three years and is worth $15 million. It will “create one of the nation’s largest and most comprehensive “smart grids,” serving at least 5,000 customers on the west side of St. Petersburg and St. Pete Beach.”276 The City of Miami is also a participant. The city will partner up with General Electric, Florida Power and Light, Cisco Systems and Silver Springs Networks to build a smart

270 Lipman, Larry. Ocean Energy Moving Toward Reality, Congress Told. Cox News Service. May 7, 2007. 271 Lipman. Ibid. 272 Ibid.

273 Berst, Jesse. Smart Grid Leadership: The Top Ten “Smartest” States in 2009. Smart Grid News. March 24, 2009. 274 Berst. Ibid. 275 USF, Progress Energy get contract for “smart grid” in St. Petersburg. Tampa Bay Business Journal. March 9, 2009. 276 USF, Progress Energy. Ibid.

Within three years, underwater turbines could begin harnessing the power of the current known as the Gulf Stream to produce commercial electricity. Within three to five years, deep-ocean cold water could be used for commercial air conditioning. Within seven to 10 years, scientists could begin commercially harnessing the energy produced by the differences in ocean temperatures at various depths. They also could begin producing hydrogen from the ocean as a fuel source.” The potential economic and environmental benefits for Florida are “huge.” More than 80 percent of Florida’s power is produced by natural gas, coal or other climatewarming fossil fuels. During periods of peak electrical demand, Florida has to purchase power from out-ofstate power grids. If ocean energy is properly harnessed, Florida could become a net exporter of energy. Within a decade, ocean energy production could mean an increase of about 35,000 new jobs in Florida, he said, and within 20 to 30 years it could account for about 100,000 new jobs.271

“Energy from the ocean is really a next frontier, both for Florida and the United States,” said Larry Lemanski, FAU’s Vice President for research and graduate studies and President of the FAU Research Corp.272

Smart Grid Initiatives: Florida vs. Other Regions

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grid for Miami. This initiative, called “Energy Smart Miami,” will have multiple benefits. In addition to the energy savings, the “program should create approximately 1,000 new jobs in Florida, and the companies involved have applied for federal stimulus funding to offset some of the $200 million investment.”277 According to Sensors Online, “Energy Smart Miami has the potential to be the most extensive and holistic smart grid implementation in the country.”278 Looking outside of the state, there has been one success story to set a good example of what Metro Orlando should be aiming for. San Diego, one of the big cleantech success cities, conducted the nation’s first Smart Grid Study, commissioned by the Energy Policy Initiatives Center (EPIC) at the University of San Diego, and cosponsored by the Utility Consumer Action Network (UCAN) and San Diego Gas & Electric (SDG&E). The study concluded that a smart grid in San Diego was feasible and economically advantageous. According to Smart Grid News, the study brought forth three key findings:

1. Economic, technological, and regulatory trends in the San Diego region will create a desirable climate for implementation of a Smart Grid. 2. Twenty-six technologies could be implemented to advance the current electric grid toward a smarter, more modern system.

3. A preliminary cost-benefit analysis suggests that smart grid benefits adequately exceed the initial installation costs and cover the ongoing operation and maintenance costs.279

Smart Grid News also pointed out that while the new technology would not have the typical 3-year payback that is sought by the industry and regulators, the case for implementing the smart grid is still strong considering the state of old technology and the benefits that will be 277 Kroulek, Alison. Miami to get Smart Grid as GE (GE), Florida Power and Light (FPL), Cisco (CSCO), and Silver Springs team up. Green Stocks Central. April 21, 2009. 278 Miami launches $200 million Smart Grid initiative. Sensors Online. April 21, 2009. 279 Pullins, Steve. Study points to business case for modern grid. Smart Grid News. February 20, 2007.

wrought over the next 20 to 40 years.

Smart Grid Major Players in Metro Orlando Progress Energy and Orlando Utilities Commission (OUC) are the main utility companies serving the Metro Orlando region. They are both pursuing renewable energy programs to achieve energy efficiency in the region. Progress Energy Central Florida’s energy provider, Progress Energy, is no stranger to the smart grid vision. Progress Energy serves 3.1 million customers in the Carolinas and Florida, is a Fortune 250 energy company, holds 21,000 megawatts of generation capacity, and operates with $9 billion in annual revenues.280 Smart Grid News interviewed Lee Mazzocchi, Vice President for Distribution at Progress Energy Carolinas, Inc. in 2007. While Mr. Mazzocchi works within the Carolinas division, the company’s smart grid approach would apply to the company as a whole: We are investing in energy efficiency and conservation, renewable and alternative energy sources, and stateof-the-art plants and delivery systems. That includes grid technology, in addition to new generating plants, to produce a balanced portfolio of cost-effective and environmentally responsible solutions. Where we are heading now is to a much more sophisticated grid that provides dynamic voltage and VAR management, automatic fault location and automated switching, using rulebased algorithms and intelligence; they truly require very little human intervention, reducing costs and freeing the workforce to perform more important tasks. The tiers involved in Progress Energy’s technology plan for energy delivery are as follows:281 •

Tier One: “A mobile enabled workforce. Distribution employees have ready access to the data that lets them make smart decisions, increase their productivity and improve

280 Progress Energy. www.progress-energy.com/ aboutus/index.asp 281 Progress Energy. Ibid. CHAPTER 4: Clean Technologies and Sectors

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reliability.”

Tier Two: “Our grid strategy, which uses automation, intelligent devices, sensors and communications to configure and operate the distribution system dynamically.” Tier Three: “Customer services. These services allow us to provide more flexibility and more options for customers.” Tier Four: “A framework to enable our use of technology … our data strategy. That says how PE is going to manage the volumes of data and information that stream in; and, finally, how we are going to manage the elements that make up the multiple tiers of our technology plan.”

In 2007, Progress Energy Florida signed a contract with Atlanta’s Biomass Gas & Electric to purchase electricity from a second waste-food biomass plant planned for Florida that would be built in north or central Florida and would use yard trimmings, tree bark, and wood knots from paper mills to create electricity. “Clean, renewable energy sources, such as this one, play a vital role in our balanced approach to managing Florida’s growing energy needs,” said Jeff Lyash, President and CEO of Progress Energy Florida.282 Progress Energy Florida also offers incentives through its EnergyWise program for the purchase and installation of a solar water heating systems. This system allows the company to briefly cycle power to the customer’s electric hot water, heating, and cooling system during periods of peak community demand. Orlando Utilities Commission Orlando Utilities Commission (OUC) is the second-largest municipally owned public utility in the state of Florida and the sixteenth largest in the nation. OUC provides water and electric service to a customer base of more than 250,000 in the City of Orlando, other parts of Orange County, as well as St. Cloud, in Osceola County. OUC owns the Curtis H. Stanton Energy Center and

portions of other power plants in Florida. Notable ownership includes the Indian River Plant north of Cocoa, a former OUC plant now owned by Reliant Energy, 283 as well as a 6.08% stake in the St. Lucie Nuclear Power Plant near Fort Pierce.284 OUC provides financial incentives for residential and commercial solar power installations. Customers who install solar systems receive credits, and any excess energy is sold back to OUC. (Refer to the Solar Energy section for more details on incentives from OUC). Seminole Electric According to Cleantech Group, in 2007, Seminole Electric launched a Request for Proposals seeking 150 MW in new, renewable energy capacity. A wholesale supplier for 10 electric distribution co-op systems in Florida, Seminole Electric is serving more than 850,000 consumers, in 46 of Florida’s 67 counties, making up the state’s thirdlargest electricity consumer group. 285 As a generation and transmission cooperative (G&T) whose members are serving some of the fastest growing regions of Florida, adding an estimated 1,000 residents a day, Seminole expects to serve only four percent of its members’ energy needs through contracted renewable sources, well behind other U.S. states.286 283 OUC Wraps Up Sale of Indian River Plant to Reliant Energy. PR Newswire. October 6, 1999. 284 U.S. Department of Energy. Energy Information Administration. St. Lucie Nuclear Power Plant, Florida. 2008. www.eia.doe.gov/ cneaf/nuclear/page/at_a_glance/reactors/ stlucie.html 285 Seminole Electric Calls for up to 150MW of renewable energy. Cleantech Group. March 1, 2007. 286 Cleantech Group. Ibid.

List of Works Consulted 1.

Bellemare, Bob. Issue Alert: What is a Megawatt? Utilipoint International, Inc. 2008.

2. Berst, Jesse. Smart Grid Leadership: The Top Ten “Smartest” States in 2009. Smart Grid News. 24 March 2009. 3. 2008. Carbon Free Prosperity. Clean Edge, Inc. and Climate Solutions. October 2008.

4. Cleantech Group. Progress Energy to get Biomass power in Florida.

282 Progress Energy to get Biomass power in Florida. Cleantech Group. December 18, 2007 70

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

5.

Doggett, Tom. “U. S. Renewable Energy faces Weak Economy, Old Grid.” Reuters. February 23, 2009.

6. Kachan, Dallas. Florida Kikstarts local ocean power research. Cleantech Group, LLC. 7.

Kroulek, Alison. Miami to get Smart Grid as GE (GE), Florida Power and Light (FPL), Cisco (CSCO), and Silver Springs team up. Green Stocks Central. 21 April 2009.

8. Lipman, Larry. Ocean Energy Moving Toward Reality, Congress Told. Cox News Service. May 7, 2007. 9.

Miami launches $200 million Smart Grid initiative. Sensors Online. 21 April 2009.

10. OUC Wraps Up Sale of Indian River Plant to Reliant Energy. PR Newswire. October 6, 1999. 11. Pernick and Wilder. 2008. The Clean Tech Revolution. HapperCollins, New York.

12. Progress Energy. www.progress-energy. com/aboutus/index.asp 13. State Energy Profiles. Energy Information Administration. U.S. Department of Energy. 2008.

14. State Science and Technology Institute (STTI) Weekly Digest.. Special Stimulus Package Issue. February 19, 2009. 15. St. Lucie Nuclear Power Plant. Energy Information Administration. 2008. 16. Thomas Friedman. “The Energy Internet: When IT Meets ET.” Hot, Flat, and Crowded. Farrar, Straus and Giroux. New York. 2008.

17. U. S. Department of Energy Website.

18. USF, Progress Energy get contract for “smart grid” in St. Petersburg. Tampa Bay Business Journal. 9 March 2009. 19. www.census.gov/popest/states/NST-annest.html

20. http://apps1.eere.energy.gov/state_energy_ program/news_detail.cfm/news_id=12209 21. www.grid-net.com/smart-grid

22. www.smartgridnews.com. February 24, 2009. 23. http://blog.floridaenergycenter.org/ echronicle/2008/08/fsec-to-lead-teamfor-doe-project-making-solar-morepractical/#more-41


“We are moving into a worldwide economy that is increasingly being driven by electrification — our cars will be run by electricity, and much of what we rely on for our quality of life is going to be driven by electrification.” - Scott Farris, CEO, Planar Energy Devices, Inc. First Orange County Cleantech Symposium. November 5, 2008.

Personal Transportation Why It Matters Personal vehicles, including cars and light trucks, as well as commercial vehicles and other petroleum-based vehicles, have been targeted as one of the culprits for environmental damage. According to the U.S. Department of Energy, the fuels burned by internal combustion engines—gasoline and diesel—produce emissions that contain substances called “greenhouse gases.” Many scientists believe it is these greenhouse substances that have been linked to climate change, as well as air toxins and added particulate matter.287 The U.S. Department of Energy lists the following pollutants found in vehicle emissions as important concerns:

Greenhouse and Tropospheric Gases • Carbon Dioxide (CO2): Produced by complete combustion. • Carbon Monoxide (CO): A byproduct of incomplete combustion. • Nitrogen Oxides (NOx): Formed by the interaction between oxygen and nitrogen in engine combustion chambers. • Sulfur Dioxide (SO2): Contributes to the formation of 287 U.S. Department of Energy. Just the Basics: Vehicle Emissions. Freedom Car & Vehicle Technologies. August 2003.

acid rain, dependent upon sulfur content of fuel (typically low for cars and trucks).

Air Toxins • Hydrocarbons (HC): Derived from unburned fuel during incomplete combustion. • Volatile Organic Compounds (VOC): Reaction with sunlight creates smog and other forms of air pollution.

Solids/Liquids • Particulate Matter (PM): Soot and smoke (microscopically suspended particles primarily arising from carbon, condensed water vapor, and soluble HCs) produced by internal combustion (notably diesel) engines. In recent years, fuel efficiency has become the biggest concern when it comes to the topic of personal transportation. The goal from an environmental standpoint is to reduce or eliminate the amount of petroleum burned as fuels for our vehicles. The public’s drive to possess vehicles that burn less, little, or no petroleum-based fuel creates new business opportunities. The U.S. regulatory framework for automotive energy use is very different when compared to other developed

nations.288 Rather than relying on high gasoline taxes and other fuel-economy regulations to promote energy efficiency, the U.S. has followed the Corporate Average Fuel Economy (CAFE) standards approach, which began out of the market uncertainties of 1975 but still lags behind other advanced nations. Most cost-effective policy studies done to compare the costs of the CAFE regime to the costs of increasing the gasoline tax to achieve fuel efficiency have concluded that CAFE was significantly more costly to the U.S. economy than a gasoline tax. 289 According to a 2007 study by the International Council on Clean Transportation, the average gas mileage across the U.S.—27mpg—is the lowest among industrialized nations, lagging behind even China, which stands at 35mpg.290 Tax accounts for 24% of the cost of a gallon of gasoline in the U.S.291 When U.S. gas prices hit $4.34 in the summer of 2008, they remained much lower than in most industrialized countries where fuel is far less consumed. In July 2008, the price of a similar grade in Germany was $9.28 and $8.91 288 Scott, B. and Murphy, E. The U.S. Market Framework for Gasoline: Individual Incentives and Societal Goals in Global Markets. Harvard Business School Publishing. Boston. September 2004. 289 Kleit, A.N. The Effects of Annual Changes in Automobile Fuel Economy Standards. Journal of Regulatory Economics. June 1990. 290 Pernick R. and Wilder, C. The Clean Tech Revolution. HarperCollins, New York. 2008.  p. 147. 291 Hakim, Danny. A Fuel-Saving Proposal from Your Automaker: Tax the Gas. The New York Times. April 18, 2004. CHAPTER 4: Clean Technologies and Sectors

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Table 1.

cars are becoming more mainstream. Estimated U.S. Comparative Weekly Retail Premium Gasoline Prices (including taxes) hybrid sales, according to the Netherlands UK US Date Belgium France Germany Italy U.S. Department of Energy, have climbed from 17 in 1999 7/7/08 $9.37 8.87 9.28 9.09 10.64 8.91 4.34 to over 350,000 in 2007. The 2/23/09 $5.58 5.47 5.54 5.50 6.03 4.95 2.15 U.S. Department of Energy Source: Information Energy Administration studies also show that, given certain hypothetical situations, Figure 1. preferences for hybrids are Hybrid Vehicle Sales in the U.S., 1999-2007 growing. The hypothetical choice given 400,000 in a study conducted in both 2007 and 2008 was: “Assume that a HYBRID Saturn Aura Lexus LS600hL vehicle and a clean DIESEL vehicle 350,000 Saturn Vue both would cost $3,000 more than a Nissan Altima comparable GASOLINE vehicle and Toyota Camry 300,000 both would reduce your annual fuel Lexus GS 450h use by 30%. Which of the following Mercury Mariner would you choose for your NEXT NEW Toyota Highlander 250,000 vehicle purchase assuming you were Lexus RX 400h Honda Accord buying one?”297 (Choices were gasoline, Ford Escape 200,000 clean diesel, or hybrid.) Willingness to Honda Civic purchase a hybrid vehicle increases when Toyota Prius surveying college graduates. For 2008, 150,000 Honda Insight college graduates showed a 10% increase in willingness to purchase a hybrid over 100,000 the full response group. According to Pernick and Wilder, the auto industry will need to transition 50,000 away from petroleum-based vehicles to vehicles with alternate sources of power: electricity and biofuels. Electric power 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 is the biggest focus in alternative vehicles Source: www1.eere.energy.gov/vehiclesandfuels/facts/2008_fotw514.html by the auto industry—electric power is cleaner, more efficient, and is key to the greatest growth and investment in UK.292 This difference in prices has there has been a growing demand in opportunities. Four main categories of greatly contributed to differences in fuel the U.S. for alternative solutions to the vehicles have been investigated in The economy performance between Europe “gas guzzler” in personal transportation. Clean Tech Revolution as follows:298 and the U.S.293 “Overall oil consumption These new options include new materials, has actually fallen in Germany and new power sources, and perhaps most 1. Hybrid electric vehicles (HEVs): Britain since the 1970’s while it is up importantly, new types of vehicles. Considered as the starting point substantially in the U.S.—to 20.9 million for many of the following vehicles barrels a day, from 14.7 million barrels in with lower emissions, hybrid Overall Trends 1970.”294 electric vehicles have helped boost One of the major challenges to having In 2008, there were over 800 million auto manufacturer sales in the a significant change in consumer-buying cars and light trucks on the roads tough economy. Hybrid buyers behavior is the consumer demand itself. worldwide. If market growth continues in the United States receive a The reason why many manufacturers the way it is, this number is estimated federal tax credit up to $3,150, abandoned their plans for alternative to reach 1 billion by 2020.295 This depending on the HEV model. fuel vehicles was the lack of appeal the staggering figure is only compounded by Additionally, certain high-tech vehicles had for the consumers. “The the current gas mileage numbers and our firms and companies give out cars were weak, unattractive, and oil consumption. $5,000 credits to their employees ugly.”296 Due to these numbers and the surge to go towards the purchase of a This trend is changing in recent in gas prices in the summer of 2008, hybrid. “AllianceBernstein, one years. With the emergence in 1999 of the world’s largest publicly 292 U.S. Department of Energy. Energy of the Honda Insight hybrid and the traded asset management firms … Information Administration. clear popularity of the best-selling 293 Bradsher, Keith. Like the U.S., China Favors predicts that hybrids (including Fuel Standards, Not Taxes. New York Times. hybrid Toyota Prius, alternative fuel November 23, 2003. 294 Hakim. Ibid. 295 Pernick and Wilder. Ibid.

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296 Ibid. p. 159

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

297 U.S. Department of Energy. 298 Pernick and Wilder. Ibid. pp. 151-164


Figure 2. Choice of Vehicle Given the Above Scenario - ALL RESPONDENTS 70%

2007

2008

Share of Respondents

60%

50%

40%

30%

20%

10%

0% Hybrid

Gasoline

Clean Diesel

Don't Know

Source: www1.eere.energy.gov/vehiclesandfuels/facts/2008_fotw531.html

plug-ins) will comprise 50% of global new car sales by 2015 and a stunning 85% by 2030.”299 China is getting in on the hybrid action as well. Production is “booming” in hybrids as well as in overall auto manufacturing. Toyota, Hyundai, and Volkswagen are partnering with local Chinese car makers and are competing with China’s own manufacturers, five of which have plans to start manufacturing and selling hybrids in 2008.300

2. Plug-in hybrid electric vehicles (PHEVs): This category is becoming very popular. Entrepreneurs and investors are beginning to see the growth opportunities as these vehicles catch on. Already, GM has introduced the Saturn VUE in a plug-in hybrid version. Toyota is close behind, disclosing plans for commercial models in 2010. Austin, Texas Mayor Will Wynn launched in 2006 the Plug-In Partners Initiative.301 It is a coalition of businesses, utilities, and more than 40 U.S. cities, all forming a ready market for PHEVs. GM has also stepped up its 299 Ibid. p. 154 300 Ibid. p. 155 301 Ibid. p. 155

efforts with the innovative E-flex platform. This concept is a step away from the parallel electric-orgasoline design and, instead, offers a serial hybrid design. “Instead of the common HEV configuration of a gasoline engine and electric motor both powering the car’s wheels at different times or in combination, the E-flex chassis uses 100% electric power from its batteries for propulsion. A small, 1-liter, three cylinder gas engine is used only to power the onboard generator.”302 Of particular concern to investors and entrepreneurs is the battery technology used in PHEVs and EVs. The batteries currently used in PHEVs and EVs are evolving from the nickelmetal hydride (NiMH) variety to lighter-weight, greater-powerdensity, lithium-ion batteries. “AllianceBernstein predicts that lithium-ion batteries will gain necessary power capability and fall in price before 2012, paving the way for widespread PHEV commercialization.”303

3. Electric vehicles (EVs): This category of vehicle has been around the longest. First coming out in the 1990s, they 302 Ibid. p. 157 303 Ibid. p. 157

lost popularity as they lacked the horsepower and style, so consumers of the time—not burdened by gas prices—lacked interest. Many U.S. automakers pulled the plug on their production plans in the early 2000s. However, with changing times, these cars are beginning to see a second life. New entrepreneurial developments across the globe promise new potential. Tesla Motors of Silicon Valley came out with a car that can be “high-performance, sexy, and profitable.” However, much of the current growth in EV sales is occurring outside the United States.304

4. Fuel-cell vehicles (FCVs): Brought on by the increase in research into a hydrogen economy, these vehicles run on hydrogen fuel cells. Cleantech experts are skeptical as to the future investment and growth of this category but recognize that breakthroughs are possible. One promising development is Honda’s newest Home Energy Station, which duplicates the industrial and agricultural process of producing hydrogen from natural gas, on a refuel-at-home scale. The device would tap into an already existing home natural gas source to refuel the Honda Civic GX. This concept would help the industry surpass the need for nationwide hydrogen fuel stations by providing a personal one at home.

5. Light Electric Vehicles (LEVs): One final, often overlooked, trend in personal transportation is in the field of electric motorbikes and scooters. “These light electric vehicles (LEVs) have been around for years, but current advances in materials, battery, and engine technology have made electric scooters a hot item for urban commuters, notably in Europe and China.”305 Of the world’s LEVs, 75%, or more than 8 million, are sold annually in China. 304 Ibid. pp. 152, & 159-160 305 Ibid. pp. 162-163 CHAPTER 4: Clean Technologies and Sectors

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Challenges Is it really clean? One of the biggest challenges in the field of clean personal transportation is the question: Is it really clean? There is some concern over whether EVs and PHEVs, which draw their power from charging stations or standard wall sockets, can really be considered clean. Emissions and fossil-fuel consumptions will be reduced on the road, but the electricity needed to charge the vehicles is coming from the same source the rest of our electricity comes from—dirty coal, natural gas, petroleum, etc. Is that really cleaner than burning traditional gasoline? The Electric Power Research Institute, the Argonne National Laboratory, and the California Air Resources Board, among other agencies, have all declared that running cars on electricity from the current electric grid (50% of which is powered by coal), as an alternative to gasoline and diesel, still reduces the overall GHG emissions up to 61%.306 Most of the electric vehicle battery charging will take place overnight. It is in the nighttime hours when overall power demand on the current grid is dramatically decreased and utility companies have excess generating capacity. This is known as “valley filling.” In December 2006, the U.S. Department of Energy’s Pacific Northwest National Laboratory determined that 84% of the 220 million vehicles in the U.S. could be powered during these off-peak hours if they were all PHEVs.307 Even better news: if a PHEV owner lives in an area where their electricity is wind or hydroelectric powered, or the current electric grid was converted or supplemented by these sources (see section on Smart Grid), or the owner of the PHEV used homebased solar panels, the electric car utilizes even more true clean energy.308 Hydrogen Economy The biggest challenge in making hydrogen fuel a reality is the needed infrastructure’s cost and accessibility.309 Due to the “huge costs and logistical challenges of building out an infrastructure for hydrogen fuel 306 307 308 309 74

Ibid. p. 153 Ibid. p. 153 Ibid. p. 153 Ibid. pp. 152-153

Figure 3. Operational Hydrogen Refueling Stations as of January 2008

Source: www1.eere.energy.gov/vehiclesandfuels/facts/2008_fotw523.html

distribution,”310 the authors believe it is a long-term opportunity. Investment in this technology is risky, however. Businesses and investors are much more inclined to take chances on vehicles powered by grid electricity. If we are to consider hydrogen fuelcell vehicles (FCVs) as a viable option, there are two alternatives currently in sight. One is the Home Energy Station currently being worked on by Honda (see Overall Trends: FCVs), and one is a nationwide hydrogen economy, a more broadly reaching option. As of January 2008, there were only 61 operational hydrogen refueling stations in the U.S., according to the U.S. Department of Energy.311 According to the U.S. Department of Energy, “the overall challenge to hydrogen production is cost reduction. … Hydrogen must be comparable to conventional fuels and technologies on a per-mile basis in order to succeed in the commercial marketplace.”312 Other challenges include the durability and reliability of hydrogen fuel cell systems; the size and weight of the system; air, thermal, and water management; and

310 Ibid. p. 161 311 U.S. Department of Energy, Energy Efficiency and Renewable Energy. www.eere.energy.gov 312 U.S. Department of Energy, Energy Efficiency and Renewable Energy. Hydrogen, Fuel Cells, and Infrastructure Technologies Program. www1.eere.energy.gov/hydrogenandfuelcells/ production/

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

heat recovery systems.313

Breakthrough Opportunities Carbon-Composite Materials One of the major breakthroughs in technology is in the field of materials. According to the U.S. Department of Energy, light vehicles have gone under substantial changes over the years in the materials they are made up of. Since 1995, high- and medium-strength steel, stainless steel, aluminum, plastics, and plastic composites have all increased while iron castings have decreased. This has led to an overall increase in vehicle weight of approximately 10% from 1995 to 2006.314 Currently, the idea of carboncomposite materials is being studied as an alternative to steel in vehicle production. Carbon fiber weighs only one-fifth as much as steel weighs. A 10% drop in the weight of an auto can improve fuel economy by 7%. If a vehicle was constructed out of carbon fiber rather than steel, it could potentially double fuel economy.315 Carbon composites are currently used in the aviation industry, as well as in the production of consumer goods, such as 313

U.S. Department of Energy, Energy Efficiency and Renewable Energy. Fuel Cell Technology Challenges. www1.eere.energy. gov/hydrogenandfuelcells/fuelcells/fc_ challenges.html 314 U.S. Department of Energy, Energy Efficiency and Renewable Energy.  www.eere.energy.gov 315 Pernick and Wilder. Ibid. p. 148


that can operate on 85% ethanol and a plug-in hybrid that uses electricity for in-city driving. A PHEV with flex-fuel capacity, running on 85% ethanol (E85), could get 400 to 500 miles per gallon on the 15% petroleum gasoline in the tank. Of additional appeal is the fact that both ethanol and electricity can and are being produced domestically. Ethanol fueling stations are found throughout the United States.318 According to the U.S. Department of Energy, as of February 2009 there were 1,860 stations nationwide.

Related Cleantech Jobs The following are examples of cleantech jobs in personal transportation: • Hybrid Vehicle System Engineer • Electric Engineer

• Hybrid Manufacturing Engineer

tennis rackets, high performance skis, and bicycles. These composites are already used in vehicles—Formula 1 race cars require it. However, carbon composites are not quite as affordable as steel when making passenger vehicles and light trucks. Prices today are $8 to $10 per pound and would need to be as low as $3 to $5 per pound to compete with steel.316

Next-Generation Batteries The batteries currently used in PHEVs and EVs are evolving from the nickelmetal hydride (NiMH) variety to lighter-weight, greater-power-density lithium-ion batteries. These batteries are of the same technology as those found in most laptop computers, cell phones, and iPods. The opportunities in this field exist in power capacity. Lithium-ion batteries store twice as much energy as a NiMH battery of equivalent weight, such as the kind used in the Prius hybrid. The downside of a lithium-ion battery is the heat it generates, though some manufacturers are experimenting with using phosphates and nanotechnologies to reduce the heat, as well as the weight.317

• Microelectronics Engineer • Program Scheduler • Project Engineer

• Quality Staff Engineer

• Research and Development

• Battery Lab Group Manager • Hybrid Software Engineer • Electric Controller

Major Players Pernick and Wilder have identified the following companies as the ones to watch for in this sector. They are the major companies and organizations that have had influence in the field of cleantech personal transportation, as stated in The Clean Tech Revolution:319

Flex-Fuel Plug-Ins One breakthrough opportunity is being discovered in flex-fuel plug-in vehicles. The idea behind the new technology is combining the best of both worlds: a flex-fuel vehicle (FFV)

CalCars (Palo Alto, CA), www. calcars.org. Founded in 2002 as California Cars Initiative, it promotes the development of PHEVs and has considered breaking into the for-profit sector. This company also promotes advocacy, technology leadership, and grassroots influence in the industry. Chery (Wuhu, China), www. cheryglobal.com, launched the first Chinese-made hybrid in its home market. This vehicle, the A5 ISG sedan, costs about half to consumers what the assembled-in-China Toyota Prius would cost.

316 317

318 319

Ibid, p. 148 Ibid. p. 156

Ibid. p. 159 Ibid. pp. 165-170

EEStor (Ceder Park, TX), www. eestor.us, developed a patented ultracapacitor technology that could surpass lithium-ion batteries in both power and affordability. The company has vast potential for clean-vehicle breakthroughs. General Motors (Detroit, MI), www. gm.com; NYSE: GM. Slowed by the bad PR of producing the Hummer, canceling plans of an electric car, and more, GM may have redeemed itself with the Saturn VUE, the PHEV it recently released. A new direction has been taken and can also be seen in its development of the E-Flex platform. Honda (Tokyo, Japan), www.honda. com; NYSE: HMC. A breakthrough company that developed the first hybrid, the Insight, Honda is now back in the competition with the Civic hybrid. Expect to see Honda’s real impact to be in the field of hydrogen, with its Home Energy Station III. REVA Electric Car (Bangalore, India), www.revaindia.com, is the world’s number one producer of electric vehicles (EVs). They sell mainly in India and have been expanding into the U.K. and are positioned to sell low-priced vehicles in growing markets. Tesla Motors (San Carlos, CA), www.teslamotors.com, is focusing on the high-performance, sleekly designed, and ultrachic vehicle category to combat the long-held opposite notions of electric cars. It plans to broaden its market to more affordable all-electric sedans. Toyota (Toyota City, Japan), www. toyota.com; NYSE: TM. Toyota’s Prius is the number one selling HEV, brought the car category into the mainstream, and raised awareness of cleantech and the business success available. Hybrids and overall fuel efficient vehicles helped Toyota surpass GM in 2007 as the number one seller of cars and trucks. Valence Technology (Austin, TX), www.valence.com; NASDAQ: VLNC. One of many small companies delivering the technologies that can make EVs, including hybrids and PHEVs, safe, reliable, and affordable. This company produces phosphate-based, Saphion lithium-ion batteries. Vectrix (Newport, RI), www.vetrix. com. A start-up company that develops design and all-electric power to “maxiscooters” or high-end motorbikes, Vectrix aims for the same demographic CHAPTER 4: Clean Technologies and Sectors

75


Figure 4.

shared by Vespa and offers a 125-volt, nickel-metal hydride battery-powered cycle with top speeds of 62 mph.

Metro Orlando and Personal Transportation Clean Technologies Hydrogen Research Metro Orlando has been awarded millions of dollars in grant money toward research in hydrogen technologies. The University of Central Florida has been working in the field of hydrogen fuel cells through its Florida Solar Energy Center (FSEC). In 1997, FSEC was designated as a Center of Excellence in Hydrogen Research and Education by the U.S. Department of Energy. Research work has led to new national technology standards and manufacturing opportunities, and 40 patents were issued to FSEC members, more than any other UCF department.320 The FSEC Hydrogen and Fuel Cell Laboratories work with highly specialized scientific chemistry and materials-related equipment worth more than $1 million. Metro Orlando has a great advantage in this field, as these laboratories are “one of the nation’s highest caliber research labs of its kind.”321 Various resources, programs, and activities are available through the FSEC’s Hydrogen Research and Development Division. The labs are equipped to conduct hydrogen research on production, storage, utilization, and sensors, and fuel cell research on membranes, fabrication, mass transport, surface properties, and electrochemical diagnostics. The FSEC’s Hydrogen Fuel Cell Laboratories have research activities that include:322 • Alternative fuels • Fuel cells • High-pressure, high-temperature reactions • Hydrogen energy systems • Hydrogen liquefaction and densification • Hydrogen membrane separation • Hydrogen production and storage • Material failure determination

320 Florida Solar Energy Center. www.fsec..ucf.edu 321 Florida Solar Energy Center. Ibid. 322 Ibid. 76

CLEANTECH at the Advanced Materials Processing Analysis Center (AMPAC)

In his presentation at the first Orange County Cleantech Symposium, Dr. Show presented the following research achieved by Dr. Sudipta Seal, UCF Professor, Department of Mechanical, Materials, and Aeorospace Engineering in the College of Engineering and Computer Scicence.

Nanoparticle to reduce soot emission in fuel

“Dr. Seal and another faculty at Texas A&M are working together on nanoseria, which is a nanoparticle. A nanoparticle has a very large surface to volume ratio, and on top of that, the surface has a tremendous amount of oxygen vacancy so it can absorb a lot of oxygen. So they use it for a lot of things. For example, it may make people live longer. That means delaying aging because it can absorb antioxidants. But one other application is to reduce soot emission. Soot is the formation of incomplete combustion. If you put this nanoparticle, which is very cheap, in gasoline or diesel fuel, you can get the emission down. So this is a patent that Dr. Seal just got recently in September, and he is interested to see investors trying to promote it. This is really green because it will get the smog down, thereby reducing CO2 emissions.” - Louis Chow, Director/Professor, AMPAC. First Orange County Cleantech Symposium. November 5, 2008. • Material property determination • Nano synthesis and materials development • Photo and thermo-catalytic reaction and reactor engineering • Photocatalytic and photoelectrochemical processes • Pollutant detoxification • Sensors and detectors • Synthesis of metal hydrides and chemical hydrides • Thermal imaging • ZBO hydrogen systems.

The following personal transportationrelated research projects, currently underway at UCF/FSEC, are either financed by the U.S. Department of Energy or by NASA, the number one user of liquid hydrogen: • High Temperature, Low Relative Humidity Membrane Fuel Cell Program

• High Temperature Proton Exchange Membrane Electrolytes • High-Temperature, ProtonConduction, Solid Electrolytes • Hydrogen for Internal Combustion Engines.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

Fueling Stations Metro Orlando has the special privilege of being the only area in Florida with hydrogen fueling distributors. These two fueling locations are located at Progress Energy’s property at the Orlando International Airport, in Orlando, FL, and at the Progress Energy-BP hydrogen station, in Oviedo, FL. “Progress Energy Florida, the State of Florida, Ford Motor Company and Chevron Corporation broke ground on Florida’s first hydrogen energy fueling station in 2005.”323 According to Progress Energy, the Orlando International Airport location is intended to fuel Ford V-10, E-450 hydrogen-powered shuttle buses that transport visitors to Orlando. The shuttle buses are owned by the State of Florida. There are eight 12-passenger buses that have a range of up to 150 miles. These buses have “near-zero” emissions and use an internal combustion engine that is designed to run on hydrogen rather than gasoline. This first station “will provide a test platform for showcasing the safe and cost-effective production, storage and dispensing of hydrogen as a transportation fuel.”324 In December 2007, “Florida 323 Progress Energy. Hydrogen Fueling Stations. www.progress-energy.com/ environment/ras/hydrogenstations.asp 324 Progress Energy. Ibid.


Figure 5.

List of Works Consulted 1.

The FSEC at UCF operates in a number of key research areas. Another research division active at the FSEC is the Advanced Energy Systems Technologies. This division includes:

1. Production 2. Storage and utilization of renewable hydrogen technologies 3. Gasification and pyrolysis of biofuels, potential biofuels (contributes to both petrochemical and agricultural industries) 4. Fuel cell 5. Transportation “We oversee the $19 million Department of Energy effort with U.S. cars to develop the proton exchange membrane that is likely to be used in the automotive industry and the transportation sector to power electric vehicles that are driven by -- that are powered by fuel cells. Now, there are a number of different fuel stocks that can go into the powering of these automobiles that range all the way from methanol to pure hydrogen.” - Phillip Fairey, Deputy Director of the Florida Solar Energy Center. Orange County First Cleantech Symposium. November 5, 2008.

Department of Environmental Protection (DEP) Secretary Michael W. Sole joined executives from Ford Motor Company, BP America, Inc., Progress Energy Florida and the United States Department of Energy to officially open the state’s second hydrogen energy station.”325 According to a press release by the State of Florida, “through the federal government’s Controlled Hydrogen Fleet and Infrastructure Demonstration and Validation Project, Ford supplied the Florida Department of Environmental Protection and Progress Energy Florida with six hydrogen-powered Ford Focus Fuel Cell Vehicles. BP America supplies the cars with hydrogen fuel through a grant from the State of Florida.”326 The vehicles were designated for various purposes. One of the hydrogen powered Focuses was given to park rangers at Wekiwa Springs State Park for a pollution-free patrol of the freshwater springs and park. Another two vehicles were given to Florida Department of Environmental Protection’s Central Regulatory District for field inspections. The remaining three vehicles were given to Progress Energy’s energy-efficiency 325 Florida Department of Environmental Protection. Secretary Sole Celebrates Opening of Second Central Florida Hydrogen Fueling Station. December 7, 2007. www.dep.state. fl.us/secretary/news/2007/12/1207_01.htm 326 Florida Department of Environmental Protection. Ibid.

specialists and account managers to use at the Operations Center.327

Examples of Personal Transportation in Metro Orlando Planar Energy Devices (www. planarenergy.com) develops and manufactures high performance solid state energy storage products. They develop, manufacture, and market metallic-lithium solid state battery products for electronic and automotive applications. According to Scott Farris, CEO of Planar Energy Devices, “one problem is that electricity cannot be stored efficiently. Planar Energy Devices focuses on the energy storage problem— the weak link. The secondary energy storage market is at $10 billion and growing.”328 Mitsubishi Power Systems Americas is testing a new stationary cell and a cell for vehicles. “Energy storage is going to be critical to the energy mix going forward,” said Jim Williams, Vice President of Service and Manufacturing Operations. “This is important because it gives us the chance to use renewables twenty-four hours a day.”329

Alternative Fueling Station Total Counts by State and Fuel Type. U.S. Department of Energy – Energy Efficiency and Renewable Energy. www.afdc.energy. gov/afdc/fuels/stations_counts.html

2. Bradsher, Keith. Like the U.S., China Favors Fuel Standards, Not Taxes. New York Times, November 23, 2003. 3. Energy Information Administration. www.eia.doe.gov

4. Hakim, Danny. “A Fuel-Saving Proposal from Your Automaker: Tax the Gas.” The New York Times, April 18, 2004. 5.

Hydrogen, Fuel Cells & Infrastructure Technologies Program. U.S. Department of Energy – Energy Efficiency and Renewable Energy. www1.eere.energy. gov/hydrogenandfuelcells

6. Hydrogen fueling station. Progress Energy. www.progress-energy.com/ environment/ras/hydrogenstations.asp 7.

Just the Basics: Vehicle Emissions. Freedom CAR & Vehicle Technologies Program and the U.S. Department of Energy. 2003.

8. Kleit, A.N. “The Effects of Annual Changes in Automobile Fuel Economy Standards.” Journal of Regulatory Economics, June 1990. 9.

Pernick R. and Wilder, C. 2008. The Clean Tech Revolution. HapperCollins, New York.

10. Porter, Richard C. Economics at the Wheel: The costs of Cars and Drivers. Academic Press. San Diego, CA. 1999. p. 30.

11. Scott, B. and Murphy, E. “The U.S. Market Framework for Gasoline: Individual Incentives and Societal Goals in Global Markets.” Harvard Business School Publishing. Boston. September 2004. 12. Vehicle Technologies Program. U.S. Department of Energy – Energy Efficiency and Renewable Energy. www1.eere.energy.gov/vehiclesandfuels/ index.html

13. Williams, Sarah. Secretary Sole Celebrates Opening of Second Central Florida Hydrogen Fueling Station. Florida Department of Environmental Protection. 7 Dec 2007.

327 Ibid. 328 www.planarenergy.com 329 Jim Williams, Vice President, Service and Manufacturing Operations, Mitsubishi Power Systems Americas, Inc. Second Cleantech Symposium. January 21, 2009. CHAPTER 4: Clean Technologies and Sectors

77


“We do a lot of training. We run a banner center on behalf of workforce in Florida on the training of photovoltaic installers. …This is being done in conjunction with about 10 community colleges. You are going to find that opportunities in the alternative energy areas are rising in efficiency. … The opportunities are in the jobs.” - James Fenton, Director, UCF Florida Solar Energy Center. Second Orange County Cleantech Symposium. January 21, 2009.

“A report prepared by Global Insight for the U.S. Conference of Mayors forecasts that renewable power generation, building retrofitting and renewable transportation fuels will together generate 1.7 million new jobs by 2018 and another 846,000 related engineering, legal, research, and consulting positions.” - Sara Sekula. Red Hot Green Jobs. First Monday. April 2009. Page 12.

Jobs

Green-collar Jobs The term green-collar job was coined relatively recently, after the blue-collar and white-collar job titles that were created in the late 19th and early 20th centuries, respectively. The term reflects the job’s focus on the environment. The first time it was used was to refer to logging jobs in the United States in 1999, and since then, the meaning of the term has grown substantially.330 There now appears to be general consensus among leading green job advocates that a green-collar job is about more than just the environment. Greencollar jobs represent a union between the environmental, economic and social concerns of society. A job is considered green only if the job improves the environment and the financial lives of the employees and their families.331 A green collar job is also classified by its safe working conditions and opportunities for advancement. The United Nations Environment Programme (UNEP) goes into more detail, defining it as: 330 Bible, Elaine. Landmark study on green collar jobs. San Francisco State University. February 14, 2008. 331 Gordon, Kate and Hays, Jeremy, et al. Green Collar Jobs in America’s Cities. Apollo Alliance and Green For All. 2008.

78

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

… work in agricultural, manufacturing, research and development (R&D), administrative, and service activities that contribute substantially to preserving or restoring environmental quality.332 Green-collar jobs span many sectors of the economy. These jobs can be (1) completely new jobs created specifically for the green movement, or (2) existing jobs that incorporate environmental concerns. For example, a solar panel installer would be a completely new green-collar job. An accountant position would be an existing job, but would be classified as green-collar if the position resides within a so-called “green” company.

Benefits A recent study conducted on behalf of the City of Berkeley found that green collar jobs are good jobs that provide workers with:333 • Living wages

• Health benefits

• Meaningful work

• High-level of job satisfaction

• Opportunities for job mobility. 332 Michael Renner, Sean Sweeney, Jill Kubit. Green Jobs. Worldwatch Institute. September 2008. 333 Pinderhughes, Raquel. Green Collar Jobs: An Analysis of the Capacity of Green Businesses to Provide High Quality Jobs for Men and Women with Barriers with Employment. City of Berkeley. 2007.


The same report found that green collar jobs are well suited for individuals with barriers to employment: • They have low barriers for entry.

• They provide workers with opportunities for training for both entry-level and advanced-level jobs. • They provide opportunities for advancement.

• They are located in growing sectors.

Green-collar Job Trends Table 1 lists five green-collar jobs that are considered by Boston Globe to be some of the leading jobs in their field.334 A description of the job, along with salary information and required education and experience, is included in the table. It is important to note that a clear distinction between green-collar jobs and “regular” jobs has not yet been made. Because of this, it is difficult to accurately assess and forecast the job market in this area. However, as the Green Jobs Act of 2007 takes effect (discussed later) and as green jobs become more researched, a clear distinction will eventually be made. Currently, there are a variety of methods institutions and organizations are using to assess and forecast levels of greencollar jobs in the U.S. and elsewhere. A 2007 report by the American Solar Energy Society indicates that the renewable energy and energy efficiency industry generated about $1 trillion and created about 8.5 million green-collar jobs in 2006.335 The same report estimates for 2030 about $2 trillion in revenues and more than 16 million green-collar jobs in the most conservative scenario, but about $4.5 trillion in revenues and 40 million jobs in the most optimistic scenario. The Political Economy Research Institute at the University of Massachusetts-Amherst compiled a list of various U.S. employment levels and wages for existing jobs that could, in 334 Hildebrand, Deborah S. Top Five GreenCollar Jobs in 2008. Suite101. http:// agriculture-environmental-careers.suite101. com/article.cfm/top_five_greencollar_jobs_ in_2008 335 Bezdek, Roger. Renewable Energy and Energy Efficiency: Economic Drivers for the 21st Century. Management Information Services, Inc. for the American Solar Energy Society. 2007.

Table 1. Top Green-collar Jobs in 2008 Education/ Experience

Description

Salary Range

Solar Installer

Install solar power systems for homes and businesses.

$25,000 to $75,000

Minimum of 8,000 hours on-the-job training and 600 hours classroom instruction

SustainableDesign Architect

Design and build structures that are environmentally friendly as whole and/or are built using green methods and materials.

$50,000 to $200,000

Bachelor’s or master’s degree, and Leadership in Energy and Environmental Design (LEED) accreditation

Environmental Lawyer

Represent individuals, businesses, and interest groups in matters regarding the environment, including environmental laws.

$75,000 to $500,000

JD with a specialty in environmental law

Fuel Cell Entrepreneur

Manufacture, assemble, install, test, maintain, research, and develop fuel cells, battery-like components.

$80,000 and up

Typically a bachelor’s, master’s, or doctorate in science or engineering

Environmental Engineer

Study and monitor the quality of soil, air, and ground water and make recommendations on cleanup.

$55,000 to $88,000

Bachelor’s or master’s degree

Source: Boston Globe

Table 2. Summary of the U.S. Renewable Energy and Energy Efficiency Industries in 2006 Industry

Revenues (billions)

Direct Jobs (thousands)

Total (direct plus indirect) Jobs Created (thousands)

Renewable Energy

$39.2

196

452

Energy Efficiency

932.6

3,498

8,046

TOTAL

$971.8

3,694

8,498

Source: American Solar Energy Society, 2007.

Table 3. U.S. Renewable Energy and Energy Efficiency Industries in 2030 Revenues (Billions of 2006 Dollars) Base Case

Moderate Scenario

Advanced Scenario

Total Jobs Created

(Direct Plus Indirect - Thousands) Base Case

Moderate Scenario

Advanced Scenario

RE

$95

$227

$597

1,305

3,138

7,918

EE

$1,818

$2,152

$3,933

14,953

17,825

32,185

TOTAL

$1,913

$2,379

$4,530

16,258

20,963

40,103

Source: American Solar Energy Society, 2007.

CHAPTER 5: Jobs

79


the future, become green-collar jobs.336 Their analysis attempts to depict the labor potential for green-collar jobs in the U.S. There are six categories of “green” included in this report: mass transit, building retrofitting, energy efficient automobiles, wind power, solar power and cellulosic biofuels. The study analyzed 12 states, including Florida, in May 2007. Some jobs, such as electricians, are included in multiple categories due to its ability to be used for multiple purposes. Florida data for solar and wind power is reproduced in Table 4. There are currently 268,690 workers in industries that could be green-collar workers for the solar industry. There are 107,860 workers in industries that could be green-collar workers for the wind power generation industry.

Table 4. Potential Labor Pool of Green-collar Workers in Solar and Wind Power Florida Solar Power Electrical Engineers # Employed Average Wage # Employed Average Wage

7,430 $36.00

# Employed

2,680

Average Wage

$31.35

Iron and Steel Workers 44,140 $17.51

# Employed

3,120

Average Wage

$19.17

Industrial Machinery Mechanics

Millwrights

# Employed

9,080

# Employed

Average Wage

$19.39

Average Wage

Welders

1,430

14,090

# Employed

Average Wage

$15.48

Average Wage

Green-collar jobs encompass clean technology jobs, as illustrated below. The main difference between green-collar and cleantech jobs is that green-collar jobs do not have to “generate income or profits” while cleantech jobs are profit-driven. Both work to improve environmental quality. However, green-collar jobs can be located in small or large for-profit businesses, non-profit organizations, or social or government institutions.337

Average Wage

# Employed

$17.82

Sheet Metal Workers

# Employed Metal Fabricators

Green-collar jobs

Environmental Engineers

Electricians

Cleantech Jobs

Figure 1. Relationship between Green-collar and Cleantech Jobs

Wind Power

9,750 $16.07

Machinists 3,790

# Employed

$14.04

9,230

Average Wage

$16.05

Electrical Equipment Assemblers

Electrical Equipment Assemblers

# Employed

11,650

# Employed

11,650

Average Wage

$11.84

Average Wage

$11.84

Construction Equipment Operators

Construction Equipment Operators

# Employed

# Employed

Average Wage

22,020 $15.24

22,020

Average Wage

Installation Helpers # Employed

8,600

# Employed

Average Wage

$10.42

Average Wage

Laborers # Employed Average Wage

$15.24

Industrial Truck Drivers 24,220 $12.16

Industrial Production Managers 128,330

# Employed

$9.85

2,980

Average Wage

$40.40

Construction Managers

First-Line Production Supervisors

# Employed

19,560

# Employed

Average Wage

$37.36

Average Wage

Total: 268,690

Cleantech jobs

20,780 $23.61

Total: 107,860 Source: Clean Edge, Inc., 2008

Table 5. Global Clean-Energy Jobs (Direct and Indirect): Solar and Wind

336 Pollin, Robert and Wiks-Lim, Jeannette. Job Opportunities for the Green Economy: A Stateby-State Picture of Occupations Gain from Green Investments. University of MassAmherst. Political Economy Research Institute. June 2008. 337 Pinderhughes. Ibid. 80

2008 (Current)

2018 (Projected)

Solar Photovoltaics

190,819

1,341,968

Wind Power

413,522

1,315,324

TOTAL

604,341

2,657,292

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

Source: Clean Edge, Inc., 2008


Table 6. Top Ten Emerging Cleantech Jobs Venture Capitalist

An individual who seeks out emerging companies with high growth potential in order to invest in them.

Corn Farmer

An individual that farms corn instead of other items.

Solar Panel Installation Foreman

An individual that directs solar panel installers on how to do their job.

Composting Toilet Installer

An individual that installs toilets that transform “human waste into organic compost.”

Green Building Manager

A manager of the design of a green building that seeks to efficiently use resources rather than waste them.

LEED Accredited Builder

A builder of green buildings that knows and follows the Leadership in Energy and Environmental Design standards.

Eco-Brewmaster

Breweries that redesign their processes to make them more efficient and environmentally friendly.

Land Use Planner

Somebody that adjusts city structure in order to increase energy efficiency without completely redesigning the area.

Biodiesel Vegetable Oil Pickup Man

A worker that collects waste items as such leftover oil from restaurants, which can used for fuel production.

Green Brand Manager A manager of a business that focuses on the environment in order to reduce costs and pollution, for example. Source: Earth2tech 2007

Cleantech Jobs Trends A recent study by Clean Edge indicates that solar photovoltaics and wind power industries have created more than 190,000 and 413,000 jobs worldwide, respectively, in 2008, or a total of more than 600,000.338 These numbers are projected to reach over 1,300,000 each in 2018 or a total of 2.7 million. There is also speculation about how cleantech could bring back manufacturing jobs lost when the U.S. began outsourcing them to other countries. Due to the principles of clean technology, it would not make sense to have China’s factories build solar panels and then ship them on coal powered boats to the U.S. It defeats the purpose of “going green.” What is needed is a net positive effect of clean technology, which to many is equivalent to keeping jobs at home. According to the New York study, some of the major necessary components of the cleantech industry are manufacturing, raw materials, and

338 Makower, Joel and R. Pernick. Clean Energy Trends 2009. Clean Edge. March 2009.

research talent.339 If a region could build up its manufacturing base, it could prove to be crucial in growing cleantech in that area. Investment and employment data have shown that green jobs are poised to save the U.S. economy from recession.340 Even in a still very weak economy, green jobs see notable growth and demand.

Green-collar Job Training In some areas of the U.S., such as California, demand for green-collar workers exceeds supply. The recent emergence of clean technology as an industry has left companies unable to fill certain positions due to a lack of qualified workers. In response, various educational institutions are creating programs designed specifically for training greencollar workers. Some of these programs 339 New York City Investment Fund Study Finds Burgeoning Clean Technology Industry Offers New Opportunities for New York State Economy. New York City Investment Fund/ Partnership for New York City. 2007. 340 Timbers, Amelia. Green Job Market Emerges. Matter Network. May 13, 2008.

do not require any higher education, and some are even geared toward young people who may not have finished high school. Community colleges across the U.S. are starting training programs for those individuals interested in entering the green market. Community colleges in California are taking advantage of the growth of the solar industry in their state and have already begun educational programs geared towards training solar installation workers. Some organizations are also beginning certification courses in clean technology and other areas that qualify the recipient to work in this area. A 120-hour certification program has been developed by The International Association of Nanotechnology and focuses on cleantech and nanotech.341 Companies have also begun developing their own internal training programs.342 Still others, like universities, are developing entire degree programs around clean technology. According to the New York Times, academic institutions’ interest in renewable energy is catching up fast with businesses and industries: The Oregon Institute has offered the first four-year undergraduate program in renewable energy; SUNY, Canton in 2006; Illinois State University in Normal in the upcoming Fall 2009; and many more.343 These programs are generally seen by students as offering great job prospects. “We can go into energy auditing, solar design, energy modeling,” said Mac Lewis, a 30-year old student from Cederedge, CO who has a B.S. in Chemistry and is about to graduate with a second degree in renewable energy from the Oregon Institute of Technology. “There are engineering firms looking for people like me. Photovoltaic manufacturers are coming here. Wind energy companies. There are nonprofit groups that are interested. And that’s just what’s going on around Portland.”344 However, besides the engineering and technology aspect of the progams, renewable energy is also being approached from other angles, from economics to public policy. 341

Ritch, Emma. Programs helps professionals break into nanotech, cleantech. Silicon Valley/ San Jose Business Journal. July 4, 2008. 342 Pinderhughes. Ibid. 343 Schneider, Keith. Majoring in Renewable Energy. The New York Times. March 26, 2009. 344 Schneider. Ibid. CHAPTER 5: Jobs

81


Washington State University offers an interdisciplinary program for graduate students allowing them to focus on clean technology while majoring in their desired field.345 Through its Precourt Institute for Energy Efficiency, Stanford University offers many interdisciplinary programs from energy and environment research to teaching.346

Green Job Policies The Green Jobs Act of 2007, Title X of the 2007 Energy Bill, authorizes $125 million to be spent on various national and state programs to promote green-collar job training. It states that the federal government will commit $125 million per year towards training approximately 35,000 people for green jobs. The act gives priority to displaced workers, at-risk youth, and veterans for the training programs. The U.S. Department of Labor (DOL) has been given the responsibility of carrying out the Green Jobs Act, along with assistance from the U.S. Department of Energy.347 The legislation addressed both environmental issues and economic issues. Chairman of the committee dealing with the bill, Rep. George Miller (D-CA), was quoted: “By helping to create good-paying jobs in industries that are likely to continue to grow for years, this bill would take a good step towards making the American economy more competitive. ‌ And by helping green industries to grow by providing them with a strong supply of well-trained, highly-skilled workers, this bill would remove one of the barriers that slows our progress in confronting the serious dangers posed by global warming.â€?348 The $125 million will be divided among the five green-collar jobpromoting programs shown in Table 7.

Table 7. Green Jobs Act Programs National Research Program

The Department of Labor (DOL), acting through the Bureau of Labor Statistics, will collect and analyze the labor market data necessary to track workforce trends and identify the types of skills and green jobs we need to train people for. The DOL will use this information to provide technical assistance and capacity building to the training partnerships described below. 10 percent of the amount appropriated will be dedicated to this program ($12.5 million if fully funded).

National Energy Training Partnership Grants

DOL will award competitive grants to non-profit partnerships to carry out training that leads to economic self-sufficiency and to develop an energy efficiency and renewable energy industries workforce. The partnerships must include the equal participation of industry and labor, and may include related stakeholders like local workforce investments boards, educational institutions, and community-based organizations. 30 percent of the amount appropriated will be dedicated to these grants ($37.5 million if fully funded).

State Labor Market Research, Information, and Labor Exchange Research Program

DOL will award competitive grants to states to administer labor market and labor exchange information programs, in coordination with the onestop delivery system. Activities will also include the identification of job openings; the administration of skill and aptitude testing; and counseling, case management, and job referrals. These programs will be administered by the state agency that administers the employment service. Unemployment insurance programs and services can only be delivered by state agency staff. 10 percent of the amount appropriated will be dedicated to this program ($12.5 million if fully funded).

State Energy Training Partnership Program

DOL will award competitive grants to states to enable them to administer, via the state agency that administers their employment service and unemployment insurance programs, renewable energy and energy efficiency workforce development programs. It will award grants to partnerships that essentially mirror the national partnerships in their make-up. Priority will be given to states that demonstrate that their activities meet state and national policies associated with energy efficiency, renewable energy and reduction of emissions. 30 percent of the amount appropriated will be dedicated to this program ($37.5 million if fully funded).

Pathways Out of Poverty Demonstration Program

DOL will award competitive grants to training partnerships that serve individuals under 200% of the federal poverty line or a locally defined self-sufficiency standard. The partnerships must include communitybased organizations, educational institutions, industry, and labor; demonstrate experience implementing training programs and recruit and support participants to the successful completion of training; and coordinate activities with the WIA system. In awarding grants, priority will be given to partnerships that target low-income adults and youth and plan to implement various strategies that enable access to, and successful completion of, training, including ensuring that supportive services are delivered by organizations with direct access to and experience with targeted populations. 20 percent of the amount appropriated will be dedicated to this demonstration ($25 million if fully funded).

345 Washington State University. Clean Technologies. 346 Schneider. Ibid. 347 Green Jobs Act 2007 FAQ. Apollo Alliance, Ella Baker Center for Human Rights, Green for All, and Workforce Alliance. 348 National Legislation: Green Jobs Act of 2007. Green-Collar Jobs Campaign. November 30, 2007. 82

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

Source: Green Jobs Act of 2007 FAQ


List of Works Consulted 1.

Bezdek, Roger. Renewable Energy and Energy Efficiency: Economic Drivers for the 21st Century. American Solar Energy Society. 2007.

2. Earth2tech, 2007. http://earth2tech. com/2007/10/18/top-10-cleantech-jobs/

3. Fenton, Jim. Director, Florida Solar Energy Center. Second Orange County Cleantech Symposium. January 20, 2009.

4. Frequently Asked Questions About the Green Jobs Act of 2007. Appollo Alliance, Ella Baker Center for Human Rights, Green for All, and Workforce Alliance. 5.

Green Collar Jobs. Boston Globe. www.boston.com/bostonworks/galleries/ green_ jobs1118?pg=17

6. New York City Investment Fund Study Finds Burgeoning Clean Technology Industry Offers New Opportunities for New York State Economy. New York City Investment Fund/Partnership for New York City, 2007. www.nycif.org/ news/2007/pr_011607_cleantech.pdf 7.

Pinderhughes, Raquel. Green Collar Jobs: An Analysis of the Capacity of Green Businesses to Provide High Quality Jobs for Men and Women with Barriers with Employment. City of Berkeley. 2007.

8. Pollin, Robert and Wiks-Lim, Jeannette. Job Opportunities for the Green Economy: A State-by-State Picture of Occupations Gain from Green Investments. Political Economy Research Institute. University of MassAmherst. June 2008. 9.

Ritch, Emma. Programs Helps Professionals Break Into Nanotech, Cleantech. http://orlando.bizjournals.com/ sanjose/stories/2008/07/07/story5.html

10. Schneider, Keith. Majoring in Renewable Energy. The New York Times. March 26, 2009 11. Timbers, Amelia. Green Job Market Emerges. Matter Network. May 13, 2008. www.matternetwork.com/2008/5/ green-job-market-emerges.cfm

12. Water Purification Technology at www. grcc.edu/ShowPage.cfm?PageID=1128

13. http://cleantech.wsu.edu/graduate/default. aspx 14. http://orlando.bizjournals.com/sanjose/ stories/2008/03/03/editorial1.html

15. http://solis.house.gov/list/press/ca32_solis/ wida6/greenjobscomm.shtml 16. http://apolloalliance.org/news/cleanenergy/data-points-green-collar-jobs/ : green collar report

“An engineering college in an academic institution has the responsibility and opportunity to be the engine of the local economy—e.g. Silicon Valley, Rte 128 (Boston), Research Triangle Park—through 1) highly trained engineers— tomorrow’s innovators, 2) research & innovation partnerships with the local industry—both big (stability) and small (growth), and 3) professional enrichment. The proximity of power generation multinationals added to UCF’s strong engineering credentials in turbines and energy gives Metro Orlando a unique opportunity.” - Jay Kapat, Director of the UCF Center for Advanced Turbines & Energy Research. Orange County First Cleantech Symposium. November 5, 2008.

Cleantech Hotspots & Clusters

The “cluster” concept became popular since Harvard Professor Michael Porter’s 1990 book, The Competitive Advantage of Nations. According to Porter, “clusters are geographic concentrations of interconnected companies, specialized suppliers, service providers, and associated institutions (for example, universities, standards agencies, and trade associations) in a particular field that are present in a nation or region.”349 “Critical masses of unusual competitive success in particular business areas, clusters are a striking feature of virtually every national, regional, state, and even metropolitan economy, especially those of more economically advanced nations,” Porter said.350 Cleantech clusters, or regions where cleantech companies and supporting institutions have grouped together, are 349 Porter, Michael. The Competitive Advantage of Nations. Harvard Business Publications. Boston. 1990. 350 Porter, Michael. On Competition. Harvard Business School Publications. Boston. 2008. pp. 213-214.

valuable in the growth of the cleantech industry. Venture capital investment, investors, research labs, and governments are integrated within cleantech clusters, resulting in an environment for cleantech businesses to thrive. Cleantech clusters typically form around major academic institutions.

Clusters and Economic Growth The first strategy for any public policy maker trying to create economic growth is to develop an industry cluster.351 Nobody explains the effects of clusters on a region’s economy better than Michael Porter in his recent book, On Competition. Clusters are at the core of any knowledge economy. Indeed, Porter argues that “cluster formation is an essential ingredient of any economic 351

Creating Cleantech Clusters: 2006 Update. Environmental Entrepreneurs and Cleantech Venture Network. 2006. CHAPTER 6: Cleantech Hot Spots and Clusters

83


development.”352 They allow information to flow freely among all stakeholders— business, government, and academia—as they pursue development solutions in the same industry within the same region. As they attract more and more expertise and investment, innovation emerges, and the economy grows. This is why urban areas worldwide are competing to transform themselves into “hubs of science and technology.”353 Here are a few excerpts from Porter’s book: The cluster concept represents a new way of thinking about national, state, and city economies, and points to new roles for companies, governments, and other institutions striving to enhance competitiveness … The development and upgrading of clusters is an important agenda for governments, companies, and other institutions. Cluster development initiatives are an important new direction in economic policy, building on earlier efforts in macroeconomic stabilization, privatization, market opening, and reducing the costs of doing business. … The importance of clusters creates new management agendas that are rarely recognized. Companies have a tangible stake in the business environments where they are located in ways that go far beyond taxes, electricity costs, and wage rates. … Clusters also create new roles for government. … Government’s more decisive influences are often at the microeconomic level. Removing obstacles to the growth and upgrading of existing and emerging clusters should be a priority. Clusters are a driving force in increasing exports and magnets for attracting (foreign) investment. They constitute a forum in which new types of dialogue can, and must, take place among firms, government agencies, and institutions (such as schools,

352 Porter, Michael. Clusters and Competition: New Agendas for Companies, Governments, and Institutions. Harvard Business Publications. Boston. 1998. 353 Burke, Adrienne. Building the Knowledge Capital of the Future. The New York Academy of Sciences Magazine. 2008. 84

universities, and public utilities). … Clusters arise because they increase the productivity with which companies can compete. … Clusters affect competition in three broad ways: first, by increasing the productivity of constituent firms or industries; second, by increasing their capacity for innovation and thus for productivity growth; and third, by stimulating new business formation that supports innovation and expands the cluster. … Each of the three broad influences of clusters on competition depends to some extent on personal relationships, face-to-face communication, and among networks of individuals and institutions. … Clusters play an important role in competition, and these raise important implications for companies, governments, universities, and other institutions in an economy. Clusters represent a new complementary way of understanding an economy, organizing economic development, and setting public policy. Understanding the state of clusters in a location provides important insights into the productive potential of its economy and constraints on its future development. Paradoxically, then, the most enduring competitive advantages in a global economy will often be local.354 Cleantech clusters offer many benefits for individual companies as well as for the communities the clusters are in.355 Clustering promotes interaction among experts in an industry, and cleantech businesses within a cluster benefit from sharing key resources, such as employees, suppliers, trade information, technologies, and specialized business services. Communication between companies in cleantech clusters leads to greater efficiency and productivity, as well as greater innovation. The competition within a cluster often results 354 Porter, Michael. On Competition. Ibid. pp. 214-215, 229, & 282. 355 Creating Jobs and Promoting a Healthy Environment. California’s Cleantech Industry: Annual Venture Capital Investment Update 2006. Environmental Entrepreneurs and Cleantech Venture Network LLC. 2006.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

in competitive products and prices, which allow businesses to compete in larger markets. The increased productivity gained from the existence of a cleantech cluster results in job growth and an enhanced standard of living. The existence of a cluster also offers reassurance to investors who might otherwise be skeptical. If a cluster of successful companies have already emerged in a particular region in a sector, investors might be more confident in backing new start-ups in the same region and sector.356

Socioeconomics of Clusters There has been growing research on the economic and organizational importance of the network relationship found in business communities357 and the importance of creating a social structure for clusters.358 Silicon Valley’s strength has been attributed not only to the local government’s commanding role in providing organizational linkages to other regions of the world, but also to the dynamic emergence of networking among non-profit and non-governmental organizations, formal and informal, that drives innovative technology development.359 Porter lays out the value of building such network relationships as follows: The mere presence for firms, suppliers, and institutions in a location creates the potential for economic value, but it does not necessarily ensure the realization of this potential. Social glue binds clusters together, contributing to the value creation process. Many of the competitive advantages of clusters depend on the free flow of information, the discovery of valueadding exchanges or transactions, the willingness to align agendas and to work across organizations, and strong motivation for improvement.

356 Burtis, P., Epstein, B., and Hwang, R. Creating the California Cleantech Cluster: How Innovation and Investment Can Promote Job Growth and a Healthy Environment. Natural Resources Defense Council and Environmental Entrepreneurs. 2004. 357 Harrison, B. and M. Weiss. Workforce Development Networks. Thousand Oaks, CA. Sage. 1998. 358 Burt, R. The Contingent Value of Social Capital. Administrative Science Quarterly 42, No. 2. pp. 339-365. 1997. 359 Saperstein, Jeff, and Rouach, Daniel. Creating Regional Wealth in the Innovation Economy. Pearson Education. NJ. 2002.


Relationships, networks, and a sense of common interest create these circumstances. The social structure of clusters thus takes on central importance. … The benefits of trust and organizational permeability, fostered through repeated interactions and a sense of mutual dependence within a region or city, clearly grease the interactions within clusters that enhance productivity, spur innovation, and result in the creation of new businesses. … Clusters offer a new way of exploring the mechanisms by which networks, social capital, and civic engagement affect competition and market outcomes.360

Factors Contributing to the Growth of Cleantech Clusters

Main Cleantech Clusters in the United States Cleantech clusters have emerged throughout the U.S. in areas where the above contributing factors are the most prevalent. The majority of cleantech regional clusters have developed near major academic institutions in the West Coast, the Northeast, the Midwest, Texas, and the Northwest. According to various studies, cleantech venture capital investments both in 2006361 and 2007362 show the West Coast as the dominant region in the cleantech industries, followed by the Northeast. Figure 1. Investment by Region Comparison 2004-2007 2B 1.8B

1.8B 1.6B

2004

1.4B

2005 1.18B

1.2B

2006

1B

2007 794.4

800M 616.6

600M 438.2

400M

327.8

300.4

340.3

$0

The following is a breakdown of the common factors that are associated with the growth of cleantech clusters. Regions that develop into clusters for cleantech typically benefit from some or all of these factors.

165.3 53.0

West Coast

Northeast

261.5

248.0

243.7

200M

94.0

68.6

Southwest

104.5

61.2

Southeast

97.0

Midwest

5. Diverse and talented human capital a. A managerial talent pool b. A highly educated workforce 6. Natural capital, such as wind, sunshine, minerals, etc.

7. A supportive business community 8. A known propensity for technological innovation

360 Porter, Michael. On Competition. Ibid. pp. 241-242

55.5

22.8

Northwest

11.6

247.7

121.6 100.1

61.2 0

Rockies/ Plains

3.5 3.0

Alaska/ Hawaii/ Puerto Rico

90.6

140.1 131.0

33.5

0

Eastern Canada

Western Canada

Figure 2. Q4 2007 Percentage of Total Investments by Region 1.0% 3.7% 15.8%

19.5%

2.3%

2. R&D partnerships a. Access to resources at leading universities b. Collaboration with academic and/or federal research labs

4. Demand for cleantech products and services a. Government-stimulated demand b. Local demand

148.6

118.1 58.5

Source: Cleantech Group, LLC

1. VC Investment a. Access to investors b. Ability to attract capital c. An environmentally aware entrepreneurial class

3. State or local government involvement a. Government incentives, programs, policies, and initiatives b. Political leaders who are innovative and progressive

183.7

190.7 112.3 127.9

Midwest Northeast Northwest Rockies/Plains Southeast Southwest West Coast Eastern Canada Western Canada

0.3%

10.8%

3.7% 43.0%

Source: Cleantech Group, LLC

The lead by the West Coast is even more pronounced in 2008 according to the latest study done by Cleantech Group: 363 Table 1. North America Year Over Year Analysis by Region Region

2008 $

Alaska/Hawaii/Puerto Rico $9 M Eastern Canada $90 M Midwest $219 M Northeast $1123 M Northwest $171 M Rockies/Plains $478 M Southeast $213 M Southwest $120 M West Coast $3294 M Western Canada $70 M Grand Total $5786 M

DisC

2007 $

1 8 18 60 11 13 11 15 110 6 253

$252 M $124 M $812 M $280 M $110 M $220 M $369 M $1843 M $131 M $4121 M

DisC

2006 $

$3 M 15 $184 M 15 $192 M 55 $622 M 22 $118 M 8 $61 M 19 $61 M 28 $303 M 102 $1170 M 16 $141 M 280 $2855 M

DisC

2005 $

DisC

2004 $

DisC

1 26 17 51 9 7 9 18 64 31 233

$4 M $100 M $129 M $305 M $23 M $12 M $104 M $100 M $459 M $91 M $1326 M

1 24 25 50 8 5 18 14 53 18 216

$120 M $112 M $160 M $58 M $56 M $69 M $53 M $231 M $32 M $891 M

32 18 33 7 11 10 16 40 12 179

Source: Cleantech Group, LLC

361 Creating Cleantech Clusters: 2006 Update. Ibid. 362 Parker, N. and Raab, K. 4Q07 Cleantech Investment Monitor. Rep. Vol. 6. 4th Issue. Cleantech Group LLC. 2008. 363 Fan, B. and Koren, D. Cleantech Investment Monitor 2008 Annual Review & 4Q08 Quarterly. Rep. Vol. 7. 4th Issue. Cleantech Group LLC. 2009. CHAPTER 6: Cleantech Hot Spots and Clusters

85


One corresponding factor among each of the major cleantech sectors in the U.S. is a significant government effort to cultivate a cleantech cluster at the local level, state level, or both. However, many cities throughout the country are in the race to build their own “cleantech Silicon Valley.” While government involvement in cleantech has come primarily from the state and local levels, the federal government has also contributed to the sector’s growth, primarily through the Environmental Protection Agency’s (EPA) laws and regulations. The Clean Air Act of 1970, the Clean Water Act of 1972, the Pollution Prevention Act of 1990, and the Energy Policy Act of 2005 are just a few federal laws that have contributed to the growth of cleantech.364

Cleantech in California California, a state that has taken the lead in energy efficiency standards and protecting the environment, is home to more cleantech clusters than any other state. Cleantech clusters in California include San Jose, Silicon Valley, San Francisco, San Diego, Berkeley, and Pasadena. The state encompasses the majority of U.S. solar businesses and received more global venture capital for cleantech start-ups than any other state in 2007 ($966 million of $5.18 billion).365 California benefits from progressive state and local governments dedicated to clean alternatives. Challenges that cleantech clusters in California face include the high cost of doing business in the state, as well as regulations. According to the Small Business & Entrepreneurship Council’s 2008 Small Business Survival Index, which ranks the policy environment for entrepreneurship across the 50 states and the District of Columbia, California ranks 49th overall. The state ranked last for both the top personal income tax rates and the top individual capital gains tax rate and 46th for workers’

364 U.S. Environmental Protection Agency. Laws, Regulations, Guidance and Dockets. Laws and EOs that Influence Environmental Protection. www.epa.gov/lawsregs/laws/index.html#env 365 Fehrenbacher, Katie. California: The accidental cleantech capital? Sustainable Industries. June 30, 2008. www.sustainableindustries. com/greenmarketing/22712709. html?viewAll=y 86

Figure 3.

Figure 4.

http://www.cpec.ca.gov/Images/HistoricRegionMap.jpg

http://www.cablecarrsystems.com/SanFranciscoBayAreaMap.jpg

compensation benefits.366 Because of excessive regulations and the high cost of doing business in the state, some companies have considered leaving California for states without such hindrances.

mandates to reduce energy consumption in state buildings by 20 percent by 2015, as well as a requirement for the construction of all new state buildings to meet LEED standards.369 AB 32, 2006: Assembly Bill 32, also called the California Global Warming Solutions Act of 2006, established a program to regulate and measure California’s greenhouse gas emissions. The legislation, signed by Governor Schwarzenegger, uses market-based incentives and mandatory caps on emissions in an effort to reduce carbon emissions by 25 percent, or to 1990 levels, by the year 2020. By 2050, the state intends to reduce greenhouse gas emissions to 80 percent below the 1990 levels. The California Air Resources Board (CARB) is responsible for developing the regulations and market incentives necessary to meet these goals.370

Statewide Programs, Policies, and Initiatives California’s Renewable Portfolio Standard, 2002: Requires 20 percent of energy from state utilities to be from renewable sources by 2010.367 This important program is part of the state’s efforts to draw sustainable businesses. Million Solar Roofs Initiative, 2004: California Governor Arnold Schwarzenegger introduced an initiative that designated $2.9 billion for solar incentives. The incentives are designated for homeowners and building owners who install solar panels. The initiative aims to create 3,000 MW of solar electricity with the installation of enough solar panels in the state by 2017.368 Greening State Buildings, Agencies, 2004: Governor Schwarzenegger’s efforts to “green” state agencies include 366 Keating, R. Small Business Survival Index 2008: Ranking the Policy Environment for Entrepreneurship Across the Nation. The Small Business & Entrepreneurship Council. December 2008. 367 California Public Utilities Commission. California Renewables Portfolio Standard (RPS). www.cpuc.ca.gov/PUC/energy/ Renewables/index.htm 368 Office of the Governor. Schwarzenegger Signs Legislation to Complete Million Solar Roofs Plan. August 21, 2006.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

San Francisco Bay Area - Energy Generation The San Francisco Bay Area, which encompasses the San Francisco, San Jose, and Silicon Valley cleantech clusters, is at the forefront of the cleantech boom. The area benefits from its reputation for technological innovation, access to 369 Lamb, C. Capital Has Potential to Become a Hub for Clean Technology. Sacramento Business Journal. August 24, 2007. 370 Office of the Governor. Gov. Schwarzenegger Signs Landmark Legislation to Reduce Greenhouse Gas Emissions. September 27, 2006.


world-class universities and research institutions, and high concentration of well-educated workers. The area does have its disadvantages, including arduous permitting cycles that hinder companies’ abilities to expand.371 The majority of cleantech businesses in the Bay Area are focused in renewable energy generation (75 percent of which are solar), finance and investment, energy and environmental consulting, and green building and design.372 San Francisco, California San Francisco is known globally for being an environmentally and technologically focused city. The city was ranked the second most sustainable city in 2008 by SustainLane373 and boasts a recycling rate among the highest for any major U.S. city.374 San Francisco’s reputation for innovation and environmental concern resulted in the United Nations selection of the city to host World Environment Day 2005. San Francisco benefits from the local government’s commitment to the environment. Mayor Newsom, among other local leaders, has taken a particularly active and progressive role in environmental policy. On the downside, cleantech companies in San Francisco are often faced with excessive red tape and overcoming the city’s bureaucracy. Cleantech businesses in San Francisco are focused primarily in finance and investment, green building, and energy and environmental consulting.375 Clean Technology Advisory Council: Established in 2005 by Mayor Gavin Newsom, the 16-member council is responsible for promoting and creating the city’s cleantech agenda, bringing cleantech businesses to San Francisco, and creating job opportunities in highskill industries.376 371 372

373 374

375 376

Kachan, D. Bay Area Cleantech Leadership at Risk, Says Khosla. Cleantech Group LLC. November 15, 2007. ICF International. Building San Francisco’s Cleantech Economy: Analysis and Strategy Options. San Francisco Planning and Urban Research Association. September 2008. SustainLane. 2008 US City Sustainability Rankings. www.sustainlane.com/us-cityrankings/overall-rankings Makower, J. Pernick, R. and De Cordova, A. Harnessing San Francisco’s Clean-Tech Future: A Plan for Attracting Businesses and Creating Jobs. Clean Edge, Inc. October 2004. ICF International. Ibid. City & County of San Francisco. SFEnvironment. Our City’s Policies: Clean Technologies. http://sfenvironment.org/ our_policies/overview.html?ssi=12

Solar Subsidies: The city of San Francisco recently passed a solar subsidy providing up to $10,000 in subsidies to businesses that install solar systems and up to $6,000 in subsidies to households. This program, which offers the nation’s highest solar subsidies, is expected to create hundreds of jobs and bring more solar firms to San Francisco. Green Building Laws, November 2008: San Francisco Mayor Gavin Newsom signed into effect new green building ordinances that impose strict requirements on all new residential and commercial buildings as well as renovations to existing buildings. The ordinances are the first of their kind and span many areas of green building, from water use reductions and renewable energy requirements to required levels of LEED certification.377 San Jose, California In 2007, SustainLane Government ranked San Jose second among U.S. cities that are at the forefront of clean technology.378 The city draws upon existing venture networks in Silicon Valley and a particularly progressive local government. Incentives to Companies: The city of San Jose was able to keep Nanosolar, a global leader in solar power, in San Jose with the offer of $1.5 million in reimbursements and training for workers funded by the government over several years. The manufacturing plant brings 200 to 300 jobs to the city.379 Creation of a 10-Point Green Vision Plan: San Jose Mayor Chuck Reed created a 10-point, 15-year plan that includes goals to create 25,000 jobs in cleantech, cut per capita energy use in half, and use renewable sources for all electrical power needs. Mayor Reed had enacted numerous initiatives in order to meet these goals, including solar roof installations, use of energy efficient lighting, and solid waste-fuel conversions.380 377 New Green Building Laws Effective City & County of San Francisco. Department of Building Inspection. November 3, 2008. August 2008. www.sfgov.org/site/ dbi_index.asp?id=89703 378 Karlenzig, Warren. Top US Cities for Cleantech Incubation Clusters. SustainLane. July 7, 2009. www.sustainlane.us/articles/cleantech.jsp 379 Karlenzig. Ibid. 380 City of San José. Mayor Reed’s Green Vision for San José. www.sanjoseca.gov/mayor/ goals/environment/GreenVision/GreenVision.asp

Silicon Valley, California Silicon Valley, the southern region of the Bay Area, is known for innovation and the area’s ability to attract investment. The region, primarily known for leading the high-tech boom, is embracing the switch to the cleantech revolution. Silicon Valley has capitalized on the area’s expertise in silicon and proximity to silicon chip production, which is used in solar cells, and is home to the majority of bay-area solar technology development.381 Sustainable Silicon Valley (SSV), 2001: A partnership between business, government, and organizations with the common goal of creating a sustainable future for the community. Representatives from each of these groups meet to identify and address environmental concerns and efforts to alleviate environmental pressures. SSV engages local businesses and organizations to reach a self-imposed goal of CO2 emissions of 20 percent below 1990 levels as part of its first initiative.382 San Diego, California: San Diego, a major cleantech hub outside of the Bay area, is home to 175 cleantech companies according to a study by Global CONNECT.383 The city’s cleantech cluster benefits from collaboration with local research and educational institutions including the University of California, San Diego, San Diego State University, and the University of San Diego. The area has a history of innovation and research and has capitalized from the presence of existing technology clusters, the city’s dedication to supporting start-up companies, an abundance of capital and highly skilled workers, and a local government focused on the area’s growth as a cleantech cluster. Sustainable Building Policy, adopted 2002: Requires City buildings that are over 5,000 square feet to meet LEED Silver green building standards. 384 381

Stuart, Candace. Silicon Valley, California: Cleantech Hubs. Sustainable Business. February 26, 2007. 382 Sustainable Silicon Valley. www.sustainablesiliconvalley.org/ 383 Gravitz, L. San Diego’s Clean Energy Companies-the Map. Xconomy. October 27, 2008. 384 Jackson, M. City Takes LEED in Green Buildings. San Diego Business Journal. November 2002. CHAPTER 6: Cleantech Hot Spots and Clusters

87


Environmentally Preferable Purchasing (EPP) Program, 2007: Requires city departments to consider environmental issues when making purchases. Products that have a reduced negative effect on human health and the environment must be considered in purchasing decisions. The City of San Diego purchased over $17 million of EPP products and services in fiscal year 2007.385 San Diego Cleantech Initiative, 2007: The initiative, launched by Mayor Jerry Sanders in April 2007, is an effort by the city to expand, attract, and retain cleantech businesses in the City of San Diego. The initiative aims to further the development of San Diego as a cleantech cluster. The initiative includes efforts to promote, cultivate, and coordinate collaboration and partnerships at the local, regional, state, and federal levels. The following organizations and efforts are actively involved in the effort to implement this initiative:386

Global CONNECT Study: The Mayor’s initiative began with a study completed by Global CONNECT, a University of California, San Diego program that assists in technology cluster development strategies. The study assessed San Diego’s existing cleantech cluster and the environment in which cleantech businesses operate. Clean Technology Program Manager: The City of San Diego created a position for, and hired, a clean technology program manager, Jacques Chirazi, who is responsible for forming and promoting collaboration within government agencies and the cleantech sector, as well as advising the mayor in the development of the San Diego Clean Technology Advisory Council. The council, composed of cleantech industry leaders, government officials, educators, and consultants, will focus on creating cleantech jobs by attracting cleantech businesses to San Diego.

385 The City of San Diego. Environmentally Preferable Purchasing Program (EP3). www.sandiego.gov/environmental-services/ ep3/ 386 The City of San Diego. Economic Development Cleantech Initiative.   www.sandiego.gov/economicdevelopment/ business-assistance/cleantech/ 88

UC San Diego’s William J. Von Liebig Center for Entrepreneurism and Technology Advancement: The city’s partnership with the Center will help to accelerate the commercialization of clean technologies from the university to the private sector, as well as provide researchers with seed funding and business mentoring. Forums and Ad Campaigns: The city and the San Diego Regional Economic Development Corporation (EDC) have plans to host a series of cleantech forums. Advertising campaigns, among other forms of marketing, have been implemented to encourage cleantech companies to come to San Diego. CleanVenture: CleanVenture is a nonprofit corporation that works with earlystage cleantech companies in an effort to produce successful clean businesses.

The organization educates and mentors entrepreneurs in successful business skills and works with universities, organizations, and the government to aid in the start-up process.387 CONNECT: A non-profit organization focused on promoting entrepreneurship in San Diego, CONNECT is currently managing CleanTECH San Diego, a consortium that actively supports the city’s cleantech cluster by advocating for state and federal research funding and investment capital, among other efforts. The consortium partners with private entities, the government, and the nonprofit community to achieve cleantech goals.388

387 CleanVenture. http://www.cleanventure. org/1301.html 388 CONNECT. http://www.connect.org/ programs/cleantechsan-diego/

The third symposium of the Orange County Cleantech Symposium series, that took place in February 2009, featured keynote speaker Jacques Chirazi, San Diego Cleantech Program Manager. Mr. Chirazi is responsible for promoting, fostering and coordinating strategic alliances and collaboration among local, regional and federal institutions to develop and execute a cleantech business strategy for the city of San Diego. According to Chirazi, his role is two-fold. First, he is the “point of contact” for any cleantech company—established or start-up. He helps them with the processes involved in becoming part of the cleantech industry, such as regulatory requirements and land permitting. Second, he “develops policies and advises the mayor on moving forward [with] what it would take to make San Diego the destination for cleantech.” In his speech during the symposium, Mr. Chirazi described what San Diego has accomplished in the cleantech field and what the city is working on. He explains that the general goal of San Diego’s efforts were to “develop a number of policies, incentives, and programs that will help attract companies and also provide sustainable solutions overall.”

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


Initiatives San Diego participated in two cleantech studies. Mr. Chirazi describes the first study as an “assessment study … designed to give us a sense of what do we have in San Diego in terms of cleantech.” He explains that the city found out it has “about 178 companies which fall under this venture capital … network.” San Diego has a number of companies in categories such as “energy efficiency, renewables, recycling waste, and wastewater technology. A lot of it is a mixed bag of small start ups.” The second study is a benchmark study. It looked at six cities: Austin, Boston, Portland, Sacramento, San Francisco, and Seattle. Chirazi describes what the study found: “So far what we’ve found is these are pretty much leading hubs for cleantech, but what’s interesting is they are all pretty much developing infrastructure for cleantech, but it’s sort of a fair game at this point.” Each city has focuses on different fields. For example, Austin and San Francisco are focused on energy generation; Portland is focused on green buildings, green infrastructure, and biofuels. Sacramento is a hub for solar energy. In 2008, the city announced its Clean Generation Program. This was a solar program between San Diego, Berkeley, and Palm Desert. The next program San Diego is executing is called The Von Liebig Center—a commercialization center that will operate as an incubator for ideas and technology that comes out of the universities. The Center will provide support for “precompanies” in their growth stages. San Diego has made strides in making the city a cleantech cluster, not just in research and investment, but in practice. Chirazi described a few of the practices the city took on in its devotion to cleantech: • The city uses low sulfur diesel fuel in city trucks to reduce carbon emissions; • All city facilities above 5,000 square feet must be LEED Certified as “Silver;” • Two water reclamation plants exist in San Diego that take waste water and turn it into non-potable water for industrial purposes such as cooling towers. Next Steps Chirazi described what he felt the city should focus on. “What I think will be interesting for San Diego is to capitalize on what we have already. We have a strong biotech. We have a strong telecom industry. We have a strong aerospace industry. … In biotech, there’s a lot of research in … biofuels and bioconversions. In telecommunications, a low powered sensor technology is a huge market that is being looked into.” One of Mr. Chirazi’s biggest points during the Symposium was on the topic of biomimicry. It is an area of huge potential that takes a look at how species and plants survive and adapt to life, and uses these observations to solve today’s problems. San Diego partnered with the San Diego Zoo and the Biomimicry Institute and Guild to turn San Diego into a hub for biomimicry. Chirazi describes some examples of technologies developed in this field. Today’s standard solar panels are about 20% efficient—only 20% of the sunlight is converted into energy. However, “if you look at photosynthesis, it’s 100%. So there are companies out there trying to recreate photosynthesis as a new form of solar panel.” Another example is the field of materials. Some forms of seashells are stronger than any of the most advanced concrete available today. Role of Policy According to Chirazi, the city and state governments, as well as national government policies and initiatives have had both a positive and a negative impact on cleantech in San Diego. The California Energy Commission has recommended a change to its performance standards. They recommend a netzero-energy performance that will require residential buildings to comply by 2020 and commercial buildings to comply by 2030, applying only to new construction. Of additional help is the government framework called AB32. It is a Global

Figure 5.

Source: www.cleantechsandiego.org CHAPTER 6: Cleantech Hot Spots and Clusters

89


“Cleantech in San Diego is not an industry per se. It’s not a sector. It’s just something that’s going to transform every single industry, and some industries will just come out better and more cost effective in providing the services.” - Jacques Chirazi, Cleantech Program Manager, the City of San Diego. Third Orange County Cleantech Symposium. February 18, 2009

Figure 6.

Warming Solution Act passed about two years ago, according to Mr. Chirazi. It will take levels of carbon dioxide consumption and reduce them, so that even with population and development expansion, carbon emissions by 2020 will be at the 1990 level. Governor Schwarzenegger signed an executive order to have levels in 2050 be at 25%-50% below the 1990 levels. When asked the question of how important government and legislation in California is to the evolution of cleantech, Mr. Chirazi stated that “in California, everything is driven by the policy.” He was asked if other states have better benchmarks and if their progressive policies stimulate the sector. Mr. Chirazi contrasted Portland with San Diego. According to Chirazi, “Portland was really on the forefront of sustainability 15 years ago, almost 20 years ago. They have the most amazing infrastructure when it comes to the way they design their cities. … The problem we’re facing in places like San Diego is [that] we want to be the greenest city [but we] have strict mandates for green buildings.” Challenges Mr. Chirazi recognizes that one of the big challenges to cleantech initiatives is the issue of funding. San Diego’s initiatives, according to Chirazi, were all financed without direct investment from the city. Rather, the initiatives were financed through a power purchase agreement between the city and various companies including energy companies. When asked the question about gap funding and how a city such as Orlando can get local industry involved, Mr. Chirazi provided some insight. He said the key was to engage local companies, and show that there is a potential for job creation. He said that he is hoping the corporate world will take over and see that cleantech is an advantage for the future. He stated that he is hoping for more corporate sponsors, and then San Diego can award fewer projects that will individually have a substantially higher amount of funding. Small business grants and other additional funding would be advantageous. Chirazi recognizes the importance in the relationship between government policy and funding for cleantech ventures. When asked how to solve the problem of capitalists investing in short term solutions rather than long term solutions— due to the energy sector being subsidized in the direction of non-sustainable energy systems—Chirazi stated that the answer is in legislation. He said that a federal cap and trade system will signal financiers that there is a price for carbon. He said that California’s example will lead the nation. “I think everybody is looking at us, California, in terms of how successful this AB32 is going to be. Are they going to be able to implement it? And are we going to be able to secure long term goals instead of having a temporary fix?” San Diego vs. Orlando Finally, there is the issue of Orlando competing with San Diego as a cleantech hub. Chirazi draws comparisons between Orlando and San Diego. Like Orlando, San Diego has a large tourist industry, a large Information and Communications Technology (ICT) industry, and significant involvement in biotech and aerospace fields. Orlando has one Economic Development Commission and one cleantech initiative at the current time. In contrast, San Diego, with its vast metro area and sister cities, has many more players in the cleantech field. Mr. Chirazi was asked what the challenges, not just the benefits, of having such a vast network of resources will be. Aside from the obvious benefit of having a huge amount of knowledge and potential sources to tap into, this network can be overwhelming. The “challenge is really too much interaction and difficulty to raise funding because there’s a lot of competing issues.”

Source: www.cleantechsandiego.org 90

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


U.S. Cleantech Clusters Austin, Texas – Energy Generation Ranked as the number one cleantech incubation cluster in 2007 by SustainLane Government, a knowledge base for government officials, Austin has taken a powerful role in the cleantech revolution. SustainLane based its rankings on venture capital investment, research lab collaboration, and government participation.389 Austin has capitalized on a prevailing R&D partnership with the University of Texas at Austin, strong venture capital support, and active government support. According to Dow Jones VentureSource, Austin received the fifth-largest amount of clean-energy investment in 2007.390 Texas Emerging Technology Fund (ETF), 2005: Texas Governor Rick Perry signed legislation that designated $200 million to help develop and diversify the state’s economy.391 The fund is intended to bring jobs, scientists, and researchers to the state and help start-up companies succeed in the early stages of their businesses. The ETF had granted $5 million to cleantech companies in central Texas as of September 2007.392 The Austin Technology Incubator (ATI) Clean Energy Incubator: Launched in 2001, the ATI Clean Energy Incubator provides clean energy start-up companies with the resources and facilities they need to grow and succeed. The ATI is part of the University of Texas at Austin.393 Opportunity Austin, 2003: The Austin Chamber of Commerce began a five-year initiative in 2003 with the goal to create 72,000 new jobs and increase payroll by $2.9 billion. The program has seen great success so far, adding almost 100,000 jobs in the first four years

389 Karlenzig. Ibid. 390 HelioVolt Deal (and Nothing Else) Put Texas on Clean Energy Map. Austin Business Journal. February 29, 2008. 391 Kwon, J. City Forming Policies to Help Budding Tech Firms Prosper. Austin Business Journal. August 17, 2007. 392 City of Austin, Texas Continues Support for Cleantech Sector. Renewable Energy World. September 7, 2007. 393 University of Texas at Austin. Clean Energy Incubator. www.ati.utexas.edu/clean-energy/ clean-energy-3.html

alone.394 New York, New York – Green Buildings SustainLane named New York City the U.S. city most able to weather an oil crisis—in fact, less than one-fourth of Manhattanites own a car compared to the national average of 92 percent. The growth of New York City’s cleantech cluster is in part a result of aggressive green building efforts in the public and private sectors that has resulted in the city becoming a leader in green building development. The city is home to more than 20 million square feet of LEED or other green building projects. 395 The city benefits from major area academic institutions, including The City University of New York, Bronx Community College, The Pratt Institute, and Pace University School of Law, that have actively worked together towards improving clean energy and sustainability programs. Photovoltaic Installation Courses: Hudson Valley Community College in New York offers courses to prepare individuals for the North American Board of Certified Energy Practitioners (NABCEP) PV Installer examination. Green City Buildings Act, 2007: The Green City Buildings Act, signed by New York City Mayor Michael Bloomberg, requires many new municipal buildings and major alterations to achieve LEED standards of certification and achieve specific energy cost savings. Under the Act, non-residential capital projects estimated to cost at least $2 million must achieve a LEED Silver rating or higher while school and hospital projects must only become LEED Certified.396 Regional Greenhouse Gas Initiative: The Regional Greenhouse Gas Initiative (RGGI), effective as of January 1, 2009, is a ten-state cooperative effort with the goal to reduce greenhouse gas emissions in the Northeast and mid-Atlantic 394 Austin Chamber of Commerce. About the Opportunity Austin Initiative. www.austinchamber.org/DoBusiness/ AboutOpportunityAustin/About.html 395 Pernick and Wilder. Ibid. p. 263 396 Block, K. New York City’s Green Buildings Act Becomes Law. Brown Raysman Millstein Felder & Steiner, LLP. 2006.

regions of the U.S. RGGI is “the first mandatory, market-based effort in the United States to reduce greenhouse gas emissions,” and has established a cap on regional power plant emissions of carbon dioxide.397 Chicago, Illinois – Energy Efficiency Chicago is actively cultivating a green image through the city’s efforts to make the Windy City’s cleantech sector grow. The city is home to more than 4 million square feet of green roofs, more than any other city in the world. The city’s efforts can be seen on the roof of Chicago City Hall, where 150 types of plants and grasses thrive, contributing to greater energy efficiency in the building among other environmental benefits.398 Green Roof Grants Program, 2005: In 2005, the City of Chicago gave 20 residential and small commercial building owners the opportunity to receive $5,000 in grant money to plan and install a green roof on their properties. The program’s success resulted in expansion of the program in 2006, when the city awarded 40 projects grant money.399 Chicago Green Homes Program: The City of Chicago’s Green Homes Program provides residential builders, developers, and homeowners with the tools and strategies to build green homes and buildings, and gives buyers and renters a choice in the marketplace. Residential buildings are given a point value based on a variety of green building factors, and are subsequently given a 1, 2, or 3 star rating. Participants receive a Chicago Green Homes Certificate, recognition on the city’s Website, and the right to use the Chicago Green Homes logo.400 Boston, Massachusetts – Energy Efficiency The City of Boston, also among SustainLane’s top-five cleantech incubation clusters, has become 397 Regional Greenhouse Gas Initiative (RGGI) CO2 Budget Trading Program. www.rggi.org/ home 398 Pernick and Wilder. Ibid. p. 261. 399 City Launches Green Roof Grants Program. City of Chicago Department of Environment. November 2, 2005. 400 Chicago Green Homes Program Brochure. City of Chicago Department of Environment. October, 2007. CHAPTER 6: Cleantech Hot Spots and Clusters

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a powerful incubation cluster for cleantech.401 With the Massachusetts Institute of Technology as the cluster’s epicenter, the city enjoys proximity to technological innovation and first-class research. Massachusetts has proven to be able to attract venture capital investments in cleantech, coming second only to California in venture capital investment.402 Boston also benefits from state policies that are among the most progressive in the nation in supporting renewable energy and energy efficiency. Green Building Standards, 2007: Boston was one of the first U.S. cities to impose LEED green building standards on all new development over 50,000 square feet. While most other cities impose LEED standards on city buildings only, Boston has extended these standards to private building permits.403 Commonwealth Solar Initiative, 2007: Massachusetts Governor Deval Patrick’s administration and the Massachusetts Technology Collaborative (MTC) introduced the $68-million initiative, which is intended to support photovoltaic installations in Massachusetts over a four-year period. The initiative will fund rebates for businesses and individuals who install solar energy systems. The initiative also will allot $4 million for solar panels to be installed on school buildings.404

Cleantech in the Northwest – Green Buildings, Smart Grid, Wind Power The Pacific Northwest is quickly becoming a leading region for clean technology innovation due to supportive governmental policies, visionary leadership, and the region’s proximity to California. The two main cleantech clusters in the Northwest are in Seattle and Portland. Cleantech companies in the region also benefit from the Northwest’s strong research base, from the University of Washington in Seattle and the Pacific Northwest National Laboratory in Richland, to Microsoft and Intel’s hightech operations. Cleantech clusters in the Northwest, Seattle in particular, draw on strong ties with China, which is emerging as a major consumer of cleantech products and services.406 The region’s growth as a major cleantech hub has been stunted by the Northwest’s limited access to capital. While Washington has secured considerable VC investment in the cleantech sector, investment in the general Northwest region has been sporadic.407 Seattle, Washington Seattle was ranked the third-most sustainable city in the nation in 2008 by SustainLane Government and, together with its active government, educated workforce, and vibrant entrepreneurial class, the city has secured its position among early cleantech leaders.408 Washington state ranked fourth nationally in VC dollars invested in cleantech in the first three quarters of 2007 and third nationally in the number of cleantech deals according to the National Venture Capital Association.409

The Massachusetts Renewable Energy Trust’s Industry Investment Development Fund: The Massachusetts Renewable Energy Trust promotes clean energy technologies and supports emerging markets for energy from renewable sources. The trust’s Industry Investment and Development Program (II&D) seeks to develop the renewable energy industry in Massachusetts, promote job growth, and promote technology development.405

Sustainable Building Policy, 2000: Seattle was the first U.S. city to adopt a sustainable building policy that mandates that all new city-funded projects and renovations meet LEED green building

401 Karlenzig. Ibid. 402 Ibid. 403 Boston’s Green Building Task Force. http://bostongreenbuilding.org 404 Massachusetts to Launch $68M Solar Initiative. Cleantech Group LLC. December 14, 2007. 405 Massachusetts Technology Collaborative. Industry Investment and Development (II&D) Program. www.masstech.org/ renewableenergy/industry_support.htm

406 Brent, W. and Rosen, D. State Must Aggressively Pursue Its Share of Cleantech. The News Tribune. May 21, 2008. 407 Pernick, R. and Wilder, C. Clean Technology in the Northwest. Seattle Post-Intelligencer. November 6, 2007. 408 SustainLane. 2008 US City Sustainability Rankings.  Ibid. 409 Celaschi, R. Out-of-state Venture Investments for Clean-tech Companies Soar. Puget Sound Business Journal. February 15, 2008.

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standards.410 Initiative 937, 2006: As a Washington state initiative voters passed in 2006, I-937 mandates that 15 percent of state utilities’ electricity must be from clean energy sources by the year 2020.411 Climate Action and Green Jobs Bill, 2008: Washington Governor Chris Gregoire passed a bill that will increase the number of green jobs, reduce pollution contributing to global warming, and significantly lessen fossil fuel imports. The bill is the first in the U.S. to integrate efforts to include workforce training for clean energy jobs into a statewide climate policy. The bill set limits for state emission levels and vehicle miles traveled (VMT) and established a green job growth initiative.412 Portland, Oregon The state of Oregon has shown considerable support for clean technologies through the implementation of statewide renewable energy goals, aggressive energy tax incentives, and endorsement of California’s policy on auto emissions. The City of Portland was the first city to enact a local renewable fuels standard, and it is known for being a frontrunner in green building policies. Green Building Policies: In 2001 the City of Portland adopted one of the first municipal green building policies in the nation. The policy, updated in 2005, now requires all new, cityowned facilities to meet LEED Gold certification and that 75 percent of construction and demolition waste is recycled, among other provisions and requirements.413 The City of Portland’s Green Building Program: The Green Building Program is a resource for individuals interested in residential or commercial 410 City of Seattle. Department of Panning and Development (DPD). City Green Building. www.seattle.gov/DPD/GreenBuilding/ CapitalProjects/SeattlesPolicy/default.asp 411 Pernick and Wilder. Clean Technology in the Northwest. Ibid. 412 Dixon, Meagan. Climate Action and Green Jobs (HB 2815). Environmental Priorities Coalition. March 25, 2008. www. environmentalpriorities.org/climate-action 413 City of Portland Bureau of Planning and Sustainability. Green Building. Policies. Policy for City Facilities. www.portlandonline.com/ OSD/index.cfm?c=41701&


green building practices.

Figure 7. Xuzhou Cleantech Park: Xuzhou, China

Oregon Renewable Energy Action Plan (REAP), 2005: Implemented by the Renewable Energy Working Group (REWG), the REAP defines a goal for 10 percent of the state’s energy needs to be derived from renewable energy sources by 2015 and 25 percent by 2025, among other short- and long-term goals.414 Business Energy Tax Credits: The state of Oregon has one of the most aggressive cleantech tax incentives in the nation, granting tax credits to investors in recycling, energy conservation, renewable energy, and cleaner transportation fuels.

Cleantech in Europe The two European countries to watch are Germany and Denmark. Germany was the main recipient of VC investments in 2008. (Refer to Global Trends) Germany – Solar Energy Germany is number one in the world in solar energy. Freiburg is the solar capital of Germany, with more than 150 factories producing PV panels and equipment.415 Home to the International Solar Energy Society, the Fraunhofer Institute for Solar Energy Systems (Europe’s largest solar organization), and others, Freiburg may be the only place with a city solar guide. The city council mandated renewable energy target of 10% of the city’s power by 2010.416 Denmark – Wind Power Copenhagen is the world leader in wind production per capita, with turbines providing 30% of the nation’s electricity. With the goal to be known as “the environmental capital of Europe,” the city has been supported by Copenhagen Energy, the local utility company. Copenhagen and vicinities are home to Vestas Wind Systems, one of the world’s largest wind-turbine manufacturers and, Novozymes, a biotech pioneer that uses its enzymes in the production of ethanol and biodiesel 414 Oregon’s Renewable Energy Action Plan. Oregon Department of Energy. April 12, 2005. 415 Pernick and Wilder. The Clean Tech Revolution. Ibid. 416 Ibid.

Source: http://cleantechpark.com/English/images/inmages_22.gif

around the globe.417

What Are Emerging Economies Doing? Burke explains best how emerging economies are working toward embracing cleantech. Leaders in Mexico, China, India, and the United Arab Emirates are among those who believe that the winners in the 21st century will be those who can respond innovatively to the challenges of climate change, energy, health care, and transportation.418 China – Solar Energy China has the world’s fastest growing economy, but the country’s rapid growth has unfortunately led to its position as the world’s top polluter as well. As a result of the country’s growing energy needs, China represents a massive potential market for cleantech. With vast foreign and domestic investment in the sector, a growing demand for clean products, and increasing government support, China is set to become a major cleantech superpower. China will focus its cluster building efforts on four scientific subjects: protein research, nanoscience, growth and reproduction, and quantum modulation.419

417 Ibid. 418 Burke. Ibid. 419 Ibid.

Xuzhou Cleantech Park: The Cleantech Group LLC, Tsing Capital, and Tsinghua Holdings are launching a cleantech park in Xuzhou, China, which will accelerate the commercialization of cleantech products and services. The Xuzhou Cleantech Park will become a center for cleantech businesses across segments.420 Top 1,000 Enterprises Program: The program, launched by the PRC National Development and Reform Commission (NDRC), aims to make China’s 1,000 largest enterprises energy efficient. The program intends to eliminate the consumption of 100 million tons of coal and 242 million metric tons of CO₂. The largest 1,000 enterprises account for onethird of China’s energy consumption.421 Fuel and Appliance Efficiency Standards: Chinese organizations have imposed efficiency standards for consumer appliances and passenger vehicles. The appliance efficiency standards should result in a 10 percent reduction in residential electricity use by 2010.422 Shanghai, China Shanghai is becoming a major hub for research and development operations in 420 Cleantech Group Announces First Cleantech Business Park in China. Cleantech Group LLC. May 17, 2007. 421 Brent, W. Cleantech Boom…or Bust? The China Business Review.  2007. 422 China Xuzhou Cleantech Park.  http://cleantechpark.com CHAPTER 6: Cleantech Hot Spots and Clusters

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the cleantech field, giving the city the potential to become a leader in cleantech development. The city is home to the Shanghai Clean Energy Research and Industry Promotion Center, which is run by a non-profit energy-efficiency advocacy group, and showcases efficient building products and appliances. The city government has shown support for cleantech through collaboration with the Shanghai Economic Commission, the Shanghai Municipal Science and Technology Commission, and local universities to promote FCV use and to establish businesses locally to support necessary technology for FCV use.423

Figure 8. Masdar City Plan

India Prime Minister Mammoham Singh aims at transforming India into a knowledge society. The National Knowledge Commission that he formed recommends a $65-billion investment in education to build more engineering and biomedical colleges. To Sam Pitroda, the commission’s chair, human capital is at the heart of knowledge. India’s goal is to turn manufacturing or servicebased economies into knowledge capitals by expanding the knowledge base, improving the access to knowledge, and improving the quality of knowledge.424 Hyderabad, India – Solar Power and Biodiesel Hyderabad, India’s fifth largest city and the capital of the south-central state of Andhra Pradesh, is known for its research and academics, and the city is quickly developing its cleantech industry, especially in the solar power and biodiesel sectors. The city is home to more than 100 biotech companies, a 350-acre nanotechnology industrial park, and growing solar companies.425 Emirates of Abu Dhabi – Solar Power Abu Dhabi, one of the seven states in the United Arab Emirates, through the Masdar Initiative, aims to build the world’s first carbon, waste, and carfree sustainable city. The Masdar City project is part of a larger plan to position the emirate as a world-class cleantech research and development hub. The city, 423 Pernick and Wilder. Ibid. pp. 267-268 424 Ibid. 267-268 425 Ibid. p. 264 94

Source: http://bbsnews.net/bbsn_photos/topics/middle_east_2008/200803178_G.jpg

which will cost approximately $22 billion, is set to be completed in 2016 and will generate all of its power from solar energy and other renewable resources, and house 1,500 businesses and 50,000 residents.426 Mexico City – Science & Technology Infrastructure Mayor Ebrard Casaubón has taken the following steps:427 • Contract with Institute for Science and Technology to build academiaindustry relationships • Establishment of governmentfunded company Capital En Crecimiento (Capital in Growth)

426 Ehrlich, D. Abu Dhabi, the Next Cleantech Hub? Cleantech Group LLC. January 23, 2008. 427 Burke. Ibid.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

to bolster technology infrastructure and improve skills of the metroarea’s 22 million residents

• Contract with the U.S.-based Rand Corporation to identify Mexico City’s strengths in science and technology development. • Multi-year partnership with the New York Academy of Science and Technology.

Policy as Crucial Factor in Cleantech Investment: The Case of California California is considered today the national leader in the cleantech industry for many reasons: a world-class technology industry, excellent higher


Australia

Japan

Korea

India

Israel

Russia

Austria

Greece

100 89 88 80 85 93

170

583

235 Italy

Sweden

152

359 Germany

Switzerland

Belgium

Netherlands

France

Spain

82 97 132

224 257

379 United Kingdom

102 Brazil

Mexico

Canada

312

784

Figure 9.

Clusters of Scientists. Science and technology clusters are emerging in some surprising spots around the world. Clusters of scientists exist in some unexpected places too. This map shows the 20 countries outside of the US with the largest numbers of NYAS members.

education institutions, an entrepreneurial culture, access to capital, and progressive public policy. However, the latter is the most important force behind this edge. Indeed, in a 2004 survey of venture capitalists conducted in California by Environmental Entrepreneurs (E2) and the National Resources Defense Council (NDRC), 79 percent of VCs (representing more than $7 billion in capital) indicated that current California policy is a factor in their cleantech investment decisions; 91 percent stated that pro-environmental public policy can be a lever in bringing new business to the state; and regulatory climate/ public policy ranked second among the list of reasons why VCs chose to invest in California.428 The state has, indeed, enacted many environmentally conscious and business-friendly policies, attracting more investment and creating more jobs, thereby making California the nation’s leading cleantech cluster.

Figure 10. Responses on Surveys from other companies in California 30 25

20

Tax Breaks for Cleantech Businesses (5) Loan Guarantees/ Project Finance (7)

15 10

5

R&D Funding (Grants and Universities) (7)

More equity investment (8)

Tighten Environmental Regs. (4) Incentives/ Subsidies for Consumers and Customers (9) Industry Outreach (4) Make State a Better Customer (9)

Incubators/Other Resources (7)

Demand Creation

Nonfinancial Assistance

0 Financial Backing or Assistance

Other

Source: E2 Venture Capital Survey (n=25 respondents)

428 Creating Jobs and Promoting a Healthy Environment. Ibid. CHAPTER 6: Cleantech Hot Spots and Clusters

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List of Works Consulted 1.

About the Opportunity Austin Initiative. Austin Chamber of Commerce. www.austin-chamber.org/DoBusiness/ AboutOpportunityAustin/About.html

2. Accelerating the Green Industry Revolution. CleanVenture. www.cleanventure.org/1301.html 3. Austin Technology Incubator. www.ati.utexas.edu/clean-energy/cleanenergy-3.html 4. Boston Green Building Task Force. http://bostongreenbuilding.org 5.

Brent, W. 2007. Cleantech Boom…or Bust? The China Business Review.

6. Brent, W. and Rosen, D. 21 May 2008. State Must Aggressively Pursue Its Share of Cleantech. The News Tribune. 7.

Building San Francisco’s Cleantech Economy: Analysis and Strategy Options. Rep. San Francisco Planning and Urban Research Association. September 2008.

8. Burke, Adrienne. Building the Knowledge Capital of the Future. The New York Academy of Sciences Magazine. Autumn 2008. 9.

Burtis, P., Epstein, B., and Hwang, R. 2004. Creating the California Cleantech Cluster: How Innovation and Investment Can Promote Job Growth and a Healthy Environment. Natural Resources Defense Council and Environmental Entrepreneurs.

10. California Renewables Portfolio Standard (RPS). California Public Utilities Commission. www.cpuc.ca.gov/PUC/ energy/Renewables/index.htm 11. Clean Technology. San Francisco Environment. http://sfenvironment.org/ our_policies/overview.html?ssi=12 12. CleanTECH San Diego. CONNECT. www.connect.org/programs/cleantechsan-diego 13. Cleantech Group Announces First Cleantech Business Park in China. Cleantech Group LLC. May 17, 2007. 14. Climate Action and Green Jobs. Environmental Priorities Commission. www.environmentalpriorities.org/climateaction 15. City Green Building. Seattle Department of Planning and Development. www. seattle.gov/DPD/GreenBuilding/ CapitalProjects/SeattlesPolicy/default.asp 16. City of Austin, Texas Continues Support for Cleantech Sector. Renewable Energy World. September 7, 2007.

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17. City of Portland Bureau of Planning and Sustainability. www.portlandonline. com/OSD/index.cfm?c=41701& 18. Creating Economic Prosperity and Environmental Sustainability. The City of San Diego. www.sandiego.gov/ economic-development/business-assistance/ cleantech/ 19. Creating Jobs and Promoting a Healthy Environment. California’s Cleantech Industry: Annual Venture Capital Investment Update 2006. Environmental Entrepreneurs and Cleantech Venture Network LLC. 20. Ehrlich, D. 23 January, 2008. Abu Dhabi, the Next Cleantech Hub? Cleantech Group LLC. 21. Environmentally Preferable Purchasing Program. The City of San Diego. www. sandiego.gov/environmental-services/ep3/ 22. Fehrenbacher, K. 30 June, 2008. California: The Accidental Cleantech Capital? Sustainable Industries. Sustainable Media, Inc. 23. Gravitz, L. 27 October 2008. San Diego’s Clean Energy Companies-the Map. Xconomy. 24. Gov. Schwarzenegger Signs Landmark Legislation to Reduce Greenhouse Gas Emissions. 27 Sept 2006. Office of the Governor. 25. Green Building Ordinance. San Francisco Department of Building Inspection. www.sfgov.org/site/dbi_index. asp?id=89703 26. Jackson, M. November 2002. City Takes LEED in Green Buildings. San Diego Business Journal. 27. HelioVolt Deal (and Nothing Else)Put Texas on Clean Energy Map. Austin Business Journal. February 29, 2008. 28. Industry Investment and Development Program. Massachusetts Technology Collaborative. www.masstech.org/ renewableenergy/industry_support.htm 29. Kachan, D. 15 November, 2007. Bay Area Cleantech Leadership at Risk, Says Khosla. Cleantech Group LLC. 30. Karlenzig, W. 2006. Top U.S. Cities for Incubation Clusters. SustainLane Government. www.sustainlane.us/ articles/cleantech.jsp 31. Keating, R. Dec. 2008. Small Business Survival Index 2008: Ranking the Policy Environment for Entrepreneurship Across the Nation. Rep. Small Business & Entrepreneurship Council. 32. Kwon, J. 17 August, 2007. City Forming Policies to Help Budding Tech Firms Prosper. Austin Business Journal.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

33. Lamb, C. 24 August 2007. Capital Has Potential to Become a Hub for ’Clean Technology.’ Sacramento Business Journal. 34. Laws That We Administer. United States Environmental Protection Agency. www.epa.gov/lawsregs/laws/index. html#env 35. Makower, J. Pernick, R. and De Cordova, A. Oct. 2004. Harnessing San Francisco’s Clean-Tech Future: A Plan for Attracting Businesses and Creating Jobs. Clean Edge, Inc. 36. Mayor Reed’s Green Vision for San Jose. Office of Mayor Chuck Reed. www. sanjoseca.gov/mayor/goals/environment/ GreenVision/GreenVision.asp 37. Orange County Third Cleantech Symposium. February 18, 2009. 38. Oregon’s Renewable Energy Action Plan. Oregon Department of Energy. April 12, 2005. 39. Pernick, R. and Wilder, C. 6 November, 2007. Clean Technology in the Northwest. Seattle Post-Intelligencer. 40. Porter, M. 1990. The Competitive Advantage of Nations. The Free Press, New York. 41. Massachusetts to Launch $68M Solar Initiative. Cleantech Group LLC. December 14, 2007. 42. Porter, Michael. 2008. On Competition. Harvard Business School Publishing. Boston, MA. 43. Schwarzenegger Signs Legislation to Complete Million Solar Roofs Plan. 21 August 2006. Office of the Governor. 44. Silicon Valley, California: Cleantech Hubs. Sustainable Business. Sustainable Silicon Valley. February 26, 2007. www.sustainablesiliconvalley.org 45. 2008 U.S. City Sustainability Ratings. SustainLane Government. www. sustainlane.com/us-city-rankings/overallrankings


Metro Orlando Assets & Resources Natural Resources & Weather Solar Central Florida’s sunshine is a large factor in determining power usage in the area. Air-conditioning is used much more often than in other places, as the air-conditioning season extends well before and after the summer months. This is because from April until November, the intensity of the sunlight creates temperatures that are not tolerated well and are above the normal human comfort level. When the sunlight reaches the surface, the rays are absorbed by the land, pavement, roofs, and walls of developed areas. The sun’s rays are unable to remain absorbed and are then re-radiated back into the air. This creates “heat islands” in cities that will remain consistently hotter throughout the year, more so than in the rural surrounding areas.429 Cities like Orlando and the Central Florida area can take advantage of Florida’s abundant sunlight. Solar power is one of the fastest-growing sectors of energy generation. Investors, companies, and individuals can utilize solar panels and photovoltaics now more than ever. On the residential scale, solar electricity costs about $10 to $12 per watt.430 However, Florida does have a solar power rebate incentive program. A solar electric system will cost about $20,000 for residential purposes; however Table 1 shows the amounts Florida offers as solar

429 Black, R.J. Florida Climate Data. University of Florida IFAS Extension. 1993. p. 2 430 The Solar Guide. Solar Cost FAQ. www. thesolarguide.com/solar-power-uses/cost-faq. aspx

Table 1. Rebate Amounts

Residential

Commercial

$20,000.00

$100,000.00

Solar Thermal System

$500.00

$5,000.00

Solar Thermal Pool Heater

$100.00

N/A

Solar Photovoltaic System

Source: www.dep.state.fl.us/energy/energyact/solar.htm

rebate:431

Wind From fall until early spring, winds blow from the east, southeast, and northeast. They then change directions in the warmer summer months and come from the south, southeast, and southwest. This brings warmer and more humid air to the area. There is a difference in winds between coastal and inland areas. The coast experiences varying wind velocities and daily sea breezes. As one gets more inland, the factors change and a less varying wind exists.432 Today, it is becoming even more efficient and affordable to use wind as a cleantech resource for energy generation. The cost of wind-powered electricity is now less than 5 cents per kilowatt-hour, an 80% drop from 20 years ago. As more and larger facilities are built and more advanced technology is introduced, wind power will become even less expensive.433 To use wind power to cost431 Florida Department of Environmental Protection. Solar Energy System Incentives Program. http://www.dep.state.fl.us/energy/ energyact/solar.htm 432 Black. Ibid. p. 2 433 American Wind Energy Association. Resources. www.awea.org/faq/cost.html CHAPTER 7: Metro Orlando: Assets & Resources

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Table 2.

Historical Wind Averages from 1930-1996 in the City of Orlando Jan

Feb

Mar

Apr

May

June

July

Aug

Sept

Oct

Nov

Dec

DIR

N

N

N

N

N

N

N

N

S

S

S

S

SPD

8

9

9

9

8

7

6

6

7

8

8

8

PGU

48

51

62

53

68

62

74

62

56

40

41

43

Key DIR: Prevailing wind directions, in compass points SPD: Mean wind speeds, in miles per hour PGU: Peak gust speeds, in miles per hour

Source: Climatic Wind Data for the United States. NOAA National Climatic Data Center. 1998.

effectively generate electricity, certain wind speeds are needed. For small grid-connected wind machines, wind speeds exceeding 5 meters per second, or 11 miles per hour, are needed; for wind farms, wind exceeding 6 meters per second, or 13 miles per hour, are needed.434 Because the highest average wind speed in Florida tops at 9 miles per hour, central Florida would not be the most ideal location for wind power generation. See Table 2.

Figure 1.

Ocean, Tides, Gulf Stream The ocean tides affect the entire state of Florida. Florida’s borders are almost entirely defined by bodies of water that are subjected to tidal changes. An ocean tide is the twice daily rise and fall of sea level, caused by the gravitational pull of the moon and the sun on the Earth. The time schedule of the tides is mainly influenced by the lunar cycle. A lunar day lasts 24 days and 50 minutes, as opposed to a solar day’s 24-hour cycle. This approximate month-long day is because the moon revolves around the Earth and the Earth rotates on its axis in the same direction.435 The Earth will rotate through two tidal “bulges” for every lunar day. This causes the Earth’s sea levels to go through two highs and two lows every 24 hours and 50 minutes. This translates to a high tide occurring every 12 hours and 25 minutes. The tide will transition between high and low in a 6 hour, 12.5 minute time frame.436 The rise of the water line during high tide is caused by the horizontal flow of

sea water. This flow is directed toward the two sides of the body of water. These two sides correspond with the positions of maximum gravitational pull from the moon and the sun. The water, pulled to these two points, heaps onto itself and creates a higher water level. Alternately, the falling of the water line during low tide is caused when the force loosens on the two previous positions of gravitational pull and the body of water compensates and moves inward, drawing water away from the previously higher areas.437 Understanding the sea’s tides is important in various fields and industries. Knowing when the tides occur, how high and low the water marks will be, and the time it takes to go between high and low tide can be used in navigation, harbor engineering projects, chart and map making, underwater demolition and other construction, military usage, fishing, boating, surfing,

434 American Wind Energy Association. Ibid. 435 NOAA’s National Ocean Service Education. www.oceanservice.noaa.gov/ education/kits/tides/media/supp_tide05.html 436 NOAA. Ibid.

and other water activity.438 High and low tides in Florida are commonly affected by tropical storms and other low-pressure occurrences. “Storm surges” occur when a hurricane or tropical storm causes strong winds to flow either onshore or offshore. These winds will either pull the surrounding waterways with it, bringing great amounts of water onto the land or will drag water offshore. The Gulf Stream is an ocean current that begins near Cape Hatteras, North Carolina. The current is approximately 90 kilometers wide and has reached maximum velocities of greater than 2 meters per second, or 5 knots. The position of the Gulf Steam changes throughout the year. In the fall, it lies more northerly, and in the winter to early spring, it moves to the south.439 Most important to Florida is the beginning of the Gulf Stream, called the Florida Current. The speed of transport of the Florida Current has been

437 Our Restless Tides: A Brief Explanation of the Basic Astronomical Factors Which Produce Tides and Tidal Currents. NOAA Tides & Currents. 1998.

438 Our Restless Tides. Ibid. 439 Gyory, Joanna, Arthur J. Mariano, and Edward H. Ryan. Ocean Surface Currents: The Gulf Stream. University of Miami. 2008.

98

http://co-ops.nos.noaa.gov/data_menu.shtml?stn=8721604%20Trident%20Pier,%20FL&type=Tide%20Data

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historically documented and confirmed through modern studies to be about 30 Sv.440 (1 Sv = 106 m3 s-1)441 This current increases when traveling through the Straits of Florida, which is the area generally between the Florida Keys and Cuba. The transport then increases to 31.5 Sv. The transport of the Florida Current reaches a maximum and a minimum with the seasons, the highest being in July and the lowest in October. A secondary high and low also existsJanuary as the high, and April as the low. The summer maximums have been linked to stronger trade winds and result in an increase in local winds.442 The importance of the Gulf Stream and the Florida Current is that the power at which the two travel, 8 billion gallons per minute, if harnessed, could mean enough energy to equal several nuclear power plants. This could potentially equal one-third of Florida’s power usage. Figure 2 shows the directional current of both the Gulf Stream and the Florida Current.443

Weather Trends

Figure 2. The Florida Current 90˚W

80˚W

70˚W 40˚N

30˚N

30˚N

90˚W

80˚W

20˚N 70˚W

Source: Gyory, Joanna, Arthur J. Mariano, Elizabeth Rowe, and Edward H. Ryan. 2008 http://oceancurrents.rsmas.miami.edu/atlantic/florida.html Table 3.

Central Florida’s Historic Average High/Low Temperatures climate is hot and CITY Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec humid. Annually, the average temperature Orlando 72/50 73/51 77/55 83/61 88/67 91/71 92/73 92/73 89/72 84/66 77/56 73/51 Source: http://www.sercc.com/cgi-bin/sercc/cliMAIN.pl?fl6638 is between 68 and 75 degrees Fahrenheit Table 4. (20 and 24 degrees Celsius). In the hottest Historic Average Total Precipitation months of the year, it is CITY Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec not uncommon for the Orlando 1.96 3.26 3.50 2.63 3.12 6.67 8.08 7.16 6.83 3.90 1.70 2.05 temperature to reach Source: http://www.sercc.com/cgi-bin/sercc/cliMAIN.pl?fl6638 more than 90 degrees Fahrenheit. The air Figure 3. Average in Florida is often highly saturated and can reach relative humidity of 50% or Annual Precipitation more. Humidity is at its lowest around in Florida from midday and at its highest right before 1961-1990 dawn, when it is common to reach 90% saturation.444 Even as one of the wettest states in the U.S., Florida can also experience a range of conditions from flooding to droughts. The average precipitation can range from 44 to 60 inches of rain per year, with most of this rainfall occurring between 440 Gyory, et al. Ibid. 441 Bryden, H.L. et al. Slowing of the Atlantic meridional overturning circulation at 25° N. National Oceanography Centre. December 1, 2005. 442 Gyory, et al. Ibid. 443 Allen, Greg. Harnessing the Power of the Gulf Stream. NPR. December 3, 2007. 444 Black. Ibid. p. 2

Source: Average Annual Precipitation: Florida. Oregon State University Spatial Climate Analysis Service. 2000. www.ocs.orst.edu/pub/maps/Precipitation/Total/States/FL/fl.gif

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the months of June and September.445 Moderate intensity rainfall is the norm, with periods of more intense rain during the tropical storm season from late spring to early fall. As seen in Figure 3, Metro Orlando has historically averaged less than 54 inches of precipitation per year.

List of Works Consulted 1.

Allen, Greg. Harnessing the Power of the Gulf Stream. NPR. 3 Dec 2007.

2. Average Annual Precipitation: Florida. Oregon State University Spatial Climate Analysis Service. 2000. 3. Black, R.J. Florida Climate Data. University of Florida IFAS Extension. 1993.

4. Bryden, H.L. et al. Slowing of the Atlantic meridional overturning circulation at 25° N. National Oceanography Centre. 1 Dec 2005. 5.

Climatic Wind Data for the United States. NOAA National Climatic Data Center. 1998.

6. Gyory, Joanna, Arthur J. Mariano, and Edward H. Ryan. Ocean Surface Currents: The Gulf Stream. University of Miami. 2008. 7.

Gyory, Joanna, Arthur J. Mariano, Elizabeth Rowe, and Edward H. Ryan. Ocean Surface Currents: The Florida Current. University of Miami. 2008.

8. Our Restless Tides: A Brief Explanation of the Basic Astronomical Factors Which Produce Tides and Tidal Currents. NOAA Tides & Currents. 1998. 9.

Orlando WSO Airport, Florida. Southeast Regional Climate Center. www.sercc. com/cgi-bin/sercc/cliMAIN.pl?fl6638

10. Resources. American Wind Energy Association. www.awea.org/faq/cost.html 11. Solar Cost FAQ. The Solar Guide. www.thesolarguide.cometers per secondolar-power-uses/cost-faq.aspx

12. Solar Energy System Incentives Program. Florida Department of Environmental Protection. www.dep.state.fl.us/energy/ energyact/solar.htm

“Much of the technology sector here in the community has started with the University and the research that goes on there, and across the country universities are creating incubation programs and other entrepreneurial support programs because it is a key element of growing a local economy, particularly a technology based economy. So we have tremendous research at UCF. … We have a very active technology transfer program and entrepreneurial education program. …” - Carol A. Dykes, Manager, UCF Technology Incubator at Research Park. First Orange County Cleantech Symposium. November 5, 2008.

Metro Orlando Research Institutions Educational institutions are partners in creating intellectual capital for any regional wealth.446 The role of higher educational institutions has been critical in the creation of all major cleantech clusters. Thanks to its evident strengths in its research institutions, Metro Orlando is well positioned to achieve scientific pre-eminence in clean technology-based research, which will help develop and strengthen the Metro Orlando cleantech industry. The University of Central Florida is well-known as one of the leading research universities in the country. With $123 million in grant awards in 2008, a patent portfolio among the top ten in the nation, and many award winning faculty, UCF plays a critical role in the region’s human capital and innovation economy.447 The following UCF centers or departments are well-known incubators and generate many of the skilled scientists, engineers, and entrepreneurs vital to the high-tech companies that are part of the cleantech industry. Figure 1.

Three Pieces of the Puzzle

For Economic Prosperity in Modern Innovation Economy Academic Institution with Engineering

13. Tide Data: Trident Pier, FL. NOAA Tides & Currents. http://co-ops.nos.noaa. gov/data_menu.shtml?stn=8721604%20 Trident%20Pier,%20FL&type=Tide%20 Data

Local "Will" and Environment

14. Tides. NOAA Ocean Service Education. 15. www.oceanservice.noaa.gov/education/ kits/tides/media/supp_tide05.html 445 Ibid. p. 2 100

Industrial Foundation

Source: Jay Kapat, Director, UCF Center for Advanced Turbines and Energy. First Orange County Cleantech Symposium. November 5, 2008.

446 Saperstein, Jeff and Rouach, Daniel. Creating Regional Wealth. Pearson Education. New Jersey. 2002. p. 15. 447 University of Central Florida. www.ucf.edu

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


UCF Florida Solar Energy Center Mission: To research and develop energy technologies that enhance Florida’s and the nation’s economy and environment and to educate the public, students, and practitioners on the results of the research.

Director: James Fenton www.fsec.ucf.edu

Program Overview: The Florida Solar Energy Center (FSEC) was created by the Florida Legislature in 1975 to serve as the state’s energy research institute. The main responsibilities of the center are to conduct research, test, and certify solar systems and to develop education programs. As Florida’s legislatively chartered “Type I” energy research institute with a 30-year history of unique expertise, experience, and infrastructure, the center is leading research and development efforts to bring our vision of Energy Independence to fruition. FSEC is involved in many advanced research projects in different sectors: Buildings, Environment, Hydrogen, Photovoltaics, Solar Thermal, and Transportation. FSEC is well recognized as a leader in technology by the U.S. Department of Energy and has forged partnerships with major businesses in the region.

“The Florida Solar Energy Center – and the name is a little bit misleading because we do much more than solar energy – has been around for 32 years. We were created by the Florida State Legislature as the Energy Institute of the State of Florida. We’re currently the largest and most active statesupported energy research institute in the nation. We operate in a number of key research areas. We are roughly split into three different research divisions. The first one … we call Advanced Energy Systems Technologies. The second area of research is the Solar Energy Research Division. The third area of research is Building Research.” - Phillip Fairey, Deputy Director of the Florida Solar Energy Center. Orange County First Cleantech Symposium. November 5, 2008.

UCF NanoScience Technology Center Program Overview: The UCF NanoScience Technology Center provides news, resources, information, and research in the field of NanoScience and for the NanoScience department at UCF. Current green energy research activities include: •

Nanoscale Optoelectronic Materials and Device for Energy Conversion

Conductive Supramolecular Assemblies with High Charge Mobility

• • •

One Dimensional Semi-Conducting Architectures for Hybrid Solar Cells

Director: Debra R. Reinhart, Ph.D., PE, BCEE, FASCE, NanoScience Technology Center www.nanoscience.ucf.edu

Computer Modeling for Energy Conversion Technologies of the Future Integrated Photovoltaic Device Development

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The following are federal funding partners: National Institute of Health, Army Research Laboratory, National Science Foundation, Air Force Research Laboratory, NASA, U.S. Department of Energy, Defense Advanced Research Projects Agency, and Metro Orlando EDC.

The following are commercial partners: Vax Design, Innosense, LLC, Sciperio, Menon & Associates, Inc., Raydiance, Inc., Life Sciences, Inc., Siemens, and Lockheed Martin.

Impact:

Director: Louis Chow, Interim Director & Professor, MMAE E-mail: lchow@mail.ucf.edu www.ampac.ucf.edu

More than $3 million in state funding, with additional funding exceeding this amount due to the Center’s federal partners, the National Science Foundation (NSF) and the National Institute of Health (NIH).

Faculty from various backgrounds: chemists, imaging experts, computer scientists, engineers, mechanical engineers, and biologists, all working together to solve difficult problems, whether in health, energy, etc. Three NSF career awardees and one DARPA Young Faculty awardee. “An extraordinary achievement,” said Jeff Anderson, Associate Director of NSTC.

UCF Advanced Materials Processing and Analysis Center (AMPAC) Mission: AMPAC strives to excel in the development, processing, and characterization of advanced materials, including structural, electronic, optical, and nanomaterials and to achieve national prominence in targeted research areas that include energy, biotechnology, microelectronics, laser materials, and nanotechnology. Program Overview: The Advanced Materials Processing and Analysis Center (AMPAC) is an interdisciplinary research and education center for materials science and engineering located at the University of Central Florida (UCF). AMPAC’s vision is to make UCF an international leader in materials science and engineering research and education by: • • •

102

Excelling in the development, processing and characterization of advanced materials to achieve prominence in targeted research areas

Providing leadership to the UCF Materials Science and Engineering research and education program Enhancing economic growth and promoting industrial development through effective partnerships with industry.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


Source: Dr. Louis Chow, AMPAC Director. First Orange County Cleantech Symposium. Nov. 5, 2008

UCF Florida Power Electronics Center Mission: The center’s mission is to develop advanced electronic power conversion technologies for efficient electric energy utilization through multidisciplinary engineering research and education in the field of power electronics. The research vision is to achieve significant improvements in power density, efficiency, reliability, and cost-effectiveness of electric energy processing systems by developing innovative topology and control techniques, power semiconductor devices, passive components, and packaging and system integration techniques.

Director: Dr. Issa Batarseh, Director, FloridaPEC Chair, School of Electrical Engineering and Computer Science E-mail: batarseh@mail.ucf.edu http://floridapec.engr.ucf.edu

Program Overview: The center was established in 1998 to carry on research and development activities in various areas of power electronics for various industries and renewable energy applications. Research conducted at FloridaPEC has led to 14 U.S. patents as well as the publication of numerous research papers and presentations at international and national conferences. Research interests include: • • • • •

Development of high-frequency power electronics systems to improve power density, efficiency, and performance The utilization of soft-switching technique in improving power factor and efficiency

Analysis and design of high frequency DC-to-DC resonant converter topologies Modeling and control of PWM and soft-switching converters

Development of power electronics interface systems for photovoltaic arrays and fuel cells.

Partners: FloridaPEC is supported by research funding from industry and government agencies such as: Apecor, Lockheed Martin, U.S. Department of Defense, Intel, National Science Foundation, NASA, and Emerson.

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Director: Randall Shumaker E-mail: shumaker@ist.ucf.edu www.ist.ucf.edu

UCF Institute for Simulation & Training (IST) Program Overview: The Institute for Simulation and Training is an institute of the University of Central Florida in Orlando, focused on training and simulation research. Founded in 1982, IST is one of the nation’s leading research centers for simulation, training, modeling, virtual, and augmented and mixed reality research for both defense and commercial applications. A growing number of joint faculty appointments with UCF extend the Institute’s range of capabilities to a wide spectrum of university disciplines. An aggressive effort to involve students in real-world research has resulted in numerous undergraduate and graduate student research positions. Located in a dynamic, growing field, supported by government and industry sponsors, and charged with identifying new directions for this technology, IST is helping to define the future of simulation and training.

UCF Stormwater Management Academy Director: Dr. Marty Wanielista E-mail: wanielis@mail.ucf.edu www.stormwater.ucf.edu

Mission: The academy provides educational materials and research to advance an understanding and practice of stormwater management and to influence policy and procedures, with the vision of protection and enhancement of valuable surface and groundwater supplies for the benefit of present and future generations. Program Overview: Goals of the program are: •

To become a leading source for stormwater management research

To be a substantial partner with governments, non-governmental organizations, and industry

To provide some of the most innovative education and training programs in the nation

To achieve success in obtaining resources

Partners: The Academy’s Senior Associate Members include: Applied Polymer, Systems, PBS&J, Hartman Consulting and Design, a GAI Company, and Florida Chapter of the American Society of Landscape Architects.

UCF College of Optics and Photonics (CREOL) Director: Eric W. Van Stryland, Dean and Professor www.creol.ucf.edu

Mission: The College of Optics & Photonics is a graduate college for optical science and engineering education and research. Its mission is to: •

Provide the highest quality education in optical science and engineering

Conduct scholarly fundamental and applied research

• •

Enhance optics education at all levels

To aid in the development of technology-based industries throughout Florida and the nation.

Program Overview: CREOL is recognized as one of the top-three independent optics academic departments in the nation. The college offers interdisciplinary graduate programs leading to M.S. and Ph.D. degrees in Optics. CREOL and the Florida Photonics Center of Excellence (FPCE), are research centers within the college. The Center’s affiliate members are listed in Appendix G.

UCF Center for Advanced Turbines and Energy Research (CATER) Program Overview: With the presence of Siemens Power Generation, Pratt & Whitney, Mitsubishi Power Systems, Elliott Microturbines, Boeing, Lockheed Martin, and the Kennedy Space Center in or near Central Florida, the Center for Advanced Turbines and Energy Research at the University of Central Florida has 104

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


a unique opportunity and responsibility for taking the leadership in innovation and advanced technology development for: • • •

Turbines for propulsion as well as power generation

Portable power and energy systems for aviation/space/distributed generation applications Use of coal or biomass-derived, liquid or gaseous synthetic fuels for power generation and air/ground transportation.

Director: Dr. Jay Kapat, Professor of Engineering E-mail: jkapat@pegasus.cc.ucf.edu www.mmae.ucf.edu/Research/ CATER/Index.html

Technical Areas of Expertise Aerodynamics Passage flow/loss measurement, use of alternate fuels, endwall countouring.

CMC High temperature strucural and property evaluation, processing.

Coatings Thermal barrier coating, bond coats, Catalytic Coatings, Thermal Spray Processes.

Combustion Combustion stability, NOX emissions, alternate fuel evaluations.

Heat Transfer & Adv Cooling Advanced cooling technologies, heat transfer coefficient measurement.

Design for Manufacturing Rapid prototyping, virtual prototyping, electro-discharge, laser and water-jet machining.

Materials Oxidation, corrosion, directionally solidified superalloys, Repair processes.

Mech Integrity: Dynamics High cycle fatigue, rotor dynamics, vibration.

Mech Integrity: Structures Thermo-mechancial fatigue: LCF, fracture mechanics, residual stresses in parts.

NDE Advanced NDE Technologies for GT Materials & Components

Seals Flow leakage and power losses, thermal compatibility.

Secondary Flows Disk cavity flow and heat transfer, secondary air flow path.

Sensors High temp sensors for flow, dynamic pressure, strain, heat flux, wireless/optical sensors.

Thermodynamics Cycle optimization: IGCC, reheat.

Probabilistic Design Use of statistical tools for probabilistic sensitivity analysis for optimal design.

Wear Effect of microstructural features on wear behavior and mechansims.

“Turbines are involved in generation of about 98% of all electricity added to US Grid (DOE/Energy Information Administration). Almost 100% of all commercial passenger-miles are powered by turbines in air transportation, as well.” - Jay Kapat, Director, UCF Center for Advanced Turbines and Energy. First Orange County Cleantech Symposium. November 5, 2008.

Supporting Organizations The following supporting organizations in Central Florida and the Metro Orlando region have played an active role in the region’s economy and cleantech industry. Their relationships with the University of Central Florida have been key in their support for the growth of the cleantech industry. The strong relationships that exists within the region among its academic institutions, the business sector, and the local governments provides a unique opportunity for Metro Orlando to nurture and create a positive environment that is conducive to the region’s continued economic success.

UCF Office of Research & Commercialization Mission: The Office of Research & Commercialization at UCF fosters the creation of intellectual capital that can solve today’s pressing problems, improve the quality of life, and provide an engine for economic growth. Program Overview: The UCF Office of Research & Commercialization serves UCF scholars as the official liaison between UCF and government and commercial sectors and by providing a helping hand for faculty as they work their way through the funding and contract management process. The office helps establish connections with the agencies and individuals who invest in the promise of research and creative activities. CHAPTER 7: Metro Orlando: Assets & Resources

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Director: Dr. Tom O’Neal, Associate VP for Research E-mail: oneal@mail.ucf.edu www.research.ucf.edu

“The Office of Research & Commercialization at UCF fosters the creation of intellectual capital that can solve today’s pressing problems, improve the quality of life, and provide an engine for economic growth.” The departments that make up The Office of Research & Commercialization: Sponsored Programs Serves UCF scholars as the official liaison between UCF and external agencies by providing a helping hand for faculty working their way through the funding and contract management process. The Office helps establish connections with the agency and individuals who invest in the promise of research and creative activities. Technology Transfer Proactively facilitates the transfer of technology from the University to the commercial sector. Incubation Program A University-driven community partnership proving early stage companies with the enabling tools, training, and infrastructure to create financially stable high growth enterprises. Compliance Office Ensures the local, state, and federal regulations are followed on every research project conducted at UCF. Research Foundation Promotes, encourages, and assists the research activities of UCF faculty, staff, and students, including the development of research, and the providing of buildings for such research activities and related or complementary uses, and to provide a means by which inventions and copyrightable materials may be developed, patented, applied and utilized. Centers and Institutes Provides an environment to conduct research in specialized areas with emphasis on interdisciplinary and specific cutting edge areas of research at UCF.

Source: www.research.ucf.edu

UCF Department of Sustainability and Energy Management Director: David Norvell, PE, LEED AP, C.E.M., Director, and UCF Energy Manager E-mail: dnorvell@mail.ucf.edu www.energy.ucf.edu

106

Mission: This department aims to obtain energy efficient operation of building systems through education, optimization, and verification while providing professional leadership and fostering sustainable growth. Program Overview: The UCF Department of Sustainability and Energy Management provides resource information, including Open Energy Information, an annual Greenhouse Gas Emissions Report, and Energy Policies. It also provides information on sustainability, including information for students and faculty, and information on transportation, recycling, energy conservation, and making office space “green.” Finally, it provides information on current and competed projects.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


UCF Institute for Economic Competitiveness Mission: The Institute for Economic Competitiveness strives to provide complete, accurate, and timely national, state, and regional forecasts and economic analyses. Through these analyses, the Institute provides valuable resources to the public and private sectors for informed decision making.

Director: Dr. Sean Snaith E-mail: ssnaith@bus.ucf.edu www.bus.ucf.edu/hitec

Program Overview: As Central Florida’s nationally recognized center for regional economic research and forecasting, the UCF Institute for Economic Competitiveness produces two quarterly forecasts, the Florida & Metro Forecast and the United States Forecast. Additionally, the Institute provides expert consultation for local and state government, as well as local and national media and businesses.

UCF Technology Incubator Mission: The UCF Technology Incubator is a university-driven community partnership providing early stage technology companies with the enabling tools, training, and infrastructure to create financially stable high-growth enterprises that contribute to the local economy Program Overview: The UCF Business Incubation program (UCFBIP) and its community partners provide business development services and resources to growing companies. The process is a series of sessions designed to help define the company business, market and capital strategies and to build the business plan. Through these sessions, the company’s expertise and resources are addressed and identified. The UCF Technology Incubator’s partners are listed in Appendix F.

Director: Dr. Tom O’Neal E-mail: oneal@mail.ucf.edu www.incubator.ucf.edu

TECHNOLOGY INCUBATOR AT RESEARCH PARK Overall Impact of Incubation Program

• Technology Incubator was named 2004 Incubator of the Year by the National Association of Business Incubators.

• There are currently over 70 companies being served by the Incubator. • Forty companies have graduated from the incubator since 1999.

• Over 900 jobs have been created by incubator companies at an average salary of $60,000. • Over $190 million in investment capital has been raised for Incubator companies • Incubator companies generate over $500 million in annual revenues.

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Director: Kirstie Chadwick, Venture Lab Director and Coach E-mail: kchadwick@bus.ucf.edu

UCF Venture Lab

www.venturelab.ucf.edu

Program Overview: The UCF Venture Lab provides business advisory services with the goal to help students, faculty, and entrepreneurs gain the business skills needed to commercialize research or launch a technology firm. Areas of assistance include Business Coaching and Mentoring, Business Plan Development, Online Templates and Tools, Intellectual Property and Idea Market Assessment, Elevator and Business Plan Pitches, and Identifying Funding Sources.

Mission: The UCF Venture Lab is a place for technology entrepreneurs to transform their ideas and intellectual property into business plans with high growth potential.

Overall Impact of UCF Venture Lab: • • • • • • • •

Since its inception in 2004, the Venture Lab has mentored hundreds of entrepreneurs. Founded or helped executive teams of 15 technology companies Raised over $200 million of venture capital

Engineering Degrees and Lab expertise in fuel cells, hydrogen energy, and cleantech Four companies assisted by the Venture Lab are established, making about $1 million in revenue Assisted faculties in winning $3 million in SBIR funding Partners with Winter Park Angels Member of Cleantech Group

UCF Advisory Board Council Program Director: Jill Kaufman, Program Manager, E-mail: jkaufman@bus.ucf.edu www.advisoryboardcouncil.org

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Mission: This program is a next-level business support service, assisting Orange County businesses by matching them with experienced business professionals with a diverse range of skills who work together on a “custom-fit” advisory board. Program Overview: The program provides any qualified companies with no-cost counseling. Inside the Small Business Development Center at UCF, the Advisory Board Council offers a variety of business seminars and one-on-one counseling for start ups and small businesses.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


UCF Small Business Development Center (SBDC) Mission: This center provides high-quality management advice and comprehensive business training through the collaboration of higher education and economic development organizations, contributing to Central Florida’s economic growth.

Director: Eunice Choi E-mail: eunice.choi@bus.ucf.edu www.sbdcorlando.com

Program Overview: The SBDC at UCF provides counseling, seminars, training, special programs, and many kinds of assistance for established and emerging business owners throughout Brevard, Flagler, Lake, Orange, Osceola, Seminole, Sumter, and Volusia counties.

UCF Center for Entrepreneurship & Innovation (UCF CEI) Mission: UCF CEI provides entrepreneurship education and research opportunities to everyone in the university community. This is accomplished by offering entrepreneurship courses for undergraduate and graduate students in the College of Business and partnering with other programs that provide complementary disciplinary and industry depth. The center also maintains resources and facilities while conducting basic research that improves its understanding of new venture emergence and success.

Director: Dr. Cameron Ford E-mail: cei@bus.ucf.edu www.cei.ucf.edu

Program Overview: CEI serves as the hub for academic entrepreneurship across UCF’s colleges and programs. CEI offers education and research resources to those who create value with new business ventures. Their offerings include entrepreneurship courses and programs, research facilities, networking opportunities, business plan showcase events, and access to a wide range of experienced advisors. Partners: CEI’s partners through the UCF entrepreneur network include: Florida Small Business Development Center, UCF Venture Lab, UCF Technology Incubator, UCF Tech Transfer, and UCF’s Science & Tech Research. CEI’s Granting Agencies: Kauffman Foundation and National Collegiat Investors and Innovators Alliance (NCIIA). Regional Organizations: Orange County Government, Florida High Tech Corridor Council, Metro Orlando Economic Development Commission (EDC), and Enterprise Florida (EFI).

Central Florida Research Park Park Overview: The Central Florida Research Park is a campus-like environment for businesses, located adjacent to the University of Central Florida. Businesses that desire a “university relationship” can purchase land in Research Park to construct a facility or can lease space for office, office/lab, or light manufacturing uses. It is home to more than 100 companies and almost 10,000 employees. Please refer to Appendix H for a list of companies.

Director: Joe Wallace E-mail: jwallace1@earthlink.net www.cfrp.org

Disney Entrepreneur Center Program Overview: A unique public-private partnership dedicated to the development, growth, and success of small business—bringing together a network of business support organizations and resources into a single facility. The Disney Entrepreneur Center provides a single location where small businesses can access a variety of business resources, technology, research tools, and more than eight resident support organizations that can provide: • • • •

Director: Jerry Ross E-mail: jerry@disneyec.com www.disneyec.com

Free one-on-one business coaching Low-cost seminars Powerful networking events Access to business building tools and resources CHAPTER 7: Metro Orlando: Assets & Resources

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• • •

Certification assistance for minority-owned businesses Connections to procurement opportunities Publicity opportunities

Partners: The Disney Entrepreneur Center partners with the following sponsors: Walt Disney World, Orange County Government, University of Central Florida, BlueCross BlueShield of Florida, City of Orlando, Orlando Utilities Commission, Florida High Tech Corridor, Regions Bank, Banco Popular, Darden Restaurants, Bank First, and Orlando Magic.

Florida High Tech Corridor Council Director: Mr. Randy Berridge, President E-mail: randy.berridge@ floridahightech.com www.floridahightech.com

Mission: Its mission is to attract, retain, and grow high-tech industry and the workforce to support it within a 23-county Florida High-Tech Corridor. Program Overview: The Florida High Tech Corridor Council (FHTCC) was established by the Legislature in 1996 to attract, retain and grow high-tech industry and to help develop the workforce to support those industries in the 21-county service areas of the University of Central Florida (UCF) and the University of South Florida (USF). In January 2005, the Council welcomed the University of Florida (UF) as a full partner of this unique economic development initiative, merging the strengths of three world-class universities and bringing the number of corridor counties to 23. The Florida High Tech Corridor Council has many partners. Please refer to Appendix I for more details.

Directors:

Mr. Ray Gilley, President & CEO E-mail: ray.gilley@orlandoedc.com Mr. Mike Bobroff, Executive Vice President & COO E-mail: mike.bobroff@orlandoedc.com Ms. Amy Edge Dinsmore, Director, Technology Industry Development/ Cleantech E-mail: amy.edge@orlandoedc.com

www.orlandoedc.com

Metro Orlando EDC Mission: The Metro Orlando EDC is the principal economic development organization for Orange, Seminole, Lake, and Osceola counties and the City of Orlando. Program Overview: The Metro Orlando EDC provides information on Metro Orlando, resources for companies looking to relocate or expand in Metro Orlando, data on the demographics, resources, and industries in the area, and the industry strengths of Metro Orlando.

TechAmerica Florida (formerly AeA) Director: Ms. Maryann Fiala, Executive Director E-mail: maryann.fiala@techamerica.org

www.techamerica.org/Florida

Mission: TechAmerica Florida (formerly AeA), founded in 1943, is a nationwide non-profit trade association that represents all segments of the technology industry and is dedicated solely to helping its members’ top and bottom line. TechAmerica achieves this in partnership with its small, medium, and large member companies by lobbying governments at the state, federal, and international levels; providing access to capital and business opportunities; and offering select business services and networking programs. Program Overview: One of the technology segments TechAmerica represents is the cleantech segment. Its National Green Technology platform provides local as well as international knowledge exchange opportunities and strategies for state and local governments, and political policy recommendations that will further U.S. leadership in global innovation. TechAmerica already has partnered with other communities, such as San Diego, on its cleantech initiatives.

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METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


Orange County Division of Environmental Protection Mission: The mission of the Environmental Protection Division is “serving the community by protecting the environment through education, participation, and conservation.”

Director: Lori Cunniff E-mail: lori.cunniff@ocfl.net www.orangecountyfl.net

Program Overview: The Orange County Environmental Protection Division is a part of Orange County’s Community and Environmental Services Department. It is composed of the following sections: •

Water Quality, Wetland, and Lakeshore Protection

Land Preservation through Acquisition (Green PLACE)

• • • • • •

National Pollutant Discharge Elimination System (NPDES) Air Quality Management Petroleum Management Waste Management

Community Outreach

Brownfield Redevelopment.

National Center for Simulation Mission: The National Center for Simulation is a member-supported, non-profit organization formed in 1993 as the link among the defense industry, government, and academia on behalf of the entire simulation, training, and modeling community. Program Overview: As a forum, showcase, advocate, and archive for simulation, training, and modeling knowledge and resources, NCS works to strengthen the simulation community’s synergy, foster innovation, and tell the story of modeling, simulation, and training to decision makers and the general public. NCS members actively create an environment where collective efforts result in new awareness and applications for military readiness, space exploration, health care, transportation, education, entertainment, and technology development.

Director: Russ Hauck E-mail: russ@simulationinformation.com www.simulationinformation.com

Partners: NCS is part of the Combined Professional Association Group (CPAG) along with the following fellow members: •

Army Aviation Association of America (AAAA)

American Society of Comptrollers (ASMC)

��� • • • • • • •

Armed Forces Communications and Electronic

Association of the United States Army (AUSA) International Council of Systems Engineering

International Test and Evaluation Association (ITEA) National Defense Industrial Association (NDIA)

Central Florida Chapter of U.S. Navy League (NLUS) U.S. Army PEOSTRI

Central Florida Marine Corps Foundation.

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www.flaseia.org

Florida Solar Industries Industry Association (FlaSEIA)

Program Overview: The Florida Solar Energy Industries Association (FlaSEIA), founded in 1977, is a non-profit professional association of companies involved in the solar energy industry. Members include manufacturers, distributors, contractors, retailers, and consultants who provide solar water heating, pool heating, and solar electric systems. Research centers and utilities also are members. Directors for the years 2008-2010 include: David Bessette Allsolar Service Company, Inc. dbessette1@cfl.rr.com

Dillon Daniels Solar Source dillondgolf@aol.com

Dr. Charles Cromer Florida Solar Energy Center charlie@fsec.ucf.edu

Victor Eyal Heliocol U.S.A., Inc. victor@heliocol.com

Jeff Curry Lakeland Electric jeff.curry@lakelandelectric.com

Bill Gallagher Solar-Fit solarfitbillg@cfl.rr.com

Peter DeNapoli SolarWorld Industries peter.denapoli@solarworldusa.com

Steve Gorman Thermal Conversion Technology sgorman@tctsolar.com

Buzz Schaberg brschaberg@aol.com

Tom Harriman Harrimans, Inc. tom.harrimans@verizon.net

Robert Zrallack Solar Energy Systems bzsolarenergy@bellsouth.net

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Directors for the years 2007-2009 include:

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

Chris Maingot Superior Solar Systems, Inc. chris@superiorsolar.com


“State and local governments are committed to creating a diversified economy, which ensures ample supporting resources and incentives are available for high-tech industry sectors in the region, including cleantech. As a result, there is great potential in Metro Orlando for start-ups and existing businesses alike to flourish.” - Ray Gilley, President & CEO, Metro Orlando Economic Development Commission.

State And Local Cleantech Programs, Policies, and Initiatives Governor Crist’s Cleantech Agenda

partnership serving as Florida’s primary economic development organization.

Governor Charlie Crist is known to be a big supporter of alternative energy.448 In his 2008 State of the State address, Crist established his platform as a big supporter of innovation in the cleantech sector, as well as other initiatives in the fields of renewable energy and “green” jobs. Crist has stated that “we must continue to fuel Florida’s Innovation Incentive Program to bring cuttingedge, world-class research centers to the state. These centers are economic catalysts that drive discovery and collaboration, diversify our economy and bring high-wage, high-skill, secure jobs to Florida.”449 Cleantech has been included as part of this program. According to Sena Black’s presentation at the first Orange County Cleantech Symposium, “there are three pillars of Florida’s cleantech economic development strategy: government policy, innovation, and telling our story.” Ms. Black is the Senior Vice President of Marketing and Strategic Development at Enterprise Florida, a public-private

Government Policies

448 The Everglades: Sugar and Grass. The Economist. December 11, 2008. 449 State of Florida. Office of the Governor. 2008 State of the State Address. 2008. www.flgov.com/2008_sos

“Government is a very important partner. Government policies and standards help to create market demand and technology deployment.”450 Governor Crist has recommended “a $200 million economic development package for solar, wind, and other renewable energy, and plans to promote biofuels in Florida and encourage alternative fuels such as ethanol.”451 Florida’s unique capacity for growing sugar cane will also play a part in this initiative. Governor Crist came up with a bold plan to buy 180,000 acres of land from one of the two main producers, U.S. Sugar Corp., with the idea to use the sugar land to construct a network of reservoirs to clean and store water before sending it south to the Everglades National Park.452 He also endorsed a biofuels proposal by an Illinois firm, Coskata, to build a 100-million gallon cellulosic ethanol plant in a joint venture with U.S. Sugar, combining farm waste 450 Black, Sena, Senior Vice President of Marketing and Strategic Development, Enterprise Florida. First Orange County Cleantech Symposium. November 5, 2008. 451 Black, S. Ibid. 452 The Everglades: Sugar and Grass. Ibid.

with municipal rubbish. “We have the opportunity to enhance the use of this cleaner fuel, while also providing a broader market for sugar cane and citrus waste,” Crist said.453

House Bill 7135 In June 2008, Governor Crist signed House Bill 7135 into law. This is a comprehensive energy and economic development package that will encourage energy companies to invest in Florida, reduce greenhouse emissions, and foster investment in alternative and renewable energy technologies. This bill authorizes: •

• •

Developing a cap-and-trade regulatory program, which gives businesses flexibility in meeting greenhouse gas reduction standards

Creating a renewable fuel standard and a renewable portfolio standard Providing grants and incentives to promote and enhance the use of alternative and renewable energy technologies Creating the Florida Energy and Climate Commission, a central office for state energy and climate change programs and policies to

453 State of the State Address. Ibid. CHAPTER 7: Metro Orlando: Assets & Resources

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help diversify energy sources and encourage economic development in alternative and renewable energy technologies.

All of these initiatives build a solid foundation for the advancement of renewable energy technologies in the state of Florida.

Renewable Portfolio Standards: 20% by 2020 Governor Crist proposed a goal of generating 20% of Florida’s electrical power from renewable energy by 2020. In January 2009, the Florida Public Service Commission adopted this goal and now it has moved on to the legislature for action. If this goal becomes law, consumers could be charged up to 3% more on their utility bills in order to jump start the market for clean technologies.

Florida’s Energy Act According to the Florida Department of Energy, this act has its roots in an executive order issued by former Governor Jeb Bush in 2005. The order called for a statewide comprehensive energy plan that developed into the 2006 Florida Energy Plan. This plan evaluated “the state’s current and future energy needs and [outlined] proposals for reducing regulatory barriers, diversifying energy sources, encouraging conservation and providing economic incentives to develop alternative energy technology.”454 The recommendations that came out of this analysis became Senate Bill 888 and passed in the Florida Legislature in 2006. The bill created the Florida Renewable Energy Technologies and Energy Efficiency Act, as well as the Florida Energy Commission. The bill additionally established the Renewable Energy Technologies Grants Program, the Solar Energy System Incentives Program, and a sales tax holiday for energy efficient products. The Florida Power Plant Siting Act was amended “to streamline permitting for new power plants and promote the use and development of biodiesel, ethanol, hydrogen, and other renewable fuels.”455 454 Florida Department of Environmental Protection. Florida’s Energy Act. www.dep. state.fl.us/energy/energyact 455 Florida Department of Environmental Protection. Ibid. 114

Innovation Initiatives “Innovation strategy includes several elements. First, R&D and commercialization search for solutions and new technologies that will solve real problems in a cost effective manner.”456 Florida Institute for Commercialization of Public Research The Florida Institute for Commercialization is a network of all Florida universities to foster innovation. Established as a result of 2007 legislation, the institute represents Florida’s One-Stop-Shop for investors, entrepreneurs and corporate partners seeking new opportunities based on technologies developed through publiclyfunded research.457 The Institute’s mission is economic development by securing funding for commercially-viable technologies driving the global economy. The Institute is a partnership between the state technology transfer offices led by University of Florida’s Office of Technology Licensing.458 According to Enterprise Florida, on October 1, 2008, Gary Keller, an “accomplished biotech executive”, was tapped as Executive Director. “The state of Florida has a vibrant technology community and significant technology resources, and the Institute can be a catalyst to help capture value from new technologies that emerge from Florida’s academic institutions and publicly supported research initiatives,” said Keller. “By bringing people together and working as a team to secure capital 456 Black, S. Ibid. 457 Florida Institute for the Commercialization of Public Research Website. www.floridainstitute. com 458 Florida Institute for Commercialization of Public Research Hires Executive Director. October 1, 2008. http://www.eflorida.com/ PressDetail.aspx?id=7208

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

resources, the State can facilitate the formation of new companies and foster a technology community that will drive sustainable economic growth.”459 “A second element of Florida’s innovation strategy is increasing access to seed capital and venture capital. Florida’s Opportunity Fund will create a $30 million investment fund. Florida has also earmarked 1.5% of its retirement fund to technology and growth enterprises such as alternative energy.”460 The Florida Opportunity Fund’s mission is to identify and invest in a diversified high-quality portfolio of seed and early-stage venture capital funds targeting opportunities in the state of Florida. Other goals include acquiring a superior rate of return on investments while fostering Florida’s economic development, nurturing the creation and growth of companies in the state, developing the VC and “angel” community base in the state, facilitating the transfer of technologies from various universities to the private sector, and finally, attracting investments from regional and national investment funds.461 Florida Retirement System Investment in ‘Technology & Growth’ Industries On May 22, 2008, Governor Charlie Crist signed into law Senate Bill 2310 committing 1.5% of its $130 billion retirement system trust fund—one of the largest in the country—to technology and growth investments, including cleantech.462 This will provide $8.5 459 Florida Institute for Commercialization of Public Research Hires Executive Director. Ibid. 460 Black, S. Ibid. 461 Florida Opportunity Fund. www. floridaopportunityfund.com/index_home.asp 462 Governor Crist Signs Bill Allowing $1.95 Billion in Investment in Innovative Florida Companies. Florida Governor’s Press Office. May 22, 2008.  www.flgov.com/release/10027.


billion for initiatives. This legislation was based on the California Public Employees Retirement System’s (CalPERS) model of public pension funds invested in private equity.463 “This infusion of investment capital will enhance the state’s capacity for innovation, economic growth and higher paying jobs for Floridians,” Governor Crist said. "Florida is committed to growing industries such as aerospace, life sciences, and energy solutions.”464 “A third element of the state’s innovation strategy are tax credits and incentives such as renewable energy sales tax exemptions, corporate tax credits, and High Impact Performance Incentive (HIPI) grants.”465 Renewable Energy Technologies Grants Program This program provides matching funds for any research and development organization that wishes to develop innovative renewable energy technologies, especially in the field of vehicles and commercial buildings. In early 2007, Florida officials recognized cleantech ventures when it awarded the first of $15 million in renewable technology grants. The companies that received these grants would be working on solar energy use, making ethanol from citrus and sugar cane waste, and replacing the fuel used in factories from natural gas to gas made from switchgrass and other plant materials. At this point in time, “Gov. Charlie Crist [had] recommended a $68 million spending package on other ways to encourage alternative energy businesses.”466 In 2008, the Florida Legislature received two Requests for Grant Proposals, one for $7 million to “support projects that generate or utilize renewable energy resources, including hydrogen, biomass, solar energy, geothermal energy, wind energy, ocean energy, waste heat and hydroelectric power,” and the other request for $8 million for bioenergy projects. These projects are expected to particularly increase energy efficiency for vehicles and 463 Warner, John. Florida Pension Fund to Invest $1.5 Billion in ‘Technology and Growth’ Industries. Swamp Fox. June 4, 2008.  www.swampfox.ws/node/26762. 464 Florida Governor’s Press Office. Ibid. 465 Black, S. Ibid. 466 Keefe, Bob. Cities, States Jostling To Attract ‘Clean Tech’. Cox News Service. March 11, 2007.

commercial buildings.467 The Florida Energy and Climate Commission, working with the Governor’s Energy Office, is accepting proposals for matching these funds in the fields of research, development, demonstration, and commercialization of projects that relate to renewable energy and innovative technologies for vehicles and commercial buildings.468 Solar Energy System Incentives Program This program quickly became one of the most popular in the state. The Solar Energy System Incentives Program offers rebates for residential and commercial owners of solar energy systems to recoup the expensive cost of installing the system. The Florida Department of Environmental Protection states the rebate amounts in Table 1:469

technologies. According to Enterprise Florida Inc., a partnership organization between public and private sectors, primarily devoted to statewide economic development,470 the tax refund can be claimed on the following:471 •

• • •

Hydrogen-powered vehicles and the materials incorporated into making hydrogen-powered vehicles

Hydrogen fueling stations (with a $2 million annual statewide cap)

Commercial stationary hydrogen fuel cells (with a $1 million annual statewide cap) Materials used in the distribution of biodiesel and ethanol—this includes fueling infrastructure, transportation, and storage (with a $1 million annual statewide cap)

Table 1. Rebate Amounts Solar Photovoltaic System

Residential

Commercial

$20,000.00

$100,000.00

Solar Thermal System

$500.00

Solar Thermal Pool Heater

$100.00

According to the site, this program became so popular and successful, that it had run up against the budget, which has been becoming smaller and smaller each year. The large volume of applicants exhausted the $5 million that was reserved in the Fiscal Year 2008-2009 budget. After the 2007-2008 funding had been exhausted, applicants were then placed on a waiting list, which quickly absorbed the appropriated amount for 2008-2009. The state continues to accept applications for the next fiscal year, as the program will continue until June 30, 2010; however, applicants are being placed on a waiting list. Renewable Energy Technologies, Machinery, Equipment, and Material Sales and Use Tax Refund Of additional benefit to companies and organizations is a tax refund on sales and use taxes that have been paid on equipment, machinery, and other materials for renewable energy 467 Florida Department of Environmental Protection. Ibid. 468 Ibid. 469 Ibid.

• Gasoline fueling station pump retrofits for ethanol distribution.

Renewable Energy Technology $5,000.00 Investment Tax Credit N/A According to Enterprise Florida,472 this tax credit can be applied to 75% of all capital costs, operation and maintenance costs, and research and development costs. Technologies that are eligible for the tax credit include renewable fuel vehicles, fuel cells, hydrogen refueling stations, ethanol, and biodiesel. Limits on the tax credit exist, however. These include: • •

$3 million in connection with hydrogen-powered vehicles and fueling stations

$1.5 million in connection with and investment in commercial stationary hydrogen fuel cells in Florida

$6.5 million in connection with an investment in the production, storage, and distribution of biodiesel and ethanol.

470 Enterprise Florida. www.eflorida.com/ ContentSubpage.aspx?id=206 471 Florida’s Key Incentives for the Clean Energy Sector. Enterprise Florida, Inc. 2009. p. 1 472 Florida’s Key Incentives for the Clean Energy Sector. Ibid. CHAPTER 7: Metro Orlando: Assets & Resources

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Businesses may also transfer the corporate income tax credit. Renewable Energy Production Tax Credit Related to the previous tax credit aimed at investment, this credit is aimed at encouraging the development and expansion of facilities that produce renewable energy in the state of Florida. It is an annual credit and will be awarded based on the taxpayer’s production and sale of electricity. It is required that this electricity come from an in-state, new or expanded renewable energy facility.473 For each taxpayer applicant, the credit is $0.01 for each kilowatthour of electricity produced and sold to an unrelated party. It is capped at $5 million per state fiscal year. The technologies that this credit is applicable for include solar thermal electric, photovoltaics, wind, biomass, hydroelectric, geothermal electric, CHP/ cogeneration, hydrogen, tidal energy, wave energy, and ocean thermal.474 Tax Exemptions The Renewable Energy Source Exemption is designed to provide property tax exemptions for devices installed and operated on real property. Additionally, the Solar Energy System Incentives Program provides financial incentives for the purchase and installation of solar energy systems.475 The following items, with the intention of encouraging investment, research, and development in the field of renewable energy, are exempt from state sales and use tax:476 • • • • •

473 474 475 476 116

Co-generation of electricity

Labor, parts, and materials used in repair of, and incorporated into, machinery and equipment Certain boiler fuels (including natural gas) used exclusively in the manufacturing process Semiconductor industry transactions involving manufacturing equipment

Machinery and equipment used predominantly in research and development Ibid. Ibid. Ibid. Ibid.

Labor and materials components exclusively used in research and development.

Corporate Solar Goals The government is not the only establishment that is becoming involved. Florida utility companies, such as Florida Power & Light, are also jumping on the renewable energy bandwagon. The company has announced plans for three new “Next Generation Solar Energy Centers”, with the DeSoto, Florida location providing “25 megawatts of photovoltaic solar capacity, making it the world’s largest photovoltaic solar facility.” 477 The first project was slotted to begin in 2008, with the other two beginning in 2009. The overall impact of these projects would be preventing “the release of nearly 3.5 million tons of greenhouses gases over the life of the projects, which is the equivalent of removing 25,000 cars from the road per year, according to the U.S. Environmental Protection Agency.”478 Florida Power & Light “is the world’s number one producer of solar energy and the nation’s top producer of wind power.” The company plans to add an overall 110 megawatts of solar energy to Florida, making the state the second in the nation for solar energy.479

Thought Leadership Strategy “The third pillar of Florida’s cleantech strategy is telling our story—thought leadership marketing. Thought leadership marketing aims at placing Florida at top-of-mind status as a place for new trends and as a place 477 FPL announces plans for new solar energy generation, including world’s largest photovoltaic solar project and first solar thermal ’hybrid’ energy center. Florida Power & Light. June 25, 2008. 478 In Florida: World’s largest photovoltaic solar plant. Smart Energy Views. July 2, 2008. 479 Gregory, Shirley Siluk. Florida Gets Serious About Solar, Aims for No. 2 Spot in U.S. Eco Localizer. June 26, 2008.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

for brainpower. This type of marketing involves key partnerships with organizations such as the Cleantech Network and Clean Edge.”480 Clean Energy Webinar On September 30, 2008, a Clean Energy Webinar was organized by Enterprise Florida in partnership with the Cleantech Group, entitled “Partnering for Success: Strategies for Growing your Cleantech Business Through Partnerships.” The purpose was to discuss best practices of partnering with cleantech, advantages and challenges of industry partnerships, and avoiding pitfalls.481 eFlorida: Key Sponsor of Clean Edge Enterprise Florida is listed as one of the 2009 premier sponsors of Clean Edge. Clean Edge is one of the most resourceful organizations in cleantech. A premier sponsorship provides high visibility from Clean Edge visitors and subscribers, 800,000 per year or 40,000 per month, and 5 million page views per year or 400,000 per month. Subscribers include “high-ranking representatives from major corporations, investment firms, academic institutions, government agencies, service providers, etc.”482

Initiatives in Metro Orlando Orange County Cleantech Initiatives In October 2008, Orange County Mayor Richard T. Crotty launched two new cleantech economic development initiatives: 1) a study titled Metro Orlando Cleantech: Assets, Capabilities, and Potential; and 2) a Cleantech

480 Black, S. Ibid. 481 Enterprise Florida’s Invitation to Clean Energy Webinar. August 1, 2008. www. efloridainnovation.com/index.php?post_ id=374455 482 Clean Edge 2009 Premier Sponsors.  www.cleanedge.com/sponsorship/


Symposium Series.483 These initiatives seek to attract cleantech investment, create jobs, foster economic growth, and make of the region a leading cluster in clean technologies. Source: Cleantech Symposium Transcript and Index

So far, three cleantech symposiums were organized, each providing great insights on the industry: •

First Symposium: November 5, 2008

Second Symposium: January 21, 2009

Orange County Mayor Richard T. Crotty

“We are a region that is recognized across the country as having something very unique—collaborations and partnerships that work to get things done. This is what the cleantech symposiums are about—working together for our future success.”484 The Institute for Economic Competitiveness at the University of Central Florida was commissioned by the Orange County Department of Economic Development, Trade, and Tourism to carry out the study. The series of cleantech symposiums had to be organized in collaboration with the UCF Venture Lab. “This Orange County cleantech study and symposium series is just one example of what our local and state governments are doing to support this sector,” said Ray Gilley, President and CEO, Metro Orlando Economic Development Commission. “Cleantech is at the top of everyone’s list and our local government is doing everything possible to make sure that it is supported as much as possible.”485 483 Mayor Crotty Launches Cleantech Economic Development Initiatives. Orange County Government, Florida. October 23, 2008.  http://www.orangecountyfl.net/cms/ ORANGEMEDIA/countynews/stories/102308. htm 484 Crotty, Richard. Orange County Mayor. Orange County First Cleantech Symposium. November 5, 2008. 485 Gilley, Ray. President & CEO, Metro Orlando Economic Development Commission.

Third Symposium: February 18, 2009.

Members of the Metro Orlando cleantech community—including academia, businesses, and government entities—took part in these meetings. “I encourage you to think hard, work hard, collaborate, and have a keen eye on the role that the University of Central Florida can play,” said Mayor Crotty. “These are going to be exciting meetings you are about to have. I want to personally thank you for the role you are playing in this visionary process that will determine what the future will look like for our kids and grandkids.”486 City of Orlando – Green Works Orlando Most important to the local Metro Orlando community when it comes to cleantech, including renewable energy, protecting natural resources, and changing lifestyle and business practices, is the City of Orlando’s Green Works Orlando—a comprehensive plan that incorporates all of the goals of cleantech. Green Works Orlando provides the basic “pillars” that its plan stands on—Energy Efficiencies and Green Buildings, Transportation, Sustainable Infrastructure and Conservation, Green Spaces, and Advocacy and Education. These pillars describe the policies and initiatives that Metro Orlando will be adopting. A sampling of these initiatives include:487 •

Designing all new city buildings

486 Crotty. Ibid. 487 Green Works Orlando. Message from Mayor Buddy Dyer. www.cityoforlando.net/Elected/ greenworks/index.htm

• •

to comply with LEED standards, with a goal of achieving LEED certification or appropriate green building standards for all municipal buildings

Transitioning the entire city fleet to bio-diesel and other alternative fuels within the next five years

Expanding the city’s reclaimed water projects to incorporate a third multi-jurisdictional regional reclaimed water supply system

Promoting Orlando Easterly Wetlands, a green space that also serves as an advanced wastewater treatment system, wildlife habitat, and a recreational and educational center

Partnering with OUC and Orange County to promote conservation and efficiency programs.

Of particular use to businesses, organizations, and governments alike is the Green Works Orlando Business— “an educational program designed to provide the Orlando business community with comprehensive best practices in sustainability.” The program hosts workshops and conventions on the topics of sustainability, the marketplace, and new technologies. Green Partnership Pledge The government has been working hand-in-hand with Central Florida businesses as well. One major step in this alliance was the October 2007 “Green Partnership Pledge.” This agreement, signed by Orlando Mayor Buddy Dyer, Orange County Mayor Richard T. Crotty, and Orlando Utilities Commission (OUC) Board President Lonnie Bell, will be the “catalyst for leveraging each entity’s leadership position to build regional partnerships, share resources, and promote environmental stewardship.”488 488 Green Partnership Pledge Kicks off Renewable Energy Expo. City of Orlando: Green Works Orlando. October 12, 2007. CHAPTER 7: Metro Orlando: Assets & Resources

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Renewable Energy Technologies 2007 Grant Program In January 2008, the state of Florida gave a grant to Orange County to “help fund a giant photovoltaic system and education center at the Orange County Convention Center.”489 This grant came through the Florida Department of Environmental Protection’s Renewable Energy Technologies 2007 Grant Program. Orange County government will be matching the grant with an additional $3.8 million. Additionally, Orlando Utilities Commission will be putting in $1.5 million.490 This money will go toward installing huge photovoltaic panels and will be the largest system in the Southeast. The system is “expected to generate 1 megawatt of electricity, enough to power 80 to 100 homes.”491 Solar America City In April 2008, the City of Orlando, with Orange County Government and OUC, was selected to be among the 12 Solar America Cities by the U.S. Department of Energy. The city was awarded a $200,000 grant for two years to increase the use of solar technology and to increase access to renewable energy. The City of Orlando partnered with Orange County Government and OUC in a strategic plan to implement solar energy and other technologies, and to help make the use of renewable energy mainstream. OUC is the program manager, and Orange County is an alliance partner.492 Included in the plan is a solar site survey and analysis aimed at measuring the region’s solar opportunities. After this analysis, the partnership will host a series of collaborative sessions to establish solar policies and priorities. Additionally, the project will include development and implementation of solar education programs. The alliance’s goals are to have a master solar plan that will “lay the foundation for a viable solar market and provide a model to growing renewable energy throughout the entire 489 Mayor Crotty Announces Major Solar Project. Orange County Government, Florida. January 31, 2008. 490 Mayor Crotty Announces Major Solar Project. Ibid. 491 Ibid. 492 City, Orange County, OUC to Receive $200,000 Grant to Advance Solar Energy. Orange County Government, Florida. April 23, 2008. 118

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state of Florida.”493

List of Works Consulted 1. 2.

3.

4. 5.

6.

7.

8. 9.

10. 11. 12. 13. 14.

15.

16.

About Us. Enterprise Florida, Inc. www.eflorida.com/ContentSubpage. aspx?id=206 City, Orange County, OUC to Receive $200,000 Grant to Advance Solar Energy. Orange County Government, Florida. 23 April 2008. Energy and Climate Protection Act Grants Program. Florida Department of Environmental Protection. www.dep. state.fl.us/energy/energyact/grants.htm Florida’s Key Incentives for the Clean Energy Sector. Enterprise Florida, Inc. 2009. Florida Governor Charlie Crist’s 2008 State of the State Address. Florida Office of the Governor. www.flgov.com/2008_ sos Florida’s Energy Act. Florida Department of Environmental Protection. www.dep.state.fl.us/energy/ energyact/ FPL announces plans for new solar energy generation, including world’s largest photovoltaic solar project and first solar thermal ’hybrid’ energy center. Florida Power & Light. 25 June 2008. Green Works Orlando. City of Orlando. www.cityoforlando.net/Elected/ greenworks/index.htm Green Partnership Pledge Kicks off Renewable Energy Expo. City of Orlando: Green Works Orlando. 12 Oct 2007. Gregory, Shirley Siluk. Florida Gets Serious About Solar, Aims for No. 2 Spot in U.S. Eco Localizer. 26 June 2008. Keefe, Bob. Cities, States Jostling To Attract ’Clean Tech’. Cox News Service. 11 Mar 2007. In Florida: World’s largest photovoltaic solar plant. Smart Energy Views. 02 July 2008. Mayor Crotty Announces Major Solar Project. Orange County Government, Florida. 31 Jan 2008. Orange County Logos and BCC Portraits. www.orangecountyfl.net/ orangemedia/logosportraits/default. htm?REDID=%7b77334CC8-165E4BAE-A4FF-7DC3F6238BC2%7d Solar Energy System Incentives Program. Florida Department of Environmental Protection. www.dep.state.fl.us/energy/ energyact/solar.htm Sugar and Grass. The Economist. Vol. 389 Number 8610. December 13-19 2008.

493 City, Orange County, OUC to Receive $200,000 Grant to Advance Solar Energy. Ibid.


Metro Orlando’s Cleantech Industry Market Analysis

Metro Orlando is emerging as a leading cleantech hub as local governments work to diversify the economy and find solutions to the nation’s energy challenges. With established cleantech industry leaders, numerous cleantech startups, the third-largest university in the nation, world class researchers, proactive economic development organizations, and an established high-tech economic sector, Metro Orlando is well-poised to develop some of the next great cleantech breakthroughs and become a cleantech innovation leader. A number of cleantech companies have been identified in the region. The cleantech industry in the Metro Orlando area encompasses 76 core companies. Please refer to the Cleantech Directory in Appendix A. These identified companies have their headquarters, research and development operations, manufacturing, or other service facilities in the region.

Industry Makeup The core companies that make up the Metro Orlando cleantech economy cover various products or services within different kinds of technologies. The region’s cleantech industry is well recognized in energy generation and energy efficiency. Due to its location in the “sunbelt” region, Metro Orlando has

a competitive advantage in solar energy. However, local and federal resources have also been channeled in alternative fuels, mainly in liquid hydrogen. The industry is also developing in other areas, such as the manufacturing, materials, and water sectors. Some companies are active in more than one category of clean technologies.

Classification Companies have been broken down according to the cleantech industry segments established by the Cleantech Group, LLC. Green building was included in efficiency, including builders as well as service providers such as architects. Renewable energy was broken down into other segments. Energy dominates more than 50% of the region’s cleantech industry. About 25% of the Metro Orlando cleantech industry is active in energy generation, with the majority of companies involved in solar power. A few companies focus on wind power, and a couple companies are owners/operators of energy plants. The energy efficiency group, estimated at almost 20% of the industry, represents the second-largest cleantech segment in Metro Orlando. Figure 1 summarizes the Metro Orlando Cleantech Directory presented in Appendix A.

“Metro Orlando has an established traditional energy sector with worldwide leaders such as Siemens and Mitsubishi, as well as leading utility companies and UCF’s Florida Solar Energy Center. With this foundation already in place, we are poised to continue leading the way in the development and production of solar, wind and alternative fuel sources.” — Amy E. Dinsmore, Director Business Development, Metro Orlando Economic Development Commission

CHAPTER 8: Metro Orlando's Cleantech Industry

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In the recent Metro Orlando Cleantech Survey conducted as part of this study, most cleantech companies in the region indicated that they offer products or services related to energy generation and energy storage. The least common segments reported in the survey were materials, followed by agriculture. Figure 2 below highlights how survey respondents fall within the industry.

Workforce The region has attracted a wide variety of cleantech companies. The sector takes advantage of a well-trained labor force to fully staff their operations within different technology sectors. Thousands of jobs are created by this sector, thereby having an economic impact not only in the Orlando Metropolitan area, but also in the state.

clean water. We have

120

Energy Infrastructure

5

4%

Energy Storage

8

7%

Manufacturing/Industrial

9

8%

Materials

10

9%

Recycling & Waste

5

4%

Transportation

10

7%

Water & Wastewater

8

7%

Others

8

7%

Respondents by Cleantech Segment Respondents by Cleantech

Segment

60.0% 50.0% 40.0%

Percentage of Respondents who Identified with Segment

30.0% 20.0%

a key to alternative

10.0%

energy.”

0.0%

— Tom Bland, Chairman and CEO, AquaFiber Technolo gies Corporation. First Orange County Cleantech Symposium. Nov. 5, 2008.

19% 24%

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

Unsure/Does not

of biomass, which is

22 28

Recycling and Waste

produce tons and tons

Energy Efficiency Energy Generation

Agriculture

patents pending. We

4%

Figure 2. Metro Orlando Cleantech based on Cleantech Survey

twenty-three patents and twenty-one

5

Manufacturing/Industr

remediation firm. We

2%

Air and Environment

– Jim Williams, Vice President, Service and Manufacturing Operations. Second Orange County Cleantech Symposium. January 21, 2009.

Materials

algae. We are a water

Air and Environment

and harvesting

Percentage

2

“Mitsubishi Power Systems Americas designs, manufactures, and services electric power generating equipment and systems. We now have about 550 employees in Orlando Central Park in Orange County, and 110 employees at our headquarters facility in Lake Mary.”

Water and Wastewater

an algae firm, growing

Transportation

capture cells—we are

No.

Agriculture

– Frank Bevc, Director, Siemens Technology Policy and Research Programs. Second Orange County Cleantech Symposium. January 21, 2009.

Energy Efficiency

solar, and carbon

Energy Infrastructure

which we grow organic,

Energy Storage

thin-film layers upon

Cleantech Segment

“Siemens Energy Sector Americas Headquarters in Orlando employs over 3,000 people, almost exclusively in intellectual property based endeavors–engineering, marketing, project management, supply management, and business functions. Since January 1, 2007, more than 700 U.S. jobs were created in Siemens Energy Renewables–over 100 of these in Orlando.”

Energy Generation

“We excel in organic

Figure 1. Cleantech Companies in Metro Orlando


Professional Background The majority of respondents to the Metro Orlando Cleantech Survey, or 64%, reported that their companies were founded by individuals with an engineering background, and 48.5% reported a background in business or finance. (Respondents were allowed to select multiple responses.)

Industry Certifications Eighty-five percent of those who responded to the survey question on industry certifications indicated they had a LEED certification and about thirty percent a NABCEP Certification. However, not all respondents answered this question.

Select Metro Orlando Cleantech Companies

Figure 3. Professional Background What is the professional background of the individual(s) who founded the company?

Answer Options Architecture

Response Frequency 3.0%

Computer Science

6.1%

Healthcare

3.0%

Manufacturing

24.2%

Retail

0.0%

Science

21.2%

Many companies are considered drivers in the cleantech industry. However, only a few will be described as they represent the diversity of cleantech companies in Metro Orlando.

Business/Finance

48.5%

Engineering

63.6%

Legal

3.0%

Media and Communications

12.1%

Allsolar Service Company Inc. 1507 Damon Ave., Kissimmee, Florida 34744 http://www.allsolarflorida.com

Telecommunications

15.2%

Allsolar is a privately owned, Florida-based company that has installed over 15,000 solar systems in the state since 1974. They are involved throughout the solar project process, from system design to installation. They are a “design-build firm specializing in solar hot water, solar pool heating and photovoltaic power systems for commercial, industrial, and residential applications.” Their services include “system design, procurement, installation, interconnection, and commissioning.” The company is a tentime winner of the Aurora Award for the best solar energy home in the Southeastern U.S. The company is a member of seven associations, including building, solar, and energy associations. Allsolar’s pool heating systems, according to their Website, will pay for itself within two to four years and offers a warranty for an operational life of over 25 years. The company’s pool services are complemented by pool automation, electronic chlorine generators, and heat pumps for when solar heating is not practical. Solar electric PV designing, engineering, permitting, and servicing is also offered. Allsolar offers five different solar systems for electricity, in addition to solar hot water systems for home uses aside from pool heating.

Figure 4. Industry Certifications Does your company have any industry specific certifications or qualifications?

Answer Options

Response Frequency

LEED Certification

85.7%

NABCEP Certification

28.6%

WQA Certification

0.0%

Others (please specifiy)

AquaFiber Technologies 1150 Louisiana Ave. Suite 6, Winter Park, Florida 32789 http://www.aquafiber.com This is a unique biotech water restoration firm with a water remediation facility on the shores of Lake Apopka near Winter Garden. This company has created a water remediation biotechnology, which, along with a strong business plan, envisions the restoration of natural water bodies throughout Florida, the U.S., and the world. The company produces tons of biomass. This company utilizes strains of algae and an ozone application to remediate all types of surface water. This technology reduces pollution in water by removing organic nutrients, metals, toxins, and coliforms. “We can take out 53,000 pounds of phosphorus per acre per year,” said Tom Bland, CEO of AquaFiber Technologies. “We excel in organic thin film layers upon which we grow organic solar and carbon capture cells.” Additionally, the biomass is used for soil amendment and has been used to produce ethanol. The company has 23 patents in 20 countries. They have a 10-billion-gallon per-day plan to work on a lake in the state of Florida to remediate phosphorus, nitrogen, and carbon. The company is also working with a local utility to remediate about five billion gallons a day, using water to remediate carbon, grow algae, and harvest the algae. CHAPTER 8: Metro Orlando's Cleantech Industry

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Building Energy Consultants 310 Valencia Shores Drive, Winter Garden, Florida 34787 http://www.buildingenergy.net Building Energy Consultants, located in Winter Garden, specializes in energy efficiency in residential and commercial buildings. Since the early 1980s, the company has been a leader in research, design, contracting, and commissioning of mechanical systems for residential and commercial buildings. Building Energy Consultants uses environmentally friendly closed cell foam for building insulation and transforming solar energy into heating and electrical sources for the home. Building Energy Consultants pride themselves in reducing energy costs for clients by half while at the same time upholding the highest standards for comfort and clean air. Beyond the design and application of cutting-edge energy efficient systems in residential and commercial projects, the company provides energy audits for individuals and businesses. The company is a certified contractor, and the services it offers include spray foam insulation, HVAC air conditioning contractors, solar heating systems, building design consulting, and dehumidifying systems. Mitsubishi Power Systems Americas, Inc. 2287 Premier Row, Orlando, Florida 32809 http://www.mpshq.com Mitsubishi Power Systems is the local presence of Mitsubishi Heavy Industries in the Western Hemisphere. MHI is a Fortune Global 150 company with more than $25 billion in annual revenues and more than 40,000 employees worldwide. Mitsubishi Power Systems focuses on the future of power generation. Their products include gas turbines, steam turbines, wind turbines, geothermal power plants, supercritical boilers, and technologies for emissions controls. “About 50% of our power is generated by coal, and we need to have a transition to get from where we are to where we want to be. We offer some of these products, such as clean coal technology, but it’s not going to happen overnight … We anticipate that by 2012 about 30% of our portfolio will be renewables, a big change for us, though one that is necessary to keep up with what the global market will be driving.” According to Mitsubishi’s Website, the company’s steam turbines offer large capacity and the best in efficiency. Of particular interest in clean energy is Mitsubishi’s highefficiency wind turbines. Since the 1980s, the company has pioneered efforts to make wind generation more productive and profitable. More than 1,380 wind turbines are in operation worldwide. The company’s geothermal power plants are currently in operation at more than 80 installations worldwide. Finally, the company offers Selective Catalytic Removal (SCR) systems. These systems remove more than 90% of nitrogen oxide (NOx) from flue gas exhaust. NOx is can react with other elements found in the atmosphere to produce health effects and environmental damage. These systems are highly efficient, resistant to sulfur oxide (SOx) and dust, are stable, resist erosion, produce no by-products, and provide safe disposal of spent catalysts. Mitsubishi also offers a wide range of service and maintenance for its electric power generating plants. New Generation Biofuels 1000 Primera Blvd. Suite 3130, Lake Mary, Florida 32746 http://www.newgenerationbiofuels.com New Generation Biofuels Holdings, Inc., based in Lake Mary, is an advanced biofuel technological company. Despite being a relatively young company, formed in early 2006, New Generation Biofuels Holdings, Inc. is making groundbreaking advancements in commercializing a second generation of biofuels. New Generation Biofuels (NGB) have less of an environmental impact and are at a lower cost than traditional, first generation biofuels with a competitive technical performance. The company, formerly known as H2Diesel Holdings, Inc., uses an emulsion of vegetable oil and animal fat as feedstock, with water and proprietary additives. It does not produce by-products, wastes, emissions, or discharges, nor does it require the use of 122

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complicated chemical reactions in its production of NGB. New Generation Biofuels will have a variety of applications, including power generation, heating oil, marine engines, and transport. It can replace oil and kerosene in combustion turbines and fuel oil in existing power boilers and generators. NovaSol Energy 121 South Orange Ave, Suite 1500, Orlando, Florida 32801 http://www.novasolenergy.com NovaSol is an independent, virtual power company, generating and distributing renewable energy for commercial and utility customers. The company has been installing solar energy systems for over ten years. NovaSol owns, installs, operates, and maintains solar energy generation facilities at their customer locations, selling power under long term Solar Power Purchase Agreements (SPPAs). The company’s research and development has focused in power control systems, and the company has developed solar systems for major utilities. NovaSol Energy has a long history of working with the Florida Solar Energy Center (FSEC) in engineering, research, and project management for solar installations. The company has been working with the Florida Solar Energy Center and UCF for over 30 years. OUC Orlando Utilities Commission 500 South Orange Ave., Orlando, Florida 32802 http://www.ouc.com OUC is a municipally owned public utility providing water and electric service to the City of Orlando and adjoining portions of Orange County, as well as St. Cloud in Osceola County. The company serves more than 200,000 customers, is the second largest locally owned electric utility in Florida, and the 16th largest in the nation. OUC has a five-member commission governing board that includes Mayor Buddy Dyer. In 2008, OUC pumped 31 billion gallons of water, produced 7.2 million megawatts of power, installed 576,048 feet of electric wire and answered 481,400 customer phone calls. With its 251,000 customers, OUC generated $844 million in revenues. OUC major contribution as a cleantech company has been in solar energy through its policies, programs, and partnerships. The utility company offers two major programs: a solar PV program and a solar thermal program. Solar PV systems generate electricity while solar thermal systems generate heat for hot water systems. OUC customers install one of these systems in their homes and in return receive monthly credits for energy production, and any excess electricity from the systems is sold back to OUC at the standard retail rate. This process allows local customers to not only save on normal consumption, but also earn money for excess electricity generation. As part of OUC’s programs, the company has formed a partnership with the Orlando Federal Credit Union in order to provide residential customers with low interest loan options for their solar installations. OUC offers additional programs to benefit both the consumer and the environment. The local Green Pricing Program blends “green” power with traditional power for a ratio of 75% landfill gas, 20% local solar projects, and 5% purchased wind power. The company’s Online Home Energy Audit provides consumers with a report on their energy usage and information on how to lower their bills by conserving electricity. Petra Solar 12201 Research Parkway, Suite 150, Orlando, Florida 32826 http://web.petrasolar.com Petra Solar, originally from New Jersey, after receiving $14 million in venture capital funding, formed a partnership with UCF and opened a local office. Through its work with UCF, the company has been able to simplify and reduce the cost of solar power installation, with the goal of developing solar electric systems that work with the existing power grid, enabling utilities to use widespread solar power sooner. CHAPTER 8: Metro Orlando's Cleantech Industry

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Petra Solar focuses on meeting the needs of its utility, commercial, and residential customers through highly integrated solar systems. According to their Website, the company “designs and manufactures the innovative, turn-key SunWave™ solar electric system for utility, commercial, and residential installations.” This SunWave™ system, the outcome of over 16 years of research and development, scales from a single panel to multi-mega watts. The SunWave™ system is leading the way to take existing technology and advance to a Smart Grid system of electrical distribution. The system, compatible with the existing grid infrastructure, will also be compatible with the future of the electric grid. According to the Website, “As a member of the Solar Electric Power Association (SEPA), an organization that facilitates solar implementation by Utilities, Petra Solar is helping to enable rapid deployment of solar infrastructure to ensure stable, future proof, solar energy on the grid. Petra Solar also helps utility clients navigate regulatory boards and utility commissions, and state and federal agencies to quickly realize the benefits of bringing additional solar generation capacity on line.” The U.S. Department of Energy recently recognized Petra Solar’s unique technology with the Energy Innovator Award. Planar Energy Devices Corporation 653 West Michigan Street, Orlando, Florida 32805 http://www.planarenergy.com Planar develops and manufactures high performance solid state energy storage products. They develop, manufacture, and market next-generation metallic thin-film lithium solid-state battery products for electronic and automotive applications. These batteries hold more energy, last longer, weigh less, and fit in tiny places. The company’s goal is to reduce the weight and size, while increasing the capacity, safety, and lifetime of batteries used to power everything from automobiles to off-grid energy storage. The company is focused on solid state energy, applying technology in three specific areas: design, process technology, and materials technology. The company developed a portfolio of 40 patents in areas of materials deposition, new materials, and battery design technologies assembled from multiple leading government, academic, and business research programs. This provides the company great economies of scale by allowing them to build small batteries into big batteries. “Multi-layer electrolytes. … This robust technology has the ability to change many industries, from the semi-conductor industry, the first panel display industry to even the solar industry,” said Scott Faris, CEO, Planar Energy Devices. “We can collect ambient energy, charge a battery using that methodology, and integrate it into solar energy. So what we’ve now done is not only marrying the energy generation to the energy storage, but also taking this into higher and higher levels of integration where the devices get smaller and smaller.” Progress Energy (DSM & Alternative Energy) 3300 Exchange Place, Lake Mary, Florida 32746 http://www.progress-energy.com Progress Energy is one of the major energy providers in Metro Orlando. The company serves 3.1 million customers in the Carolinas and Florida, is a Fortune 250 energy company, holds 21,000 megawatts of generation capacity, and operates with $9 billion in annual revenues. Currently, Progress Energy is involved in a number of programs and initiatives that address the environmental issues associated with providing power to its customers in Florida. Progress Energy’s environmental policy states that: “The company acknowledges our responsibility to be a good steward of the natural resources entrusted to our care while providing affordable and reliable energy to our customers. Environmental factors will be an integral part of planning, design, construction and operational decisions.” In addition to this, Progress Energy follows certain principles that guide how it operates, including accountability and minimizing impacts on the environment. Its commitment to managing waste, pollution, and environmental degradation is what makes the company stand out as not just a cleantech company, but as a socially 124

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responsible entity. Progress Energy does not just stop at its policies. The company is actively pursuing opportunities in renewable and alternative energy. It is currently operating four hydroelectric plants. The company partners with regional government to offer wind power. Progress Energy offers solar power to customers through its EnergyWise program—a program involving managing energy usage during peak and off times. This system allows the company to briefly cycle power to the customer’s electric hot water, heating, and cooling systems during periods of peak community demand. Particularly applicable to Florida is Progress Energy’s hydrogen fuel program. The company operates two hydrogen fueling stations in Metro Orlando—the only area in Florida with hydrogen fueling distributors—and is in the process of offering hydrogen fuel cells for backup power to some areas. These two fueling locations are located at Progress Energy’s property at the Orlando International Airport, in Orlando, FL and at the Progress Energy-BP hydrogen station, in Oviedo, FL, respectively. Progress Energy is also very involved in biomass projects. The company has purchased biomass power through contracts with various groups, including the Florida Biomass Investment Group, LLC, Biomass Gas & Electric, Vision Power, and Horizon Energy. Through these contracts, and other research partnerships, Progress Energy will be able to provide fuel from sources such as solid waste, Sweet Sorghum, and waste wood.

“For UCF, keeping the campus “green” means more than planting trees. The Environmental Initiative is a group that manages 800 acres of UCF land, improves storm-water drainage and preserves the habitats of more than 45 animal species, all while increasing sustainability.” - Lessons in Conservation. First Monday. April 2009. Page 26.

Siemens Energy 4400 Alafaya Trail, Orlando, Florida 32826 http://www.siemens.com While Siemens Worldwide is headquartered in Germany, Metro Orlando is the headquarters for Siemens Power Generation, Inc. Siemens Energy Division is one of the premier companies in the international power generation sector providing leadingedge power and energy solutions. Siemens Power Generation develops and builds fossil fuel power plants and power-generating components as well as wind turbines, turbines for use as mechanical drives, compressors for industrial applications, instrumentation and control systems, and fuel cell technology. “Our most recent growth has come from environmentally-driven businesses such as environmental cleanup and renewables, wind power in particular. … Our growth opportunities in clean energy are coming from increasing the efficiency of existing power resources, air pollution control, wind power, desalination, and gasification.” Siemens is the world leader in the solid oxide fuel cell area. This technology promises to meet today’s needs for higher quality, more reliable and environmentallyfriendly power. In addition to this ground-breaking technology, Siemens is providing more clean energy solutions, including carbon capture and storage (CCS), biomass, solar plants, waste-to-energy sources, and reheat processes. The CCS, in brief, reduces greenhouse gas emissions by safely storing carbon dioxide emitted by fossil fuel power generation in underground geological formations. Siemens operates “biomass-fueled Combined Heat and Power (CHP) plants [that] are an excellent solution to increase power output without burdening the environment.” The solar, waste-to-energy sources, and reheat processes are all used by Siemens to produce superheated steam for steam turbines. The company produces this steam by collecting solar radiation, incinerating solid waste, and by reheating used steam from the other processes—essentially recycling its own renewable energy.

“In late 2008, Orlando Utilities Commission opened Reliable Plaza to its customers. While this new home was a major milestone for OUC, it is also a first for Central Florida. Designed to meet or exceed the requirements for LEED Gold Certification, this new tower has already earned the title of “The Greenest Building in Downtown Orlando.” - OUC Makes it Easier to be Green. First Monday. April 2009. Page 24.

SolarBLUE, Inc. 2624 Bellewater Place, Oviedo, Florida 32765 http://www.solarblue.org SolarBLUE is a full-service distributor of equipment and systems for solar pool heating, solar water heating, solar lighting systems, and photovoltaic installation specifically for commercial business use, such as for hotels, restaurants, swimming pools, industrial facilities, and condominiums. The company manufactures, sells, and installs its solar systems, which require little maintenance and can operate for more than 20 years. CHAPTER 8: Metro Orlando's Cleantech Industry

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In addition to its systems, SolarBLUE also provides maintenance of all brands of solar systems, installation of electric systems, and energy-saving products such as KVAR units. Its maintenance includes both homeowners and commercial customers. Its services include checks on pumps and other mechanical and electrical components, overall observation of operations, inspections for damage and leaks, inspection of roof equipment, and repairs of such equipment. The company offers KVAR energy saving units. By combining the KVAR Home Unit with the solar system, maximum savings are achieved. This unit, according to the Website, saves the consumer at least 15% on electric bills, and offers a return on investment within two years or less. Stormwater Treatment Environments (STE) 12565 Research Parkway, Suite 300, Orlando, Florida 32826 http://www.stormwaterenvironments.com This company develops stormwater management practices, such as green roofs, pervious pavements, reuse, and integrated water systems. These methods reduce pollutants released, manage stormwater, and create revenue generating space for owners, thereby lowering the cost of ownership. “By protecting Florida’s economy, we derive from solutions which are both environmentally sound but also economically sound,” said Dr. Wanielista, STE founder and CEO. The company provides unique and aesthetically pleasing green roofs for commercial real estate developers and owners to meet mandatory storm water management and pollution control regulations. “The new American home has a green roof. It lives with photovoltaics that actually operate more efficiently on a roof top when you can reduce the heat or you cool down the roof down. So green roofs save energy, save water. …” Among its various developed products, the company uses water pollution control media to sequester pollutants in different applications, such as green roofs, pervious pavement, and water reuse. The latter is used to protect and remove pollutants from stormwater while also providing alternative water supply. The company has 300 water reuse projects currently in operation, the biggest one in Orange County—550,000 acres of land with Florida Public Service Commission franchised area, enabling them to provide water at a reduced rate. Superior Solar 275 Hunt Park Cove, Longwood, Florida 32750 http://www.superiorsolar.com Superior Solar is one of the largest solar contracting firms in America, founded in 1984 and with a portfolio of over 18,000 installations. It provides services for solar hot water, solar pool heating, and solar electricity. The company serves both commercial customers and residential customers. The company’s solar hot water system includes storage tanks and solar collectors. They offer two types of solar water heating systems. The first kind is an active system, which involve circulating pumps and controls, and use the flat-plate solar panels. The system is self-scheduled and collects solar heat whenever it is available. A backup heating element is involved to ensure that hot water is always available. The second type of solar water heating system is a passive system. This system does not involve pumps and controls, and functions as a pre-heater for existing conventional or tankless water heaters. Superior Solar’s pool-heating system uses Heliocol solar panels, as they are durable and state of the art. Superior Solar offers two types of systems for solar electric PV. The first type of system is called grid-tied, as it is tied into the home or establishment’s power lines. Any additional power from that used by the home or establishment is fed back into the power grid. The meter is then spun backwards and the amount of power comes directly off the customer’s electric bill. The other type of grid-tied system offered by Superior Solar adds battery storage to act as a backup rather than returning power back to the grid. The second type of solar electric PV system aside from gridtied is the stand-alone electric PV system. These operate independently of the electric 126

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utility grid. These systems are typically installed in remote locations or situations where a tie to the power grid is not available and/or cost effective. Xenerga 7075 Kingspointe Parkway, Suite 1, Orlando, Florida 32819 http://www.xenerga.com Orlando-based Xenerga, Inc. has become an industry leader by combining efficient biodiesel production facilities with low cost feedstock. The company has been involved in the development of more than 160 biodiesel plants internationally, and instead of building massive production facilities, has focused on developing numerous, efficient, smaller facilities that are located wherever feedstock is. These facilities have a 5 million gallon per year capability. They have a network of biodiesel facilities in key markets worldwide and feedstock including Algae, Jatropha, and Yellow Grease. Xenerga is also very involved in biofuel research and development. The company has focused its R&D efforts on four fields: biofuel feedstock plantations being planned and implemented throughout the world, developing new forms of algae that can produce oil at 98% efficiency, converting brown grease into biodiesel feedstock, and designing wind turbines to scale to the needs of individual homes and office buildings.

List of Works Consulted 1. Bevc, Frank. Director, Siemens Technology Policy and Research Programs. Second Orange County Cleantech Symposium. January 21, 2009. 2. Farix, Scott. CEO, Planar Energy Devices, Inc. First Orange County Cleantech Symposium. November 5, 2008.

3. Wanielista, Marty. Founder, Stormwater Treatment Environments, (STE, Inc). First Orange County Cleantech Symposium. November 5, 2008. 4. Williams, Jim. Vice President, Service and Manufacturing Operations. Mitsubishi Power Systems Americas. Second Orange County Cleantech Symposium. January 21, 2009. 5. Allsolar Service Company Inc. www.allsolarflorida.com 6. Aquafiber Technologies. www.aquafiber.com

7. Building Energy Consultants. www.buildingenergy.net

8. Mitsubishi Power Systems Americas, Inc. www.mpshq.com 9. New Generation Biofuels. www.newgenerationbiofuels.com 10. NovaSol Energy. www.novasolenergy.com

11. OUC Orlando Utilities Commission. www.ouc.com 12. Petra Solar. http://web.petrasolar.com

13. Planar Energy Devices, Inc. www.planarenergy.com

14. Progress Energy (DSM & Alternative Energy). www.progress-energy.com 15. Siemens Energy. www.siemens.com

16. SolarBLUE, Inc. www.solarblue.org

17. STE, Inc. Stormwater Treatment Environments. www.stormwaterenvironments.com

“Another exciting project is the start of construction soon on LYNX’s biodiesel blending facility, allowing the agency to convert its entire fleet to biodiesel fuel. … Annually, more than 1.2 million gallons of diesel will be replaced with a clean, renewable, carbon neutral energy source. This will effectively lower carbon dioxide emissions by approximately 26 million pounds.” - The Road to Green. First Monday. April 2009. Page 22.

18. Superior Solar. www.superiorsolar.com 19. Xenerga. www.xenerga.com

CHAPTER 8: Metro Orlando's Cleantech Industry

127


Potential for Growth: Contributing Factors Metro Orlando’s cleantech industry is poised to benefit from different parameters whether they are economics, research, or industry related. This section will first assess the overall strength of the Metro Orlando regional economy as a contributing factor. Then, it will lay out the existing economic forecasts for the region during the period 2009-2012. Finally, it will highlight the fundamentals behind the region’s success in building a high-tech economy: a strong partnership between academia and industry illustrated by the leadership’s vision and their economic development strategies, access to research and technology transfer, abundance of technology clusters, skilled labor, and an environment conducive to entrepreneurship.

Economic Performance Why should Metro Orlando cleantech investors, business executives, policymakers, and ordinary citizens pay attention to economic reports? Economic highlights are great tools that allow everyone to assess the conditions that impact their markets and provide them with trends and investment opportunities for the future. How is Metro Orlando doing?

Overall Economic Strength There is no doubt that the current U.S. economy is having a strong negative impact on the region. Florida’s emergence out of the recession has been particularly affected by the housing and the financial markets.494 Nevertheless, Metro Orlando’s economic fundamentals are considered strong, and the region’s 494 Florida & Metro Forecast 2009-2012. Institute for Economic Competitiveness. UCF College of Business Administration. March 2009. 128

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

“Central Florida offers many of the things we were looking for in establishing our new headquarters: An available diverse and talented workforce, proximity to educational and research institutions, access to major population centers and the markets we intend to serve, and quality of life for our employees were all important considerations. Central Florida provides all of these and more.” – David A. Gillepsie, President and CEO, New Generation Biofuels. Governor Crist welcomes New Generation Bioefuels in Florida. www.myflorida.com


economic engine continues to be active.495 Metro Orlando is expected to show positive growth in the next few years and ranks among the highest metros in many economic indicators.496 Personal income growth and average annual wage growth are expected to be some the highest in the state. Additionally, the gross metro product is expected to be one of the highest in the state. Metro Orlando was also ranked number 5 and number 11 by the Milken Institute/Greenstreet Real Estate Partners Best Performing Cities report in 2007 and 2008, respectively.497 In both studies, Metro Orlando is the strongest economy in the state of Florida. The components include job, wage and salary, and technology growth.

Population Growth Population growth can be a reflection of a vibrant regional economy as people tend to migrate to areas with the strongest job and business opportunities. Population growth can also have a positive impact on the economy as an influx of residential and commercial customers provides more revenues to local government and businesses. The Orlando-Kissimmee MSA, as defined by the Office of Budget and Management for Census purposes, includes Lake, Osceola, Orange, and Seminole counties. Greater Orlando is the third most populated metropolitan region in the state of Florida, behind Miami and Tampa, with an estimated population of 2,054,574.498 From 2001 to 2006, Metro Orlando’s population grew at a 3.13 Compound Annual Growth Rate (CAGR).499 Forbes Magazine ranks Orlando as the 9th fastest growing metro.500 (Please see Figure 1 below comparing Metro Orlando to other large U.S. cities and cleantech clusters). However, according to the latest quarterly forecast report from the Institute for Economic Competitiveness at UCF, from 2007 onward this trend is expected to slow down to a CAGR of 1.21 up to 2012.501 Figure 1. Population Growth: Orlando vs. Other Cleantech MSAs Austin-Round Rock, TX (MSA) Chicago-Naperville-Joliet, IL-IN-WI (MSA) New York-Northern New Jersey-Long Island, NY-NJ-PA (MSA) Orlando-Kissimmee, FL (MSA) San Diego-Carlsbad-San Marcos, CA (MSA) San Francisco-Oakland-Fremont, CA (MSA) Seattle-Tacoma-Bellevue, WA (MSA)

Population (2001=100)

125 120

ndo

115

Index

rla tro O

Me

110 105 100 95

2001

2002

2003

2004

2005

2006

2007

Source: U.S. Bureau of Economic Analysis

495 Metro Orlando Economic Development Commission. www.orlandoedc.com 496 Florida & Metro Forecast 2009-2039. Institute for Economic Competitiveness. UCF College of Business Administration. June 2009. 497 2008 Best Performing Cities. The Milken Institute/Greenstreet Real Estate Partners. 2008. 498 Florida & Metro Forecast 2009-2039. June 2009. Ibid. 499 Regional Economic Information. Bureau of Economic Analysis. 500 Facts and Rankings. Metro Orlando Economic Development Commission. www.orlandoedc.com 501 Florida & Metro Forecast 2009-2012. June 2009. Ibid.

Photo by Scott Todd www.stoddphotography.com

CHAPTER 9: Potential for Growth: Contributing Factors

129


Cost of Living This recent slow down in population growth is mainly attributable to the unusually high cost of living generated by the rapid economic growth and the housing bubble of the mid-2000s. “Economic expansion comes with a price, namely the rise in cost of living.”502 Nevertheless, despite the sour economy, those who decide to move to the region today will certainly benefit from the current housing conditions: a large inventory of distressed properties and house prices falling below replacement costs. In a national cost-of-living index comparison, released in March 2008, Metro Orlando fairs very well nationally ahead of many other U.S. competitive cleantech clusters, except Austin, TX.503 (For a detailed one-on-one comparison, please see Appendix E.) The Pew Research Center also ranks Orlando as the fourth most popular city based on where people want to live.504

Unemployment According to the U. S. Bureau of Labor Statistics, the Metro Orlando civilian labor force is estimated to be at 1,110,700 as of April 2009, not seasonally adjusted.505 Of that number, 107.8 thousands, or 9.8%, are unemployed.506 This is certainly due to the current economic conditions because the region’s average annual unemployment rate from 2002 to 2007 was 4.3.507 In fact, according to a Global Insight study, job growth in Orlando during the next five years will occur at the fastest rate in the country.508 Furthermore, according to Forbes Magazine, Orlando ranks fourth for best U.S. city for job creation.509 Please refer to Figure 2 below comparing Metro Orlando to other cleantech MSAs. Figure 2.

Unemployment Rate - Orlando vs. other MSAs 12

Metro Orlando

10 8 6 4 2 0

April 2009

Source: U.S. Department of Labor Statistics

Income Growth According to the Bureau of Economic Analysis, Metro Orlando’s per capita personal income was $34,528, representing 89 percent of the national average of $38,615. The 1997-2007 average annual growth rate of per capita personal income was 4.2 percent while the average annual growth rate of the total personal income for the region was 7.2 percent.510 From 2001 to 2006, it averaged 4.6 percent (see Figure 3). Personal income is expected to be one of the highest in the state in coming years, growing at a rate of 3.2 percent. Average annual wage growth will be one of the highest in the state at 2.5 percent.511 Yahoo! considers Orlando a “Great City for Salary Growth” mainly in

© 2009 Thomas Baker 130

502 Florida & Metro Forecast 2009-2012. March 2009. Ibid. 503 Council for Community and Economic Research (C2ER) in Quality of Life. Metro Orlando Economic Development Commission.  www.business-orlando.org 504 Facts and Rankings. Ibid. 505 U.S. Bureau of Labor Statistics. www.bls.gov 506 Ibid. 507 Florida & Metro Forecast 2009-2039. June 2009. Ibid. 508 Facts and Rankings. Ibid. 509 Facts and Rankings. Ibid. 510 Bureau of Economic Analysis. Regional Economic Reports. 511 Florida & Metro Forecast 2009-2039. June 2009. Ibid.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


part due to its emerging medical city.512

Figure 3.

Per Capita Metro Product

Economic Outlook The development of any industry, including the cleantech industry, requires a healthy economic environment and a positive outlook prone to sound economic growth. Business leaders need to know the direction of the economy to enable them to have greater confidence in making investment decisions: Should the company buy more equipment, hire workers, increase inventories, etc.? How will Metro Orlando perform in the next four to five years? Despite the national economic downturn, the Metro Orlando area is expected to rebound from this sluggish economy. The following are the outlook summaries from the latest Florida & Metro Forecasts quarterly report issued by the UCF Institute for Economic Competitiveness.514

Metro Orlando vs. Similar MSAs Per capita personal income, average annual growth rate 5

4

4.06

3.98

3.09

3.6

3.57 3 Percent

From 2002 to 2008, Gross Metro Product increased at an average rate of 5% from $58,982.2 million to $78,671.4 million, respectively.513 The highest peak in the percentage change of GMP was in 8% in 2005. Orlando fares better than most of its cleantech competitors in Per Capita Real Gross Metro Product (Please refer to Figure 4).

2.64

2.53

2

1

0

Austin

Boston

Orlando

Phoenix

Portland

Salt Lake

San Francisco

Source: U.S. Bureau of Economic Analysis, 2001-2006

Figure 4. Gross Metro Product: Metro Orlando vs. Other Cleantech MSAs Per Capita Real GDP by Metro Area: All industry total (2001=100) Austin-Round Rock, TX (MSA) Chicago-Naperville-Joliet, IL-IN-WI (MSA) New York-Northern New Jersey-Long Island, NY-NJ-PA (MSA) Orlando-Kissimmee, FL (MSA) San Diego-Carlsbad-San Marcos, CA (MSA) San Francisco-Oakland-Fremont, CA (MSA) Seattle-Tacoma-Bellevue, WA (MSA) 125 120

Index

115 110 105 100 95

2001

2002

2003

2004

2005

2006

Source: U.S. Bureau of Economic Analysis

512 513 514

Facts and Rankings. Ibid. Florida & Metro Forecast 2009-2039. June 2009. Ibid. Ibid. CHAPTER 9: Potential for Growth: Contributing Factors

131


Figure 5.

Orlando Real Personal Income (percent change year ago)

10.0% “Personal income is expected to be one of the highest in the state, growing at a rate of 3.2 percent. Per capita income is expected to be at a level of 28.6. Average annual wage growth will be one of the highest in the state at 2.5 percent. Average annual wage levels will be at 43.5.”

8.0% 6.0% 4.0% 2.0% 0.0% -2.0% -4.0%

Source: Florida & Metro Forecasts, June 2009

97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 Real Personal Income Figure 6.

Orlando Payroll Employment “Employment growth is forecasted to average 0.4 percent annually, the highest in the state. The metro will see an average unemployment rate of 9.9 percent.”

1150.0 1100.0 1050.0 1000.0 950.0 900.0 850.0 800.0 750.0

(Thousands)

Source: Florida & Metro Forecasts, June 2009

97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 OrlandoPayroll Employment Figure 7.

Orlando Real Gross Metro Product (Millions 2000 $)

90000.0

Source: Florida & Metro Forecasts, June 2009

80000.0 “Gross Metro Product is expected to be one of the highest in the state, averaging 79,121.73 (million).”

70000.0 60000.0 50000.0 40000.0

132

97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 Real Gross Metro Product

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


“In the Orlando area, the top sector is expected to be Education and Health Services with an average annual growth rate of 2.7 percent. This will be followed by Professional and Business Services and State & Local Government, each with average annual growth rates of 2.6 and 1.0 percent, respectively.” Table 1.

Annual Outlook for Orlando-Kissimmee, FL

June 2009 Forecast

Personal Income (Billions $)

Total Personal Income Pct Chg Year Ago Wages and Salaries Nonwage Income Real Personal Income (00$) Pct Chg Year Ago Per Capita Income (Ths) Real Per Capita Income (00$) Average Annual Wage (Ths) Pct Chg Year Ago

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

48.3 4.3 30.6 17.7

51.1 5.8 32.5 18.7

56 9.6 35.6 20.4

61.6 9.9 39.2 22.4

67.1 8.9 42.2 24.9

70 4.4 43.9 26.2

71.7 2.4 44.2 27.5

70.9 -1.2 43.5 27.4

72.4 2.1 44.3 28

76 5.1 46.4 29.6

81.1 6.7 49.3 31.8

46.7 2.8

48.4 3.7

51.7 6.8

55.2 6.8

58.5 6

59.5 1.7

59 -0.9

58.4 -0.9

59 1

60.9 3.2

63.8 4.8

27.4 26.5

28.2 26.7

29.9 27.6

31.7 28.4

33.6 29.3

34.5 29.3

34.9 28.7

34.1 28.1

34.5 28.1

35.8 28.7

37.6 29.6

33.5 4.2

34.8 3.9

36.3 4.3

37.8 4.1

39.2 3.8

39.9 1.8

40.8 2.3

42.1 3

43 2.2

43.9 2.2

45 2.4

Establishment Employment (Place of Work, Thousands, SA)

Total Employment Pct Chg Year Ago Manufacturing Pct Chg Year Ago Nonmanufacturing Pct Chg Year Ago Construction & Mining Pct Chg Year Ago Trade, Trans, & Utilities Pct Chg Year Ago Wholesale Trade Retail Trade Trans, Wrhsng, & Util Information Pct Chg Year Ago Financial Activities Pct Chg Year Ago Prof & Business Services Pct Chg Year Ago Educ & Health Services Pct Chg Year Ago Leisure & Hospitality Pct Chg Year Ago Other Services Pct Chg Year Ago Federal Government Pct Chg Year Ago State & Local Government Pct Chg Year Ago

908.4 -1

928.1 2.2

976.6 5.2

1032.4 5.7

1071.3 3.8

1094.8 2.2

1078.4 -1.5

1029 -4.6

1026.6 -0.2

1051.8 2.5

1092.3 3.8

45.4 -7.5

43.2 -4.9

44.1 2.2

45.3 2.7

44.5 -1.9

44.1 -0.8

42.7 -3.1

39.1 -8.4

36.7 -6.2

37.7 2.6

39.5 4.8

863 -0.6

884.9 2.5

932.4 5.4

987.1 5.9

1026.8 4

1050.7 2.3

1035.7 -1.4

989.8 -4.4

989.9 0

1014.1 2.4

1052.8 3.8

61.4 1.8

66 7.4

74.2 12.5

84.4 13.7

91.2 8

85.4 -6.4

73 -14.5

61.5 -15.7

55.4 -9.9

54.9 -1

58.7 7

171.6 -3.7

173.4 1

181.7 4.8

192.8 6.1

198.8 3.1

204 2.6

201.1 -1.4

192.8 -4.1

193.1 0.1

194.7 0.8

200.7 3.1

39.6 104.8 27.3

40 107.4 25.9

42 113.5 26.2

44.7 120.1 28

46.2 122.4 30.3

47.3 123.7 33

46.7 121.3 33.1

45.5 115.3 32.2

45.2 115.7 32.2

46.1 114.8 33

48.8 116.5 35

22.5 -2

23.1 2.5

23.8 3.1

24.7 3.9

25.8 4.6

26.8 3.7

26.2 -2.1

24.8 -5.4

23.6 -4.9

24.4 3.3

24.5 0.5

54.7 1

57.4 4.8

59.5 3.7

63.7 7.1

67 5.2

67.8 1.1

67 -1.1

66.2 -1.3

66.3 0.2

67.3 1.5

69.6 3.4

152.3 -2.9

152.2 -0.1

162.4 6.7

175.4 8

182.1 3.9

187 2.6

179.9 -3.8

162.7 -9.6

163.2 0.3

179.5 10

196.8 9.6

89.4 2.7

93.6 4.7

97.3 4

102.2 5

107.5 5.2

112.7 4.8

117.3 4.1

119.8 2.2

124.2 3.7

127.5 2.7

130.3 2.1

165 -3.3

169.9 3

179.4 5.6

183.6 2.4

186.9 1.8

193.6 3.6

200.2 3.4

191.9 -4.1

192.6 0.4

193.8 0.6

197.7 2

45.4 7

45.7 0.7

47.5 4

49.9 4.9

53.4 7.1

55.8 4.5

53 -5

50.8 -4.2

51.4 1.3

52.1 1.2

52.4 0.6

10.4 1.2

11.1 7

11.2 1.2

11.8 5.2

11.4 -3.5

11.5 0.4

11.7 2.2

11.7 0.3

12.3 4.5

11.7 -4.6

11.8 0.6

90.2 5.8

92.6 2.6

95.4 3

98.7 3.5

102.7 4.1

106.2 3.4

106.2 0

107.5 1.2

107.8 0.2

108.3 0.5

110.4 2

58982.2

62259.4

66657.7

72893.2

76534.3

78098.3

78671.4

75696.3

76701.6

79855.7

84233.3

1761.1 2.8

1810.1 2.8

1873.1 3.5

1941.9 3.7

1996.8 2.8

2031.3 1.7

2057.8 1.3

2079.6 1.1

2097.4 0.9

2123.1 1.2

2157.1 1.6

917.6 1.2

932.9 1.7

961.8 3.1

1005 4.5

1046.6 4.1

1088.8 4

1116.9 2.6

1123.7 0.6

1128.6 0.4

1143.3 1.3

1160.4 1.5

5.6

5.2

4.4

3.6

3.2

3.8

5.9

10.3

10.6

9.8

9

25182 17509 7673

27607 22318 5289

32400 26196 6204

33906 26872 7034

30304 24310 5994

17991 12531 5460

10604 5733 4871

6095 4133 1962

12225 9370 2855

18887 15801 3085

23955 19805 4150

Other Economic Indicators

Gross Metro Product (00$ Mil) Population (Ths) Pct Chg Year Ago Labor Force (Ths) Pct Chg Year Ago Unemployment Rate (%) Total Housing Starts Single-Family Multifamily

Building a High-Tech Economy Partnership of Academia and Industry Best known for its tourism industry and even considered today by many as the vacation capital of the world, Metro Orlando attracts 52 million visitors every year. Indeed, Walt Disney Co. is the largest employer in the area with 62,200 employees.515 The region boasts not only an extensive network of park attractions and hotels— Orlando has the second largest number of hotel rooms in the country besides Las Vegas, NV516 —but also a range of discount and factory outlets, as well as some major upscale shopping malls, attracting many high-end visitors and residents.517 Metro Orlando is also home to the second largest convention center in square footage, the Orange County Convention Center, and one of the busiest U.S. cities for conferences and conventions.518 However, the region is also a growing high-tech hub.519 How has this milestone been achieved? 515 516 517 518 519

Ibid. Vegas FAQs - Frequently Asked Questions. Las Vegas Convention and Visitors Authority. 2009. Metro Orlando Occupancy Report, 2008. Orlando/Orange County Convention and Visitors Bureau, Inc. www.orlandoinfo.com Bergen, Kathy. Las Vegas and Orlando Bruising Chicago’s Trade Show Business. Chicago Tribune. September 11, 2003. Trigaux, Robert. UF joins regional high-tech recruiters. St. Petersburg Times. January 5, 2005.

New Vision for Metro Orlando’s Economic Development Metro Orlando’s leaders had a new vision: Local authorities implemented short-term and long-term development strategies and made consistent strides to diversify the local industry, move it away from a purely service-based economy, target other sectors, and build high-tech industries. One important action that changed the landscape of the region’s industry was the creation, in 1977, of the Orlando/Orange County Industrial Development Commission (now the Metro Orlando Economic Development Commission). The EDC swiftly and aggressively embarked on a journey to foster a technology-based economy and build an environment conducive to technology industries. This paid off, as Metro Orlando is home to many technology clusters today. But to achieve that goal, it developed strong partnerships between academia and industry and also strong alliances between academia, business, and government—partnerships that have proven vital for growing cleantech in the region’s economy. “An important driver of cleantech business growth is innovation, and Siemens uses an open innovation concept in developing technology,” said Frank Bevc, Director, Technology Policy and Research Programs, Siemens Power Generation. “This means that while we conduct a lot of R&D on our own, a good deal of our research comes from university partnerships.” CHAPTER 9: Potential for Growth: Contributing Factors

133


“We work with MIT, Penn State, Purdue, Florida State, the University of Florida, and others, though UCF is our largest and most active university partner. … Twenty-five Siemens engineers support the UCFSiemens Energy Research & Development Center. Siemens also supports and actively works with the UCF Nanoscience Technology Center and the UCF College of Optics and Photonics.” – Frank Bevc, Director, Technology Policy and Research Programs, Siemens Power Generation. Second Orange County Symposium. January 21, 2009.

“In terms of our local impact, Planar has been around for 18 months. About half of our staff are UCF grads. … We’ve invested heavily in Kevin Coffey's [Associate Professor at the Advanced Materials Processing and Analysis Center] work at UCF. A lot of our prototypes are directly being built out at UCF. … We have the capability of producing several million chips a year out of our facility on a pilot phase, and we’ve been very actively looking at additional technology across the I-4 corridor. Again, we’re actively engaging in these partnerships with universities to find pockets of technologies that we can pool into this.” – Scott Faris. CEO, Planar Energy Devices, Inc. First Orange County Cleantech Symposium. November 5, 2008. 134

Together local leaders worked to ensure that the main educational institution in the region, the University of Central Florida (UCF), could achieve scientific authority in technological research and advancement; that UCF was a leader in developing and commercializing the latest technologies and meeting new industries’ demands; that the region could attract the best companies (both U.S. and international) and develop its own home-grown companies; and finally that the local workforce had the skills required to meet the challenges of the 21st century.

Partnership with our local community “We don’t do anything at UCF unless it’s in a partnership with our local community, and the Incubation Program, just like the Venture Lab, is another example of that. We truly do represent an economic development collaboration with our local community. … We complete the economic development strategy for the community. Just as the Venture Lab contributes to growing companies here from the ground up, the Incubation Program is one of those next steps. We have companies coming out of the Venture Lab programs into the Incubator, and our job is to help grow those companies here. Economic gardening is a term that you may hear these days, so we work very closely in concert with groups like the Economic Development Commission, which is an incredible partner with us. They focus extensively on recruiting and retaining companies that are here in the community, and we work hand in hand with them to help the entrepreneurial side. …”520 The role of state and local governments in Metro Orlando has been very critical to the regional success in wealth and job creation. These government bodies ensured the right environment prevailed for business and technology innovation to thrive. They provided adequate infrastructure, deployed resources, and invested in research institutions and technology parks. Together, all these elements can serve as a strong foundation for the cleantech sector to grow. Among the major events that shaped the region’s development are as follows.

Metro Orlando and Renewable Energy In response to the 1970’s oil embargo, the State of Florida established in 1975 the Florida Solar Energy Center (FSEC), which is considered the most active and largest state-sponsored renewable energy and energy efficiency research and training institute in the country.

Metro Orlando Economic Development Commission In 1977, the Orlando Chamber of Commerce, the Central Florida Development Committee and the Orlando/Orange County Industrial Board united their efforts to create the Industrial Development Commission (IDC) serving primarily the city of Orlando and Orange County. The Commission was joined in 1981 by Seminole 520 Dykes, Carol Ann. Manager, UCF Technology Incubator. Orange County First Cleantech Symposium. November 5, 2008.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


County, in 1987 by Lake County, and in 1989 by Osceola County. The same year, the IDC was renamed the EDC. In 2001, it became Metro Orlando’s EDC. Four major development initiatives were taken by the IDC/EDC: 521 1. In 1986, the Metro Orlando Film and Television Commission was established. 2. In 1989, an “industry retention team” was created to assist local businesses. 3. In 1995, the Metro Orlando International Affairs Commission was established to attract global investment in the region and foster export opportunities. 4. In 1999, the Central Florida Technology Partnership (CFTP) was created to build Metro Orlando’s technology industries.

Central Florida Research Park In 1978, the Central Florida Research Park was established by state legislation through cooperative efforts between UCF, the Orange County Research and Development Authority, and the Orange County Board of Commissioners. It is the largest research park in Florida and the seventh largest in the country. Adjacent to the main UCF campus in Orlando, the park was created with the belief and potential to create and foster an environment conducive to both research and business. As a result, many business partnerships have been created. The Central Florida Research Park consists of 1,027 acres of land, includes 56 buildings occupying 166 companies, and employs approximately 9,500 people, including more than 400 UCF students.522 However, the research park is considered only 60 percent built, and there is still room for 8,000 more employees. Furthermore, a second research park is being considered at the International Corporate Park that would include software companies and larger manufacturers.523

521

Metro Orlando Economic Development Commission. www.orlandoedc.com 522 Central Florida Research Park Website. www.cfrp.org 523 Wilken, Stephanie A. Wallace: Second Research Park May Be in Orlando’s Future. Orlando Business Journal. July 11. 2008

Recent Initiatives taken by Orange County Mayor Richard T. Crotty Innovation Way In 2005, Mayor Crotty announced his plan to create the “Innovation Way,” a corridor between UCF and the Orlando International Airport. The goal of this project is to stimulate the development of high-tech parks and clean industries, support the tech industries in the region, and create high-value jobs while promoting economic diversity in the region. Cleantech Initiatives In October 2008, Orange County Mayor Richard T. Crotty launched two new cleantech economic development initiatives: 1) a study titled Metro Orlando Cleantech: Assets, Capabilities, Presence, and Potential, and 2) a Cleantech Symposium Series. These initiatives seek to attract cleantech investment, create jobs, foster economic growth, and make the region a leading cluster in clean technologies. Table 2. Timeline of Major Events in Metro Orlando’s High-Tech Economic Development 1963 1972

The Florida Technological University was founded to support the Kennedy Space Center. The Environmental Systems Engineering Institute was created. The Transportation Systems Institute at UCF was created.

1975

The state of Florida established the Florida Solar Energy Center in response to the 1970’s oil embargo.

1977

The Industrial Development Commission (IDC) was formed to serve the City of Orlando and Orange County.

1978

The Central Florida Research Park was established by the state legislature from cooperative efforts between UCF, the Orange County Research and Development Authority, and the Orange County Board of Commissioners. The Florida Technological University was renamed the University of Central Florida.

1980 1982

The Small Business Development Center was established. The Institute for Simulation and Training was established. The Florida Sinkhole Industry was created.

1984

The State University System Center of Excellence in Optics and Laser Sciences was founded.

1986

The Center for Research in Electro-Optics and Lasers was renamed as the Center for Research and Education in Optics and Lasers (CREOL).

1989

The Orlando IDC was renamed the Economic Development Commission of Mid-Florida.

1990

The Space Education and Research Center was founded at UCF. The Biomolecular Science Center at UCF was established.

1998

1999 2000

The Advanced Materials Processing and Analysis Center (AMPAC) was created to support the College of Engineering and Computer Science, the College of Sciences, the College of Optics and Photonics, and the NanoScience Technology Center (NSTC). The Advanced Materials Processing and Analysis Center was established. The UCF Incubation Program was created. The Hydrogen Research & Applications Center was established. The Center for Advanced Transportation Systems Simulation (CATSS) was created.

2003

The Florida Photonics Center for Excellence within the College of Optics and Photonics was founded.

2004

The UCF Venture Lab was created through a joint initiative between the UCF Office of Research & Commercialization, the UCF College of Business, and Orange County.

2005

Orange County Mayor Crotty announced plans to create the “Innovation Way”. The NanoScience Technology Center was created at UCF to create strong bonds between industry and UCF’s NSTC and AMPAC.

2006

The Women’s Research Center was created to enhance research capacity of UCF female faculty.

2008

Mayor Crotty launched two cleantech initiatives: the cleantech study on Metro Orlando’s assets, capabilities, and potential and a series of cleantech symposiums.

CHAPTER 9: Potential for Growth: Contributing Factors

135


Strong Research and Technology Transfer Any innovation economy requires strong research institutions. One of more than 35 post-secondary institutions in the area, the University of Central Florida is regarded as one of the best computer and engineering public institutions in the country. With expected enrollment of over 52,000 students, UCF is now the 3rd largest university in the nation with over $120 million in annual research.524 Metro Orlando has been able to achieve competitiveness in technology and is well positioned to develop its cleantech industry. Innovation Metro Orlando showed great progress in the field of technological research and innovation, as can be evidenced in the number of engineering degrees granted. UCF conferred 1,307 engineering degrees during the 2007-2008 academic year and 1,039 engineering degrees during the 2008-2009 academic year.525 “The most important thing for a high-tech company is the university. They have smart people. You can license technology, and they do the research.”526 Research Funding UCF continued to improve its research productivity over the past ten years. Research expenditures increased by more than 227% from over $37.5 million in 1999 to $122.9 million in 2008.527 “A significant portion of these funded projects are tied to the university’s initiatives to stimulate technological development along Central Florida’s High Technology Corridor.”528 Research awards were divided as follows: $57.5 million from federal sources, $33.2 million from state sources, and $33.2 million from private sponsors.529 Figure 8.

Figure 9.

Engineering Degrees Conferred Academic Year 2008-2009 800

doc $130

Undergraduate

700

10 -YEAR RES EARCH FU NDI NG HI STO RY, 19 9 9 - 20 0 8

734

$121.4

mast

$110

600

undq MILLIONS

500 400 300

100 0

$104.3

2005

2006

$88.8 $82.8 $75.4

$70 $64.9

238

$50

$52.8

Doctorate

67

$30

Source: UCF Research and Commercialization

524 525 526 527

$37.5 1999

2000

Metro Orlando Economic Development Commission. Ibid. UCF Office of Institutional Research. June 2009. Wilken. Ibid. UCF Research & Commercialization Fiscal Year 2008 Annual Report. UCF Office of Research and Commercialization. 2008. 528 UCF Office of Research and Commercialization – Sponsored Programs.  http://www.research.ucf.edu/SponsoredPrograms/ 529 UCF Research & Commercialization Fiscal Year 2008 Annual Report. Ibid. 136

$103.6

$90

Masters

200

$122.9

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

2001

2002

2003

F IS C AL

2004

YE AR S

2007

2008

Source: UCF Research and Commercialization


Figure 10. TOTAL FEDERAL AWARDS $60 $57.5 MILLION

MILLIONS

$50

$40

Federal funding is a key strength

$30

indicator for research universities nationwide. At UCF, federal funding has risen 257 percent in the last

$20

10 years.

$16.1 MILLION

$10 1999

2000

2001

2002

2003

F I S C A L

2004

2005

2006

2007

2008

Y E A R S

Source: UCF Research and Commercialization

Faculty Research Awards Since 2000, UCF faculty members have received 22 National Science Foundation’s Faculty Early Development (CAREER) awards, which honor promising young teachers and scholars as future leaders. Eight faculty members were awarded in 2008. In the same year, 32 faculty members were recipients of external grants of at least $1 million, including some with cumulative grants of up to $13 million. Technology Transfer UCF is committed to an innovation-based economy when ensuring the success of the Technology Incubator, the Orange County Venture Lab, and the Technology Entrepreneur Center.530 UCF has been ranked among the top ten universities in the nation in patents’ strength by two independent assessments. In 2008, UCF’s patent portfolio was ranked No. 7 by the Patent Board, ahead of Harvard University, and as the third in Industry Impact.531 As Metro Orlando is thriving to deliver value as a business location, the region is starting to turn innovation commercialization towards cleantech, becoming a competitor in the industry. Table 3. National University Patent Scorecard – 2008 Ranking & Movement

Technology Strength™

Universities

Industry Impact™

Science Linkage™

Innovation Cycle Time™

2008

2007

Includes subsidiaries and wholly owned entities unless otherwise noted

2008

5-Year Average

2008

5-Year Average

2008

5-Year Average

2008

1 2 3 4 5 6 7 8 9 10

1 2 3 4 17 5 11 21 6 20

University of California Massachusetts Inst of Technology California Inst of Technology Stanford University William Marsh Rice University University of Texas New York University University of Central Florida University of Wisconsin Harvard University

258.68 239.73 194.21 149.21 112.51 91.94 90.36 87.74 68.37 66.2

420.9 281.1 186.8 132.5 115.6 80.1 74.8 73.5 68.5 65.5

1.12 2.24 2.04 1.53 4.40 1.29 3.14 2.49 0.99 1.53

1.36 2.75 2.05 1.97 1.48 1.44 3.68 1.17 2.02 2.96

25.93 20.31 26.24 17.77 23.75 27.91 21.47 8.2 16.77 36.61

20.25 19.39 20.53 17.61 33.79 25.55 25.65 17.29 8.2 22.23

9.44 8.98 9.38 9.28 10.26 9.58 7.63 9.1 8.4 8.71

5-Year Average 8.4 8.5 7.8 7.6 9.5 8.2 8.3 7.1 8 6.8

Patent Count 2008

5-Year Average

290 134 119 122 32 89 36 44 86 54

425 142 126 94 108 77 29 86 47 30

Source: IEEE Spectrum Patents Scorecard, April 2009. 530 UCF Research and Commercialization. http://www.research.ucf.edu/ 531 UCF Research & Commercialization Fiscal Year 2008 Annual Report. Ibid. CHAPTER 9: Potential for Growth: Contributing Factors

137


Table 4. Scorecard for U.S. Universities – 2007 Rank, Company/Organization, Country

2007 U.S. Patents

Pipeline Growth Index

Pipeline Impact

SelfCitations

Adjusted Pipeline Impact

Pipeline Generality

Pipeline Originality

Pipeline Power

Adjusted Pipeline Power

1.02

2.03

9%

2.03

2.32

1.09

761

761

Universities/Education/Training 1

Massachusetts Institute of Technology, U.S.

2

California Institute of Technology, U.S.

3

University of California, U.S.

4

145 117

0.96

2.02

16%

2.02

2.34

1.10

584

584

368

0.84

1.18

11%

1.18

1.39

1.13

573

573

Harvard University, U.S.

46

1.07

2.54

25%

2.54

3.13

1.31

514

514

5

Rice University, U.S.

24

0.77

3.33

2%

3.33

5.00

1.27

394

394

6

University of Texas, U.S.

97

0.83

1.66

13%

1.66

2.20

1.17

343

343

7

University of Central Florida, U.S.

32

1.00

1.99

9%

1.99

3.28

1.16

242

242

8

Georgia Institute of Technology, U.S.

54

1.00

1.67

5%

1.67

2.14

1.21

233

233

9

Standford University, U.S.

92

0.87

1.45

8%

1.45

1.89

1.04

227

227

10

University of Wisconsin, U.S.

93

0.91

1.44

30%

1.43

1.55

1.03

195

194

Source: IEEE Spectrum Patents Scorecard, April 2009.

In 2009, UCF patents have been ranked No. 7 by the IEEE, the world’s leading technology professional association, but No. 2 in the applicability section of the ranking.532 “To be cited by two independent innovation rankings in less than a year’s time says our strategy of focusing on key areas of research, graduate education and partnership is indeed making an impact,” said M.J. Soileau, Vice President for Research & Commercialization at UCF. “It is of course gratifying to see the work of our faculty, students and commercialization team consistently ranked alongside such nationally recognized leaders in research as MIT and Stanford.”533 Nevertheless, while UCF’s patent strengths were comparable to the leading universities in the country, it trailed them in the number of patented inventions. Metro Orlando is home to a variety of highly ranked digital media education programs, including the UCF College of Arts & Humanities’ Digital Media Department, Full Sail University, and Valencia Community College's Digital Media Program.

Established Technology Clusters The Metro Orlando region currently has a rapidly growing $13.4 billion technology industry employing 53,000 people.534 Besides clean technology, 532 Abney, Bob. UCF Patents Rank in Top Ten – Again. UCF Research and Commercialization. April 2009. 533 Abney. Ibid. 534 Metro Orlando Economic Development Commission. www.orlandoedc.com 138

Metro Orlando is now recognized for its industry strengths in other sectors, including the following:535 Advanced Manufacturing. “Advanced manufacturing companies in Metro Orlando are involved in design and production of high-tech components like microchips used in the production of myriad goods such as cellular phones, modems, data storage systems and power generators.”536 According to the EDC, the industry is supported by the AeA (the largest high-tech trade association), the Advanced Materials Processing and Analysis Center (AMPAC) at UCF, and the Institute of Electrical and Electronic Engineers (IEEE). Major companies include Siemens Generation, Inc. and Mitsubishi Power Systems, Inc. as well as Lockheed Martin Missiles and Fire Control. Agritechnology. This industry is concentrated in Lake County, the northwestern part of Orlando, which for decades was famous for its commercial citrus and orchard farms. Three famous national companies are doing business in the region: Agri Starts III, Inc., Florida Food Products, Inc., and Valensa International. Aviation and Aerospace. Developing over the past 60 years, Metro Orlando has become “a hub for global commercial air travel, advance flight training, air defense projects and space

535 Metro Orlando Economic Development Commission. Ibid. 536 Ibid.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

exploration.”537 Major companies include the major airports in the region and other companies, such as Cessna, FMC Airport Systems, G&T Conveyor Company, Lockheed Martin, Signature Flight Support, and Southern Jet Center. Digital Media. This sector includes more than 1,200 companies, 30,000 employees, and annual revenues of over $9 billion.538 It is intertwined with other industries, such as Modeling, Simulation, and Training; Film and Television; Theme and Park/Ride and Show; and Interactive and Immersive Entertainment. Major companies include 360Ed, Blue Orb, Inc., Digitec Productions, ECS, Electronic Arts (EA), House of Moves, i.d.e.a.s., Indra Systems, Inc., Lockheed Martin, Mighty Mojo Studios, n-Space, Inc., Project Firefly Animation Studios, Science Applications International Corporation (SAIC), and NBC Universal. Electronic Arts (EA) is known as the world’s leader in interactive entertainment software development and publishing. Film and Television Production. Due to its year-round film capabilities and a well-educated crew base, Metro Orlando is considered among the world’s best regions for film production. This industry employs more than 3,400 employees and in 17 years has increased 337% from a merely $2.5 million to $845.5 million business sector. Companies in the industry are 537 Industry Strengths. Metro Orlando Economic Development Commission. www.businessorlando.org/Industry-Strengths/ 538 Industry Strengths. Metro Orlando EDC. www.orlandoedc.com


supported by the Metro Orlando Film and Entertainment Commission. Financial Services and Financial Technology. Metro Orlando is home to more than 5,300 financial service and financial technology companies. Four sectors of this industry have shown great progress: 1) Banking and Finance (with leaders such Wachovia, SunTrust, Bank of America, Regions, Fifth-Third, and R-G); 2) Software (with leaders such as Fiserv, Metavante, Hartland, Optria, EnableSoft, Fidelity National Information Services, Temenous U.S., and Symantec); 3) Investments (driven by The Bank of New York Mellon, Pershing, Outsourcing, G-Trade and AIS, Charles Schwab, Premiere Trade, the Newport Group, StockCross Global, International Assets, Holding Corp., and I-Trade); and 4) Insurance (with leaders such as Liberty Mutual, IOA, Zurich North America, Universal American, Primerica Financial Services, AIG, Crum & Foster, and Wells Fargo). Life Science and Biotechnology. This estimated $2.6 billion industry includes more than 150 biotechnology and life science companies and 9,250 employees. This sector is supported by Mid-Florida Research and Education Center, the UCF Biomolecular Science Center, and the Central Florida Research Park. This industry is being driven by the following companies: the Burnham Institute of Medical Research, Cardiovascular Sciences, Inc., Cognoscenti Health Institute, CORD:USE, CuraScript, Inc., Emergency Medicine Learning & Resource Center, Florida Blood Centers, the Florida Hospital, Informed Care, Inter BIO-LAB, Inc., Nemours Children’s Hospital, Orlando Health, Orlando VA Medical Center, Ortheon Medical, Rippe Health Evaluation, Triad Isotopes, Valensa International, VaxDesign Corporation, and Virtual Reality Medical Center. According to the Metro Orlando Economic Development Commission, Orlando is one of only two world communities currently building a ‘medical city’ or a cluster of life sciences companies. This cluster is estimated to create some 30,000 jobs with $7.6 billion in economic impact.539 Manufacturing, Warehousing and Distribution. Thanks to its ideal 539 Facts and Rankings. Ibid.

geographical location and easy access to air, land, and water transportation, Metro Orlando has been able to establish a strategic advantage in attracting over 2,200 companies in this industry. Leading companies include: Accord Industries, Constar International, HD Supply, G&T Conveyor Co., Inc., McLane Company, Mitsubishi Power Systems, Vac-Tron Equipment, and Wiginton Corporation. Modeling, Simulation, and Training. This industry includes more than 100 companies, almost 17,000 employees, and produces gross revenues of $2.5 billion. Due to its overall dominance in this industry, the region has earned the designation of “National Center of Excellence in Simulation and Training.” This industry is being supported by the National Center of Excellence in Simulation, the UCF Institute for Simulation and Training, and Embry Riddle Aeronautical University’s aviation simulation programs. This industry is being driven by Adacel Technologies, Advanced Interactive Systems, DiSTI, Dynamics Research Corporation, Engineering & Computer Simulations, Indra Systems, Jardon and Howard Technologies, Lockheed Martin, Northrop Grumman, Primary Image, Productivity Apex, Inc., and Science Applications International Corporation. Optics & Photonics. This industry is boasting 70 companies and a labor force of 20,000, and is estimated at $20-50 million. It is supported by the UCF Center for Research and Education in Optics and Lasers, one of only three such centers in the nation. Leading companies include Chrystal Photonics, Laser Photonics, LLC, Lockheed Martin, Lucent Technologies, Northrop Grumman, Ocean Optics, and Optigrate. Software and Hardware. This $1 billion industry features more than 1,000 companies and 12,000 workers and is supported by the UCF Technology Incubator. Software being developed have applications to utilities, billing, workers compensation, higher education, financial services, sales, multimedia, animation, location-based entertainment, and military training. The region is home to an abundance of technologically driven firms, and more than 150 international companies, representing about 20 countries have

their offices in the region.540 In 2008, according to a quarterly report by Cushman & Wakefield, Inc., Metro Orlando was No. 1 in the state of Florida in high-tech industrial space.541 However, the four highest-growth industries are clean technology, digital media and film, biotech and life sciences, and simulation, including modeling and training.542 “The city is one of the tech industry’s top 10 economies based on dollars generated through simulation, laser and optics, digital media and software development,” says John Fremstad, Vice President for technology industry development for the EDC.

Skilled Labor By developing the intellectual capital of its people—that is, investing in their education and skills—Metro Orlando can meet the demands of the local industries, including cleantech. Metro Orlando’s workforce is a dynamic business asset—a well-educated, and one of the most innovative and youthful talent pools in the nation. Through research and internships, the region’s higher education system prepares highly qualified employees, trained in a variety of field programs. “There are tremendous resources in this community, and it is a great place to recruit people,” said Scott Farris, CEO, Planar Energy Devices, Inc. “This is where our corporate headquarters is, and corporate headquarters are where the action is.”543 According to the EDC, 80 percent of engineering students have access to training before graduation. Orlando has also been ranked No. 9 in the nation and No. 1 in the state to offer the best job market to young adults. 544

540 Ibid. 541 Bilbao, Richard. Orlando No. 1 in State’s High-Tech Industrial Space. Orlando Business Journal. May 9, 2008. 542 Bilbao, Richard. More Companies ’Prospecting’ in Orlando. Orlando Business Journal. June 13, 2008. 543 Farris, Scott, CEO, Planar Energy Devices, Inc. First Orange County Cleantech Symposium. November 5, 2008. 544 Kauffmann, Chris. Orlando Among Best Job Markets for Young Adults. Orlando Business Journal. May 23, 2008. CHAPTER 9: Potential for Growth: Contributing Factors

139


“Over 400 of our employees in Orlando are UCF alumni, and Siemens hires from twenty to thirty new UCF graduates each year.” - Frank Bevc, Director, Technology Policy and Research Programs, Siemens Power Generation. Second Orange County Symposium. January 21, 2009.

Attractive Location for Entrepreneurs It is undeniable that UCF’s research work has had a great impact on the creation of entrepreneurial activities in Metro Orlando. With 24,000 company startups per year and over 29,000 home-based businesses, Metro Orlando has been a very attractive location for entrepreneurs and small businesses.545 “These numbers are the result of the presence of facilities such as the Disney Entrepreneur Center — one of only two such centers in the nation — and the University of Central Florida Technology Incubator — ranked as one of the top incubators in the nation.” 546 The College of Business Administration has made strenuous efforts to promote entrepreneurship in the region and in Florida through its diverse quality programs in business and leadership. It has been ranked as one of the largest business schools in the nation, and Central Florida’s Rollins College has been ranked the #1 regional university in the south and its school of business considered among the best in the country.547 Through its Institute for Economic Competitiveness and its well-recognized Director, Dr. Sean Snaith, the College of Business Administration has been able to publish quarterly forecasting reports, one for the U.S. and another one for the state of Florida and metro areas. Bloomberg News has named Dr. Snaith as one of the country’s most accurate forecasters.548 545 546 547 548

140

Facts and Rankings. Ibid. Ibid. Ibid. Snaith recognized by Bloomberg News. Orlando Business Journal. November 26, 2008.

List of Works Consulted 1. 2. 3.

4.

5.

6. 7. 8.

9.

10.

11.

12.

13.

14.

15.

2008 Best Performing Cities. The Milken Institute/Greenstreet Real Estate Partners. 2008. Abney, Bob. UCF Patents Rank in Top Ten – Again. UCF Research and Commercialization. April 2009. Bergen, Kathy. Las Vegas and Orlando Bruising Chicago’s Trade Show Business. Chicago Tribune. September 11, 2003. Bevc, Frank. Director, Technology Policy and Research Programs, Siemens Power Generation. Second Orange County Symposium. January 21, 2009. Bilbao, Richard. Orlando No. 1 in State���s High-Tech Industrial Space. Orlando Business Journal. May 9, 2008. Bilbao, Richard. More Companies ’Prospecting’ in Orlando. Orlando Business Journal. June 13, 2008. Central Florida Research Park Website. www.cfrp.org Council for Community and Economic Research (C2ER) in Quality of Life. Metro Orlando Economic Development Commission. www.business-orlando.org Dykes, Carol A. Manager, UCF Technology Incubator. Orange County First Cleantech Symposium. November 5, 2008. Farris, Scott, CEO, Planar Energy Devices, Inc. First Orange County Cleantech Symposium. November 5, 2008. Florida & Metro Forecast 2008-2011. Institute for Economic Competitiveness. UCF College of Business Administration. September 2008. Florida & Metro Forecast 2009-2012. Institute for Economic Competitiveness. UCF College of Business Administration. March 2009. Florida & Metro Forecast 2009-2039. Institute for Economic Competitiveness. UCF College of Business Administration. June 2009. Gillepsie, David A. President and CEO, New Generation Biofuels. Governor Crist welcomes New Generation Bioefuels in Florida. www.myflorida.com Kauffmann, Chris. Orlando Among Best Job Markets for Young Adults. Orlando Business Journal. May 23, 2008.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

16. Kauffmann, Chris. Orlando Among Best Job Markets for Young Adults. Orlando Business Journal. May 23, 2008. 17. Kauffman, Chris. Orlando Income Growth Worst in Florida. Orlando Business Journal. June 15, 2007. 18. Metro Orlando Economic Development Commission. Industry Strengths. All contents on the technology industries were taken from the EDC Website. www.orlandoedc.com 19. Metro Orlando Economic Development Commission. Facts and Rankings. www.orlandoedc.com 20. Metro Orlando Economic Development Commission. www.orlandoedc.com 21. Metro Orlando EDC and Orange County Library System in Florida & Metro Forecast 2009-2012. Institute for Economic Competitiveness. UCF College of Business Administration. March 2009. 22. Metro Orlando Occupancy Report, 2008. Orlando/Orange County Convention and Visitors Bureau, Inc. www.orlandoinfo.com 23. Regional Economic Information. Bureau of Economic Analysis. 24. Scott, Faris. CEO, Planar Energy Devices, Inc. First Orange County Cleantech Symposium. November 5, 2008. 25. Snaith recognized by Bloomberg News. Orlando Business Journal. November 26, 2008. 26. Trigaux, Robert. UF joins regional high-tech recruiters. St. Petersburg Times. January 5, 2005. 27. UCF Office of Institutional Research. January 2009. 28. UCF Research & Commercialization Fiscal Year 2008 Annual Report. UCF Office of Research and Commercialization. 29. UCF Research and Commercialization – Sponsored Programs. 30. U.S. Bureau of Economic Analysis. Regional Economic Reports. 31. U.S. Bureau of Labor Statistics. www.bls.gov 32. Wilken, Stephanie A. Wallace: Second Research Park May Be in Orlando’s Future. Orlando Business Journal. July 11. 2008. 33. Vegas FAQs - Frequently Asked Questions. Las Vegas Convention and Visitors Authority. 2009


Survey Findings & Priorities Results from Metro Orlando Cleantech Survey

This report provides a summary of the key findings from the Metro Orlando Cleantech Survey conducted by the Institute for Economic Competitiveness in April 2009. The purpose of the survey was to study the cleantech industry in Metro Orlando and the impact of (or the lack of) any federal, state, or local policies, programs, or initiatives on cleantech investment in the region.

Survey Participants Members of the Metro Orlando business and government community, as well as other entities interested in cleantech, have been asked to participate in this survey. The survey asked 50 individuals from businesses and organizations in the clean technology sector in Metro Orlando questions relating to their businesses and organizations as well as opinion questions relating to cleantech policies and initiatives at the federal, state, and local levels. The 50 respondents designated themselves as follows. Table 1. Response Frequency

Response Count

Cleantech Company

32.0%

16

Company providing products or services to cleantech companies

12.0%

6

UCF-affiliated or other research entity involved in cleantech

20.0%

10

Economic Development Organization

10.0%

5

Government

14.0%

7

Non-Profit

0.0%

0

Other (please specify)

12.0%

6

Type of Organization

Answered question 50 Skipped question 0 CHAPTER 10: Survey Findings & Priorities

141


The purpose of this section is to provide an overview of the key findings from the survey.

Figure 1.

Metro Orlando Cleantech Segment with Biggest Opportunity in the Next 5-10 Years

Survey Key Findings

30.0% 25.0% 20.0% 10.0% 5.0% rg yG e En En ner a er er gy gy tion In St fra or En st ag er ru e gy ctu re E W T r ff at er ans icie an po ncy Ai d W rta ti ra nd aste on En wa M vir te an on r uf ac m e tu rin Mat nt g/ er In ial du s Re s cy A tr cli gri ial ng cu an ltu r d W e as te

0.0%

Figure 2.

Most Attractive Cleantech Sector for Investment in Metro Orlando 60.0% 50.0% 40.0%

Percentage ofof Respondents Percentage Respondents Who Saw as as Most Who SawSector Sector Most Attractive Attractive

30.0% 20.0% 10.0%

142

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

r

ch

no

lo

he

s gie

in ld

ui M

ob

ile

Te

nB

Ot

gs

r

t

Gr

ee

W ind

Po

we

en

rid

tm

er

Tr

ea

ls

W at

Sm

ar tG

ue

40.0% 35.0% 30.0%

Percentageof of Respondents RespondentsWho Percentage Selected FactorFactor as a Deciding Who Selected as a Factor Deciding Factor

25.0% 20.0% 15.0% 10.0% 5.0%

Bu s

Su Edu pp ca t o A n rti ed A in cce cho ng wo es ss r c st a rkf s, re to V omp te p orce se o ar C or any lic ie ch , a oth pre s nd er se Co te res nce Lo st o chn our c o ca f d lo es Ac Stro l go oin gy ce ng ve g b ... rn ss u to rese me sin tra ar nt es ns ch su s po in pp rta stit or tio uti t n o M ne ns ar tw Po ke pu t d ork lat em io n g and ro wt h Ot he r

0.0%

Figure 4.

Barriers to Metro Orlando Cleantech Cluster Development

At

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Ra

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of

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M an

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Percentage Percentageof ofRespondents Respondents Who a a Who Considered ConsideredFactor Factor Barrier Barrier

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50.0% 45.0% 40.0% 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0%

La

5. National and State Policies and Initiatives Survey respondents were presented with a statement on each idea and a description of the issue, including pros and cons. When asked to rate the importance of national and state policies by choosing the top two priorities, respondents identified the adoption of a Renewable Portfolio Standard (statewide renewable energy goal, requiring at least 20% of Florida’s electrical power to be from renewable energy sources by 2020) as the most important national or state policy or initiative, giving the policy an average of 51% as top priority and 17% as a second priority. The adoption of a cap-and-trade program received the lowest average rating with 4% choosing it as a top priority and 21% as a second priority.

of

Figure 3. Deciding Factors for Cleantech Companies to Locate in the Metro Orlando Region

3. Deciding Factors to Locate in Metro Orlando The top factors respondents identified as deciding factors to attract cleantech companies to Metro Orlando were local government support, strong research institutions, an educated workforce, and supporting state policies. 4. Barriers to Metro Orlando’s Cleantech Development The respondents saw the lack of state supporting policies, raising project financing capital, raising capital during the early stages of development, and the lack or limited access to venture capital as the main barriers to the development of a cleantech cluster in Metro Orlando.

Bi

En

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gy

0.0%

So

More than half of respondents saw solar energy as the most attractive cleantech sector for investment in the region, followed by the green building sector, which 17% of respondents saw as most attractive.

Percentage Percentageof ofRespondents Respondents Who Who Saw SawSegment Segmentasasthe the BiggestOpportunity Opportunity Biggest

15.0%

lar

2. Cleantech Opportunities in Metro Orlando Respondents saw energy generation (35.4%), energy efficiency (14.6%), and transportation (12.5%) as the cleantech segments that present the biggest opportunities in Metro Orlando in the next 5 to 10 years. No respondents selected the agriculture or air and environment segments as having the biggest opportunity for the area over this time frame.

35.0%

En e

1. Source of Funding Of the individuals who reported being from cleantech companies, half reported that the owner was (is) their company’s main source of funding during the seed stage, while the others received funding from the bank, a venture capitalist, or a combination of sources. The findings for the companies that had reached the startup stage of development were similar to the findings for the seed stage. The majority of companies obtained their seed stage and start-up stage funding from sources within Florida, although seed stage funding sources were geographically more varied than start-up stage funding sources.

40.0%


(Please refer to Appendix J for the full survey section on policies.) Table 2.

National and State Policies and Initiatives Top Priority

2nd Priority

Renewable Portfolio Standard

51%

17%

National feed-in tariff

13%

38%

Cap-and-trade program

4%

21%

Florida Clean Energy Fund

31%

24%

Policy/Initiative

6. Local Policies and Initiatives Respondents were also asked to rate the importance of local policies and initiatives, designating the top five policies that would promote cleantech in Metro Orlando the most. Of the 12 local policies and initiatives presented in the survey, the adoption of comprehensive green building codes/ordinances and supporting policies received the highest rating, the launching of Cleantech Challenge Grants was rated second highest, followed by the adoption of net metering and incentives for solar producers. Respondents saw the investment of public employees’ pension funds in cleantech companies as the least important local policy or initiative. The creation of a “Cleantech City” for incubation, manufacturing, and technology showcasing received the second-lowest average rating.

Gr

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Percentage ofof Respondents Percentage Who Saw Selected Respondents whoIdea as One of Their Top 5 One of Selected Idea as Their Top 5

Figure 6. Ideas to Promote Cleantech in Metro Orlando within Two Years 30.0% 25.0% 20.0%

Percentage PercentageofofRespondents Respondents who Selected IdeaIdea as Best Who Selected as Best

15.0% 10.0% 5.0%

Na C ti a E ap ona ne -an l fe 20% rg d-T ed R y P ra -in P S Gr ubl de tar Gr ee Cle een ic B Init iff i e a n c an b n t ol tec uil efi ive lar h di t F n Ne job Cha g p und l o tr le t li Cl met aini nge cies ea er ng G nt in p ra ec g a ro nt h n g s Cl Pro d in ram e s g Cl Ne an ram cen ea w En t n T pr er Ma ives ec ocu gy na hn re Inc ge In ol m ub r In vest og en a ve m y C t p tor st en m e o t en gu “ nte lici t o ar Cle r a es f p an an t U en tee te C sio s ch F n to C Sm fun VC ity” ar ds fir t G in m rid cl. s In .. iti at ive

0.0%

rid

Individuals from cleantech companies were more likely to choose the adoption of a national feed-in-tariff legislation and the creation of a Florida Energy Public Benefit Fund, and less likely to choose the adoption of comprehensive green building policies or the hiring of a

70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0%

Flo

7. Priorities When asked to select the one idea that would do the most to promote the growth of cleantech in Metro Orlando within the next two years from the 16 state, federal, and local policies and initiatives presented in the survey, 27% of respondents selected a statewide renewable energy goal of at least 20% by 2020, 13% selected the adoption of a national feed-in tariff legislation, and 13% selected hiring a cleantech Program Manager as the most important idea. No respondents selected green collar job training programs, the adoption of net metering and incentives for solar producers, the adoption of new procurement policies, the creation of a Clean Technology Center at UCF, or the creation of a “Cleantech City” for incubation, manufacturing, and technology showcasing as the most important idea to promote the growth of the Metro Orlando cleantech sector within the next two years.

Figure 5. Top 5 Priorities for Local Policies and Initiatives

CHAPTER 10: Survey Findings & Priorities

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Figure 7.

Ideas to Promote Cleantech in Metro Orlando Beyond Two Years 30.0% 25.0% Percentage Respondents Percenta geofof Res pondents Who Idea as Best WhoSelected Sel ected Idea a s Bes t

20.0% 15.0%

5.0% 0.0% 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

Key:

20% Renewable Portfolio Standards National feed-in tariff Cap-and-Trade Initiative Florida Energy Public Benefit Fund Green building policies Cleantech Challenge Grants Green collar job training programs Net metering and incentives Cleantech Program Manager Clean Energy Incubator New procurement policies Clean Technology Center at UCF “Cleantech City” Investment guarantees to VC firms Investment of pension funds in clean tech companies 16 Smart Grid Initiative

Respondents’ top priorities were more varied when looking at the Metro Orlando cleantech sector beyond two years, although the top three most frequently selected ideas remained the same.

Respondents who were not from a cleantech company were more likely than respondents from cleantech companies to choose the adoption of an RPS in Florida as the idea that would do the most to promote long-term growth of cleantech in Metro Orlando. Respondents from cleantech companies chose the adoption of national feed-in tariff legislation and the creation of a Florida Clean Energy Public Benefit Fund as the best idea to promote long-term growth more frequently than their non-cleantech company counterpart.

10.0%

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

cleantech Program Manager as the idea that would do the most to promote the growth of cleantech in Metro Orlando within the next two years compared to respondents not associated with a cleantech company.

Third Orange County Symposium Feedback During the third Cleantech Symposium, some ten initiatives/ideas were presented, described, and discussed. The audience was requested to provide their feedback on the importance of these ideas. They are listed as follows in the other they were presented: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

RPS: Renewable energy goal in Florida of at least 20% by 2020 Florida Clean Energy Public Benefit Fund Cleantech Initiative Challenge Grants “Green Collar” Job Training Programs Hiring or Designating a Cleantech Program Manager Creation of a Clean Energy Incubator within the UCF Technology Incubator Adoption of Comprehensive Green Building Codes Creation of a Clean Technology Center at UCF Creation of a “Cleantech City” for incubation, manufacturing, and showcasing Various policy levers from procurement policies and relocation incentives, for expedited permit processing and free design reviewing for green building

When asked about the importance of each idea to promoting the growth of cleantech in Metro Orlando (from a scale of 1 to 5 with 5 being the most important), the Renewable Portfolio Standard initiative of 20% by 2020 was judged to be the most important with a weighted average of 4.64, followed by the creation of a Florida Clean Energy Fund and Green Building policies both at 4.55. Figure 8.

How important is each of the following ideas to promoting the growth of cleantech in Metro Orlando? Importance 1. Renewable energy goal of at least 20% by 2020 2. A Florida Clean Energy Public Benefit Fund 7. Green building codes and ordinances 10. Various policy levers 3. Cleantech Initiative Challenge Grants 5. A Cleantech Program Manager 8. A Clean Technology Center at UCF 4. “Green collar” job training programs 6. Clean Energy Incubator in UCF Tech Incubator 9. “Cleantech City” incubation, manuf, showcase bldg importance

3.62 3.05 2.81 2.68 2.64

0.00

1.00

2.00

Mean

3.00

4.05

4.64 4.55 4.55

3.57 4.00

5.00

Note: On a scale of 1 to 5, the overall importance of all ideas taken as a group is 3.57. Source: Third Orange County Cleantech Symposium

144

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


Priorities When the audience was asked to chose the initiative/policy that would do the most for the Metro Orlando cleantech industry in the short term (within the next two years), the majority of respondents chose Green Building Codes and Ordinances, followed by the Renewable Portfolio Standard goal of 20% by 2020. Figure 9. Which ONE of the ideas presented above, if implemented, would do most to promote the growth of cleantech in Metro Orlando within the next two years? Please select only one idea.

7. Green building codes and ordinances 1. Renewable energy goal of at least 20% by 2020 10. Various policy levers 2. A Florida Clean Energy Public Benefit Fund 3. Cleantech Initiative Challenge Grants 5. A Cleantech Program Manager 8. A Clean Technology Center at UCF 4. “Green collar” job training programs 6. A Clean Energy Incubator in UCF Tech Incubator 9. “Cleantech City” incubation, manuf, showcase bldg

5.00, 1 5.00, 1 5.00, 1 0.00, 0 0.00, 0 0.00, 0 0

25.00, 5

15.00, 3 10.00, 2

10

20 Frequency (%)

35.00, 7

30

“The greatest consumers of energy today –and, in turn, the largest contributors of greenhouse gases – are our commercial, industrial, and residential buildings. Heating, air-conditioning, and electricity for what the industry calls “the built environment” accounts for 40 percent of greenhouse gas emissions in the United States (almost 60 percent globally), almost twice the emissions of the automotive sector. ” - Peter Senge, Bryan Smith, Nina Kruschwitz, Joe Laur, and Sara Schley. The Necessary Revolution. 2008.

40

Note: The figures at the end of each bar show the percentage response and the number of responses. Source: Third Orange County Cleantech Symposium

Finally, when asked to chose the initiative/policy that would do the most for the region’s cleantech industry in the long-term (beyond two years), the creation of a Florida Clean Energy Fund was chosen, followed by the Renewable Portfolio Standard of 20% by 2020. Figure 10. Which ONE of the ideas presented above, if implemented, would do most to promote the long-term growth of cleantech in Metro Orlando (over two years out)? Please select only one idea.

2. A Florida Clean Energy Public Benefit Fund 1. Renewable energy goal of at least 20% by 2020 10. Various policy levers 7. Green building codes and ordinances 5. A Cleantech Program Manager 6. A Clean Energy Incubator in UCF Tech Incubator 8. A Clean Technology Center at UCF 3. Cleantech Initiative Challenge Grants 4. “Green collar” job training programs 9. “Cleantech City” incubation, manuf, showcase bldg

4.76, 1 4.76, 1 4.76, 1 0.00, 0 0.00, 0 0.00, 0 0

14.29, 3 9.52, 2

10

23.81, 5

20 Frequency (%)

30

38.10, 8

40

Note: The figures at the end of each bar show the percentage response and the number of responses. Source: Third Orange County Cleantech Symposium

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Key Findings, Recommendations, and Proposals Findings

Finding 1: Policy is a critical driver of cleantech. Public policy is considered one of the main drivers in attracting and nurturing venture capital investment in cleantech. Policy can also create and grow market demand for cleantech products and services in a region. This was confirmed by the recent survey of Metro Orlando. Metro Orlando has supportive regional policies, but more concrete initiatives will need to be taken locally to assure the cleantech industry is competitive. Finding 2: Metro Orlando has many competitors in cleantech from which to learn. Whether in California, Texas, Massachusetts, New York, or the Northwest, many cleantech cities or regions are pursuing aggressive strategies to attract businesses, investments, and the most qualified human capital required to meet their cleantech clusters’ needs. Consequently, many regional initiatives have been taken, and many studies conducted. Here are a few examples:

“J.L. ‘Buck’ Martinez, FPL senior director of project development, described a cascade of solar-energy projects and jobs waiting to land in Florida. He said what stands in the way is the state’s lack of a ‘renewable portfolio standard’ that would require utilities to produce a specified portion of their electricity using the sun, wind or other renewable energy.” – Kevin Spear, Florida utility exec: Lack of solar standard could hinder growth of ‘green’ jobs. Orlando Sentinel. July 1, 2009. 146

Table 1. Release Date

Title

Authors

October 2008

Carbon-Free Prosperity 2020: How the Northwest can create Green jobs, Deliver Energy Security, and Thrive in the Global Clean-Tech Marketplace

Clean Edge, Inc. and Climate Solutions

September 2008

Seattle Clean Technology Strategic Plan

Sustainable Business Consulting

June 2007

“Cleantech Industry in San Diego: An Assessment of Assets and Capabilities”

Global Connect at UC San Diego

January 2007

Cleantech: A New Engine of Economic Growth for New York State

The New York City Investment Fund

October 2004

Harnessing San Francisco’s CleanTech Future

Clean Edge; San Francisco Dept. of Environment

November 2002

“Enriching Economy and Environment: Austin Clean Energy Making Central Texas the Center for Initiative; IC2 Institute, Clean Energy” University of Texas-Austin.

Finding 3: Metro Orlando established great public/private partnerships by developing strong ties between government, academia, and businesses. With

research and development a priority, local governments have encouraged continuous collaboration between companies and researchers. Thanks to the vital role played by the Economic Development Commission, Metro Orlando has created an attractive and very competitive climate for cleantech businesses.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


Finding 4. Metro Orlando’s research institutions—mainly at the University of Central Florida—are very competitive and have achieved pre-eminence in clean technology research and innovation. The following centers are among the most prominent in cleantech research: •

The UCF Florida Solar Energy Center has substantially boosted the region’s R&D capabilities in solar energy, green buildings, smart grid, and advanced energy systems.

The UCF NanoScience Technology Center is dedicated to research in various areas of renewable energy. Research is being undertaken to increase the efficiency of photovoltaics, among other areas.

The UCF Center for Advanced Turbines and Energy Research (CATER) has been dominant in funding for federal and industry research in turbines in Florida since 2000. CATER scientists partner with many U.S. research institutions and local industry leaders which are at the forefront of cleantech in Metro Orlando.

The UCF Advanced Materials Processing Analysis Center (AMPAC) is dominant in various targeted research areas that include energy and nanotechnology.

Finding 5: Metro Orlando has substantial support infrastructure for technological research and innovation. Some of the main supporting organizations in cleantech are: •

The UCF Office for Research and Commercialization, with its deep pool of talent in research and innovation.

The UCF Venture Lab, which is a well-established resource for promising early stage technologies.

The UCF Technology Incubator that supports local companies from early stages to financially stable businesses.

“The Venture Lab is currently mentoring and coaching six early-stage cleantech companies. Our new Chief Technology Officer has a background in cleantech. And we are a member of the Cleantech Network—an elite network of investors, companies, and service organizations focused on the creation of innovative cleantech economies.”

“We work in a team-based approach looking at the basic mechanisms, the design of the plastics, the nanoelectronics, and then integrated device development and partnering with others to meet these energy needs of the country.” – Jeff Anderson, Associate Director, NanoScience Technology Center. First Orange Cleantech Symposium. November 5, 2008.

“Turbines are involved in 98% of all electricity added to the U.S. grid.” – Jay Kapat, Engineering Professor. CATER. First Orange County Cleantech Symposium. November 5, 2008.

“UCF wants to be an international leader in materials science and engineering. Actually, we are very good. This is one of the strongest disciplines at UCF.” – Louis Chow, AMPAC Director. First Orange County Cleantech Symposium. November 5, 2008.

– Kirstie Chadwick, Director and Coach, UCF Venture Lab. First Orange County Cleantech Symposium. November 5, 2008. Finding 6: Metro Orlando has a rich mix of startups and industry leaders in its cleantech sector. Startups include companies such as Planar Energy Devices, Aqua Fiber Technologies, and Stormwater Treatment Environments. Cleantech industry leaders in Metro Orlando include Siemens Energy and Mitsubishi Power Systems. Finding 7. Metro Orlando cleantech companies are active in different cleantech segments. However, the majority are involved in Energy Generation and Energy Efficiency, followed by Materials and Transportation. Metro Orlando’s cleantech industry is spread over different sectors, including Solar Energy, Wind Power, Biofuels, Green Building, Public Transportation, and Smart Grid. The most active sectors are Solar Energy, Wind Power, and Green Building.

“Everyone seems to be looking for money to purchase equipment or for R&D. Money seems to be the biggest hurdle.” – Carbon Free Prosperity 2025. Clean Edge, Inc., and Climate Solutions. 2008.

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“The Florida Solar Energy Center — and the name is a little bit misleading because we do much more than solar energy — has been around for 32 years. … We’re currently the largest and most active state supported energy research institute in the nation.” – Phillip Fairey, Deputy Director, Florida Solar Energy Center, First Orange County Cleantech Symposium. November 5, 2008.

“The Office of Research & Commercialization at UCF fosters the creation of intellectual capital that can solve today’s pressing problems, improve the quality of life, and provide an engine for economic growth.” – UCF Office of Research and Commercialization Website. www.research.ucf.edu

“STE got our start, through the Venture Lab and they helped us with a business plan. … I am very appreciative of the opportunities that we got from the Venture Lab.”

Finding 8: Metro Orlando has limited access to capital compared to other regions, thereby hampering the full takeoff of its cleantech industry. According to a recent study conducted by the Pew Charitable Trusts, venture capital in cleantech in the state of Florida totaled nearly $117 million for the past three years, half of which went to the energy generation segment.549 Compared to other regions in the country, the state of Florida, including Metro Orlando, is behind in attracting venture capital (see Table 2). However, access to capital is the engine behind the growth of clean technologies. It is important for companies to have access to capital in order to make long-term investments in cleantech.

Table 2. Top Ten States for Clean-Energy Investments, Venture Capital, 2007 ($ Millions) California

$1,393.37

Massachusetts

$377.58

New York

$130.60

Pennsylvania

$114.55

Georgia

$86.70

Colorado

$70.62

Oregon

$64.65

Washington State

$46.01

New Hampshire

$44.49

Source: New Energy Finance, 2008. Carbon Free Prosperity 2025. Clean Edge, Inc., and Climate Solutions. October 2008.

Finding 9: Metro Orlando needs to continue branding itself as a high-tech hub and a cleantech cluster. Metro Orlando is still perceived today by many out of the region as the vacation capital of the world, hampering its opportunities for growth and development. Those are opportunity costs that should be contained if the region wants to compete in the cleantech market. Finding 10: Florida’s clean energy economy grew by 7.9% from 1998 to 2007 and the state is among the top ten in cleantech jobs according to a recent Pew research report.550 Cleantech jobs nationwide grew by 9.1%, while total jobs grew only by 3.7%.551 Revenue growth in the three main clean energy sectors—biofuels, solar, and wind—expanded by 53% to $115.9 billion in 2008 and is expected to reach $325.1 billion in 2018.

“The UCF Incubation Network now includes five locations in Metro Orlando to serve emerging high growth cleantech and other technology companies—with a sixth location coming online in 2009,” said Carol A. Dykes, Manager, UCF Technology Incubator at Research Park. “Everything we do, and every company that we help, aims to diversify our economy and create high-wage jobs.” – Carol A. Dykes, Manager, UCF Technology Incubator. Orange County First Cleantech Symposium. November 5, 2008.

– Marty Wanielista, Director, Stormwater Treatment Environments. First Orange County Cleantech Symposium. November 5, 2008. 549 Pew: Florida Sees Green in Going Green. South Florida Business Journal. June 10, 2009. 550 Pew. Ibid. 551 Ibid. 148

$47.11

Maryland

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


Recommendations The vision for Metro Orlando as a leader in the cleantech industry is quite challenging. It requires a strong commitment from the local government and new technologies that are attractive and respond to today’s private and public needs. Today’s cleantech presence in the region is very promising when compared with other cleantech clusters in the country. The present companies’ performances and the industry makeup are quite diverse. Some efforts have been identified, but more needs to be done. The following recommendations in this study are based upon two different sources: first, they emanate from the views of participants at the cleantech symposiums—both presenters and audience—and the cleantech survey. Participants were from academia, businesses, government, and other backgrounds in the community who are interested in promoting and growing cleantech in Metro Orlando. Another basis for the recommendations is the comprehensive research of studies, initiatives, and successes in other regions and states, currently recognized as cleantech leaders and that are demonstrating “what works.”

Policymakers Metro Orlando needs to embark on new policies that will attract more investment and drive innovation. Investments tend to go where innovative products are supported. Through its Economic Development Commission, Metro Orlando can certainly address those challenges and continue to build strong ties with researchers at the University of Central Florida, entrepreneurs, and venture capitalists to spur economic growth and create jobs. In addition, they need to maintain ties with other out-of-state resources when not available in the region and promote a rebranding of the Metro Orlando region as a 21st century technology leader, including cleantech. In the “Cleantech Opportunity” section, we were able to assess the potential and likelihood of many of these companies to achieve high growth and high market impact in the region. However, as the Metro Orlando cleantech industry is evolving and gaining maturity, there are still plenty of opportunities for economic development initiatives to promote the expansion of startups and homegrown cleantech companies in the region. When asked what it would take to see more innovation around solar, biofuels, and electric vehicles, most cleantech industry leaders answered the following: More money, more government assistance, and real changes in consumer behavior.552 Some believe that the U.S. must do more to take a leadership position in the cleantech industry, with some even asking for a carbon tax, new biofuel mandates, and research and development grants. Metro Orlando, like many local 552 Cook, John. Venture Capital: Clean Tech Industry Says the Future Could Be Now. Seattle Post-Intelligencer. August 14, 2008. CHAPTER 11: Key Findings, Recommendations, and Proposals

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governments, can play a significant role in spurring the industry, as capital will flow only in locations where new energy products are being supported.553 While the cleantech symposiums were able to provide an unprecedented opportunity for entrepreneurs, academia, and policymakers to form alliances and share ideas and expertise, it is recommended that any future cleantech symposiums include another group: prominent clean technology investors. It would certainly provide more access to networking for capital and investment deals, sales leads, and opportunities.

Academia The University of Central Florida could play an important role in helping the state and Metro Orlando area become a leader in the new industry. With its strengths in engineering and its fundamental role in research, UCF can not only build on its social network with local municipalities and local businesses, but also develop new partnerships with other academic, state, and federal government bodies to be more competitive and serve as a leading cleantech research center in the nation. Science and technology infrastructure is a real pillar in the economic growth of a region. Innovative capacity is not only a matter of spending on research and development (R&D); microeconomic competitiveness has to be sufficiently high across many dimensions of business environment quality and company sophistication in order for R&D spending to generate more patenting and other innovation output.554 There is a broad range of opportunities that can be addressed by targeted investments. The concept of the “Porter Hypothesis” can induce efficiency and encourage innovations that help improve

553 Cook. Ibid. 554 Furman, J., M. Porter, and S. Stern. The Determinants of National Innovative Capacity. Research Policy. 31 (6) 899-933. 2002. 150

competitiveness.555 Research and commercialization leaders must ensure that the patents’ rights are leveraged into returns on investments.

Businesses It is important for companies to have access to capital in order to make long-term investments in cleantech. They need to attract private equity funds, venture capital, and their own private investors. However, to attract capital, companies need to build on their innovation, their market, and their ability to execute their plans, including their finance, team competencies, and their networks. Following her interview with venture capitalists, Elizabeth Block, of Renewable Energy Focus, summarized as follows how companies can attract investment: “Tucker Twitmyer, managing partner of EnerTech Capital in Philadelphia, wants to see a technological and business model that looks promising in the near term even at an early stage, as well as a “capable-looking” management team and the potential for large returns. Gina Domanig, managing partner at Emerald Technology Ventures, cites a “grave” lack of market analysis as a major failing in some pitches. Dr. Steve Mahon, CIO of Low Carbon Accelerator, takes this sentiment even further, saying that direct experience of the marketplace is invaluable, and companies should “hold out” for those who have it.”556

555 Frohwein and Hansjürgens. Chemicals Regulation and the Porter Hypothesis: A Critical Review of the New European Chemicals Regulation. Journal of Business Chemistry. Vol. 2. Issue 1. January 2005. 556 Block, Elizabeth. VCs: Getting on the Radar. Renewable Energy Focus. Vol. 9, Issue 4. July-August 2008. pp. 24-26.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential


17-Point Action Proposal 17-Point Action Proposal 1. Cleantech Leadership Council

2. Branding Metro Orlando as a cleantech cluster

3. New partnerships with UCF and other academic/research institutes 4. Green building codes and ordinances 5. Targeted cleantech funds 6. Clean Energy Challenge Grants

7. Renewable Energy Portfolio Standards

8. Florida Clean Energy Public Fund 9. Cluster-related strategies

10. Cleantech Incubator at UCF 11. Smart grid initiative

12. Feed-in tariff system

13. Cleantech Center at UCF

1 4.

Integrate UCF into Metro Orlando’s Economic Development Strategies and Programs

1 5. Funding and support for UCF economic development programs 1 6. Green Jobs Steering Committee

17. Green Transportation Initiatives

In light of the previous assessment, the following seventeen point action proposal is recommended:

Orlando Economic Development Commission’s Website. Clean technology is listed among the region’s industry strengths.

1. Establish a Cleantech Leadership Council to discuss challenges and opportunities, as well as strategies for local governments in developing cleantech in Metro Orlando. Its major role would be to convey regularly occurring forums that bring together academia, businesses, and government entities. Also, develop and implement the best policies to promote cleantech growth in Metro Orlando.

However, more is necessary to reach others out of the Sunbelt through partnerships and coordination efforts with other key national players in the cleantech industry. “Coordination and communication with other regional, state and federal initiatives. If Orlando wants to be taken seriously, it needs a face to the effort and a presence in Washington, D.C. as well as other efforts in the U.S. and abroad.”559

“Continue the Orange County/ UCF Cleantech Symposium Series, with each new symposium focusing on a specific topic such as green buildings.”557

“Providing connections within the community, as well as promoting linkages with significant players in the cleantech industry from other parts of the country and the world (Silicon Valley/SF Bay, Washington DC, San Diego, Boston, Austin, Latin America, China/Japan) to raise awareness/ links/business cooperation between Orlando and other communities.”560

2. Build new marketing strategies to brand Metro Orlando as a serious cleantech cluster. This requires developing new ties and partnerships with other entities, both at the state and national levels. “Encourage branding and marketing efforts, creating an environment where utilizing cleantech is encouraged.”558 Some work is already being done towards that step as illustrated by Figure 1, taken from the Metro 557 Comments and suggestions by Orange County Cleantech Survey participant. 558 Comments and suggestions. Ibid.

3. Promote new partnerships between UCF and other regional academic and research institutions. This will certainly provide more innovation opportunities. Clusters have been found to emerge not only from individual institutions, but also 559 Ibid. 560 Ibid.

Figure 1.

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from synergies between different institutions, creating greater networks and greater knowledge capacity, all at a faster pace. “Our R&D base will be especially important, and we have strengths in almost all areas … solar, biomass/biofuels, fuel cells and hydrogen technologies, and ocean energy. Our universities, and our partnerships with universities, are going to be especially important if we are going to be cleantech players.”561 “While some industry clusters develop out of one great academic institution, other clusters can be born out of a regional network of universities cooperating and sharing capabilities and knowledge.”562 Among others, the University of Central Florida could develop key partnerships with the closest universities in the region: the University of Florida in Gainesville and the University of South Florida in Tampa. Some of the entities that could be beneficial to promoting cleantech are the UF Technology Licensing Office, the UF Florida Institute for Sustainable Energy, the USF Energy Efficient Energy Project, and the USF Clean Energy Center. 4. Enact comprehensive green building codes and ordinances. Studies have shown that buildings represent almost half of carbon emissions in the U.S. Metro Orlando local governments encourage green building. For example, Orange County expedites green building projects and recognizes green projects with the Orange County Design Excellence Awards. However, no local governments as of yet have enacted comprehensive green building codes and ordinances. 561

Black, Sena. Senior Vice President of Marketing and Strategic Development, Enterprise Florida. First Orange County Cleantech Symposium. November 5, 2008. 562 Carbon Free Prosperity 2025. Clean Edge Inc. and Climate Solutions. 2008.

152

By passing new green building codes, Metro Orlando will foster the growth of the cleantech industry and create more opportunities for the building and design industry. The region should adopt building policies for public sector, residential, and commercial buildings and push the industry to meet the Architecture 2030 Challenge, which has been endorsed so far by the American Institute of Architects, the U.S. Green Building Council, and the U.S. Conference of Mayors. As discussed in the Green Building opportunity section, all cleantech clusters have adopted major green building standards, including San Diego, Santa Monica, Dallas, Austin, New York, Denver, Scottsdale, etc. “It is true that we need new construction [to be] more efficient,” said Jim Fenton, Director of Florida Solar Energy; “but we’ve got to retrofit our existing buildings and our existing homes.”563 5. Encourage more access to capital by creating targeted cleantech funds. One way to promote the industry is to provide investment guarantees to venture capital firms. For example, the Commonwealth of Pennsylvania has offered a total of $320 million in low-interest loans and investment guarantees to VC firms that invest in midstage companies based in the state.564 That would send a signal that Metro Orlando is serious about cleantech and promote the success of companies at their most fragile stages. Furthermore, local firms should be encouraged to use local resources such as Siemens Venture Capital. Finally, cleantech investment can be promoted by organizing venture forums connecting local cleantech firms to potential investors. “For years, VC companies have been interested in Metro Orlando’s leading industries, such as MS&T, Digital Media and 563 Fenton, Jim. Director, Florida Solar Energy Center at UCF. Second Orange County Cleantech Symposium. February 18, 2009. 564 Pernick R. and Wilder, C. The Cleantech Revolution. HarperCollins. New York. 2008.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

Life Sciences,” said Amy Dinsmore, Director of Business Development at EDC. “With the support that cleantech is receiving, it is sure to become another leading sector in our region. This is a good time for VC’s to look at Metro Orlando and our entrepreneurial spirit and find out what the next opportunity is going to be.” “Siemens has its own venture capital firm (www. siemensventurecapital.com) to encourage cleantech ventures and other startup companies. It is celebrating its tenth year and has almost $1 billion under management.”565 6. Create the Clean Energy Challenge Grants to encourage researchers to develop and commercialize new technologies. These funds could significantly contribute to the success of the industry by promoting more innovation. This is an example of an action step that requires only a modest investment from public and private partners, such as in San Diego. In November 2008, the City of San Diego launched the Cleantech Innovation Challenge Program in collaboration with UC San Diego and San Diego State University.566 “The idea behind this is simple: creating innovation at the bottom so that we can create more ingrown companies,” said Jacques Chirazi, City of San Diego Cleantech Program Manager in his presentation at the Third Orange County Cleantech Symposium. “Innovation has to be nurtured and grown. Ninety-eight percent of companies which graduate from the commercialization center remain in San Diego. That’s where we could eventually get a lot of growth in the future.”567 565 Bevc, Frank, Director, Technology Policy and Research Programs, Siemens Energy Orlando. Second Orange County Cleantech Symposium. February 18, 2009. 566 San Universities, Government, and Industry Rally Around Cleantech. UCSD Jacobs School of Engineering. November 6, 2008. 567 Chirazi, Jacques. Cleantech Program Manager, the City of San Diego. Third Orange County Cleantech Symposium. February 18, 2009.


7. Promote the adoption of the Renewable Energy Portfolio Standard in Florida. According to the Pew Research reports as of June 2009, 29 U.S. states and the District of Columbia have established renewable portfolio standards requiring electricity providers to supply a minimum percentage or amount of customer power from a renewable source of electricity.568 The State of Florida is among five other states which have set a voluntary State Renewable Goal. Indeed, in June 2008, Governor Charlie Crist signed into law House Bill 7135 requiring the Public Service Commission to develop an RPS by February 1, 2009. Governor Crist’s Executive Order of July 13, 2007 requires utilities to produce at least 20% of energy from renewable sources. However, there is no mandate.

Figure 2.

Source: www.pewclimate.org

Figure 3.

States with Renewable Energy Standards

Figure 3, dated as of December 2007, provides specific policy requirement details for each state with Renewable Portfolio Standards.569 In January 2009, the Florida Public Service Commission unanimously backed the governor’s goal for renewable energy standards.570 Unfortunately, in the 2009 legislative session, a Florida RPS was not allowed to come to a vote, thereby placing the state at a disadvantage compared with other states when it comes to promoting the development of the cleantech sector. Consequently, some believe that the state is losing ground in attracting renewable energy businesses and jobs.571 As for all other states with an RPS policy in place, a strong RPS in Florida would expand the state’s economy and create jobs, besides 568 The Clean Energy Economy. The Pew Charitable Trusts. June 2009. 569 Cory, K.S. and Swezey, B.G. Renewable Portfolio Standards in the States: Balancing Goals and Implementation Strategies. National Renewable Energy Laboratory. December 2007. 570 Loder, Asjylin. Florida PSC backs Crist’s renewable energy plan. St. Petersburg Times. January 10, 2009. 571 Anderson, Zac. Energy Legislation Killed by the House. Sarasota Herald Tribune. May 2, 2009.

Source: www.nrel.gov

being good for the environment.572 For example, the state of Texas has benefited tremendously from the implementation of its first RPS policy since 1999. It is estimated that more megawatts of renewable energy came online after this than in the past 100 years. “Texas wind corporations and utilities invested $1 billion in wind power, creating jobs, adding to the Texas Permanent School Fund and increasing the

572 Renewable Energy to Jumpstart Florida’s Economy. Florida Consumer Action Network. www.fcan.org

rural tax base.”573 As one of the “most successful and effective” in the nation, the Texas RPS is considered as a model to follow.574 8. Promote the creation of a Florida Clean Energy Public Fund. Together with the RPS policy, this was considered the best local initiative by participants at the Orange County Third Symposium Indeed, it has been determined that for any Renewable Portfolio 573 Texas Renewable Portfolio Standard. State Energy Conservation Office.  www.seco.cpa. state.tx.us 574 Texas Renewable Portfolio Standard. Ibid.

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Standard to be successful, policymakers must simultaneously establish a public benefit fund. That is the only way to accelerate cleantech growth. According to the Florida Renewable Energy Association, 18 other states currently have funds ranging from $2 million to $300 million, each for energy incentives and efficiency programs.575 Such a fund in Florida would add only approximately 60 cents per month onto the average residential electric bill. Larger customers would pay proportionately more, and smaller customers would pay less. Based on Florida’s 2006 total energy consumption, a Florida Clean Energy Public Benefit Fund would generate $114 million a year. State clean energy funds have emerged as a key driver of renewable energy projects across the U.S. The following are the key findings from the Clean Energy States Alliance Database as of January 2009:576 a. b. c. d. e.

The impact of state clean energy funds is significant and accelerating. The state funds invested $1.5 billion in renewable energy projects between 1998 and 2007 and leveraged an additional $2.6 billion. The state funds have supported a broad range of renewable technologies and have led the nation in the development of photovoltaics. The state funds have focused their financial support on onsite installations. While California is the largest contributor, states across the nation are investing in renewable energy.

9. Develop cleantech clusterrelated strategies by fostering the emergence of new firms and expansion of local companies, targeting companies that fill the gaps of the existing market, supporting entrepreneurship, and 575 Florida Clean Energy Fund Campaign. Florida Renewable Energy Association.   www.cleanenergyflorida.org 576 State Clean Energy Fund Support for Renewable Energy Projects. Clean Energy States Alliance. January 2009. 154

Figure 4.

State Clean Energy Fund Projects Completed by Year 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

2003

2004

2005

2006

2007

Source: Clean Energy Fund Association. January 2009.

promoting policies that support the cluster. For example, Metro Orlando can stimulate local demand for cleantech products by implementing procurement policies by the public sector. Local governments can promote cleantech growth by requiring the purchasing of products and services from local cleantech companies. This is the best way for local governments to “walk the walk” and to send a signal to the cleantech industry and the financial community that there is demand for their products, resulting in less risk. The Florida Statutes 287.045 and 403.7065 are both green procurement policies. They require state agencies to purchase products made with recycled content. In the state of California, the Buy Recycled Program is a Green Procurement Policy that promotes buying green throughout the state. Under the management of the California Integrated Waste Management Board, it coordinates all green procurement efforts or initiatives in the state.577 In January 2001, the County of Sacramento adopted the Environment Purchasing Policy. Since September 2001, the City of San Jose has been implementing the Environment Preferable Procurement Policy. Besides many other examples in the state, most recently, in April 2009, the city and county of San Francisco approved 577 Buy Recycled Programs. Green Procurement Policies. California Integrated Waste Management Board. www.ciwmb.gov

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

the Environmentally Preferable Purchasing Ordinance. Finally, Metro Orlando can also benefit from demand growth by encouraging green procurement practices by local firms and the public, as well as promoting export opportunities. Indeed, green procurement should be the responsibility of every organization. “By understanding the social values that motivate different segments of the public to action, companies can play an integral role in shaping what it means to care about the environment,” said Joel Makower, green business expert. “In so doing, more Americans will be able to see themselves as participants in the green economy every day.”578 Comprehensive procurement guidelines can be found on the EPA Website at www.epa/gov/cpg. “Also leverage the strengths of energy companies currently located here in Orlando/Melbourne (Siemens, Mitsubishi Power, Harris) - encourage them to grow their cleantech operations here, and thereby grow Orlando’s own “anchor” cleantech companies right here at home.”579 10. Create a Cleantech Incubator within the Business Incubator at UCF to strengthen and facilitate 578 Makower, Joel. Strategies for the Green Economy: Opportunities and Challenges in the New World of Business. McGraw-Hill. 2009. 579 Bevc. Ibid.


Figure 5.

1.8 1.6 1.4 1.2 1.0

Fuel Cells Hydro Geothermal Landfill Gas

0.8 0.6 0.4 0.2 0 2003

Biomass PV Wind

2004

2005

the commercialization of innovative clean technologies. Metro Orlando needs to build on the region’s strengths in research and innovation by supporting applied research and technology transfer activities, and facilitating the commercialization of innovation in cleantech. Regions which are considered today as cleantech leaders are well known for their dedicated cleantech incubators: Austin, TX; San Jose, CA; Berkeley, CA; Boston, MA; San Diego, CA; San Francisco, CA; etc. The Clean Energy Incubator at the University of Texas in Austin was launched in 2001 as a joint effort between the Austin Technology Incubator and the National Renewable Energy Laboratory (NREL). In March 2007, Austin was ranked by SustainLane as the No. 1 U.S. city for cleantech incubation due to the influx of cleantech capital, deep R&D, opportunities for field testing and prototyping, and the Clean Energy Incubator. According to Sena Black, “R&D and commercialization search for solutions and new technologies that will solve real problems in a cost-effective manner.”580 “It’s not just a matter of you having a great patent. Who’s going to translate the patent into a 580 Black, S. Ibid.

2006

2007

commercial success?”581 “The future of Florida will be in an innovation and knowledgebased economy, and it is in this framework that cleantech will play a very important economic development role.”582 11. Undertake a smart grid initiative. Metro Orlando could claim a leadership role in grid management by taking a high-profile smart grid initiative that would draw attention to the region. As well developed under the section Clean Technologies and Sectors of this study, a smart grid is a two-way network that delivers electricity, utilizing digital technology, becoming more flexible, secure, reliable, and efficient. Smart grid technologies embody the true cleantech revolution whether in new distributed resources (distributed generation interconnection, and energy storage integration), power grid management (realtime monitoring, transmission/ distribution automation, demand response and communication networks), or customer power management (smart meters, smart buildings and equipment, smart appliances, and customer voltage regulation).

581 Black, S. Ibid. 582 Black, S. Ibid.

Source: Clean Energy Fund Association. January 2009.

Gigawatts

Cumulative Generating Capacity Supported by State Funds by Technology

Smart grid and smart energy not only provide solutions to power delivery and generation, but also provide a great booster in the industry and the local economy. A smart grid can help accelerate the adoption of new technologies, boost job creation, reduce power delivery costs, reduce blackouts and power disturbances, improve energy efficiency, cut pollution, and promote the development of renewable capacity. Regional utility companies can be requested to develop their smart incentives into regulations once it is determined that their policies will spur cleantech growth. Recent initiatives have been implemented in St. Petersburg, FL. This $15-million smart grid project is scheduled to be built over three years by Progress Energy and the University of South Florida.583 Once developed, it will be the first in Florida and the largest in the Southeast, serving at least 5,000 consumers. “The state of California spends $550 million a year on rebates to its citizens to buy down the cost of photovoltaics or solar thermal hot water on their roofs. … Now, California has twice the population the state of Florida does, so if we want a million solar roofs like California, this is easy. Just come up with $275 million a year. That’s $1.50 a month on your electric bill. That’s what that cost is. … Now, we were told, of course, that $1.50 a month was too much money. Many of you who are in Progress Energy territory or in Florida Power and Light territory, you are going to be paying $6 to $9 a month to purchase a nuclear power plant which won’t turn on for 10 years.”584 12. Promote a feed-in tariff system. The concept of net metering allows electric meters to measure not only the energy used but also the energy produced by consumers and returned directly to the grid. This initiative is a cost-effective, simple method to 583 USF, Progress Energy get contract for ‘smart grid’ in St. Petersburg. Triangle Business Journal. March 9, 2009. 584 Fenton. Ibid.

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promote direct customer investment in renewable energy technologies, and it is easy to administer while helping offset the capital cost of smart grid technologies and passing savings onto consumers. Some states, such as Washington and Oregon, have already introduced similar policies while others are considering a stronger bill, such as the states of California and Hawaii, and the City of Los Angeles. But in March 2009, according to the New York Times, Gainesville, FL became the first U.S. city to introduce higher payment for solar power, which otherwise would be too expensive to install by consumers or businesses. City leaders approved the policy after studying the German model. “The Gainesville Regional Utilities is one part of what is necessary to achieve the highest energy efficiency and reductions in energy consumption, because it is encouraging people to make economic decisions on how to generate their own electricity and the time of day to use electricity.”585 13. Create a Cleantech Center at UCF. There is no doubt that UCF, through its major university departments, has been able to engage in topnotch research and prepare very well qualified engineers to meet the demands of the cleantech industry. However, for more coordination in cleantech, it is advised to have a Cleantech Center with a onestop-shop state-of-the-art Website entitled “UCF Clean Technologies,” with a mission/vision of showing all cleantech research being undertaken by the university, with links connecting all different departments or organizations involved in cleantech. The new UCF Cleantech Center should be open not only to UCF-based organizations but also to other research institutions (whether national or international), whether they are universities, research institutes, private companies or non-profit research labs. Some universities, such as Washington State University, have already taken such steps. They have dedicated 585 Bevc. Ibid. 156

complete academic programs to clean technologies, whether at the graduate level or undergraduate levels. They also have allowed students to have a focus in cleantech. In the beginning of this year, Stanford University announced plans to build a $100 million green technology center, the Precourt Institute for Energy.586 The Institute is an extension of Stanford’s already existing Global Climate & Energy Project (GCEP). 14. Fully integrate UCF cleantechrelated entities into Metro Orlando’s Economic Development Strategies and Programs. Ten years ago, economic development mostly meant marketing and targeted business retention/ expansion programs. During the past ten years, new UCF economic development programs have been incorporated into the community’s economic development efforts—such as the UCF Venture Lab, UCF Technology Incubator, and the UCF Small Business Advisory Board Council Program. “As we move forward, other UCF entities need to be [included] into our efforts to grow the cleantech sector of our economy,” said John Lewis, Administrator of the Orange County Office of Economic, Trade, and Tourism Development. “These entities include the UCF Florida Solar Energy Center, the UCF Nanoscience Technology Center, the UCF Advanced Materials and Processing Center, the UCF Center for Advanced Turbines & Energy Research, and the UCF Sustainability and Energy Management Center.” 15. Increase funding and support for UCF economic development programs supporting the creation and growth of cleantech companies. These include the UCF Technology Incubator, the UCF Venture Lab, and the UCF Small Business Advisory Council 586 Ricketts, Camille. Stanford launches $100M energy institute for cleantech research, teaching. January 12, 2009. http:// venturebeat.com/2009/01/12/ stanfordlaunches-100m-energy-institute-forresearchteaching/

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

Program. There is strong university and local government support for these programs, as well as some corporate support. However, “there is little, if any, state support for these programs,” said Lewis. “In the same way, there are state incentives to attract companies to Florida, there needs to be state support for creating and nurturing home grown companies.” 16. Establish a permanent Green Jobs Steering Committee to plan for, coordinate, and otherwise oversee training programs that will help Metro Orlando to realize its full potential for creating green jobs.587 The growth of cleantech depends heavily on human capital. An increase in the number of training programs, both at the company and college level, is key to sustaining growth in cleantech. One key impetus for the Metro Orlando area making green-job training a priority is the upcoming layoffs of Kennedy Space Center workers in 2010 or 2011 with the ending of the shuttle program. Approximately 3,500 workers are expected to be laid off.588 The potential labor pool of engineers, manufacturers, and many other aerospace workers could help cleantech transition more quickly into a strong presence in the region. A centralized committee designed to assess and meet the demand for green-collar workers for companies throughout the metro would help in the growth of cleantech. “… We may want to look at existing companies that are already here in cleantech and see if their needs are being met in terms of work force skills, and then … have that guide the programs, whether it's at UCF or any of our community college partners or technical schools.”589

587 Lewis, John. Director, Orange County Office of Economic, Trade & Tourism Development. 588 Burnett, Richard. More layoffs coming to Space Coast. Orlando Sentinel. July 30, 2009. http://blogs.orlandosentinel.com/ news_space_thewritestuff/2009/07/ morelayoffs-coming-to-space-coast.html 589 Snaith, Sean. Director, UCF Institute for Economic Competitiveness.


17. Encourage Green Transportation Initiatives. These initiatives could range from developing a network of charging stations to encouraging green car dealerships and green car rentals. Given the number of rental cars on the roads in Metro Orlando, this could make a big difference. One of the stumbling blocks to the widespread use of electric vehicles is the lack of a system of battery charging stations. San Diego County will be getting a network of such charging stations as part of President Obama’s $2.4 billion program to promote green transportation, which could be an example for us to follow. The grant program is part of a plan to have one-million hybrids by 2015 on roads across the nation.590 “Green transportation initiatives could help Metro Orlando cleantech companies such as Planar Energy Devices, Inc., an advanced battery R&D and manufacturing company.”

List of Works Consulted 1.

Anderson, Jeff. Associate Director, NanoScience Technology Center. First Orange Cleantech Symposium. November 5, 2008.

2. Anderson, Zac. Energy Legislation Killed by the House. Herald Tribune. May 2, 2009. 3.

4.

5.

Bevc, Frank. Director, Technology Policy and Research Programs, Siemens Energy Orlando. Second Orange County Cleantech Symposium. January 21, 2009. Black, Sena. Senior Vice President of Marketing and Strategic Development, Enterprise Florida. First Orange County Symposium. November 5, 2008. Buy Recycled Programs. Green Procurement Policies. California Integrated Waste Management Board. www.ciwmb.gov

6. Carbon Free Prosperity 2025. Clean Edge Inc. and Climate Solutions. October 2008.

590 Reston, Maeve. Obama unveils $2.4-billion grant program to aid electric cars. Los Angeles Times. March 20, 2009. http:// articles.latimes. com/2009/mar/20/nation/na-obamapomona20.

7.

Chirazi, Jacques. Cleantech Program Manager, the City of San Diego. Third Orange County Cleantech Symposium. February 18, 2009.

8. Chow, Louis. AMPAC Director. First Orange County Cleantech Symposium. November 5, 2008. 9.

Chadwick, Kirstie. Director and Coach, UCF Venture Lab. First Orange County Cleantech Symposium. November 5, 2008.

10. Comments and suggestions by Orange County Cleantech Survey participant.

11. Cook, John. Venture Capital: Clean Tech Industry Says the Future Could Be Now. Seattle Post-Intelligencer. August 14, 2008. 12. Domanig, Gina. Managing Director, Emerald Technology Ventures in “VCs: Getting on the Radar” by Elizabeth Block. Renewable Energy Focus. Vol. 9, Issue 4. July-August 2008. pp. 24-26.

13. Dykes, Carol A. Manager, UCF Technology Incubator. Orange County First Cleantech Symposium. November 5, 2008.

14. Fairey, Phillip. Deputy Director, Florida Solar Energy Center. First Orange County Cleantech Symposium. November 5, 2008.

15. Fenton, Jim. Director, Florida Solar Energy Center at UCF. Second Orange County Cleantech Symposium. Feburay 18, 2009. 16. Florida Clean Energy Fund Campaign. Florida Renewable Energy Association. www.cleanenergyflorida.org

17. Frohwein and Hansjürgens. Chemicals Regulation and the Porter Hypothesis: A Critical Review of the New European Chemicals Regulation. Journal of Business Chemistry. Vol. 2. Issue 1. January 2005.

18. Furman, J., M. Porter, and S. Stern. 2002. The Determinants of National Capacity. Research Policy. 31 (6) 899-933. 19. Kapat, Jay. Engineering Professor. Center for Advanced Turbines & Energy Research. First Orange County Cleantech Symposium. November 5, 2008.

23. Pew: Florida Sees Green in Going Green. South Florida Business Journal. June 10, 2009.

24. Pernick R. and Wilder, C. The Cleantech Revolution. HapperCollins. New York. 2008.

25. Renewable Energy to Jumpstart Florida’s Economy. Florida Consumer Action Network. www.fcan.org 26. San Diego Universities, Government, and Industry Rally Around Cleantech. UCSD Jacobs School of Engineering. November 6, 2008. 27. Siemens Venture Capital. www.siemensventurecapital.com from Orange County Second Symposium. January 21, 2009.

28. State Clean Energy Fund Support for Renewable Energy Projects. Key Findings. Clean Energy States Alliance. January 2009 29. States with Renewable Portfolio Standards. The Pew Research Organization. www.pewclimate.org June 10, 2009.

30. Cory, K.S. and Swezey, B.G. Renewable Portfolio Standards in the States: Balancing Goals and Implementation Strategies. National Renewable Energy Laboratory. December 2007. 31. Texas Renewable Portfolio Standard. State Energy Conservation Office. www. seco.cpa.state.tx.us 32. Third Orange County Cleantech Symposium. February 18, 2009. 33. UCF Office of Research and Commercialization Website. www.research.ucf.edu

34. USF, Progress Energy get contract for ‘smart grid’ in St. Petersburg. Triangle Business Journal. March 9, 2009.

35. Fenton, James. Director, Florida Solar Energy Center. Second Orange County Cleantech Symposium. January 21, 2009. 36. Wanielista, Marty. Director, Stormwater Treatment Environments. First Orange County Cleantech Symposium. November 5, 2008.

20. Loder, Asjylin. Florida PSC backs Crist’s renewable energy plan. St. Petersburg. January 10, 2009.

21. Mazza, Patrick. Powering up the Smart Grid: A Northwest Initiative for Job Creation, Energy Security and Clean, Affordable Electricity. Climate Solutions. July 2005. 22. Makower, Joel. Strategies for the Green Economy: Opportunities and Challenges in the New World of Business. McGraw-Hill. 2009.

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Conclusion

This report sought to assess Metro Orlando’s assets, capabilities, and potential of cleantech and was intended to reach a wide audience: policymakers, academia, and businesses, as well as others in the community interested in cleantech. The study was quite comprehensive. It was based not only upon information obtained throughout the series of cleantech symposiums and from the survey results, but also from primary and secondary research on the cleantech industry in general, existing studies done elsewhere, as well as a policy analysis of existing initiatives already adopted in other cleantech clusters. The outcomes of the study, including the results of the survey and the key findings, have served as the framework for the recommendations outlined previously. Cleantech is the new economy—the new economy that is set to transform not only local cities and states, but also countries and regions around the world. Merrill Lynch Cleantech Strategist, Steven Milunovich, believes that the sixth technology revolution will be driven by clean technology and biotech. “History shows that technology revolutions occur every 50 years. We believe cleantech is at the beginning of a high-growth period much like computing was in the early 1970s. The application of technology to resource problems should cause profound changes in the energy, utility, and automotive industries,” said Milunovich.591 Cleantech does offer challenges, but the opportunities are limitless. Despite the worst economic conditions since the Great Depression, the cleantech industry has proven to be resilient by continuing to benefit the most from venture capital investments and providing a fertile ground for innovative entrepreneurs. Through innovative technologies, great access to capital, and support from policymakers, companies are generating billions of dollars in revenue and creating millions of new jobs—green jobs. Once only known as the vacation capital of the world, Metro Orlando is also a high-tech hub, where plenty of industries are thriving, breaking out new technologies, nurturing an innovation economy, and creating jobs. Today, like several other regions, Metro Orlando is trying to put itself at the forefront of cleantech. Metro Orlando’s cleantech sector includes about 85 companies, which are active in different segments 591

158

Merrill Lynch Research Calls Cleantech the Sixth Technology Revolution. Merrill Lynch Newsroom. November 24, 2008.

of cleantech. However, about 50% of the companies are involved in energy generation and energy efficiency combined, with solar energy being the strongest sector. The University of Central Florida has served as the backbone of the Metro Orlando’s regional economic development. Thanks to its strong research institutions, such as the UCF Florida Solar Energy Center, the UCF Nanoscience Technology Center, the UCF Advanced Materials and Processing Center, and the UCF Center for Advanced Turbines & Energy Research, UCF has been able to achieve pre-eminence in technology R&D and innovation. Today, UCF continues to play a central role in promoting cleantech in the region. With a great leadership vision, strong state government support for cleantech, strong partnerships between academia and industry, a high-tech economy with full access to research and technology transfer, an abundance of technology clusters, skilled labor, and an environment conducive to entrepreneurship, Metro Orlando is well poised to become a true cleantech leader. Indeed, Metro Orlando has the assets, the know-how, the capabilities, and the full potential to become a true cleantech cluster. “In terms of cleantech, we are onto something here,” said Mayor Richard Crotty in his presentation at the First Orange County Cleantech Symposium. “I think that we can make our mark as a community to further diversify our local economy, further go down the road to greatness in the days ahead.”592 592 Crotty, Richard. Orange County Mayor. First Orange County Cleantech Symposium. November 5, 2009.

METRO OR LANDO CLEANTECH | Assets, Capabilities, Presence & Potential

Cleantech offers tremendous opportunities for Metro Orlando to expand its economy to the next level. If Metro Orlando takes the right initiatives and enacts the right policies, it will benefit from this industry poised to become the best economic opportunity of the 21st century. Local policymakers in Metro Orlando should take advantage of the opportunities offered by cleantech by disseminating the information available through this report, implementing new policies, and creating an environment conducive to cleantech. They should work together with state policymakers to create some kind of synergy in promoting cleantech in the state, particularly the adoption of the 20% by 2020 RPS in the state of Florida and the creation of a Clean Energy Fund. They should promote Metro Orlando cleantech as a competitive advantage to potential venture capital investors. Long-term prospects for the cleantech industry remain optimistic. The clean technology’s global market value is expected to reach $1.3 trillion in 2017. Revenue growth in the three main clean energy sectors—biofuels, solar, and wind—expanded by 53 percent to $115.9 billion in 2008 and is expected to reach $325.1 billion in 2018. Local leaders should continue partnering with the local business community and research institutions to develop new clean technologies that will serve not only Metro Orlando and the state of Florida, but the whole nation and the world.


Appendix A - Directory of Metro Orlando Cleantech Companies Agriculture AgCert Services (USA) Inc.

1190 W. New Haven Avenue, Suite 250 Melbourne, Florida 32904 Tel: 321-409-7800 Website: www.agcert.com

Information: Produces and sells greenhouse gas reductions, in the form of emissions credits from agricultural sources on an industrial scale. They are a “mass producer” of Certified Emission Reductions (CERs). [Listing also in Air & Environment section]

Agri-Starts, Inc.

1728 Kelly Park Road Apopka, Florida 32712 Tel: 407-889-8055 Fax: 407-889-2523 Website: www.agristarts.com

Information: A biological technology company who produces and sells tissue culture liners (duplication of an original plant) on a wholesale level. This plant-cloning creates plant farms, which provide various benefits, from growing plants specifically for commercial needs to saving a species of endangered plants.

Materials Recycling of Orlando 5361 Young Pine Road Orlando, Florida 32829 Tel: 407-234-1788 Tel: 866-527-5281 Tel: 888-380-5188 Fax: 407-380-5188 Website: http://materialsorlando.com

Information: Produces custom and designer colored wood mulches, as well as wood compost and screened top soil for use as soil amendments and fuel. Products are 100% recycled wood, are cost-effective alternatives in landscaping, and used to enrich soil, control erosion, and improve drainage. [Listing also in Recycling & Waste section]

Sunshine Hydroponics

6100 Hanging Moss Road, Suite 500 Orlando, FL 32701 Tel: 888-833-4769 Website: www.sunshinehydro.com Information: Provides new a Provides new alternatives to traditional gardening techniques. Offers a variety of growing products and equiptment including lights and light systems, hydroponic and soil garden systems, plant nutrients, growing media/ containers, testing meters, climate control devices, propigation systems, pest & disease control solutions, and a variety of educational materials.

Air & Environment AgCert Services (USA) Inc.

1190 W. New Haven Avenue, Suite 250 Melbourne, Florida 32904 Tel: 321-409-7800 Website: www.agcert.com

Information: Produces and sells greenhouse gas reductions, in the form of emissions credits from agricultural sources on an industrial scale. They are a “mass producer” of Certified Emission Reductions (CERs). [Listing also in Agriculture section]

CO2 Scorecard Group, Inc. 1800 Gipson Green Winter Park, Florida 32789 Tel: 202-494-3360 Website: www.co2scorecard.com

Information: Provides environmental benchmarking, performance management and related analytical services. Provides scorecards for the key U.S. actors in the greenhouse gas and climate change arena. The Website also provides data on greenhouse gas emissions and their underlying drivers, state-of-the-art data collection and visualization tools, and a guide to the climate-change field.

Mitsubishi Power Systems Americas, Inc. 2287 Premier Row Orlando, Florida 32809 Tel: 407-563-6628 Website: www.mpshq.com

Information: This division of Mitsubishi focuses on the future of power generation. Their products include gas turbines, steam turbines, wind turbines, geothermal power plants, supercritical boilers, and technologies for emissions controls. [Listing also in Energy Generation section]

Progress Energy (DSM & Alternative Energy)

3300 Exchange Place Lake Mary, Florida 32746 Tel: 407-942-9360 Tel: 407-942-9755 Website: www.progress-energy.com

Information: Energy company selling electric and gas energy and energy-related products. They are currently investing in various initiatives in environmental issues, renewable energy, alternative energy, alternative transportation, emissions reduction, and plant and wildlife protection. [Listing also in Energy Efficiency, Energy Generation, Energy Infrastructure, & Transportation sections]

QD Sciences Inc.

2567 Tree Ridge Lane Orlando, Florida 32817 Tel: 407-797-2622 Website: www.qdsciences.com

Information: Created a low cost, high efficiency, PCT utility patented air pollution control technology. This technology is for any

capacity and can be applicable to any kind of polluting industry, such as coal, oil, gas, waste, and chemical plants.

Energy Efficiency AbleLight USA

178 Lago Vista Blvd, P.O. Box 181250 Casselberry, Florida 32718 Tel: 407-339-0020 Website: None available

Information: A manufacturer, retail seller, and wholesale supplier of power products, power distribution needs, and specialty transformers. They offer regular and compact fluorescent light bulbs, regular and compact fluorescent lighting, and other energy-efficient lighting. [Listing also in Energy Infrastructure section]

Adobe Building Consultants & Contractors, LLC 8070 Beechdale Drive Orlando, Florida 32818 Tel: 407-810-5030 Website: www.adobebuilding.com

Information: They provide design, engineering, c