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Amidst Predictions for Slow Economic Recovery, California Takes Measures to Spur Economic Development

California is confronting its economic challenges head on as it continues to be a state of superlatives in terms of its potential for growth. The big gold rush ahead may just lay in green tech.

Apr/May 10
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"Green Corridor" Investment
The focus on solar energy is not just a recent development. Kyocera Solar U.S.A. was on the forefront of the trend as the first Japan-based corporation with manufacturing operations in California as far back as 1971. Now, the Kyocera Group of companies currently employs approximately 4,000 people in the United States, with three out of seven of its North American companies headquartered in California. Cecilia Aguillon, director of market development and government relations for the firm, recently explained why the company decided to embark on its new photovoltaic module assembly project in San Diego: "California has the largest solar electric market in North America. Naturally, it is ideal to manufacture in or as close as possible to our major markets.Since Kyocera has a manufacturing facility in San Diego, it made sense for us to expand our solar manufacturing operation in a place where we have a building and logistical operations in place."

The facility is expected to begin manufacturing modules in June. Aguillon noted that the state's incentives demonstrate support for this industry: "The Governor has recently signed a bill to expand the photovoltaic market through feed-in tariffs (SB 32). This convinced us that the state is thinking and moving towards accelerating our market."

Aguillon explained that the feed-in tariff program is set by the state/county or utility company and allows building owners to install photovoltaic systems and sell the energy to the utilities at a set price for a set number of years. Aguillon reflects her company's confidence in this sector's expansion: "The North American markets are growing fast and it was time to expand manufacturing to keep up with demand."

Another solar firm, N Solar Inc., a Seoul, Korea-based IT equipment and solar cell manufacturer and business services provider, is locating its North American headquarters and first solar module manufacturing plant in Sacramento County. Manufacturing is scheduled to begin in the fourth quarter of 2010; the plant will initially employ 100 workers and build its work force to 150 over 18 to 24 months.

Also in the state's "green corridor," Bayer HealthCare is investing upward of $100 million at its Berkeley biotech manufacturing center to develop a new manufacturing process for the creation of future versions of Bayer's hemophilia drug, Kogenate® FS. The investment, the largest by Bayer HealthCare in Berkeley to date, will be made over the course of the next four years on facility upgrades, new equipment, and state-of-the-art technologies. The Berkeley site has been ISO 14001 compliant since 2001 (Bayer's first North American site to earn this environmental rating), has a model auto-use reduction program and a recycling program, and contributes to local education, environmental, and patient-advocacy charities.

Even manufacturers are getting in step with environmentally conscious options. Shoe company Skechers broke ground on its 1.8 million-square-foot North American Operations headquarters in Rancho Belago, in Riverside County. Upon completion next year, the facility will be the largest Leadership in Energy and Environmental Design (LEED) certified building of its kind in the nation; it will create 1,100 construction jobs and 3,000 permanent jobs in the local area. Additional phases are already planned that will ultimately expand the headquarters to 2.6 million square feet.

State of Superlatives
To serve its industries, California's infrastructure projects seek to improve current distribution channels and speed up travel options. Plans are on-track for a high-speed train system that will be funded by a grant of $2.25 billion in federal stimulus funds and a $9.95 billion state bond commitment. The project, which will be the largest public works project in the nation when it breaks ground in 2012, is estimated to create 450,000 permanent jobs statewide when completed.

In addition, the Governor recently announced that California was the first state in the nation to obligate $1 billion of Recovery Act funding to transportation infrastructure projects. Getting these plans on the road has already begun with groundbreaking on the construction of one of the largest highway projects in the nation along I-405 that is anticipated to create an estimated 18,000 jobs.