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Location California 2009: California's Green Advantage

Apr/May 09
California's housing market may be in crisis today, but the Golden State is poised to regain its losses when the nation emerges from the economic recession. Indeed, California's efforts toward energy-efficiency on all fronts - from architecture to construction to utilities and technology - is positioning California as the go-to state for companies that want to realize real operational cost savings while tapping into one of the strongest talent pools and consumer bases in the country.

Through its efforts to advance energy-efficient innovations and green technology, California is witnessing a powerful economic stimulus that promises to pay even greater dividends in the months and years to come as companies make decisions about where to locate and expand. In fact, Dian Grueneich, commissioner of the California Public Utilities Commission, has said that energy efficiency is one of California's most important economic development programs.

The numbers are telling. A report prepared by California-based Collaborative Economics reveals that green tech venture capital investment in California nearly doubled in one year, hitting an all-time high of $3.3 billion in 2008, capturing 57 percent of the national total. Los Angeles, San Francisco, and Sacramento together accounted for over 20 percent of the nation's hybrid vehicle registrations in 2007. And total Gross Domestic Product per unit of energy is 68 percent higher in California than in the rest of the nation, generating billions of dollars for the local economy.

"California's experience with energy efficiency and clean technology is instructive," says F. Noel Perry, venture capitalist and founder of the nonprofit Next 10. "If California had not moved as forcefully to decrease energy consumption over the last three decades, we would be in a much more precarious economic position right now. Imagine where the country could be if it were as efficient as California."

A Growing Green Economy

Although California's unemployment rate has climbed to over 10 percent, its advantages in the eco-friendly realm promise a faster recovery than some areas of the nation. The California Community College's Workforce and Economic Development Centers of Excellence (COE) found a pocket of economic hope in March with its report on "energy-efficiency occupations." The report suggests real opportunities for "green collar" workers in California. Since 2005, statewide green jobs have grown at a rate 10 times faster than total job growth.

Two largest growth occupations over the next 12 months are building performance or retrofitting specialists and energy auditors. The two largest growth occupations over the next three years are project managers for construction or design work and building performance or retrofitting specialists.

"These numbers show a real opportunity to train individuals into high growth occupations in the Bay Area," says Dan Geiger, executive director of the U.S. Green Building Council's Northern California chapter. "Knowing what occupations and skills are most important is a key factor in retraining displaced workers and getting them back to work, which ultimately will help re-energize our economy here in California."

Meanwhile, in March, Governor Arnold Schwarzenegger launched the California Green Corps. The program will place at least 1,000 at-risk young adults aged 16-24 in California's emerging green economy. The program will consist of a minimum of 10 regional Green Corps throughout the state, with at least one regional Green Corps located in each of California's nine economic regions. "In California, we will utilize federal economic stimulus funds and public-private partnerships to help stimulate our economy, while initiating actions to improve our environment," Schwarzenegger says. "Green jobs are exactly what our economy and environment need right now - and the California Green Corps targets that need while helping at-risk young adults realize a brighter future."

California's solar energy may also see a boost. According to the Solar Energy Industries Association (SEIA), solar manufacturing jobs in the United States are growing. A recently enacted manufacturing tax credit may encourage companies to invest in new U.S. operations, and California has one of the nations' largest solar manufacturing clusters. "Solar is an emerging economic engine, creating thousands of jobs, unleashing billions in investments, and building new factories nationwide," says SEIA President and CEO Rhone Resch. "With the right policies, solar deployment will continue growing and create thousands of new green-collar manufacturing jobs."

Despite the economic uncertainty, some companies are moving forward with green manufacturing facilities. Among these is Pyramid GPS, which launched into full production at its new 47,000-square-foot Santa Ana, Calif., facility. The new plant ushers in the next generation of technology to produce more efficient packaging supplies. Pyramid reports its futuristic model reduces the amount of energy and material used to produce and market products.

"This is a great story for this economy," says Linda Summers, economic development manager for the City of Santa Ana. "Pyramid's new business model is a win-win. They have addressed the customer, the environment, and are providing new local employment growth for the state of California."

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