The San Francisco Chronicle just published my op-ed piece today. Read the full article here or have a read below. Look forward to your thoughts in the comments section!
The closer you get to a goal, the tougher the going can get.
As California prepares to launch America’s latest cap-and-trade program for greenhouse gases, opponents are making a goal-line stand. They’re trying to persuade Californians that a carbon market will somehow hurt the state’s recovering economy.
As a California investor, I know the opposite is true. The new carbon market is one element in a broad suite of business-friendly clean energy and efficiency policies that California has carefully crafted over decades. These measures might attract continued opposition from in– and out-of-state oil interests, but they are strongly supported by California voters, and with good reason. They are turning the Golden State into a global leader in the fast-growing clean energy sector.
California’s forward-looking policies on energy and efficiency have touched off an incredible flowering of profitable creativity at businesses, universities and national labs across the state. As a result, about one-third of U.S. clean tech venture capital flows to California.
Since 2005, the clean tech sector has grown 10 times faster than the average job growth in any other economic sector in the state. Since the state’s clean energy and climate law (AB32) was passed in 2006, $9 billion in venture capital investment has flowed to clean-tech firms in California. Our state leads the nation in solar power generation, and wind generation has doubled since 2002.
All this forward-looking action on energy is setting up California businesses to grab a fat portion of a fast-growing global market. Worldwide, investment in renewable energy alone grew by 5 percent last year, to hit a record $260 billion.
As nations around the world tackle climate change, companies selling solutions continue to grow. California’s decision to reduce greenhouse gas emissions has created tremendous opportunities for entrepreneurs, scientists and business strategists to develop technologies and services that will help businesses accomplish their greenhouse gas emission goals. Those are exactly the kinds of companies venture capitalists love to fund: high-tech firms with tremendous growth potential, not just in California but also across the country and around the world.
And rather than dictating to polluters exactly how they have to clean up their acts, California’s cap-and-trade program will harness the power of the market to control greenhouse-gas emissions. The power companies and other large polluters affected will decide for themselves how to proceed. A company that is especially effective in cleaning up its act can make money on the deal, by selling unneeded pollution allowances to other firms whose operations run dirtier.
Setting aside all these business-centric arguments, there are a lot of other reasons to support AB32 and California’s cap-and-trade program. Public health groups point out that these policies are cutting air pollution and saving Californians from asthma and heart attacks. Environmental groups approve of tackling climate change, which threatens California’s coastline, snowpack, forests and other natural resources.
Consumer groups praise AB32 because it will help our state’s families make ends meet, eventually cutting electricity bills by about 5 percent. But as an investor – and especially in these rocky economic times – it is the business argument that I find so persuasive. A strong carbon market sends a clear market signal. It will spur investment, innovation and economic growth. It will help solidify California’s leadership in the emerging clean energy economy.