Green-tech touted as red-hot option for the region
Sacramento could be in line to be leading pro-environment burg.
by Clint Swett
April 9, 2007
In the nearly three decades since Hewlett-Packard Co. and Intel Corp. set up shop in the Sacramento area, the region has yet to amass the technology heft that many envisioned.
But rather than aspiring to become Silicon Valley East, the region is now vying for a different title: Green Acres.
Given the push for so-called green technology -- environmentally friendly and energy efficient -- the area has the necessary ingredients to become a national leader, experts say.
"I think green tech in general represents a huge growth opportunity," said Tony Perkins, founder of Red Herring magazine, who's hosting a green-tech symposium in Davis in September.
"I am very bullish on the Sacramento region as a budding (green-tech) innovation center," he said, "and firmly believe this opportunity bodes very well for long-term economic growth and job creation."
The green-tech industry is exceedingly broad, encompassing such diverse industries as power generation, automobiles, building materials and agriculture.
And investors are backing their optimism for its future with plenty of cash, both here and around the world.
In 2006, venture capital funds invested more than $270 million into Sacramento and Bay Area clean-energy companies, more than double the $123 million a year earlier, according to Dow Jones VentureOne, which tracks VC investments. And the state's two major pension funds, CalPERS and CalSTRS, have earmarked nearly $1 billion combined for green investments.
More than 60 local companies are already in place, with technologies running the gamut from ethanol production to solar panels to hydrogen fuel cells.
But Sacramento isn't alone in maneuvering to become a clean-energy hub. San Jose, Berkeley, Pasadena, Boston and Austin, Texas, are among the contenders for the crown, according to SustainLane, a San Francisco green-energy research firm.
No single region, however, has muscled into the lead, said Warren Karlenzig, SustainLane's chief strategy officer. "I think Sacramento has as good a chance as anyone right now," Karlenzig said.
The stage is certainly set for a clean-tech surge. Stratospheric oil prices, heightened awareness of global warming (including a push by California's governor against greenhouse gases), and a boost in investment activity all point toward clean energy being the next high-tech opportunity.
Developing a clean-tech center here would yield long-term benefits, said Oleg Kaganovich, chief executive of the Sacramento Area Regional Technology Alliance (SARTA). Once the region's reputation was established, both investments and companies would flow to the area, he said.
The Sacramento region boasts a number of advantages, experts say. The area has an environmentally aware population, proximity to the state Capitol where environmental policy and regulations are forged, and access to two universities with strong engineering, science and agriculture programs.
And the University of California, Davis, recognized as a top research institution in the green-tech sector, is committed to commercializing those research efforts.
Dennis Schuetzle, a green-energy consultant and former Ford Motor Co. research executive, runs the Renewable Energy Research Institute International in Roseville.
Schuetzle, whose McClellan Park-based lab tests equipment for the renewable energy industry, said the governmental cooperation that he's seen here bodes well for the region's efforts to become a green-tech leader.
"I've managed projects all over the world and the only time I've seen them work is when there was this kind of cooperation," he said.
The global buzz over green technology is already beginning to pay dividends for some area businesses.
Executives at Clean Energy Systems in Rancho Cordova, for instance, say they've seen increased interest in their technology to burn fuel for electricity and inject the resulting carbon dioxide -- which is blamed for global warming -- into the ground.
"We've really seen a surge in the past year within the energy community," said Keith Pronske, chief executive of the firm founded in 1993 by a group of Aerojet retirees.
