San Diego’s rise as home to one of the world’s top clean-tech clusters has been swift, with industry and government leaders harnessing financial, political, business and community support for the region’s 670 companies currently in this space.
San Diego is world-renowned for its collaborative culture, which has created robust high-technology and biotech sectors. In just a little more than two years a local business organization called CleanTECH San Diego has become a key champion for the clean-tech industry, and is working to mirror the region’s high-tech and science success. By collaborating with strategic stakeholders and leveraging local political leadership, the nonprofit member organization has been instrumental in positioning the San Diego region as a recognized leader in the low-carbon economy. CleanTECH San Diego’s efforts have earned the organization a spot on the “Top 10 Cleantech Cluster Organizations for 2010” list.
Leading Solar City
Shawn Lesser, the list’s author and president and founder of Atlanta-based Sustainable World Capital, identified critical characteristics of successful clean-tech clusters, including a region that has a thriving technology base, abundant entrepreneurial and management talent, access to capital, and a proactive environmental public policy. Such a cluster, he said, can create thousands of new jobs and attract billions of investment dollars to a region.
This is what Lesser had to say about CleanTECH San Diego, which ranked No. 7 on the list: “With an estimated 650 clean-tech companies in the region, San Diego is emerging as a global leader in clean-tech. Led by an initiative of San Diego Mayor Jerry Sanders, CleanTECH San Diego has developed a comprehensive one-stop-shop and vibrant ecosystem for clean-tech companies to accelerate their growth. San Diego already has a track record. Having less than a third the population of Los Angeles, San Diego has installed 60 percent more solar roofs than its neighbor to the north. In July 2009, San Diego was recognized as the leading solar city in the No. 1 solar state, with over 2,200 rooftop installations and the most solar capacity in the state.”
Other clean-tech organizations on the list are Austria Eco World Styria in Graz, Austria; The New England Clean Energy Council, Cambridge, Mass.; Finnish Cleantech Cluster, Lahti, Finland; MaRS, Toronto; Copenhagen Cleantech Cluster, Copenhagen, Denmark; The CleanTech Center, Syracuse, N.Y.; Environmental Business Cluster, San Jose; Stockholms Miljöteknikcenter, Stockholm, Sweden; Ontario Clean Water Initiative, Toronto.
One of the biggest coups by CleanTECH San Diego was facilitating the award of $154 million in federal bonds for solar installation projects in San Diego last fall. The bond allocations for the San Diego region went to a total of 192 projects submitted by San Diego municipalities, school districts, universities and a water district. The Clean Renewable Energy Bonds, or CREBs, program is part of the American Recovery and Reinvestment Act of 2009 through the Internal Revenue Service and provides public agencies with an opportunity to issue tax-credit bonds to finance renewable energy projects for public facilities.
“As a young organization we managed to help secure over $150 million in renewable energy bonds,” said Holly Lepre, CleanTECH San Diego’s vice president. “That’s a pretty handsome deliverable.”
The Role Of Research Institutions
CleanTECH San Diego has not only delivered, but has attached itself to some key players from industry, government and academia, such as Tony Haymet, vice chairman of the organization and director of the Scripps Institution of Oceanography.
The organization has also recognized the significant role local research institutes such as UC San Diego and Scripps play in the clean-tech industry’s growth and continued innovation.
“Our greatest asset in the region is our world-class research institutions,” Lepre said. “We already have a strong biotech industry that has been there, done that. We don’t have to start from scratch. The model is already there. San Diego has a long tradition of taking great ideas and turning them into economic engines. It’s characteristic of the region. We have every intention of replicating that around clean-tech. We have the right people, the sweat equity, the vision and track record to make this happen.”
Lepre added that CleanTECH San Diego is a pure economic development play.
“We have the companies, the wherewithal and intellectual prowesses to not only deliver but to run with other global leaders,” she said. “That’s a pretty good start and we’re happy to build on that.”
Lepre is elated about the quick and strong success of the San Diego clean-tech cluster, but she is not breaking out the champagne yet.
“We have to be mindful that we have a lot of challenges ahead of us,” she said. “We’re very excited about the ranking, but I don’t want to celebrate for too long. There are some real gaps in the market that need to be resolved.”
Despite a strong interest from investors, the clean-tech industry will continue to grapple with dried-up capital markets, which Lepre said is one of CleanTECH San Diego’s top priorities.
“The new VC is Washington, D.C.,” she said. “So we have to reposition ourselves to go after all these federal stimulus dollars.”
According to Lesser of Sustainable World Capital, there are many solid clean-tech clusters throughout the world, but regions like San Diego that have organizations built around those clusters that can act as clearing houses to help them grow are the ones that will thrive.
“You need all the pieces of the puzzle to have a successful cluster — academia, government support, culture acceptance and dollars,” Lesser said. “Also, if you look at the top 10 states, California gets the most VC dollars in the world for clean-tech.”
California received a total of $6.5 billion in capital for clean technology between 2006 and 2008, he said. In 2009, venture capital firms invested a total of $5.6 billion in clean technology in China, Europe, India and North America, according to Cleantech Group LLC and Deloitte.
“Capital is the driver of this industry,” Lesser said. “It’s all about job creation and money.
“It will be similar to the Internet boom. If you look at the Internet from a stock market perspective, billions of dollars were made and billions of dollars were lost, but in the end you have the iPhone and other devices. As the clean-tech industry grows there will be billions of dollars made and lost, but there will be a lot of great technologies that will change the world.”
Andrea Siedsma is a freelance writer for the Business Journal.