Silicon Valley is known as the beating heart of Web 2.0, where online businesses are built and thrive, surrounded by a culture of innovation, venture capital and mentoring from one generation to the next.
Such an environment should therefore be a natural fit for a still young industry – clean tech – looking to build momentum and break into the energy marketplace as mainstream players.
This was a central theme of my conversation with Mike Foster, the acting program manager in the Environment Services Department for the City of San Jose, where he is responsible for their green buildings, energy efficiency and solar programs.
Mike is a key element in helping implement Mayor Chuck Reed’s Green Vision plan, an ambitious project with 10 major goals set to a deadline of 2022. Their goals include creating 25,000 clean tech jobs, reducing per capita energy use by 50%, procuring 100% of their electricity from clean renewable sources and building or retrofit 50 million square feet of green buildings.
With a head start in solar companies, next generation LED manufacturers and other clean tech businesses, such an initiative should begin a virtuous circle. According to Mike “By embracing this notion of sustainability, we are also reinventing our economy.”
This even runs into their purchasing and procurement process, where there is a preference indicated for buying from local suppliers and manufacturers, to help support the local economy. A drive to reach “50 MW of solar generation capacity over the next few years” should also help bolster the local market for solar, with dozens of public buildings cited as potential recipients of panels.
However, to really kick start demand, there are a number of additional initiatives required. One of these is federal, with 30% tax credits available for solar installations; another is state-wide, with California offering a rebate program on solar purchases.
Perhaps more important is the commercial structure that surrounds clean teach, and finding a viable financial model for encouraging purchases in this space.
To that end, Mike points to power purchase agreements as one viable option, whereby a commercial or industrial buyer will enter into a private agreement with a renewable energy generator, to purchase their energy from there (usually over an extended period of time) and the seller fronting the infrastructure costs and installation. This way there is no out of pocket expense for the buyer.
However the economic drivers and relatively clear return on investment found in commercial and industrial sectors may not be so apparent, or even existent, in residential properties with low electric bills.
“Does it make my home more comfortable? Do I have cleaner indoor air quality?” These are the questions that Mike thinks will help drive adoption of clean tech by residential customers. It’s all about quality of life, comfort and convenience for families.
To make that case, the City of San Jose has worked with PG&E and other partners to create a widespread educational program across the locale, spreading the message of energy efficiency in several ways to appeal to different segments of the community.
One such initiative, in partnership with PG&E, is called the Silicon Valley Energy Watch. The program is taking a decentralized approach by awarding grants to community stakeholders who can demonstrate their ability to reach and effectively educate their community members, which they hope will create more tailored, meaningful messages tied to the needs and wishes of that community.
Another initiative introduced is to make available a Kill-A-Watt Meter in all local libraries, which allows residents to go home and measure the electrical consumption of their home devices and make more informed decisions over their energy use.
A notable success for Mike has been the Green Vision Clean Energy Showcase, a local solar exhibition located right across the street from city hall. He says that this “hands-on opportunity for the public to touch and feel and understand solar technology was extremely popular with over 6,500 people visiting in just 10 months. The showcase allowed them to ask about financing options, how much solar costs, what savings they can expect, who manufactures it, who installs it, etc.” The event was so successful it has now moved north to Palo Alto to continue its educational mandate.
San Jose is also taking note of the trend towards “gamification” or offering rewards and competition as motivators for people to save energy. For this, they have recently partnered with WattZon, an innovative energy software platform that provides free tools and expert advice to help people understand their energy use and how they can make smart decisions about saving energy. Those residents enrolled in the program get coupons and vouchers for achieving specific energy saving goals. The pilot is very fresh, having started just a month and half ago, and it will be up to 6 months until there’s meaningful data on its success, but Mike certainly sees promise in the initiative.
This idea of partnership is one keenly fostered by Mike and his colleagues, who have a formal application process for “Demonstration Projects” where start-ups with unique products and solutions can work with San Jose to beta test their ideas in a real life environment. The idea is that they can then use this to prove effectiveness and attract further investments, which then creates jobs as the company grows; while at the same time it opens San Jose up to cutting edge technology that can help it meet its Green Vision goals in job creation and sustainable energy.