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1. If Green Jobs Are So Hot, Where Are They?
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2. Why the Stimulus Stake in Carbon Capture Neglects Algae Startups
If Green Jobs Are So Hot, Where Are They?
Jennifer Kho - Big Green
In the economic downturn, “green jobs” has become one of the hottest political catchphrases. President Barack Obama has promised 5 million new green jobs as part of his energy and stimulus plans. Here in California, the mayors of Los Angeles and San Francisco, as well as the governor have made green jobs a priority. And states across the country, from Indiana to Washington, are considering bills to develop more green jobs.
This week as the sold-out Good Jobs, Green Jobs National Conference kicks off, and Congress sits down to vote on a new, pared-down stimulus package that includes billions for jobs in energy efficiency and clean power, “green jobs” are at the forefront of everyone’s minds. But the cleantech industry hasn’t proved to be recession-proof, and layoffs and hiring freezes are leading would-be green employees to question just how soon the jobs will arrive, and what kind of cleantech companies will be hiring. Here’s what we see:
Where The Green Jobs Ain’t Right Now:
In the near term, the recession has caused many large renewable energy developers to shed staff — the New York Times had an excellent article last week on the hard times for renewable developers. A big part of the problem is that debt and tax-equity financing dropped off late last year, making it far harder to finance new clean power projects. And after a period of high demand, high prices and high margins, manufacturers have been suffering.
The wind industry has been blown over. Clipper Windpower is laying off 90 workers at its Ceder Rapids, Iowa, plant and cutting its production for 2009. Gamesa is laying off about 180 workers at its plant in Fairless Hills in eastern Pennsylvania. Even Vestas Wind Systems, the world's No. 1 turbine maker, is reportedly seeing lowered demand for its products.
Large solar makers are feeling the same pain. Suntech Power, Day4 Energy, GT Solar, Emcore and Advanced Energy have announced layoffs, and still more have delayed or suspended new plants.
In addition, younger startups in capital-intensive businesses — many of which grew too big too fast in the good times — are in varying stages of crash and burn. OptiSolar ramped up at an incredible pace out of nowhere and recently had to chop half its staff. Electric-car maker Tesla underestimated just how difficult it would be to raise the money to mass produce vehicles and started cutting staff last year. Basically, if you see a new firm that needs to raise hundreds of millions to manufacture a lot of gear in order to start generating revenues, it’s probably not a good idea to turn in your resume.
Where The Green Jobs Still Are:
In the near term, early-stage firms and less conventional sectors of cleantech are still providing jobs. Greg Chin, a partner at law firm Latham & Watkins, says he’s seeing a net increase in jobs among his early-stage cleantech clients, with jobs mainly in science, engineering and marketing. Amy Vernetti, a managing director at headhunting firm Taylor Winfield, says many of the jobs are coming from more obscure cleantech sectors, such as fuel additives and air filtration. She pointed us to Accsys Technologies, which is hiring and has developed a nontoxic chemical process to harden fast-growing pine so it can be used in place of hardwoods or even steel.
Startups that are building tools that can help companies save money on their energy bills can still move product in a downturn, and many are still hiring skilled employees. IT companies like Sun Microsystems are increasingly focusing on cutting the energy consumption in their data centers, which requires engineers, installers and designers. Sentilla, a startup that makes energy management services for data centers and industrial manufacturing, recently raised funding and is hiring engineers. Positive Energy, a startup that builds energy management reports for utilities, raised money in late 2008 and has over a dozen jobs for engineers, executives and designers listed on its site.
But a couple things to consider about these current openings: smaller, early-stage firms hire fewer people, and that means more competition. And getting those jobs will require more skill and experience than they did previously. “A lot of people might be trying to come into the sector at a time when many people have got a three- to five-year head start on them,” says Ron Pernick, a principal of research firm Clean Edge.
Down the Road: Green Jobs From the Stimulus
A lot of hope is being pinned on the green jobs that will be created in the stimulus package, particularly jobs in building out infrastructure. The package, if passed, could allocate $4.5 billion to build out a smarter power grid, which could create jobs for electricians, installers, engineers. Smart grid software company eMeter says it has seen increased interest from utilities based on stimulus expectations. Though other utilities are slowing their smart-meter rollouts in the face of the downturn.
The stimulus package is allocating a massive $6.2 billion to weatherize public housing, which would create jobs for local construction companies that can install new insulation and more energy-efficient windows. The DOE’s Weatherization Project Manager, Robert DeSoto, told us that every local agency that will be allocating these funds will be searching for new home retrofitters to work with.
The stimulus package also allocates billions in tax breaks for renewable energy projects. This could help those large clean power developers down the road that have recently been shedding staff. The more-established, later-stage companies are the ones that are far better poised to answer Obama’s call for “shovel-ready” clean power projects than new startups. And new projects could also create a substantial amount of construction jobs, which would have a far bigger impact on green jobs overall than a small number of highly-skilled openings for executives and engineers in Silicon Valley. Another bonus: clean power construction jobs can’t be outsourced.
While it remains to be seen how many green jobs the stimulus package will deliver, as Latham & Watkin’s Chin, says: “I expect the pickup in cleantech job creation to come before the pickup in the overall economy.”
Hear Microsoft, IBM, Dell and Cisco execs at GigaOM’s Green:Net.
Why the Stimulus Stake in Carbon Capture Neglects Algae Startups
Josie Garthwaite - Policy
Bottom line: Commercial-scale carbon capture is risky and unproven by any means. But commercial-scale carbon capture and recycling (turning it into other usable products, rather than shoving it underground) by startups with pond scum — or other high-tech solutions — may still be too big a gamble, and too expensive, for even a government toying with around $800 billion.
It’s inevitable with a spending bill of this size for the government to pick winners and losers among competing technologies. And when it comes to carbon capture, it has favored incumbent (read: coal) energy producers’ plan to pipe emissions underground — a temporary solution — over lab researchers’ and fledgling companies’ schemes to recycle CO2 using algae, solar reactors, synthetic genomic-based life forms and other technologies.
Here’s the problem: While according to Alex Klein, research director for Emerging Energy Research’s clean power generation group, shoving millions of tons of carbon dioxide underground presents a technologically simpler challenge than recycling it, storage space will eventually run out. With recycling, you don’t have that problem. The idea is to use carbon-fed, algae-derived biofuels to replace petroleum based fuels, thus reducing total CO2 emissions.
The House version of the bill allocates $2.4 billion for “necessary expenses to demonstrate carbon capture and sequestration technologies,” as authorized under part of the Energy Independence and Security Act of 2007, which provides for developing what’s called geologic storage of carbon dioxide — basically holding it in the reserves from which it was mined. This means algae startups like Ternion Bio and GreenFuel Technologies, which capture carbon emissions from industrial flues and “feed” them to algae for use in other products, don’t qualify. (For the carbon capture funds, that is. Biofuels funding comes under a separate section.)
The current Senate version leaves the door cracked open for a broader range of technologies, with at least $4.6 billion set aside for carbon capture and storage, including a portion for projects that demonstrate carbon capture from industrial sources. Algae technologies would be potential candidates for those funds.
President Obama and Congress are grappling with this issue in a time when “clean coal” advocates face growing opposition — and on the heels of similar legislation in Europe and Canada, which greenlighted C$1 billion ($812 million) for a fund that will finance CCS, a move seen by some environmentalists as a way to divert clean energy funds to fossil fuel-based power generation.
Ternion Bio thinks it can undercut geologic storage on price, and so it wants Congress to give priority to carbon capture projects that are cost effective, according to Elizabeth Moeller, public policy group leader for Pillsbury Winthrop in D.C. and a lobbyist for Ternion Bio. This would be something new for CO2 recyclers, as the technology has historically been considered too expensive to pursue commercially. Given access to equal funds, it’s possible that a nimble startup could progress faster than big coal companies, which have so far invested more in advertising the potential for cleaner coal technologies than in actually developing them. Whether Congress wants to take that chance remains to be seen.
The point of the American Recovery and Reinvestment Act (aka stimulus package) is to jumpstart the economy, to get dollars moving again. President Obama also wants it to invest in long-term economic growth and reduce greenhouse gas emissions. Carbon capture is squeezing in on just one of those goals — potentially reducing greenhouse gas emissions as part of a comprehensive energy portfolio overhaul. Unlike private investors (and some states), which have invested millions of dollars in early stage algae bioreactor technology, Congress may not see the same opportunity in R&D for carbon capture and recycling.
Image of bioreactor pilot project courtesy of GreenShift Corp.
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