Taking Charge: Clean Tech's New Capital
[SUITERS] California's Silicon Valley has long been known as the home to Internet and technology companies like Google and Apple, and as a magnet for venture capital, the money that investors give to start-up companies, hoping they will become the next Google or Apple. But information technology firms are increasingly sharing Silicon Valley with energy companies. Last year, the region took in about $9 billion in venture capital, and almost 20% of that went to clean technology companies, a far cry from 10 years ago, when clean energy firms lured less than 1% of Silicon Valley's start-up funds.
[TEXT ON SCREEN]
Silicon Valley Venture Capital
2010 total $9.1 billion
Clean technology 19.6%
2001 clean technology 0.9%
Source: National Venture Capital Association.
[SUITERS] That tremendous growth in clean energy investment has helped Silicon Valley make it through some tough economic times. And, as "energyNOW!"'s Lee Patrick Sullivan reports, that area is now helping America take charge of its energy future.
[RUSSELL HANCOCK] They said, this is going to be a place where America's energy future is invented.
[SULLIVAN] Russell Hancock's nonprofit organization helps Silicon Valley's business leaders create the next big thing. And Hancock says, in the last decade, he's seen a steady stream of both money and people switch from high tech to renewable energy. People like software programmer Laks Sampath.
[LAKS SAMPATH, TRINA SOLAR] So, my software background came in very handy. I was able to build critical modeling tools. I built one of the first monitoring systems that the industry ever had.
[SULLIVAN] And that monitoring system runs this 468-kilowatt solar array at a Silicon Valley water treatment plant and could save this plant more than $2 million in energy costs over the next decade.
[SAMPATH] Here, actually, it is something that is tangible. It is green. You're putting together something that actually is worth your while. That's what I love about the industry.
[SULLIVAN] For Silicon Valley, clean energy companies came along just at the right time. When the tech bubble of the 1990s finally burst in 2000, it left a lot of highly educated and skilled workers looking for new jobs. And the region's economy took another hit during the recent recession. But between those two body blows, California's state government decided it was going to set limits on greenhouse gas emissions and mandate greater use of solar panels, wind turbines, and other forms of renewable energy. The state's clean energy push helped spur a local market for new energy technologies, just as some I.T. and Internet companies were downsizing.
So you're one of the high-tech refugees that have switched over to clean energy. There's a lot of you guys here, isn't there?
[BOB LOFTIS] Yeah, there are quite a few.
[SULLIVAN] Bob Loftis was at Apple, Compaq, and Hewlett-Packard before coming to Solyndra, a solar energy manufacturer outside San Jose.
[LOFTIS] A lot of the people working on the factory floor are using automation tools that they're pretty familiar with from previous jobs.
[SULLIVAN] The high-tech background of the workers and designers at Solyndra has led to innovative ways to harness the power of the Sun. Instead of flat panels, these are lightweight round tubes, able to get reflective sunlight from rooftops without having to be motorized to follow the Sun.
[SULLIVAN] Innovation like that led the Obama administration to award the facility a half a billion dollars in loan guarantees. Now, while the area was struggling during the recent recession, jobs in clean energy grew in the region by 109% in the last decade. Driving that growth, an array of solar companies setting up shop; electric vehicle manufacturers; and new innovations like the Bloom Box, a fuel cell that runs on a host of fuels, including natural gas, methane, and propane.
Even companies from the last big thing in Silicon Valley are jumping on board. eBay has installed five of those Bloom Boxes on its campus. And Google has pledged $780 million for clean energy.
Still, for all the overlap between these dot-com companies and clean energy firms, there are some important differences. Take the folks at eBay, for example. Last year, they helped facilitate the sale of billions of dollars' worth of products. But they have no warehouse, because they have no items. Like most dot-coms, their start-up cost is this. With clean energy, you need factories, warehouses... and energy projects just tend to be big.
[HANCOCK] The projects are done on huge scales. I mean, they're done on a regional scale, on a utility scale, on a statewide scale.
[SULLIVAN] It's also good to have government support. But for all the help clean tech companies are getting in California, they haven't been so lucky in the nation's capital, where renewable energy and global warming legislation has stalled. And when the Department of Energy was handing out stimulus money for clean energy projects, politicians from the Midwest made their voices heard in Washington.
[SEN. DEBBIE STABENOW (D) MICHIGAN] And when we talk about innovation and making things, that's Michigan.
[SULLIVAN] And Silicon Valley watched as Michigan and Indiana got the bulk of the funding.
[HANCOCK] That's not what Silicon Valley does well. Silicon Valley is a really maverick kind of place. Lots of libertarian thinkers here, cowboy entrepreneurs. You know, we don't have our act together, politically. We're not used to going to Washington. That part is going to be hard for us.
[SULLIVAN] And even the federal help they do receive is getting scrutinized. The Republican-controlled House is looking into Solyndra's loan guarantee, demanding the White House hand over all documents related to the decision.
So, back in Silicon Valley, programs like Boots on the Roof are looking to train the wave of blue-collar workers needed to install the solar panels, geothermal systems, and wind turbines.
Now, the whole idea behind this is that, although it's, you know, it's green technology, but it's still electricians and plumbers that need to do this.
[CHUCK RAMES, DIRECTOR, BOOTS ON THE ROOF] Very much so, yeah. This is how renewable energy is going to happen. Working men and women are going to need to install these things on, eventually, millions of homes in America.
[SULLIVAN] And if former high-tech refugees like Laks Sampath have their way, those systems will be designed and improved in Silicon Valley.
[TEXT ON SCREEN] To learn how solar energy works, watch Solar Power 101 at energynow.com.
[SULLIVAN] Do you think there will come a day where you and I will have to explain to our grandkids that Silicon Valley refers to the semiconductor and not the solar panel?
[LAKS SAMPATH] I hope it comes to that. That will be a good one. [Laughs]
[SULLIVAN] In San Jose, California, Lee Patrick Sullivan, "energyNOW!"
[SUITERS] And Laks Sampath is working especially hard to make that happen. Since we visited with him, he has left Trina Solar and opened up his own solar company. A man with a vision and apparently an endless supply of his own energy.
California’s Silicon Valley is mostly known for launching the Internet revolution, but the region has also become the epicenter of the U.S. clean energy industry. In fact, billions of dollars in venture capital funding to clean-energy companies has helped the region through some tough economic times.
Correspondent Lee Patrick Sullivan looks at Silicon Valley’s shift toward clean energy, and meets the tech-savvy workers and entrepreneurs who are now helping America take charge of its energy future.
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