Washington and Oregon Could Lead the U.S. in Cleantech Under New Policies, Report Says

The Pacific Northwest could potentially be the first region in the United States to achieve 75 percent of its electricity supply from carbon-free sources like hydropower and renewables. But that will require a dedicated new effort in cleantech policy and investment which, if successful, could create 41,000 to 63,000 new jobs in Washington and Oregon across five energy sectors by 2025.

That’s according to a study released today by Clean Edge, a cleantech research and publishing firm based in Portland, OR, and Climate Solutions, a Seattle-based non-profit organization focused on global warming. The report, entitled “Carbon-Free Prosperity 2025: How the Northwest Can Create Green Jobs, Deliver Energy Security, and Thrive in the Global Clean-Tech Marketplace,” makes the case (both economically and environmentally) for a serious cleantech push in Washington and Oregon. It points to five main technology areas in which the Northwest has a competitive advantage:

—Solar photovoltaics manufacturing. For instance, SolarWorld’s plant in Hillsboro, OR, will be the largest crystalline silicon solar-cell manufacturing facility in the U.S. by 2011.

—Green building design services. Seattle and Portland consistently rank in the top three U.S. cities with the largest number of certified green buildings.

—Wind power development. The Shepherd’s Flat Wind Farm, slated for operation in 2012 in north-central Oregon, would be the largest wind farm in the U.S., and one of the largest in the world.

—Sustainable bioenergy. Pacific Ethanol in Boardman, OR, SeQuential Biofuels in Portland, and Seattle-based Imperium Renewables are part of an emerging group of companies in biofuels in the Northwest.

—Smart-grid technologies: Liberty Lake, WA-based Itron is the top global manufacturer of advanced meter readers. Ron Pernick, managing director of Clean Edge, calls these kinds of smart sensors and communication technologies “the linchpin” of the entire cleantech effort.

However, the Northwest also faces some significant barriers in cleantech, the report says. First, there has been less venture capital activity in cleantech in Oregon and Washington (they received about $65 million and $47 million in clean-energy investment in 2007), as compared with California and Massachusetts ($1.4 billion and $378 million, respectively). Second, the report cites the lack of a 21st-century electric grid, and the “lack of a coordinated regional strategy.” That fits with what energy expert Jesse Berst of GlobalSmartEnergy (an Xconomist) told me over the summer: that other parts of the U.S., like New Mexico and Hawaii, are “more progressive and aggressive about energy.”

To overcome these barriers, the study recommends a 10-point plan to get cleantech on track in the Northwest:

—Put a price on carbon
—Increase Washington’s renewable portfolio standards (required percentage of electricity from renewables) to 25 percent by 2025
—Implement low-carbon fuel standards
—Pass aggressive green building codes
—Foster regional cooperation
—Ensure public funding for cleantech via public employees retirement system investments and through targeted cleantech funds
—Implement effective tax credits for renewables development
—Deploy cleantech workforce development programs
—Establish government purchasing policies for cleantech products and services
—Build regional smart grids and a 21st-century transmission backbone

If these steps are taken by regional government and industry, the independent study says, then Washington and Oregon could lead the U.S. in clean-energy deployments. “The cleantech industry is really taking root in the Northwest,” says Rhys Roth, co-founder of Climate Solutions. “The opportunity is real, but we have to act now, with urgency.”

Gregory T. Huang is Xconomy's Editor in chief. E-mail him at gthuang [at] xconomy.com. Follow @gthuang

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