Jose Beceiro of the Austin Chamber of Commerce discusses why Austin, Texas is becoming a hot bed for cleantech start-ups.
|Jose Beceiro:||Hi, I’m Jose Beceiro with the Austin Chamber of Commerce. I’m the Director of Clean Energy at the Chamber. I work in the Chamber’s Economic Development Recruitment Program. I focus on recruiting Clean Tech companies to the Austin region. The goal of the program, overall, we are trying to diversify Austin’s Technology base. Austin, through the past couple of decades, has gone through up and down trends in its technology economy. We’ve seen the Semi-conductor Industry and the Software Industry and the Computer Industries grow; but with the downturns, we would always see these industries take a pretty hard hit. And so, one of our goals is to bring in new emerging tech sectors like the Clean Energy industry to help smooth-out and create more buffers in our local economy so that we can rely on areas that are strong whenever other areas are weak and not doing so well. And so, the Clean Tech focus is really an effort to bring together some of the areas of expertise that we have in software, computers and semi-conductors which are all really converging together in merging with the energy economy. And so, you are seeing a lot of that happen here in Austin and we are trying to bring these new innovative Clean Tech companies to Austin to prove-out their technologies and also to deploy their technologies at a very large scale.The main driver here in Austin in building the Clean Tech industry is what’s happening at the University of Texas. There are a number of research programs that are focusing on advanced battery research, energy-efficiency technology and smart grid technology; even solar and wind technologies. Power electronics is an area that UT (University of Texas) in Austin has been involved with for several decades. So you are seeing a lot of advanced inverter technologies coming out of UT. And so, the research capabilities at the University are really driving new innovations and entrepreneurs are coming to Austin, taking these technologies out of the university labs and spinning them out into new start-up companies.You are seeing a lot of activity with the University in that regard. You also have an environment here in Austin where we have a very progressive and green-focused electric utility, in Austin Energy; it’s a city owned electric utility, it’s one of the tenth-largest municipality-owned electric utilities in the country. Consistently ranked as the top green utility in the nation and they have very aggressive policies on energy-efficiency, rebate programs for solar. They offer a Green Choice Program where you can purchase all your power from renewable energy sources like wind. And so, they offer a lot of support incentives to help drive the market for the scaling up and the deployment of these technologies. So, a lot of entrepreneurs are finding that their company can do best when you have the support of the local government and the electric utility trying to grow these new markets.
One thing that Austin is doing that is very innovative is; we have a mandatory energy-efficiency audit process and the city council passes, a few years ago, to City Ordinance that any single-family home that is sold needs to undergo energy-efficiency audit before it is sold. It is similar to doing a home inspection when a house is sold and this is a mandatory program. What has happened over the years since we’ve implemented it is that we are building up slowly an inventory; in this sort of a profile of what are existing housing stock looks like from energy-efficiency stand point. We now know what upgrades need to be done within homes, what’s the low-hanging fruit and how best to get homes in a position where they can be as energy-efficient as possible. And also add as much value as possible to the new home owner; but also to the electric utility, which is having to supply these homes with power and other utilities. And so, this is a very instrumental policy in helping us become a more energy-efficient community. But it’s also, at the same time, creating a new market for these energy-efficiency technologies. From advanced windows, advanced insulation for homes, even smart landscaping. You’re seeing a lot of landscaping firms starting to specialize in native landscaping so we are minimizing how much water we are using for irrigation purposes. And so, these policies have actually helped spur the growth of these industries here in the region.
You know, we are always highly competitive when it comes to building out our Clean Tech industry; but at the same time we are very dependent on what’s happening in the Bay area, particularly in Silicon Valley.
One thing that we are seeing is, the investors that are investing into Clean Tech are in large part coming from Silicon Valley and from Menlo Park. They see the high quality start-ups that we have here in Austin. They are putting money into them and helping these companies grow. So, we are dependent on the resource available in the Valley; but also the companies that emerge out of Silicon Valley. Once they reach a certain kind of tipping point, it becomes a situation where they have to decide where is the least cost environment to locate and to operate their future operations. And we have several examples here in Austin where large solar companies like SunPower and Super Conductor Technologies; companies that were born in California, hit to a point where they need to scale up to manufacturing. And a lot of times the companies will keep their headquarters in the Bay area or in California but then move new operations centers to Austin to take advantage of the high-tech talent that we have here but also the resources and the new markets that are developing.
We have a number of very exciting companies coming out of Austin today in the Clean Tech field. HelioVolt is a solar manufacturing company that was born and raised right here in Austin. They started in 2001 and they were kind of in an R and D (Research and Development) phase for almost a decade then they finally had some breakthroughs in how they design and implement new manufacturing lines for thin film solar panels. They raised a lot of money, I think to date, Two Hundred Million dollars in venture capital. They established their first pilot manufacturing line here in Austin and now they are cranking out solar panels and selling them across the world. Another exciting company; we have two companies that are focused on advanced solar inverter technology, SolarBridge Technologies and also Ideal Power Converters.
SolarBridge Technologies is a company that actually originally came out of Illinois, relocated after they received their first transfer funding. They actually received some funding from the State through the Emerging Technology fund. They have gone on to raise over Fifteen Million in venture capital and now have close to a hundred employees. They are doing very well, they make a micro inverter that attaches to the back of the solar panels so its almost like a solid state inverter. In effect, it makes the solar panel an AC (Alternating Current) panel versus a Direct Current. And what the advantage of SolarBridge Technologies is that, down the road, you can actually see a situation where we could start selling solar panels just at Home Depots or WalMart so people can take them home and install it themselves without having to deal with the complicated electrical wiring and hook-ups. Ideal Power Converters is making a different type of inverter; they are doing a mid-range commercial scale thirty Kilowatt inverter. It is about half the size and twice as efficient as your standard commercial inverter. They have actually raised money from the Federal Government through the ARPA-E program. They have also received some state funding and a little bit of venture capital funding. (They are a) home-grown company that are growing very quickly, a lot of the commercial scale solar projects in the Austin area are using Ideal Power Converter inverters; so, it’s another exciting company. You know, the list goes on and on.
We have L.E.D. technology companies, we’ve got smart grid technology companies that are designing home energy monitoring systems and deploying those in demonstrations projects such as the Pecan Street Demonstration Project. So, it’s a very diverse industry that we have grown here and the vast majority of these companies are home grown start-ups started up by local entrepreneurs that come from different tech industries that have come now to bring their skills to the Clean Tech industry.
The reason I enjoy this area in the Clean Tech space is because it really is the future economy; in my opinion. Our energy challenges are tremendous; and Texas, being kind of the center of the energy economy, globally. We are in a great position here to identify new technologies that can help make electric grids more efficient and help us satisfy our future energy demand while at the same time providing new power and new solutions that are either carbon neutral or carbon free; and also to have the opportunity to create an incredible amount of new jobs.
I think we’ve seen that particularly in the wind industry here in Texas. In a span of ten years, we went from zero Megawatts of wind to now over eleven Giga Watts or eleven thousand Megawatts of wind, which is tremendous. We are the largest wind market in the country; I think the fifth-largest globally. So, we effectively created over thirty thousand jobs just in the wind industry here in Texas.
In the solar industry, it’s been a tremendous ramp-up as well. Solar is trailing wind as far as the amount in terms of Megawatts we have installed, but the growth rate has been phenomenal. We currently have forty different companies that are focused on solar in Austin today. From installers, manufacturers, project development firms; and we currently have about six hundred people employed in solar in Austin. And whenever you kind of measure that in terms of how many jobs it created per megawatt, its somewhere around a hundred jobs per megawatt that we are creating. That’s a much faster rate than most large established solar clusters around the world.
So, you are seeing the direct impact of these new high-tech and clean-tech industries growing. And Here in Texas and in Austin, you are seeing these markets develop at an alarming rate and in some very quick pace that we are building these companies and creating these new jobs. And I think this is something that is just going to keep getting bigger and bigger; and so from a strategic standpoint and economic development standpoint, it is a very smart thing to target this industry which we have incredible resource and potential of being very good at. It is something that we need to make sure that we are focused on in trying to capture as much economic opportunity as possible.