Major energy market disruptions and a fundamental shift away from old growth models are underway in California—with significant leadership from San Francisco’s Bay Area and Silicon Valley—as clean technology hotspots take root across California. New data shows how the state’s economy is getting cleaner as it grows.
Numbers from Next 10’s California Green Innovation Index detail an ongoing story of clean energy innovation and uptake as economic growth decouples from emissions:
- California patent registration in 2015 topped the nation in all major clean technology categories, from biofuels to solar to green materials.
- Electricity from in-state solar surged by 1,122 percent from 2009 to 2014.
- Zero-emission vehicle registrations increased by 244 percent between 2012 and 2014.
Clean energy costs are dropping, investment is rising, capital costs are coming down, and clean energy costs are competing with traditional energy sources. In short, California is demonstrating how to grow an economy while reducing greenhouse gas emissions. It is a model for the nation and the world.
Silicon Valley leads as both a creator and a consumer of clean technology. It tops statewide rankings in the number of green technology patents earned (1,168 in 2015), and in the number of electric car rebates per capita. Clean energy plays a role in the San Jose-Sunnyvale-Santa Clara area’s economic success, and is one reason the region boasts the highest GDP per capita in California ($111,020) with the largest recent increases in the state (5.4 percent growth 2013-2014).
The San Francisco Bay Area tops the statewide rankings for electricity productivity –producing a higher value of goods and services for every dollar spent on electricity than any other region in the state. San Francisco-Oakland-Hayward is second only to Silicon Valley for filing green tech patents and per-capita clean-vehicle registration. It also ranks fourth in solar capacity across the residential, commercial, and industrial sectors.
But clean energy isn’t just for places traditionally considered innovation hotspots, like San Francisco and Silicon Valley. In examining how clean-tech innovation is taking hold in 26 metro regions, we find that leadership and innovation can be found across our state.
For example, California’s leader in both commercial solar power and residential solar power is Riverside-San Bernardino-Ontario. And Fresno tops the rankings for industrial solar power. On a per-capita basis, Yuba City ranks number one for residential solar energy, and Chico ranks number two. Riverside–San Bernardino–Ontario ranks fifth for the number of clean vehicle rebates and sixth for green tech patents in the state. And a number of metro regions not traditionally known as innovation hotspots such as Bakersfield, Modesto and Merced, produced a small but growing number of clean technology patents in 2015.
None of this is accidental. Rather, it is the result of conscious decisions made by governments, businesses, families, and institutions across the state. Last year, for example, SB 350 increased California’s Renewable Portfolio Standard and efficiency targets, committing our state to a goal of 50 percent renewable energy and a 50 percent increase in energy efficiency in buildings by 2030. Also in 2015, California spearheaded the Under 2 MOU, which commits states and regions around the world to cutting greenhouse gas emissions and limiting the increase in global average temperatures to two degrees Celsius.
A common thread runs from innovations in California’s metro areas to commitments made worldwide: Clean energy is transitioning from cutting-edge to commonplace. Last year, two-thirds of new generating capacity installed across America was renewable. Globally, that figure was 90 percent.
In a vacuum, news that California earned nearly 68 percent of the nation’s total clean tech investment in 2015 or that it leads in all major clean tech patent areas may not seem to have much impact on the average Californian. But when we observe these headlines and track the data that shows California’s trajectory of policy and clean-tech innovation, along with our per capita emissions reductions, we can better understand the transformational impact California’s clean energy economy is having.
This is what the new world of energy looks like. It brings with it measurable economic growth.
Noel Perry is a businessman and founder of Next 10, a nonpartisan nonprofit think tank in San Francisco that produces the California Green Innovation Index. Christopher Thornberg is founding partner of Beacon Economics, an independent research firm that compiled this year’s Index.