California is home to the world’s greatest innovation economy. From semiconductors to social networks, the state boasts a rich tradition of supporting new technologies that spawn job-creating companies and industries and provide California consumers with the goods and services that make their lives better.
But recent attacks on the Low Carbon Fuel Standard could stifle California’s role as an innovation leader. And these attacks could also stifle improvements to our economy, consumer choice and the environment.
Five years ago, backed by strong support from members of the business community, California enacted the Low Carbon Fuel Standard, or LCFS, as part of the state’s landmark clean energy law, called AB 32. The fuels standard component of this law is one of the ways California can meet its goal to lower greenhouse gas emissions to 1990 levels by 2020.
Companies like mine – Sierra Energy, located in Davis – are ready to help the state meet these standards. By sending a market signal to my business, the LCFS has helped spur the development of a waste gasification technology that can help large polluters reduce their emissions and meet the new standards in a clean, renewable, and cost-effective way.
At Sierra Energy, we convert unrecyclable trash and biomass like wood chips into energy. Using a non-combustible, thermal-chemical reaction, we create synthesis gas, or syngas. This clean gas can then be burned to generate electricity or help power vehicles. Simply put, we’ve reengineered a centuries-old blast-furnace technology to create low-carbon fuel.
If successfully implemented, the LCFS will drive businesses and municipalities that want to purchase Sierra Energy’s technology to our front door. And we won’t be alone. Every day in my industry, I see competitors across California who have the courage to take the risks and make the investments that help businesses meet the new standards and expand our economy.
These entrepreneurs grow sugar beets to produce advanced biofuel feedstock that doesn’t interfere with the food supply and carefully conserves soil and water.
They create biotechnologies in labs that help fuel burn cleaner and more efficiently.
And their businesses grow – and in doing so, they help California’s overall economy grow, too.
In order to meet the LCFS, oil companies need to supply 600 million gallons of their fuel from alternative sources. Home to more than 30 growing biofuel companies like mine, California is fully prepared to help meet the standard.
According to an Environmental Entrepreneurs (E2) report included on a new Web site – www.fuelinggrowth.org
> – that shows the breadth of the clean fuel industry, production of advanced biofuels is quickly scaling up. By 2015, domestic advanced biofuel production capacity could reach 2.6 billion gallons – about six times 2011’s production level.
As production increases, so will employment opportunities. Advanced biofuels will create more than 18,000 new jobs nationally, and this is only a starting point – the total number of advanced biofuels jobs for skilled and unskilled workers will likely be much higher, the E2 report stated.
Beyond growing the businesses that boost our economy, the LCFS will also increase competition in the fuels marketplace. In 2011, Californians spent $70 billion at the pump. Because of limited development of clean fuels, consumers had little diversity in fuel choice – almost every penny was spent on fuels derived from oil and supplied by major corporations headquartered out-of-state.
As an advanced biofuel entrepreneur, I hope Californians understand the LCFS changes this status-quo. By developing new supplies of alternative fuels, California’s clean biofuel industry increases competition and gives consumers choice at the pump. Oil and gasoline will still be available, but clean-burning biofuel will increasingly become part of the state’s fuel mixture.
And instead of California’s fuel supplies being controlled by a monopoly, consumer demand for biofuel will be partially met by new, nimble companies like mine that operate right here in Northern California. These small- to mid-sized businesses are the true engines of our economic growth.
Support for innovation has been a part of every major expansion in the dynamic history of California’s economy. By standing behind the LCFS, we do more than just honor our state’s proud innovation tradition – we also usher in a new era of clean economic growth.
Ed's Note: Mike Hart is the CEO of Sierra Energy and a member of Environmental Entrepreneurs (E2), a national community of business leaders who believe that sound environmental policy builds economic prosperity.