Monday, February 4, 2008

Industry: $20M clean-tech plan is a 'good start'

By Brendan Lynch

Massachusetts Gov. Deval Patrick's life sciences initiative may make politically sexier headlines, but another promising tech cluster attracted nearly as much investment funding in his budget proposal released last week.

Patrick's fiscal 2009 budget proposal includes a commitment of $20 million, just $5 million less than state funding for the life sciences, for investment in clean and alternative energy businesses and programs.

The Alternative and Clean Energy Trust Fund would focus primarily on delivering seed grants to biofuel companies and funding "Green Communities" municipal programs that encourage energy efficiency in cities and towns, said Robert Keough, assistant secretary for public affairs at the state Executive Office of Environmental Affairs.

"Including it in the budget begins a dialogue with the Legislature about how to invest in this cluster," said Keough.

Clean technology and its promise of eventually eliminating the nation's dependence on foreign oil and reducing greenhouse gases has already attracted the attention of private investors. Now that promise, along with the potential for new jobs and economic momentum, is also attracting the attention of state and federal officials. In his State of the Union address, however, President George Bush directed $2 billion in funding to an international trust aimed at helping other, developing nations such as India.

In Massachusetts, Nick d'Arbeloff, co-executive director of the New England Clean Energy Council, said a number of local biofuel companies could benefit from Patrick's proposed trust funds. Such companies include Agrivida Inc., Bioenergy International LLC, Mascoma Corp., World Energy Alternatives and Twin River Technologies Inc.

"There are significant capital requirements on all these companies that a budget item like this might address," D'Arbeloff said.

D'Arbeloff also said that energy-efficiency technology companies such as EnerNOC Inc., Aircuity Inc., Ameresco, Aspen Aerogels Inc. and Climate Energy LLC could benefit indirectly from the proposed municipal grants.

In the larger picture, Dennis Costello, managing director of Braemar Energy Ventures, said while the fund is helpful, it isn't likely to grow the regional cluster significantly.

"If it's going to make a difference, it needs to be more," said Costello.

Still, both Keough and Anderson said the Patrick administration's proposal is a good first step.

The $20 million represents a recapitalization of a $43 million fund appropriated last year. The Environmental Affairs office would administer the $20 million, though such details have not been legislated for the initial $43 million, Keough said.

The proposed trust fund also amounts to a committment to the sector from the governor, according to Bruce Anderson, CEO of Woburn-based energy company Wilson TurboPower Inc., who is a board member of the regional clean energy council.

"The governor has put his money where his mouth is," Anderson said.

Anderson said other locales, such as Abu Dhabi, United Arab Emirates -- which is building a $2 billion hydrogen power plant -- have invested more in clean energy. But he said that even with the smaller investment, Massachusetts has the built-in apparatus to develop an industry-leading cluster.

"We should be able to achieve some global leadership here, but it does take money," he said. "It's a good start."