Solar panels

OK, my headline might be stretching the point. But it might not.

Look what is coalescing in Berkeley:

I suspect there are other initiatives I’ve left out.

Then there’s the policy leadership shown by the City of Berkeley with its Financing Initiative for Renewable and Solar Technology (FIRST).  Vice-president Joe Biden recently launched a report that urges wholesale adoption of a Berkeley-style financing program for solar. Add to that the fact that Bay Area venture capitalists are the source for the bulk of start-up cleantech investments globally.

I can’t think of a more natural home for such pioneering work. It offers the prospect of a very exciting future for Berkeley, particularly if the city can find ways to welcome the entrepreneurs that are certain to emerge from the research over time.

Photo by Kevin T Houle from Flickr

Lance Knobel

Lance Knobel (co-founder) has been a journalist for nearly 40 years. Much of his career was in business journalism. He was editor-in-chief of both Management Today, the leading business magazine in Britain,...

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1 Comment

  1. Ok, I’ll play contrarian. There are two aspects of all this investment that worry me:

    First, as a public safety matter, I don’t think that the synthetic biology research belongs here, in an urban environment, prone to earthquakes, where the labs conducting it are not sufficiently paranoid for my tastes in how they handle the materials. (By “synthetic biology” I mean research that involves creating genetically altered bacteria, yeast, etc.) The simple facts are that we don’t really know how dangerous this kind of research is; there are good reasons to think it is more dangerous than is commonly reported; the “containment” practices for these GMOs is lax; the *monitoring* for escape of these creations is non-existent; in an earthquake or fire, there is little preparation or safeguards to prevent spills of materials they do try contain; the consequences of a sufficiently bad release are *irreversible* (short of, perhaps, nuking the Bay Area).

    So that’s one thing. More mundanely but also important:

    It’s a nice thing to bring all these brains together around, for example, LBL. Go, Chu, go! But that’s only half the story. The other half of the story is Berkeley adopting a de facto policy of staking most of its economic growth hopes on these firms. That’s a bad bet, for two reasons:

    Reason 1: This kind of research does *not* recirculate its revenue in Berkeley very much at all. It does not contribute to a diversification of the City’s economy. It’s a kind of “bypass ramp” highway for big money. Sure, the money technically enters Berkeley in high volume at a fast rate. About as fast and at about the same volume, most of it quickly leaves again.

    Reason 2: This de facto “most of our eggs in one basket” strategy is a bubble. Let’s assume this research is top tier – some of the very best that there is. Even so, the vast majority of the top tier research in these areas takes place *elsewhere*. The odds are that if big breakthroughs are going to happen, they’ll happen elsewhere and this research investment in Berkeley will dry up. One of the next best long-odds bet is that some breakthrough happens here, but then we’re done and this research investment in Berkeley dries up. Another of the best long-odds bets is that no serious breakthroughs happen anywhere or other external factors make breakthroughs irrelevant – the research investment in Berkeley dries up because there’s no money to fund it with.

    In short, as a long-term (decades) economic strategy for Berkeley, the only possible way we can win is if the research (everywhere) never quite succeeds but in tiny increments that just barely prop up the global economy enough to justify continued research investment. To me, this seems like a very dubious bet.

    So, the likely outcome in 5-10 years is a bunch of under-utilized, debt-burdened, facilities that are hard to convert to any other use that would keep them above water.

    As a City, our primary focus really has to be on steps that build a highly diversified economy with high recirculation of dollars and a favorable balance of trade (e.g., importing less finished goods and exporting finished goods at a net profit to the City’s economy). Jacobian (Jane) Urban Economics, 101.