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Business Voice for the Environment

February 25, 2008
The Honorable Therese Murray
Senate President
State House, Room 330
Boston, MA 02133
Dear President Murray:
I am writing on behalf of Environmental Entrepreneurs (E2 - www.e2.org) in support of S.534, The Massachusetts Global Warming Solutions Act. We strongly believe that this bill will improve our economy, spur innovative new industries, and give the state a competitive advantage in the emerging clean energy economy.
E2 represents a national community of over 900 independent business leaders -- 80 of them in Massachusetts -- who believe in protecting the environment while building economic prosperity. E2 is widely recognized as a resource and an independent voice for understanding the business perspective on environmental issues. As a group of entrepreneurs, investors and professionals who collectively manage over $20 billion of venture capital and private equity, and have started well over 800 businesses which in turn have created over 400,000 jobs, we believe that Massachusetts has many of the right ingredients to lead the clean energy economy if we have the political will to turn words into action.
Massachusetts: Leader or Laggard?
Massachusetts is at a unique turning point in history. In the next 50 years our economy will almost certainly be powered by something other than fossil fuels. The question is whether Massachusetts will become an innovative leader in this economy or continue to send our precious dollars to other states and countries to buy fossil fuels, the primary cause of global warming. By making a binding commitment to reduce emissions, the Massachusetts’ Global Warming Solutions Act will send a signal to the world that Massachusetts is serious about clean energy, creating a market for our growing clean energy industries such as advanced batteries, cellulosic ethanol, and new forms of highly efficient insulation.
It will create jobs in renewables, efficiency and demand-side management that are applicable to workers at every level of the academic and skills ladder and across the entire state. Clean energy jobs run the gamut from Ph.D. research to solar panel installation, energy audits, weatherizing buildings and maintenance of wind turbines. Not only can these not be outsourced, but with proper training are appropriate for low-income and disadvantaged workers.
Most observers believe that within the next two years, regardless of who is elected to the presidency, there will be a federal cap on greenhouse gases. Some states will seize this opportunity and be well prepared to capitalize on the growing clean energy industry that this will spur. Massachusetts’ S534 can give us a running start in the race for clean technologies that reduce global warming pollution and allow us to catch up with European and Japanese companies that currently lead in renewable energy technologies like wind and solar.

In September 2006, California passed its’ landmark Global Warming Bill (AB32) requiring strong mandatory cap on global warming pollution.  An independent state report found that meeting their limits increases Californians’ income by about $4 billion and provide about 83,000 additional jobs.

The bill is already paying dividends for California. The number of companies receiving venture capital investments is considered a leading indicator for the future of emerging industries. As a rule of thumb, every $100 million in venture capital funding could help spur creation of 2,700 direct jobs in venture-backed companies, $500 million in annual revenues over the next two decades,and many more indirect jobs.[1] Since passing the Global Warming Bill, California has taken a dramatic lead over the Northeast in venture investment.
The Cost of Action versus Inaction
A recent report from McKinsey & Company[2] analyzed the cost and methods for the United States to reduce greenhouse gas (GHG) emissions. The detailed report demonstrated that if we act quickly greenhouse gas emissions can be reduced one-third to one-half by 2030 at minimal economic cost. It showed that this can be accomplished without new technology breakthroughs and without reductions in our current standard of living. In addition, the investments in energy efficiency and renewables will grow many existing and new sectors of the economy, creating new jobs and keeping the country competitive. Failure to act quickly means that we risk far greater consequences from global warming and make it much harder to reach the goals that scientists believe are necessary to stave off both environmental and economic disaster.
According to the Stern Review[3], a highly respected economic study by the British government, “the overall costs and risks of climate change will be equivalent to losing at least 5% of global GDP each year, now and forever. If a wider range of risks and impacts is taken into account, the estimates of damage could rise to 20% of GDP or more. In contrast, the costs of action – reducing greenhouse gas emissions to avoid the worst impacts of climate change – can be limited to around 1% of global GDP each year.”

Business Supports a Mandatory Cap on Emissions
In 2007, a growing list of over 27 leading American companies known as the U.S. Climate Action Partnership (USCAP) issued an unprecedented call for a federal limit on heat-trapping pollution, backed by a market system that rewards quick results and cuts overall costs to the economy. USCAP’s members include Alcoa, BP America, Caterpillar, Duke Energy, DuPont, FPL Group, General Electric, Lehman Brothers, PG&E, PNM Resources and many other large and respected companies.

In March 2007, a group of 65 institutional investors and US companies called on Congress to pass federal legislation to cut greenhouse gasses that lead to global warming. Organized by Ceres and the Investor Network on Climate Risk (INCR), the group presented a "Climate Policy Call to Action" with detailed responses to climate change they believe need to happen on a nationwide scale. This was the largest group of pension funds, state treasurers, state/city comptrollers, financial service firms, asset managers, foundation endowments and US companies ever to ask the Congress and federal government to act on this issue.
Old Economy versus New
No market exists in Massachusetts today for clean technologies that reduce global warming pollution, because the pollution can be emitted without charge. An enforceable limit on global warming pollution will provide clear market incentives for innovative technologies that reduce pollution. We are watching the economic opportunity of a lifetime unfold right in front of our eyes. Massachusetts can continue down the path of the old economy watching paper mills and textile plants close because of the high price of energy. Or we can take our destiny into our own hands, set achievable mandatory limits on greenhouse gas pollution, and reduce the price of energy while building the economy.
A recent news article in the Springfield Republican may provide a look at the future. In Russell, Massachusetts developers of the Russell Biomass electrical power plant to be built on the site of the former Westfield River Paper Company say the company’s new plant will provide tax revenues to the town of Russell that are 20 times greater than those paid by the former paper company and will eliminate the town’s budget problems for the next 20 years.
Thank you for consideration of the E2 business perspective on these issues. Please contact Berl Hartman at 617- 497-0393 if you would like to discuss these important matters further.



[1]Creating Cleantech Clusters: 2006 Update, May 2006, E2 & Cleantech Capital Group


Adam Albright
ARIA Foundation
Lauren Armstrong
Daniel Bailey
Rackemann, Sawyer & Brewster
Jay Baldwin
Partner, Wind River Capital Partners, LLC
Fred Bamber
Managing Director, Spartina LLC
Constance Barbour
Eric Becker
Chief Investment Officer, Clean Yield Asset Management
Aron Bernstein
Professor of Physics, MIT
Elizabeth Bertolozzi
COO & Managing Director, Wilmington Trust FSB
Blake Bisson
Director of Marketing, American Superconductor
Geri Blitzman
New England Growth Associate
Bill Capp
Founder, Grid Storage Consulting
Jacqueline Capp, DDS
Owner, JHC Studio
George Denny
Partner, Halpern Denny & Co
Barry Dicker
President, Decent Energy, Inc.
David Duehren
Co-founder, Brooktrout Techology
Sid Embree
President, Atmosclear
Allison Friedman
VP Business Development, Co-Founder, Rate It Green
Richard Gallogly
Attorney at Law, Rackemann, Sawyer & Brewster
Rob Gifford
Principal, AEW Capital Management, LP
Harry Gold
CEO and Founder, OverDrive Interactive
Susan Goldhor
Biologist, C.A.R.S.
Dan Goldman
Co-Founder and Managing Partner, Clean Energy Venture Group
Diana Goldman
Founder, ICanPlanIt
Amy Goldstein
Director of Programs, National Multiple Sclerosis Society, Heartland Chapter
Larry Grob
Grob Communication Consulting
L.D. Gussin
Principal, Cleanmotive Strategies
John Harper
Principal, Birch Tree Capital, LLC
Berl Hartman
E2 New England Chapter Director, Hartman Consulting
Hyman Hartman
Research Scientist, Massachusetts Institute of Technology
Nancy Hazard
Consultant, WorldSustain
Heather Henriksen
Director, Office for Sustainability, Harvard University
Raymond Hoefling
Senior Vice President, Corporate Banking, Citizens Bank
Eric Hudson
Founder & CEO, Preserve
Ogden Hunnewell
President, Nordic Properties
David Hurwitz
President, Garnett Consulting
Christopher Kaneb
Principal, Catamount Management Corporation
Jon Karlen
IDG Ventures
Karen Krucik
Business Development Manager, Vision Developers
Joseph LaRusso
Assistant Corporation Counsel
Dick Lawrence
Co-founder, Director, Aspo USA
Erik Levy
President, Save That Stuff, Inc.
Deb Lockett
Sustainable Belmont
Andrew Magee
Senior Consultant, Epsilon Associates
David Marcus
CEO, General Compression
Theo Melas-Kyriazi
David Mendels
Board Member, Resilient Coders
David Miller
Executive Managing Director, Clean Energy Venture Group
Karen Miller
President, Belly Shmooze
Rob Moir
President, Ocean River Institute
Ted Moriarty
Owner, Smart Watering Company
Anne Murphy
Roger Nauth
Strategy Consultant, Accenture
Peter Papesch
Architect, Papesch Associates
Anne Peretz
Donald Reed
Senior Environmental Consultant
Wilson Rickerson
Jacqueline Royce
Independent Scholar
Dan Ruben
Director, Boston Green Tourism
Tedd Saunders
CSO, The Saunders Hotel Group
Bob Shatten
Principal, Boreal Renewable Energy Development
Steve Shoap
Karen Shragle
Christopher Stix
Executive in Residence, Babson College Fund
Jim Sweeney
President, Sustainable New Energy
Ian Todreas
Vice President, ERG
Haskell Werlin
Solar Project Developer, Solar Design Associates
George Woodwell
Founder and Director Emeritus, The Woods Hole Research Center
Leila Yassa
Don Young
President and CEO, Aspen Aerogels, Inc.

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