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Mayor says Richmond’s green economy prospers despite Solyndra’s closure

on September 13, 2011

When Fremont-based solar power company Solyndra LLC filed bankruptcy last week, “green job” supporters in Richmond shrugged their shoulders in indifference.

Like Solyndra, solar company SunPower Corp., the largest green business in Richmond to date, is a mass-manufacturer of solar solutions. But Solyndra’s closure and layoff of nearly 1,000 employees last week failed to upset Mayor Gayle McLaughlin’s green dream to boost Richmond’s economy with a push toward more green jobs.

We don’t think Solyndra impacts our green and clean tech business sector in Richmond. It seems Solyndra may have had some specific issues,” said McLaughlin, referencing the recent FBI investigation there.

RichmondBUILD Green Jobs Training Academy director Sal Vaca agrees. RichmondBUILD, which averages 150 to 200 graduates a year, has seen an upswing of up to 25 percent of graduates going to work in the green industry, according to Vaca. “There is still optimism,” he said. “[Solar power] is still a viable energy but without the incentives and with a very challenging economy, more is needed in the area of policies.”

Currently, the Richmond Recovery Solar Rebate program provides incentives for business and homeowners to install solar panels. Richmond is first in the Bay Area for solar installed per capita, said McLaughlin.

But not everyone is convinced that Solyndra’s closure is meaningless for Richmond.

Karen Chapple, a UC Berkeley Professor who helped develop the strategy to improve Richmond’s “green economy” in 2010, says that we have already lost the edge in solar manufacturing in the East Bay. “The writing has been on the wall for a couple of years. Green manufacturing is not going to be a stable job force,” she said.

Gov. Schwarzenegger with Richmond Mayor Gayle McLaughlin at SunPower in January of 2010. The ex-governor spoke about his support for companies like SunPower as a foundation for California's push for more green jobs. (Photo Courtesy of Robert Rogers)

Chapple quoted the same challenges that belied Solyndra, including the threat of cheaper manufacturing costs for solar panels coming from China, whose subsidies to its solar industry threaten American-based companies’ competitive power.

Unlike Solyndra, SunPower does have manufacturing facilities around the world, including in Asia and Europe. 

Chapple tried to dissuade the city from investing in solar manufacturing while developing the green strategy, but in early 2010, Gov. Arnold Schwarzenegger christened SunPower as the local embodiment of the state plan to harbor an influx of green jobs.

There is probably a role for green manufacturing in the East Bay–if there’s going to be anywhere in the country, it’s here,” said Chapple. “But it’s going to be food manufacturing…niche market, not on the scale of solar.”

Despite Chapple’s bleak outlook, SunPower has expressed no concern about Solyndra’s closure. SunPower employs “a couple dozen” Richmond residents, and “more in Point Richmond,” said Julie Blunden, SunPower’s VP of public policy and corporate communicastions. The majority of employees at the Richmond office live within a 30-minute commute.

All industries, especially in the early stages, have companies who thrive while some fail to get to scale, reduce costs or develop products that meet market demand,” said Blunden. “Solar in the US is growing rapidly, as is SunPower.”

Vaca agrees. “[Solyndra’s closure] is more systemic of the overall recession. That’s just one major company. We have not seen that in our community. SunPower is still going strong,” he said.

According to a report commissioned by the City of Richmond last year, Richmond had 1,837 green jobs in 2010, 581 of which were jobs in solar energy. SunPower could not provide data on the number of new jobs created at the Richmond facility this year.

If the City truly wants to boost its economy, it would be better off training Richmond youth in occupations that are growing and can scale up, said UC Berkeley’s Chapple. “Let’s train them as electricians, or plumbers.”

According to Blunden, SunPower has received research and development funding from the government, but not to the same extent as Solyndra, which received $535 million in loans from the U.S. Department of Energy and $1.1 billion in venture capital funding before its collapse.

Ford Point, above, is the home of SunPower Corporation, the largest green business in Richmond.

SunPower is privately funded and has a long history of profitability as a publicly listed company,” said Blunden. “We have taken advantage of programs aimed to expand investment in California, like the federal and state manufacturing tax credits.”

It’s a shame that the government gave Solyndra a half-million dollar loan guarantee and it’s going to give green jobs a bad name, said Chapple. “It’s trashing the government – that’s not quite true. The government can actually do a great job spurring job growth. It just needs to make more strategic bets.”

Mayor McLaughlin said that Richmond is moving forward seeking grant money. “We are, of course, in the midst of an extremely harsh national economy, but Richmond is actually a city that is moving forward in spite of this,” she said.

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