Seeking to lure new clean-tech companies and retain existing ones, Palo Alto officials are pitching a new program that would turn some of the city's utility customers into "test beds" for emerging technologies.
The concept is part of an aggressive new strategy for boosting economic development that the office of City Manager James Keene unveiled this week. The effort, spearheaded by the city's Economic Development Manager Thomas Fehrenbach, aims to reverse recent dips in tax revenues and bolster Palo Alto's image as a hub of green innovation.
The plan, which is still in draft form and is likely to see modifications in the coming months, reflects the City Council's ambition to become more proactive in attracting clean-tech companies. At their annual retreat in January, several council members expressed interest in using the city-owned utilities to create partnerships with Stanford University and emerging green companies.
Palo Alto already boasts a strong crop of young green leaders, including the electric-vehicle companies Better Place and Tesla Motors. At the same time, existing tech giants such as Hewlett-Packard Co. and SAP continue to place a higher emphasis on clean technology, Councilman Pat Burt said at the retreat.
"It's hard to be a major corporation without being engaged in clean technology and sustainability," said Burt, himself a high-tech CEO. "It's emerging even more than we thought a few years ago."
The new plan places clean technology at the center of the city's strategy for economic development.
"As we move forward with economic development and sustainability goals, we intuitively know that they must fuse," the plan states. "We understand that in order to maintain our leadership as a global center of innovation, we must continue to attract the next wave of start-up entrepreneurs, cutting edge clean-tech, bio-tech, and research firms, while retaining the existing companies that keep our character and charm."
Fehrenbach said the proposal to designate "test bed" partnerships is a response to the comments made at the retreat. Partnerships of this sort, the plan states, could help the city attract a clean-tech firm that "could eventually mass-market a taxable product from within our city."
"It's about finding ways to partner with emerging technology companies to leverage city resources in a way that can attract such companies and use the fact that we have our own utilities," Fehrenbach told the Weekly.
Fehrenbach said staff is still exploring the "test bed" idea and discussing possible incentives it could offer to companies. These could include technical expertise from the Utilities Department and the prospect of having utilities customers volunteer to test the latest cutting-edge green technologies.
Palo Alto's Utilities Department is already partnering with a Stanford University professor and graduate students on a "demand response" project that encourages large commercial customers to reduce their electricity usage during high-peak days. If successful, the project could be a precursor to a broader smart-grid program in Palo Alto.
The strategic plan, which Fehrenbach is scheduled to present to the City Council's Policy and Services Committee Tuesday night, calls on staff to draft a business plan for other pilot projects by June and to implement these projects by Jan. 31, 2012.
The plan also calls for a new survey of local businesses to identify reasons why businesses move to Palo Alto and ways in which the city can help the companies remain successful. The survey would be released by the end of this year.
Staff would also hold regular outreach meetings with key company leaders to identify expansion, relocation and renovation opportunities and assist the companies as needed. The document calls for 20 general outreach meetings every month starting in January 2012.
"The goal is really to have my team interface with businesses on a regular basis to understand what the business climate is and to understand what opportunities exist," Fehrenbach said.