Palo Alto hitches economic future to green innovation | March 4, 2011 | Palo Alto Weekly | Palo Alto Online |

Palo Alto Weekly

News - March 4, 2011

Palo Alto hitches economic future to green innovation

City to look for partnerships with clean-tech companies as part of new economic-development strategy

by Gennady Sheyner

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.

Staff Writer Gennady Sheyner can be e-mailed at


Posted by NIMBYs, a resident of College Terrace
on Mar 4, 2011 at 9:01 am

Don't bring those jobs to College Terrace of the NIMBYs will kick them out like they kicked out Facebook.

Posted by Walter_E_Wallis, a resident of Midtown
on Mar 4, 2011 at 9:39 am

Walter_E_Wallis is a registered user.

Funny, just 5 years ago I was told that there was no interest here in time of day metering.

Posted by Doris, a resident of Southgate
on Mar 4, 2011 at 10:45 am

That's how Enron went broke

Posted by Walter_E_Wallis, a resident of Midtown
on Mar 4, 2011 at 11:05 am

Walter_E_Wallis is a registered user.

Time based electricity metering, if the savings are correctly distributed, is the ultimate conservation measure. Run dryers after 7, recharge cars after midnight, defer A/C between 4 and 7 PM, all make sense ONLY with time of day metering. Of course, it all fails if the utility spends the savings on frou-frou instead of remitting direct to the user..

Posted by resident, a resident of Barron Park
on Mar 4, 2011 at 12:17 pm

the city owned utilities is clearly a cash cow and the city is trying to figure out more ways to make money off it. I hope this does not come at the expense of the residents.

Posted by Time-To-Privative-The-PAU, a resident of Another Palo Alto neighborhood
on Mar 4, 2011 at 12:22 pm

Why does the City of Palo Alto need to "partner" with Stanford people on the matter of "Demand Response"? There are any number of programs around that have prior experience:

Demand Response:
Web Link

Web Link

Web Link

Web Link

These topics have been on Power-Point presentations of the Utility Department for the better part of a decade. Why is it that it takes so long for people at 250 Hamiliton to read the "memos" that everyone else read years ago?

> Metering ..

Yes .. the then Utilities Director (Ulrich) made it clear that the PAU would not be offering metering/off-peak pricing to the people of Palo Alto. So .. seems that what was "unacceptable" then is "acceptable" now?

Oh .. and let's not forget that as we use less electricity, the rates will go up!! There doesn't seem to be the least possibility that if you use less in Palo Alto, you'll pay less.

Posted by Train Neighbor, a resident of Ventura
on Mar 4, 2011 at 12:32 pm

"Demand Response" is different from time-of-use rates.

Demand Response offers incentives to participants to drop electric consumption for a few hours a year during peak demand times (usually during a heat wave). Customers usually turn off lights, raise the temperature and take other temporary actions to shed load for just a few hours.

PG&E's program: Web Link

Time-of-use electric rates have set electric prices for different time periods throughout the year, with the highest prices during summer weekdays, typically from noon - 6pm. The summer peak period is about 800 hours per year.

Posted by Adrianus Schrauwen, a resident of Midtown
on Mar 4, 2011 at 1:41 pm

It looks like another sneaky way to increase rates, just like the so called "Green Energy".
There is no accounting for it.

Posted by what'sup, a resident of Fairmeadow
on Mar 4, 2011 at 2:12 pm

And it looks like a sneaky way to control energy use by residents. Look at that silly report comparing usage to other homeowners. It's just a waste of money because there is so much more that has to be compared besides the sq. footage. Utilities will need to know how many people reside in our homes, any special needs, who is working, who is traveling, and on and on. And our rates will go up to pay for our new monitors.

Posted by Walter_E_Wallis, a resident of Midtown
on Mar 4, 2011 at 2:17 pm

Walter_E_Wallis is a registered user.

Demand response is a voluntary program. Time of day metering insures that savings go to those who earn it.

Posted by Time-To-Privative-The-PAU, a resident of Another Palo Alto neighborhood
on Mar 4, 2011 at 3:37 pm

> a "demand response" project that encourages large commercial
> customers to reduce their electricity usage during high-peak days

Why? There are that many large companies in Palo Alto, and there has never been any complaints about how they were "hogging" all of the power. So .. what's the point of this exercise?

Roche was the singly largest user of power, at one point. However, Roche moved out of it's Palo Alto R&D campus:

Web Link

Before the closing was announced, the PAU, Roche and a solar power company were supposed to have installed a solar generating unit on the roof of some of the Roche buildings:

Web Link

PAU ratepayers money was invested in the Roche project, but after the announcement of the site closing, the power generation project didn't get much attention. Not clear what the status of the unit is at the moment, or how much rate-payer funding was actually involved.

What's interesting about this Roche power investment was that the City was willing to "invest" money so that Roche could have more power that it didn't have to pay the City for. So, although this particular project might have been a "bust", shouldn't this be the way our Utilities department should be seeing the world? Helping to produce more electricity that can be used to drive industry, rather than find wants to "conserve" power--such as perhaps shutting down production for some amount of time every day?

It will be very interesting to read the results of these surveys. The idea that companies are flocking to Palo Alto so that they can join in "environmental conservation" programs that result in their paying more for utilities, year-after-year, and being lectured to by City Councils about the evils of "consumerism", and how bad it is to be "a capitalist". Can't wait to find out how many newly-minted CEOs are lining up to for this.

Posted by Walter_E_Wallis, a resident of Midtown
on Mar 4, 2011 at 4:59 pm

Walter_E_Wallis is a registered user.

Demand metering was, until recently, an expensive proposition, and required a commitment of the customer to reduce demand during peak hours. There is nothing sneaky about it - if you use energy during peak periods, you pay a premium for it, while off peak is cheap. Same rules for everyone. Now, demand metered customers who bust their demand pay dearly for it.
"Yes .. the then Utilities Director (Ulrich) made it clear that the PAU would not be offering metering/off-peak pricing to the people of Palo Alto. So .. seems that what was "unacceptable" then is "acceptable" now?" I still have that letter from Ulrich, AKA The Flimflam Man, telling me there was no interest in time of day metering in Palo Alto. Alas, his replacement is more of the same.

Posted by what'sup, a resident of Fairmeadow
on Mar 4, 2011 at 7:20 pm

Walter, yes it's voluntary now, but with smart meters that could change. PGandE insists it has no intention of doing this (turning off power to homes) but as the technology becomes more sophisticated and the power company can remotely turn on/off power, and our energy efficient appliances can be remotely accessed, I have to figure that's the next step.

Posted by James Hoosac, a resident of another community
on Mar 4, 2011 at 10:48 pm

Global Warming is not that bad. Think about the vast land in Canada and Russia that will become much more habitable. It is far, far bigger than the few islands that may be submerged under sea level. We can just relocate those islanders.

Of course pollution is bad. We need to clean up the fuel we burn. But CO2 itself is not pollution. We breathe out CO2 every minute.

Earth also has its own way to balance. Cloud - the white stuff that reflects sun light just as the (disappearing) arctic ice cap, will become more plenty, due to increased evaporation. Mother Nature is well designed to sustain itself.

I'd argue Global Warming might even be good for the humanity. The explosion of human population needs more habitable land. Siberia and Yukon are good places to accommodate.

Posted by Walter_E_Wallis, a resident of Midtown
on Mar 5, 2011 at 3:45 am

Walter_E_Wallis is a registered user.

Why would PG&E want to turn off appliances when they could just charge more for peak hour usage? I would certainly use timers to keep my usage away from peak hours.

Posted by Peter, a resident of Palo Alto Orchards
on Mar 5, 2011 at 6:37 am

How about not cutting down the mature trees in the city due to specious "safety" risks. Each large tree removes at least 1000lbs of C02 per year. In my view the city's embracing of green is at least 50% show, 25% well intentioned and 25% effective.

Case in point - the city has goals to remove 120K lbs of C02 per year, yet has made no effort to tie this number to the true cost of tree removal. If the city was serious about green it would require for each tree removed an alternative CO2 removing capability by found. Until then it is mostly talk.

Posted by who cares, a resident of Triple El
on Mar 5, 2011 at 9:20 am

Demand metering sounds like an easy way for Palo Alto officials to siphon more money to the general reserve as they have already shown their intentions of the continued bilking of the utilities fund. I am sure there are a few "good" Palo Altans who will conform to the government regulated "non-peak usage" time frame determined by PAU officials, but what happens when they decide to add "emergency" provisions at additional cost to customers and the re-adjustment of usage hours for profit. Palo Alto officals have already shown they look to the PAU funds as just another source of money to fund general reserve needs.

Posted by what'sup, a resident of Fairmeadow
on Mar 5, 2011 at 10:37 am

Walter, PGE would turn off power when it has to deal with possible blackouts. During peak usage there might be times when it cuts off power to one area in order to avoid a blackout. (Or, we could be building more power plants to deal with greater energy demands, but the global warming scare seems to make that a no-no.)

I agree that why not just charge more for energy usage during peak hours and yes I agree I would conserve energy. That's motivation enough. So, why then does the Utility need to chastise individual users with their reports comparing neighbors when they could simply charge more?

Posted by Walter_E_Wallis, a resident of Midtown
on Mar 5, 2011 at 6:28 pm

Walter_E_Wallis is a registered user.

With time of day, no more chastisement.

Posted by Time-To-Privatize-The-PAU, a resident of Another Palo Alto neighborhood
on Mar 6, 2011 at 1:15 pm

> So, why then does the Utility need to chastise individual users with
> their reports comparing neighbors when they could simply charge more

The Utility doesn't. This chastisement is coming from the City Council, and the actions of well-insulated "staff". Look at the cover of this year's budget. The very top tag line is: "To Protect The Environment."

So, where does the City government get this kind of "vision"? Certainly not from the Charter, and certainly not from any binding ballot items that were passed by the voters. No--they get this gobbledygook from the City Council.

The sad thing is that when there is an election, none of the candidates will answer any questions honestly. On the odd occasion when you do get an honest answer, the candidates are "unelectable".

Voting the bums out is the way to free ourselves of this insanity. But finding candidates with a clarity of vision, and honesty, who are "electable" becomes almost impossible in this town.

Posted by Walter_E_Wallis, a resident of Midtown
on Mar 7, 2011 at 8:01 am

Walter_E_Wallis is a registered user.

TTPTT, that is why I have advocated, from the start' a demotion for Palo Alto from City to a municipal service district with strictly limited authority.

Posted by what'sup, a resident of Fairmeadow
on Mar 7, 2011 at 12:24 pm

Just another thought on Utilities monitoring and evaluating usage. Right now the report which compares your usage to neighbors has no penalties. That could change. Also the smart meters which could eventually interact with smart thermostats/appliances could set up a system where the temperature in your home could not go above a certain level in winter. I keep mine as low as possible but there are times when I want it warmer, especially when I have visitors. Bottom line this is very invasive for the Utilities to start monitoring and evaluating and criticizing individual usage. It's offensive Utilities wants me to "compete" with my neighbors. I see the new thing is to have neighborhoods compete for their approval with switching to a smaller garbage unit. Why can't the Utilities stick with just encouraging good environmental practices?

Posted by Walter_E_Wallis, a resident of Midtown
on Mar 7, 2011 at 4:53 pm

Walter_E_Wallis is a registered user.

what'sup, with TOD metering, the "penalty" for peak period use is peak period rates. Nowadays, you pay as much for 2 AM power as for 6 PM power.

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