January 14, 2020

Mass. Clean Energy Center needs more funding

Over 111,000 people work in Massachusetts’ dynamic clean energy economy, due to a powerful combination of leading policies, strong talent, and key institutions. At the center of this dynamic industry is the Massachusetts Clean Energy Center (MassCEC). Founded by the Green Jobs Act legislation in 2008, this quasi-public agency’s mission is to put public renewable energy trust funds to work to build a clean energy economy. For the past decade it has been quite successful, serving as a ground-breaking national model and positioning Massachusetts as an international climate leader by advancing clean technology innovation, job creation, and investment, leveraging more than $1.78 billion in private capital.

But MassCEC is in danger of fading away, just when we need its continued leadership most.

MassCEC’s success at this critical time is at risk because of significantly decreased funding. In 2018, MassCEC put $74 million to work, but that number dropped to $30 million in 2019 and is forecasted to drop even lower in the years to come. For comparison, the New York State Energy Research Development Agency (NYSERDA), projects to have a budget for comparable activities of $406 million.

Several factors, including MassCEC’s effectiveness at running key programs, have led to its current funding challenge. When created, MassCEC took over the state’s renewable energy trust fund with a mandate to spend down its considerable balance. The trust is funded by a renewable energy charge on electricity bills, amounting to 29 cents per month for an average residential customer, that generates roughly $22 million a year. In addition, MassCEC received funding from compliance payments under other clean energy programs which no longer produce revenue for the agency. Finally, a legal dispute in 2019 resulted in a $20 million verdict against MassCEC. Each has contributed to the current crisis.

If not addressed, MassCEC’s funding decline will significantly jeopardize the Commonwealth’s climate leadership at a time when the international consensus among scientists and policymakers has never been clearer: climate action is needed now. The global movement to address this crisis will undoubtedly require clean technology innovation as an essential part of the solution.

Through the leadership of MassCEC over the past decade, Massachusetts has become an internationally recognized innovation hub for clean technology, attracting new innovative companies and large industries alike. MassCEC powers the clean technology startup innovation ecosystem in the Commonwealth with a variety of indispensable investments, grants, pilot and demonstration programs, and workforce development initiatives, including a program that funds internships for students at clean energy innovation companies. In doing so, MassCEC has attracted matching private sector dollars to support young clean technology companies across the state.

The strength of the clean technology innovation ecosystem here in the Commonwealth has in turn drawn large companies from across the globe to establish headquarters, expand offices, and invest in Massachusetts. Firms like Schneider Electric, GE, Enel, Veolia, and Engie now call the Commonwealth home.

MassCEC’s role in launching the offshore wind sector helped attract global leaders like Orsted, Vineyard Wind, MHI Vestas, and Mayflower Wind. These companies are opening new offices here and are aiming to invest billions in scaling offshore wind (the manufacturing and supply chain infrastructure could be built in the Commonwealth as well). Others will join if we remain committed to making Massachusetts a stable and forward-looking environment for clean energy innovation and policy.

Our international leadership in the life sciences industry is proof that with vision and sustained commitment, we can build a world class innovation hub in the Commonwealth. Our state starts from a position of unique strength: we have all the building blocks, including talent at varying skill levels, leading universities, dynamic financiers, and the emerging and established companies needed to succeed.

We stand ready to partner with MassCEC and Gov. Charlie Baker to meet our climate challenge. The coming decade demands climate action that will only be brought about by a clean energy market transition and growth for electric vehicles, clean transportation, energy storage, smart grid, solar energy, and offshore wind. Today, Massachusetts risks losing its climate leadership, as well as the jobs, private investments, and company headquarters that MassCEC has helped to build. Now is the time to refresh and affirm MassCEC’s critically important mission and to revitalize its funding to reap the many benefits of its leadership — now and into the future.

Authored by:
Peter Rothstein, president of NECEC (Northeast Clean Energy Council and NECEC Institute)
Emily Reichert, chief executive officer of Greentown Labs, the largest clean technology startup incubator in North America
Robert Rio, senior vice president for government affairs at Associated Industries of Massachusetts
Elizabeth Turnbull Henry, president of the Environmental League of Massachusetts.

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