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A message from our President & CEO:
With 2013 already under way, and some elements of the fiscal cliff addressed and/or postponed through last minute actions in Washington D.C., we wanted to take a moment to share what we still foresee as significant challenges for San Diego’s economy in the months ahead.
While both chambers of Congress did eventually approve a deal to fend off certain elements of the fiscal cliff, their plan postpones decisions about sequestration; the $110 billion in spending cuts that would deeply affect the military and many other sectors of the economy that receive funding from the federal government. As we have been noting over the past year with our colleagues at the San Diego Military Advisory Council (SDMAC), here in San Diego this could most notably impact our military/defense sectors as well as the research that is the backbone of our technology industries.
According to today’s Washington Post, “The legislation, which President Obama supports but had not signed as of Tuesday night, would delay across-the-board budget reductions known as sequestration for two months, setting up likely fights in Congress over the federal debt ceiling over the same period. The fiscal-cliff deal would offset half the cost of a delayed sequestration with cuts to discretionary spending split evenly across defense and non-defense programs. The other half would come by way of new revenue raised.”
Even when a deal is reached regarding sequestration we will still see significant reductions in funding that will have big implications for our region. These reductions could have far reaching impacts to workforce, infrastructure, and research. In the days ahead we will continue to provide you with the best and most up-to-date analysis we can on what all this will mean for our economy. In the meantime, we wanted to remind you all of the layoff support and aversion services that EDC, Manpower, San Diego Workforce Partnership and all of the sub-regional EDCs (North, South and East) can provide to companies that are faced with staffing reductions. All of these services are free to the business community and are available year-round.
For any companies you may know of that are currently filing WARN notices, informing staff of possible layoffs and/or in the midst of downsizing, please forward them to our website to learn more about the Rapid Response services available to them.
In all ways we look forward to a strong and productive 2013 for our region. Together, by being informed and prepared, we can stand strong in minimizing the impact of sequestration to our economy and in developing new plans for job creation, industry growth and economic prosperity.
“Good News of the Week” was born out of a casual conversation in the conference room. Someone mentioned the positive headlines the region was getting and before we knew it we’d been around the room and everyone had something to contribute. We live in one of the greatest places in the world and it seems like we don’t spend enough time recognizing our regional accomplishments. So we started pulling together the good news of the week and sending it out to our stakeholders. Now, people from around the region send us their news and week by week we have seen the readership grow.
This week, we thought we’d mix things up a bit: we present to you “Good News of the Year,” a collection of the top 10 stories that came out of the region in 2012.
Here’s to many more positive headlines in 2013.
Wishing you the best,
San Diego Regional EDC Team
P.s. If you don't subscribe to our newsletter now, you can do it here.
1. Clinton lauds San Diego's model of collaboration
2. Operation San Diego in full force
3. Filner becomes SD's 35th Mayor
4. Forbes names Debra Reed a 'power woman'
5. Brookings mentors San Diego to create International Export Plan
6. SD establishes a direct link to Asia
7. Soitec opens plant in SD
8. SD quenches thirst with new desalination plant
9. California's economy on rebound
10. Community funds public market
Despite tumultuous times for the industry, 2012 marked a banner year for clean technology in San Diego. Numerous organizations within the region’s cleantech cluster – from startups to multinational brands- made significant strides in continuing San Diego’s leadership in the global advanced energy economy. SDREDC Partner CleanTECH San Diego, a regional non-profit member organization dedicated to advancing cleantech innovation and adoption, picked a few of the highlights from a long list of local achievements as we say goodbye to 2012.
1. US Defense Department Awards $30 Million to San Diego Companies to Install Cluster of Three Microgrids
In November, the Department of Defense Environmental Security Technology Certification Program (ESTCP) awarded Power Analytics, OSIsoft and Viridity Energy a $30 million grant to create a secure cluster of microgrids at three San Diego military bases. These best-in-class pioneers will install smart grid technology systems creating the first centrally managed microgrid cluster in a US military environment. This project was selected by the ESTCP and stands out as one of only five technology awards out of more than 750 submitted nationally. The proposal submitted by these three companies was cited as a "must-fund" demonstration for its ability to significantly reduce energy consumption and improving the security of electrical supply for the all three naval facilities. This esteemed selection by the DoD is an illustration of the proven “gold standard” microgrid solution from these technology partners, which is currently deployed at UC San Diego's world-renowned microgrid.
2.San Diego Approves Development of Tule Wind Project and Signals Leadership in Renewables
On August 8, the San Diego County Board of Supervisors voted in favor of Iberdrola's Tule Wind Power Project, a wind farm proposed on federal, county, state and Ewiiaapaayp Band of Kumeyaay tribal land in wind-rich McCain Valley. The Board’s supportive vote shows the region’s commitment to local renewable energy generation and represents a significant stance in welcoming utility-scale renewable energy development in the County. The Tule Wind Power Project will generate up to 200 megawatts (MW) of clean power, enough to serve approximately 60,000 local homes, and reduce carbon emissions by nearly 250,000 metric tons per year. The project will also provide the County with approximately $3.5 million in annual property tax revenue – totaling $105 million over the project’s 30-year life –as well as supporting more than 915 jobs in the San Diego economy and $30 million in sales and use tax during the year of construction, and roughly $1 million per year in lease payments to local landowners.
3.San Diego Accelerates Electric Vehicle Adoption and Charging Station Infrastructure
Today more than 2,000 privately-owned electric vehicles (EVs) are passing you on the roads of San Diego County. The city launched in early 2012 the nation’s first all-electric EV car sharing service through car2go, a Daimler subsidiary. The program boasts more than 12,500 members and more than 200,000 trips in the smartfortwo electric vehicles. Additionally, the California Energy Commission awarded UC San Diego a grant with charging manufacturers RWE and ABB to build the world’s largest and most diverse campus EV infrastructure. The grant provides for 26 Level Two chargers and three DC fast chargers and will further complement both the car2go and private electric vehicle footprint and uptake.
4.California Votes for Proposition 39; Enabling Statewide Energy Efficiency Upgrades
Last election day, Californians overwhelmingly voted to pass Proposition 39, an initiative that will close a corporate tax loophole for out-of-state companies that generated an annual $1 billion revenue loss for the state. Proposition 39 will boost San Diego’s economy, creating thousands of quality jobs with half of the revenues generated by closing the loophole dedicated to funding energy efficiency and clean energy programs at schools and municipal buildings. By upgrading old heating/cooling systems, replacing old windows, inefficient lighting and other energy solutions, this investment will dramatically lower public energy costs, saving cities and taxpayer money for years to come. It will also reinvigorate the local construction and contracting industries performing these retrofits.
5.Smart City San Diego Unveils Solar-to-EV Project at San Diego Zoo
On November 27, San Diego Mayor Sanders joined Smart City San Diego – a collaboration between GE, SDG&E, UC San Diego, City of San Diego and CleanTECH San Diego – to dedicate the historic Solar-to-EV Project in the San Diego Zoo parking lot. The nation’s first system of its kind, harnesses energy from the sun to charge plug-in electric vehicles (PEVs,) store solar power and provide renewable energy to the electrical grid. This project features 10 solar canopies producing 90 kilowatts (kW) of electricity (enough energy at peak capacity to power 59 homes) powering five EV charging stations, with one station located in a nearby ADA-accessible parking space. Utilizing new battery technology, the Solar-to-EV project’s 100-kW energy storage system is charged by the solar canopies and used to offset power demands on the grid to charge the electric vehicles. When the battery is at full capacity, the excess solar energy is distributed onto the grid to improve reliability and benefit the surrounding community. With more than 3.5 million annual visitors at the Zoo, this project serves as an example of the Zoo’s commitment to sustainability and the region’s excellence in collaboration.
6.SDG&E Energizes Sunrise Powerlink
On June 18, SDG&E flipped the switch to its Sunrise Powerlink, a 500,000-volt, 117-mile transmission line linking San Diego to Imperial Valley. The Sunrise Powerlink Project, a $1.9 billion investment chiefly designed to transport renewable energy from the solar and wind-rich Imperial Valley region, will bring more than 1,000 megawatts (MW) of additional imported power to San Diego, enough energy to serve more than 650,000 homes. The project – characterized as one of the most complex and challenging in SDG&E's history – is a result of more than five years of environmental review and permitting as well as 18 months of construction. With the nearby San Onofre Nuclear Generating Station shut down through the year, the Sunrise Powerlink proved timely and invaluable as it provides essential support in maintaining electrical reliability during heat waves.
7.San Diego ‘s Solar Adoption and Cluster Unparalleled
In 2012, San Diego County solar installation exceeds 132 megawatts (MW), with the City of San Diego’s total installations nearing 50 MW. The region is home to more than 200 solar companies, ranging from panel manufacturers like Kyocera and Soitec to installer and leasing firms such as Sullivan Solar Power and OneRoof Energy. Kyocera announces it surpassed production of 2 million solar panels while Soitec opened its utility-scale concentrated photovoltaic (CPV) manufacturing facility in Rancho Bernardo. The Soitec plant will have a 200-MW annual production capacity and create 450 direct jobs and 1,000 indirect regional jobs.
OneRoof Energy – the nations’ first residential solar company to work directly with roofers to sell and install its systems – launched in San Diego and hires more than 100 people as it expands operations. Sullivan Solar Power enjoyed tremendous growth in the, completing large-scale solar projects across military bases, university campuses, commercial sites, and residences. Its CEO, Daniel Sullivan voted San Diego Business Journal’s Most Admired CEO and made the finalist list for Ernst & Young’s Entrepreneur of the Year. Meanwhile, global companies like Everest Solar Systems and KACO New Energy have entered the San Diego solar scene to provide solar equipment supplies to this frothy marketplace.
8.Consortium Expands Curricula and Training Program to Support Local Biofuels Industry
The EDGE (Educating and Developing Workers for the Green Economy) Initiative – a regional consortium developed to help meet current employment needs in the growing biofuels industry – completed two years of workforce training and placing hundreds of workers in internships and permanent jobs. The EDGE Initiative created both curriculum and career-focused tools aimed specifically at unemployed, underemployed and transitioning workers looking to make the move to a high-growth industry. Since 2010, the program trained more than 300 participants and placed more than 100 in permanent positions. Currently, the curricula developed for EDGE is being expanded to other industry associations and academic institutions across California, and potentially the globe.
9.City Launches Competitive Market for Commercial Property Retrofits
This fall, San Diego City Council voted to allow several Property Assessed Clean Energy (PACE) financing program options for commercial property owners, making San Diego one of the most robust commercial-scale energy retrofit markets in California. The programs – administered by vendors including CaliforniaFIRST, Figtree Energy Resource, Ygrene Energy Fund and Renovate America – allow commercial property owners to use municipal bonds to finance energy efficiency improvement projects, using their properties as collateral. Owners then pay off the retrofits through assessments added to their annual property tax bill. Private financing is used to supply the upfront capital for the retrofits so that local government budgets are unburdened while property owners benefit through no up-front costs for improvements, increased building values and efficiencies, and reduced energy costs.
10.Honeywell Moves Its International Green Boot Camp to San Diego
This summer, Honeywell broke from tradition and moved its annual Green Boot Camp from New Jersey to San Diego, bringing 70 internationally selected middle school teachers to San Diego. The Green Boot Camp is a five-day workshop that focuses on best practices for teaching environmental and sustainability concepts. This workshop, part of a partnership with CleanTECH San Diego, SDG&E, California Center for Sustainable Energy and the Urban Corps of San Diego County, engaged teachers in a variety of interactive experiences such as designing and building a solar house and wind turbine, which equipped them with new teaching methods and sustainability concepts to share with their students and incorporate in their school curriculum for the next generation of sustainability leaders.
Jeff Harris of TrellisWare Technologies shows off his Cheetah CUB Mobile Ad Hoc Networking unit. (Photo courtesy of CONNECT)
CONNECT’s Most Innovative New Products Awards celebrated 25 years of well-deserved recognition for San Diego companies on Friday. MIP has survived numerous economic cycles including the dot.com juggernaut and the great recession. Throughout its long run, the awards have remained relevant and fresh; changing with the times (and technology) and still coveted by companies big and small. In future posts, Big Picture San Diego will profile the winning companies listed below and also some of the finalist companies that are also very watchable.
The winners this year:
Action and Sport Technologies: PEAR Sports for PEAR Square One
PEAR Square One acts as a personal trainer, delivering real-time coaching and feedback while users listen to music. Users can then view results, track progress, and share performance with friends post-workout.
Aerospace and Security Technologies: Cubic Defense Application for DCID-TALON
DCID (Dismounted Combat Identification) is a rifle-mounted laser system that allows users to instantly identify their friends in the fog of war, using a technology that modulates reflected laser energy with a secure "Friend" code when interrogated.
Clean Technology: Atlantis Technologies for RDI desalination system
The Radial Deionizing super capacitor technology platform (RDI) system can desalinate industrial waste water from oil, gas, and mining operations for 40 – 70 percent less cost than state-of-the-art technologies.
Communications & IT: TrellisWare Technologies for Cheetah CUB
TrellisWare's TW-400 'CUB' unit is the world's smallest and most capable Tactical Mobile Ad-Hoc Network (T-MANET) product – an all-in-one transmitter/receiver/relay offering multi-channel push to talk voice, IP data and streaming video services, and position location services.
Hardware and General Technology: Logic PD for DM3730 Torpedo + Wireless System on Module (SOM)
The ultra-compact DM3730 Torpedo + Wireless SOM is an ideal off-the-shelf solution for applications in markets where network connectivity is required and space is at a premium, including point-of-care medical products to handheld communication devices.
Life Sciences — Diagnostics and Research Tools: Life Technologies for Ion Proton Sequencer
The Ion Proton™ System is a high-throughput bench-top sequencing system that will enable the $1000 genome. The system utilizes semiconductor technology to sequence DNA and RNA bases in a massively paralleled manner.
Life Sciences — Medical Products: Amylin Pharmaceuticals for BYDUREON®
BYDUREON® is the first once-weekly medicine approved by the FDA for the treatment of adults with type 2 diabetes. Biodegradable microspheres provide controlled release of the medicine into the body throughout the week, working whenever blood sugar levels are elevated.
Software: Independa, Inc. for Independa Integrated CloudCare
The CloudCare platform for caregivers enables the elderly to continue living at the residence of their choice longer, more safely and more comfortably. Independa’s "Senior TV," enabling critical yet easy to use care management through the viewer's TV.
Mobile Apps: LIA: Liberated Intelligence for LIA
LIA is an enterprise mobile sales enablement platform. Its innovation utilizes a combination of cloud computing power, mobile device capability, and proprietary sales enablement software to replace outdated legacy tools.
Congratulations to the 2012 Most Innovative New Products Awards winners!
From left to right: Cathy Berg, Regional Vice President Passenger Sales Western United States, American Airlines; Jun Niimi, Consul General of Japan in Los Angeles; Yoshiharu Ueki, Representative Director/President, Japan Airlines; Thella Bowens, President/CEO, San Diego County Regional Airport Authority; Hiroyuki Hioka, Senior Vice President-The Americas, Japan Airlines
It was a day of firsts at San Diego International Airport (SDIA) on Sunday, December 2, as Japan Airlines (JAL) flight #66 arrived from Tokyo and flight #65 departed. It was also the first commercial flight out of SDIA for the highly touted Boeing 787 Dreamliner. "Let's think of all the real people who will benefit from this flight," said Thella Bowens, President and CEO of the San Diego County Regional Airport Authority, adding that half a million people from San Diego travel to Asia every year. Bowens described the Dreamliner as a dream aircraft for the San Diego market because it is the first aircraft with the size, airfield performance and range to make the nonstop oceanic flight viable.
San Diego Regional EDC worked with the Airport Authority and other organizations to make the case for the San Diego-Tokyo flight. Before now, business executives had to fly to Los Angeles, San Francisco or other west coast cities to connect to Asia. The new Tokyo service will link directly to 15 other destinations in Asia.
Bob Filner, new Mayor of the City of San Diego, attended the press conference held prior to the arrival of the inbound flight and reiterated his desire to strengthen San Diego's image as an international center. "I want to make San Diego a far more cosmopolitan center," said Filner. He also recognized the economic benefits the new flight will bring to the San Diego region.
The ceremonies that accompanied the launch of the new service were marked by elegant protocol and buoyant enthusiasm. White gloved dignitaries simultaneously cut a ribbon with multiple pairs of large gold scissors. JAL President Yoshiharu Ueki, invoking the Spirit of St. Louis (which was built in San Diego), said "San Diego is so connected to aviation history. Time has brought us more innovation in the new Boeing 787 Dreamliner and it has special meaning to me to take this historic journey with you."
The flight will operate four times weekly (Monday, Wednesday, Friday, Sunday) until March 2, 2013, when it becomes a daily flight. The current configuration for the San Diego flight consists of 42 business-class seats and 144 economy seats.
The goal of Big Picture San Diego is to expand the understanding of economic development and highlight the innovative ways in which the San Diego community is coming together to build a stronger region for the benefit of all of its residents.
There’s a lot being written and discussed about the future of the San Diego region. Big Picture San Diego is an attempt to synthesize information about what’s going on in the region with commentary on how current events and policies affect San Diego’s ability to grow and prosper. Here’s a broad definition of economic development from Business Exchange, a Bloomberg blog:
“Economic development is the development of wealth in countries or regions for the wellbeing of their citizens. From a policy perspective, economic development is any effort that seeks to improve the economic wellbeing and quality of life for a community by creating and/or retaining jobs and supporting (or growing) incomes.”
At EDC, we feel that the true definition of economic development is reflected in our mission: To maximize our region’s economic prosperity and global competitiveness. We believe that this is best accomplished through thoughtful collaboration and open communication. As we build the blog, the hope is to offer good working examples of economic development and start a new conversation about how San Diego can best use its unique assets to grow jobs and the economy.
Dr. Lynn Reaser recently delivered the Fermanian Business & Economic Institute Economic Outlook for 2013. With the election behind us but the fiscal cliff still looming, Reaser sided with many observers to predict that the fiscal cliff will either be avoided or – if it is allowed to happen – would not last longer than a few weeks. However, she pointed out that “if there is no political solution, there will be a market solution.” The government has been running annual deficits of more than a trillion dollars for the last four years and that is not sustainable.
Some highlights from the report:
California is currently outperforming the nation in job growth.
California’s economy continues to see job gains in construction, finance, professional and business services, trade, health care, and leisure and hospitality. The state should add about 275,000 new jobs in 2013, following the estimated 260,000 new jobs created in 2012.
In San Diego, job growth should yield a gain of about 29,000 jobs.
The growth will be driven by San Diego’s key economic drivers – the military, technology and tourism – and a revival in the housing market.
The military continues to be the most important economic driver in San Diego’s economy.
Although the region will not totally escape the impact of budget cuts – even under the best case scenario – the most likely outcome for 2013 is for defense dollars coming into the region to hold relatively steady. San Diego’s strengths fit very well with a defense strategy that is 60 percent focused on Asia and the Pacific with an emphasis on cyber security and unmanned aerial systems.
California State Controller John Chiang joined Reaser at the event. Chiang spoke about the challenges he has faced since coming into office in early 2007, including dealing with a cash deficit within seven months of taking over as State Controller. His focus is on determining a competitive tax structure to create a high standard of living while keeping California competitive as a location for business.
There was little suspense about the topics when U.S. Senator Dianne Feinstein spoke to a group of business and community leaders recently. Both the Senator and her audience are well aware of the pressing federal issues facing California and the rest of the country. Feinstein came prepared with exhibits to illustrate the changes in spending and revenues between 2001 and 2012 and projected federal outlays for 2012. From 2001 to 2012, defense and war spending increased 64 percent, while tax revenues declined 13 percent. Mandated federal outlays in 2012 (entitlements and interest on the national debt) account for 64 percent of federal expenditures.
These figures would be sobering facts in any situation, but the looming threat of sequestration makes the current budget woes seem to pale in comparison. Feinstein has been working with Mark Zandi of Moody’s Analytics to develop a compromise approach that would enact half the cuts (approximately $109 billion) and reduce the projected impact on GDP from three percent to one percent of GDP. She compared the current plan to using a hard cleaver that would throw the U.S. back into recession. Feinstein is advocating for a more targeted approach that she likened to using a scalpel rather than a meat ax.
As part of the Senator’s visit to San Diego, she also met in a small group with leaders from the San Diego Regional Chamber of Commerce, CONNECT, San Diego Regional EDC and other local organizations. The briefing included an update on the progress of the Cali Baja Bi-National Mega-Region initiative, initially funded with an Economic Development Administration grant. Feinstein must have been impressed because she said she would like to come back to see more of the mega-region, including a first-ever official visit to Mexico.
Senator Feinstein recognized San Diego Mayor Jerry Sanders, saying he had accomplished much in his time in office. She also had high praise for the sponsoring groups – EDC, the Chamber and CONNECT – saying that the fact that these groups work together for the region is one of the reasons San Diego has been so successful. Her closing comment was that she rated the San Diego business community AAA+++…