March 6, 2014 - From the March, 2014 issue

Terry Tamminen’s R20 Regions of Climate Action: Global Policy Goals & Initiatives

The R20—Regions of Climate Action—is a non-profit that assists governments in implementing low-carbon and climate resilient economic development projects, originally founded by California Governor Arnold Schwarzenegger. Terry Tamminen, R20’s Strategic Advisor to the Founding Chair and President/Founder of 7th Generation Advisors, sat down with TPR to explain R20’s goals, impact, and current project, as well as touching on his other climate-related endeavors.


Terry Tamminen

“The R20 is a nonprofit. The R stands for regional governments—states and provinces... It’s now connecting over 500 states and provinces all over the world. We try to do three things: We bring together policy, technology, and finance.” -Terry Tamminen

“As I travel around for the R20, everybody wants to know how California has done it. I’d say California’s still truly the shining light around the world for governments of all sizes. Even though we’re a state, we’re probably the eighth or ninth largest economy on the planet. Countries look to California.” -Terry Tamminen

Terry, you’ve spoken of R20—which you helped found with Governor Schwarzenegger and where you still serve as the strategic advisor—as a “carbon rebel alliance” of states and provinces. Tell us what you mean and what that term implies.

Terry Tamminen: The R20 is a nonprofit. The R stands for regional governments—states and provinces—and there were originally 20, including California and British Columbia. It’s now connecting over 500 states and provinces all over the world. We try to do three things: We bring together policy, technology, and finance. Policy is obviously where we can share what has worked. If you’re a region that’s thinking about incentivizing more solar, should you study the California model that has a lot of incentives built in the front end of the system, or should you follow the German model with a feed-in tariff, or some blending thereof? All the states and provinces can learn from each other. 

Secondly is technology. Government cannot know which policy to incentivize or promote if they don’t understand the technology. In building standards, you might want to set a new performance standard for efficient lighting, but if you don’t know the next generation of LED lighting coming down the pike, and what it’s going to cost, it’s difficult to set the standards in a way that maximizes the efficiency benefits. 

The third piece, finance, really is the key because there are other organizations that do those first two. In addition to having the right policy and understanding the technology, if you don’t educate the financial community, they won’t invest in the resulting projects. They’re worried about the stability of government policies and about the durability of new technologies. Getting investors comfortable with the policy and the technology is just as important as working with those other two sectors. 

That’s what the R20 tries to do—bring together those three sectors into meaningful projects. An example of that would be in Brazil, where we’re helping states and cities identify inefficient streetlights that can be replaced by modern LEDs, with the cost covered through savings of energy, labor, and maintenance. The overall goal of the R20 is to help its member states and provinces become more energy-efficient, cleaner, more sustainable, and reduce greenhouse gases globally.

As there are literally a host of jurisdictions involved with R20, give us other examples in which these principles are being applied with the assistance and support of R20.

With a relatively small staff, being a non-profit, we can’t be active in every one of those jurisdictions, so we try to take the lessons of successful projects and help our members find them on their own. For example, we have an LED street-lighting toolkit that takes a region through the step-by-step process of identifying for themselves what they can do to retrofit their streetlights—how to find financing, how to find the right technology, and so forth, even if there’s not an R20 office in their immediate vicinity. 

We do that with other toolkits where there might not be such an obvious payback. Our first one that’s actually up on our website is called the “Cool Roofs Toolkit.” That was put together with the Cool Roofs Alliance and Art Rosenfeld, when he was at the Energy Commission—a great guy who has been involved in these things for many years. It’s a how-to for entities—whether you’re a university campus, a city government, or any other jurisdiction—to consult and say, “If I were to make some changes to my roof, could I get the benefits of paying for that with energy savings or greenhouse gas reductions?” We try to create projects that can be self-replicating, and then there are others where we just try to introduce the technology, get governments comfortable with it, and let the financial community figure it out on their own, so to speak. 

We’re working in Brazil, for example, and also in Delta State in Nigeria, on a biogas program. Since development of biogas from food waste or animal waste is well-understood, it’s just a matter of showing the technologies that are less expensive, that might be more useful for small-scale projects—say, for example, a university campus that has a lot of food waste, or a group of farms that might have a good deal of animal waste but might not be close to major cities. Helping those jurisdictions find the right technology and then letting them shop for themselves is another way that the R20 helps.

Terry, with the governor you’ve spent a great deal of time in China, and you’ve written two books on fossil fuels, Cracking the Carbon Code and Lives Per Gallon, published in China. Elaborate on your work in China and the consequences of that work to date.

China is such a fascinating place. You mentioned those books—in the time since I’ve written them, China has become the world’s leading producer of greenhouse gases and is rapidly closing on the US as the world’s largest economy. We know how fast people are moving from the rural areas to the urban areas, and what that’s meant for development—people who want cars, want appliances, air conditioning, and all the modern conveniences. We’ve seen this rapid commercialization of the country, not just for the export market. The greenhouse gas levels and pollution levels have increased dramatically just in the time I’ve been going over there, just since 2007. 

What we’re trying to do there is once again help various Chinese regions identify, in some cases, technology in their own regions. For example, one of the regions where the R20 works is the province of Jiangsu. One of the major cities there is Wuxi. In Wuxi, they have a fantastic manufacturing facility called WesTech that makes solar water heater systems, solar-thermal technology. They’re exporting it—in fact, they’re opening a factory in the United States—but various government agencies right in Jiangsu weren’t using their own homegrown product and were instead heating water with electricity or fossil fuels. We were able to introduce this local company to the hospital being built by the government and to the environmental protection building being built by the government. Today, both of those facilities have very large water-heating systems—100 percent of the hot water locally provided by WesTech systems. 

Part of our goal is to increase the number of green jobs in a region. That’s what makes these things more sustainable and scalable. 

As you know, VerdeXchange is modeled on how you and the governor framed the opportunities around subnational initiatives and opportunities. You played a role not only in the countries you suggested, but also in Canada and Arizona, two other locations of VerdeXchange conferences. Tell us about your work in Arizona and Canada.

Arizona’s an interesting situation. Back when the R20 was formed, and back when we were doing Governors Climate Summits with Governor Schwarzenegger in office, Janet Napolitano was one of the co-founders of those efforts when she was Governor of Arizona. Then Governor Brewer took over, who is a conservative Republican and doesn’t want to be involved in things relating to climate change. She, as you know, took Arizona out of the Western Climate Initiative in terms of the cap-and-trade system and also said she didn’t want to be part of the R20 because its nominal purpose is to reduce greenhouse gases. But, we were able to continue working with the City of Phoenix, because officials there can see the benefits of renewable energy, energy-efficiency projects, waste conversion, and various other things that obviously create green jobs. The same thing was true in Michigan, where we went through a change of political leadership, but the Republican governor coming in said, “Look, as long as this is about green jobs, we want to do it.” 

In British Columbia, that’s always been a success story. They went from what would have been considered a more conservative government—Gordon Campbell, one of the founders of the R20—to what would be considered a more liberal government under Christy Clark, and yet they didn’t miss a beat staying part of the R20, because they’ve had a carbon tax up there that both parties support, and they see the benefits of clean energy and green jobs. They’ve got a very vibrant clean tech sector. In fact, as you know, Premier Clark was here in Los Angeles recently promoting investment in clean technology in British Columbia. 

Every time I go up there, I find really exciting opportunities in the form of companies that can be shown throughout the R20. 

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Let’s take a step back and speak to R20, your strategic work there, and how R20 is going about “empowering regions to implement new energy solutions.” 

It was originally founded when Governor Schwarzenegger, at the end of 2009, went to the Conference of the Parties (COP15) the UNFCCC has every year. It was in Copenhagen, you may remember, when everyone was hopeful that the UN process would give us a new climate change agreement globally to take over from the Kyoto Protocol. That didn’t happen, even though President Obama and various world leaders went there and tried their best. Governor Schwarzenegger gave a speech at that event and said, “It’s time to stop doing things the old way—which is top-down, from the national governments—and to harness the power of this bottom-up strategy, where you have states, provinces, and cities that are already taking the kinds of actions that we are asking our national governments to take, and proving it’s good for the economy, as well as the environment.” 

After that speech, Secretary General Ban Ki-moon of the UN asked him to try to stay involved with this, knowing that he had less than a year and half in office at that point—much like Tony Blair has done after leaving office, or President Clinton, and now Mayor Bloomberg. That was really the place where we began thinking about creating an organization that would work with states and provinces, and partner with organizations like the C40 that works with cities. In fact, Jay Carson from C40 is on our Board of Directors to make sure that we coordinate carefully with examples learned in cities. Of course, they can benefit from the resources R20 brings. 

The organization was started in Geneva. Because we are an international organization, it seemed a good place to connect with many countries. Ban Ki-moon gave us some free office space and staff on loan from the UN to get started. R20 was first launched there, and our headquarters are still in Geneva. Then, we opened up an office here in Los Angeles, one in Beijing, one in Brazil, and now we have a couple of offices getting started in Northern and Western Africa. It’s a non-profit, and its members are state and provincial governments. We work with businesses and academics that we call our partners. We try to get everybody in under the same tent.

Share with our readers how R20 has evolved in these last four to five years to become stronger and more inclusive of additional jurisdictions. What are the learning lessons, and how has it evolved?

As with any non-profit, you never have enough staff and never have enough hours in the day. We learned that you do have to pay for this sort of thing—you do have to raise the money to be able to put a professional staff in the field to respond to the demand. However, you have to leverage those resources. So, the projects that we try to focus on are the ones that can be replicated easily. With the one-off projects that might require very localized feedstocks, inputs, circumstances, or government support—it’s not that we wouldn’t try to help on those if they had a good benefit, but we do try to focus on the things that, if we’ve done it in one place, we can show our other members they can do it, too. That also is good for business. 

We partner on lighting with Lighting Science Group, which is helping us replace streetlights in Brazil, and Philips on similar projects in Europe. Once we’ve helped some of our members do things like replace streetlights, then we can turn to those companies and say, “Here are the markets.” This shortens their time to get to the markets and to find more willing cities to replace their streetlights. 

Similarly, whoever financed that, we can turn back to those financial institutions and say, “You did a great job financing streetlight retrofits in Brazil. Now we’ve got a similar project for you in Canada. What do you think of this?” Once you’ve shortened that learning cycle, it makes it possible to do a lot more, much more quickly, with the limited resources that any non-profit has.

Well said. Terry, coming to a close, in addition to being a former Shakespearean actor and the former Secretary of the California Environmental Protection Agency, share with our readers the other hats you continue to wear.

Part of this, since leaving state government, has made me realize how important finance is to this. It’s not just the greening of technology or the greening of governments and politicians. It really is finance. I was struck in 2010 when I went to a UN conference where 400 financial institutions were all talking about the low-carbon economy and the benefits of it, but on the same day a report came out showing that more than 50 percent of the investment managers in those very same investment firms were not taking carbon or sustainability into consideration at all when they actually made the investments for those institutions, because that’s not how they were measured. It’s not that they weren’t aware of the policies that their leadership had created, but they simply were not measured that way. It highlighted to me the need to get the financial community on board. 

I’ve tried to put together a green finance network for the R20 to educate as many different institutions as possible. I also serve as an advisor to Pegasus Capital in New York, which is one of the leading sustainability and resource-scarcity investors. I’ve tried to work with anyone else—Walmart, Proctor and Gamble, other companies—moving the needle globally.

Let’s close with this last question. Having been so involved as a cabinet secretary and with the last governor, is California still successfully framing and advancing opportunities in the global green economy?

Absolutely. I can’t tell you—as I travel around for the R20, everybody wants to know how California has done it. I give a lot of credit to Governor Brown. You may recall that as soon as he was elected, his first appointment was to reappoint Mary Nichols to Chair of the Air Resources Board because of her crucial role in implementing California’s Global Warming Solutions Act, AB 32. The two of them have, indeed, continued to do a great job on expanding and developing the cap-and-trade program, some of the other early action measures and incentives, and so forth, whether it’s on clean cars or renewables. 

I think Governor Brown has also done a good job to say that AB 32, Million Solar Roofs, the Hydrogen Highway, and many other things that Governor Schwarzenegger did were all about mitigation, so California’s a leader in climate change mitigation. But, we’re going to have to adapt to some of the inevitable problems that are created by the fact that we haven’t, as a world, dealt with this issue sooner. There’s going to be sea level rise, more intense storms, the kinds of droughts that we’re seeing now, and so on. He’s focused on adaptation—what are the things that we’re going to have to do to adapt?—and making California a leader in cost-effective ways to try to adapt to the inevitable changes coming our way. 

I’d say California’s still truly the shining light around the world for governments of all sizes. Even though we’re a state, we’re probably the eighth or ninth largest economy on the planet. Countries look to California. We have another delegation coming in March from Nigeria to learn from California. We just hosted the countries of Bahrain and Algeria, with many of their environmental and business leaders coming to understand how California has done it. I’d say we’re still number one in that category.

© 2014 The Planning Report | David Abel, Publisher, ABL, Inc.