LANSING – As Michigan grapples with the combined challenges of balancing our state budget, providing quality public services, and dealing with rising energy costs and the economic challenges of globalization, we would do well to give more thought to how entrepreneurialism can help.
Take energy costs, for example. Many believe, as I do, that Michigan would greatly benefit from an energy efficient economy. A key part of an energy efficient economy, however, is the existence of robust energy efficiency and renewable energy businesses that commercialize two-to-three more products each year than their competitors, incorporate two-to-three more technologies in their products than their competitors, bring their products to market in half the time than their competitors, compete in twice as many markets as their competitors, and, invest significant resources in research and development to develop breakthrough technology innovations.
Some people, on the other hand, have advocated a different approach, calling for a new tax/rate-payer funded ?Public Benefits Fund? program of rebates and other assistance programs ? most often provided by process vs. outcome oriented non-profits ? to help consumers purchase energy efficiency products. I think this is in-the-box, old-line, non-sustainable thinking. Byron Kennard, president of the Center for Small Business and the Environment, notes that we will never have a healthy environment unless business leads the way. Within this context, the following quote by Amory Lovins aptly reflects my concern: ?Optimizing one element in isolation pessimizes the whole system.? Taxpayer funded rebates and grants to fund non-profit salaries optimize one element in isolation, effectively undermining sustainable market-based solutions, discouraging competition, driving-up prices and serving as a barrier to green business development.
There are some ways that non-profits work well with businesses, and these should be our benchmark for energy. The Vermont Energy Efficiency Corporation, for example, uses a revolving fund approach to invest in energy efficient projects. In Michigan the Michigan Interfaith Power and Light (MiIPL) is a Faith Based Initiative that uses an affinity marketing model to stimulate new green business development in Michigan. MiIPL leverages tax-payer dollars by effectively aggregating the buying power of member congregations to drive down the price of energy efficiency products with bulk purchases. The MiIPL project has won national awards for excellence and is so successful that they have received funding to duplicate their aggregation model in five other states! Taxpayer funded rebates and ineffective process vs. outcome-based assistance programs undermine effective market-based approaches such as the MiIPL.
Energy efficient and renewable energy products are driving the global economy. Michigan needs to foster the creation, retention, expansion and attraction of green small entrepreneurial businesses that effectively compete in this marketplace through the research, development and commercialization of breakthrough energy technologies. We need an energy plan that fosters made-in-Michigan energy efficient products and renewable fuels, especially bio fuels. We need regulatory reform that results in a viable Renewable Energy and Energy Efficiency Portfolio Standard. We need to stop subsidizing make-work non-profit assistance programs at the expense of businesses seeking to create real energy jobs and real energy security in our state.
Entrepreneurialism is the preferred path to both an energy efficient economy and to any and all impending economic storms and challenges. Enough of this un-sustainable non-profit mentality ? I want a sustainable profit mentality to drive our energy security!
Mark H. Clevey of Lansing is the Vice President for Entrepreneurial Development with the Small Business Association of Michigan.
