All the western states experienced budget crunches in the recent economic downturn. All the western states are looking for new business. And the cost of doing business in the western states is fairly similar across the board (California being the exception). Nevada needed a dynamic business platform to present the reasons Nevada is a great place to grow business.
Nevada also needed a way to make the playing field a little less even. In Nevada’s favor. A home field advantage.
One way to gain that advantage: form a partnership between Nevada Commission on Economic Development (NCED) and the Department of Employment, Training and Rehabilitation (DETR). The benefit? Workforce training programs tied into the state employment agency with potential employer access through the state commission on economic development. Kind of a one-stop-shop for companies looking to locate or expand in Nevada and needing a workforce with specific skill sets.
The first application of this partnership was Amonix where an aggressive training program led to the creation of 200 jobs in North Las Vegas in May of 2010. “This definitely gives Nevada an even stronger competitive advantage” according to NCED Executive Director Mike Skaggs.
The next step was to identify the industries Nevada wanted to recruit. In general, all states want industries that offer high wage jobs and operate clean and green. Nevada not only wanted clean, green industries, but those industries that could benefit from what Nevada has to offer: great sun, wind and geothermal resources, a construction-based workforce on tap, and an energy-hungry state next door to export energy to. Creating renewable energy technology fits neatly into place given those parameters.
There are a couple ways to create jobs, according to NCED Executive Director Mike Skaggs. One is to recruit companies to come to Nevada. The other is to grow them in the state. The first choice is a shorter-term solution to creating jobs for Nevadans, because the companies that relocate in the state are already up and running. The second solution is the economic future of the state, and it’s tied to technology commercialization.
Technology Commercialization and the Silver State
“NCED is the organization that’s responsible for developing and implementing the diversification plan for the Nevada economy,” said Skaggs. “It’s up to us, by statute, to exert leadership in showing how we should grow this economy. And one of the main things we are putting our money into is technology commercialization. It’s a long-term strategy and it will be longer if we don’t get started.”
Technology commercialization is all about new technology. New technology is the result of new ideas, new research and the ability to translate the two into reality.
There are two types of research: basic and applied. Basic research results in a paper or finding and adds to our knowledge base. Applied research is solution-driven, created when universities and research organizations are tasked with finding the answers to problems. Very often the solution is a new technology. If a prototype of the technology solves the problem it was created to solve, the technology can become a product. Build a company around the new technology and the product can be manufactured and sold on the market. This means new technology, new jobs, new flow of money into that state, with the added benefit of a new company that works closely with the university system.
With that in mind, NCED and the Nevada System of Higher Education – the Nevada university and community college system – came together to discuss renewable energy.
University of Nevada, Las Vegas is working on technology commercialization ideas in biosciences, but also pursuing a grant or designation from the Department of Energy to become a solar center, a technology commercialization installation funded by the Department of Energy on the university campuses, working to make solar power more and more efficient so the price can go down and production can go up.
In Northern Nevada, University of Nevada, Reno’s Great Basin Center for Geothermal Energy works with U.S. industry to identify and evaluate new and emerging geothermal technologies for production, storage, transmission and use of geothermal resources.
Activities on both campuses will create the research to launch the companies to work in solar and geothermal technology, inviting more support service companies into the state. A win all the way around.
Another win is the ability to build on what Nevada already has. Nevada has a workforce that, until recently, was driven by building and construction. With a talented construction workforce looking for work and a partnership between the employment training and the economic development commission, the advantages are obvious.
NCED likes to work with workforce clusters, where a basic anchor industry in the state means suppliers, vendors and service providers will move to the area to be close to the anchor industry. Skaggs is an advocate of growing the economy with clusters because supplier industries usually have similar workforce needs, so early stage workforce training can be broad and similar and workforce training dollars can stretch. Industry dictates specific workforce training, but basic training is often similar enough for a jumpstart.
One of the major expenses for new and expanding companies is workforce training, so when companies are considering Nevada for their operations, NCED can provide mechanisms for training potential employees through community college system or by funding or underwriting a portion of salaries during training, according to Frank Woodbeck, director, NCED Workforce Initiatives.
The relationship between Nevada System of Higher Education and NCED works in industry’s favor. The university system has the resources to offer workforce education, particularly through the community college system. “The best part of the education system in the state of Nevada is that everybody is accessible,” said NCED Deputy Director Ken Pierson. “We can take a company directly in to meet the Dean of Engineering on the Las Vegas or Reno campus and the Dean will be available to meet with the company and do whatever is needed to help them succeed.”
Furthering workforce training initiatives, Senate Bill 239 specified NCED set up sector councils for target industry areas, including renewable energy and manufacturing. The council will be comprised of business and education leaders in the target industries and will help determine basic skill sets for early workforce training. Offering workforce training in addition to Nevada’s business friendly climate and existing resources for renewable energy makes Nevada competitive with other states.
Another piece of the education and research pie is Desert Research Institute and, within it, the Clean Technologies and Renewable Energy Center. The Center’s applied research in renewable energy may drive technology commercialization when products become viable, and serves as an intellectual and R&D “draw” for energy companies considering Nevada that are in need of technological support, laboratory analysis capability and a host of other services including workforce development, said Executive Director Alan Gertler.
Nevada Institute of Renewable Energy Commercialization (NIREC)
To further facilitate energy industry coming here, NCED is going into contract with NIREC, which is hosted by the Tahoe Center for Environment Sciences at Sierra Nevada College at Incline Village, to create an audit of all the resources Nevada has in place to assist tech companies growing in this market. The audit will take into account not only sources and funding, but professional talent available to consult and help new companies grow.
Helping technology companies grow is part of what NIREC does. The public-private partnership is a consortium of research institutions, utilities and other energy producers, energy distributors and energy consumers, corporations and venture capital organizations. NIREC provides seed capital and advisory services for entrepreneurs who might have great ideas in renewable energy but not the business savvy or resources to take the idea and turn it into a company that can employ Nevadans and ultimately build part of Nevada’s knowledge-based economy, according to Jim Croce, president/CEO.
NIREC partners with NCED in attracting renewable energy companies to Nevada by providing partners and capital for growing businesses and letting them know there will be R&D support and support services available when they’re ready to go forward with the next generation product. NIREC also holds biannual request for proposal competitions, awarding $150,000 to up to three emerging companies.
Nevada State Office of Energy
NCED works closely with the Nevada State Office of Energy. In terms of drawing renewable energy companies to Nevada, two legislative initiatives in 2009 enacted a tax abatement program for renewable energy generating companies coming into the state and building systems with output production of 10 megawatt or greater, allowing 55 percent property tax abatements within the county the company locates in for up to 20 years. Other incentives include sales and use tax abatement, according to Jim Groth, director, Nevada State Office of Energy.
Groth also put together a Nevada Energy Economic Strike Force made up of public employees, private sector energy experts, consultants, utility representatives, educators and energy efficiency experts to look into topics such as energy transmission, permitting, funding sources, regulatory issues, energy efficiency, outreach and land issues.
Nevada Commission on Economic Development
Nevada Commission on Economic Development was formed in 1983 in response to a nationwide recession that was affecting Nevada. Previously widely believed to be recession-proof with its economic base of travel, tourism and gaming, with mining as a back up, the state wasn’t used to feeling the economic woes other states felt. With gaming and hospitality taking a hit, the decision was made to form a commission that would work to diversify the Nevada economy.
Today NCED is chaired by Lt. Gov. Brian Krolicki, who also serves as a member of the Renewable Energy and Energy Conservation Task Force. The commissioners are Leroy Goodman, vice chairman and mayor, City of Fernley; Luis Valera, University of Nevada, Las Vegas; Miranda Du, McDonald Carano Wilson, LLP; Anthony Dazzio, Burke Construction Group, Inc.; Patty Wade, Wade Development Company; and Charlie Myers, Sierra Office Solutions.
Innovation, sustainability and inclusiveness are the principles Nevada’s economic platform is founded on. Nevada’s economy will be driven by development and commercialization of technology, by capturing a share of the growing renewable or alternative energy market, and by understanding and supporting the intellectual capital of the state – the dreams, ideas and creations of Nevada citizens.
So far, in 2010 NCED has helped create, sustain and retain 15,909 jobs for Nevadans. The Business Development division provided assistance to 36 Nevada companies resulting in 1,282 new Nevada jobs. Business incentive applications submitted to NCED by businesses coming into Nevada or expanding in Nevada brought $109.8 million in new capital investment to the state.
NCED programs, business and community development efforts brought $1.47 billion of new money into the state in 2010.
NCED and Nevada
Nevada is the seventh largest state in the U.S. by land area, but not by population. Rural communities are thinly populate and even in the metro areas people are apt to know their neighbors.
NCED staff wear many hats. The team has great skill sets, said Pierson, and everybody pitches in to do what needs to be done to promote Nevada and attract business. Things change daily and the learning curve is ongoing.
“At the end of the day, the best thing is when a company we’ve worked with has created jobs for Nevadans and you can say ‘I helped with that,’” said Pierson. “Maybe my little piece there helped somebody get a job. That’s satisfaction. And that’s how the whole team works.”
A-Power Energy Generation Systems, Ltd. and Asia Energy
In a move to bring energy companies, alternative energy technologies and new jobs to the Silver State, in October Nevada officials met with Chinese company A-Power, based out of Shenyang, China, to finalize details on a 36,000-square-foot facility to be based in Southern Nevada. The new plant will be home to Singapore-based Asia Energy, which manufactures LED (light emitting diodes) and will also be a temporary site for A-Power’s wind turbine assembly plant. A-Power will eventually move into a 320,000-square-foot facility. The arrival of both Asia Energy and A-Power in Nevada should create some 1,300 new jobs.
The arrival of the Chinese companies in Nevada is a milestone for Chinese/U.S. ventures. Previously only the Chinese government could invest in U.S. business ventures. The change and the new partnership was facilitated in September 2009, when NCED Chairman, Lt. Gov. Brian Krolicki, and Executive Director Mike Skaggs met with representatives from the People’s Republic of China in Phoenix to sign a memo of understanding allowing direct investment in Nevada by Chinese companies.
The LED plant is located in Henderson.