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Houston Lures Clean Energy Companies Seeking New Home Base

As America's oil capital continues its push to build a greener economy, cleantech innovators are finding a home in an unlikely town

By Maria Gallucci, SolveClimate News

Jun 22, 2011
Houston Mayor Annise Parker

Houston's Texas-sized push to build a cleaner, more competitive economy is luring alternative energy businesses and giving the nation's oil and gas capital an increasingly green tinge. 

John Higgins, CEO of NeuTex Advanced Energy Group, said an extra-warm welcome from City Hall last year persuaded him to choose Houston to manufacture the firm's energy-efficient LED lighting.

The development and construction company has been based in Houston for more than 20 years, but NeuTex was looking at cities across the country for its nascent lighting division after deciding to close most of its China-based operations, due partly to rising labor costs.

"Tax breaks weren't real important to us," Higgins told SolveClimate News. "We looked for a team in a city that would embrace energy efficiency and would embrace sustainable technology."

Mayor Annise Parker's office reached out to NeuTex and ensured it could support the firm by championing sustainable building initiatives and giving NeuTex visibility among developers and engineers.

"We thought that if we can be taken seriously in Houston, Texas, then we can be taken seriously anywhere in the world," Higgins said.

In March, NeuTex began the demolition and reconstruction of a vacant facility to serve as its U.S.-based headquarters and manufacturing hub for lighting, which together will create at least 250 jobs in the next two years, Higgins said. He added that NeuTex took no incentives or tax benefits from the city for the project.

Higgins said he expects lighting to account for 90 percent of the firm's revenues over the next year — up from just 25 percent today — while its main commercial construction division will shrink to 10 percent. The green shift could boost NeuTex's revenue to $30 million in 2012, up from nearly $3 million last year.

Houston's First Green Steps

The drive to raise Houston's renewable and energy efficiency portfolio began largely with former mayor Bill White, who served from 2004 through 2009, and who challenged incumbent Gov. Rick Perry as a Democratic candidate in the 2010 gubernatorial elections.

Clean energy advocates see Houston as key to influencing the state's clean economy due largely to its size. With 2.1 million residents, Houston has the highest city population in Texas and is the fourth most populous city in the nation behind New York, Los Angeles and Chicago.

As mayor, White signed a green building resolution to set a target for new construction projects to get LEED (Leadership in Energy and Environmental Design) certifications, and he started the Residential Energy Efficiency Program to weatherize more than 2,000 inner-city homes.

White contracted over 250 million kilowatt-hours of renewable energy for municipal use. In 2005, he set a goal of having 50 percent of the city's non-emergency fleet be hybrid cars.

He also helped to encourage Danish wind turbine maker Vestas to locate its North American research headquarters in Houston, said Pratima Rangarajan, the division's senior vice president of global research and innovation, in an email to SolveClimate News.

Wind Giant Finds a New Home

"We located our North American research headquarters in Houston [in 2008] after an extensive review of U.S. cities and a specific analysis of Texas," she explained. "From the outset, we received encouragement from the State of Texas and the City of Houston, including the mayor's office.

"Placing our research center in Houston put Vestas in close proximity to key customers and a number of top research universities. It also gives us access to a highly qualified workforce with an exceptional depth and range of relevant engineering talents from the energy and aerospace industries," she said.

Rangarajan added that Texas has the largest number of installed wind projects in the United States, with more than 10,000 megawatts of power, about a quarter of the nation's total wind capacity.

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