New York City’s technology sector is alive and kicking, earning acclaim for its solutions driven focus and merging industry clusters to support the vision of a cleaner, greener New York. NYC ACRE Director, Micah Kotch sits down with the Green Line Series to talk about how emerging clean tech companies are playing a role in reinventing New York City as the greenest in America.
GoGreen Conference: What is your perspective on how technology is currently being leveraged to solve sustainability in NYC? In what areas do we need improvement?
MK: Both here in New York and nationally, we still don’t have an effective energy climate policy in place. That’s the 800-pound gorilla in the room. Without a transparent, long-term program that puts a price on carbon, in one form or another, the technology industry does not compete on a level playing field. And in the absence of national or international leadership, cities are going to continue to blaze a path forward, because cities like New York are most at risk for the negative impacts of climate change.
We see adaption and mitigation as amazing opportunities to spur both job creation and the development of new products for export. Here in New York, I feel like we have a lot unique assets that we’re trying to leverage: the finance industry, the media industry, our mass transit network, the fact that we have a million buildings, and our real estate industry. Also, our tech start-up scene. Our sweet spot is capital-efficient, IT-driven technology business.
At NYC ACRE, we believe that working right at the convergence of energy, water, waste, green building and the mobile and social web, presents a very compelling case for us to help emerging companies grow and get up to scale. We have seven companies that have graduated the program and created about 100 full-time jobs and raised about 17.5 million dollars. Our strategy is to go out and connect the dots that will lead to start of great, long-term companies. We want to get different clusters to spill over and have a real mix of people, ideas, products and services that are ultimately filling this need and that aren’t dependent on government policy to be successful.
GG: You mentioned scalability — you work at the foundational level with start-ups. Since there are a ton of big corporations in NYC, how does the work you do at the ground-level translate up to the Bank of Americas and the New York Times? What role do they have to play in developing these cross-industry clusters?
MK: When you are talking about infrastructures, you absolutely have to work with people who are the gatekeepers. So we have really strong relationships with National Grid and Con Edison. That is absolutely critical because you can’t go to market without the buy-in of those big players. And I think the same holds true with the real estate industry.
In order to get to scale, you need large portfolio managers. Same thing with the transportation network; we have this great start-up called Wheeels.org that is doing great things with social transit. They are working with for-hire vehicle fleets, including the NYC Taxi and Limousine Commission and The Port Authority of New York & New Jersey that operates the airports in the cities. Fundamentally, they encompass control of the distribution channels in this sector, and we have been very fortunate to have very strong working relationships with companies like Con Edison, Siemens, and National Grid, and IBM.
GG: In terms of collaboration happening in the clean tech field, you have higher education, government, private sector and all sorts of cross-pollinations of the above. What does that allow you to do that you couldn’t if you were just focusing in one area? And, do you think it’s still possible to accomplish the really big things without working across silos?
MK: Definitely not. These issues are so interrelated and complex — and again, infrastructure at scale has so many different stakeholders — that you can’t work successfully without understanding how to work with other disciplines. I think that we’ve been an effective contributor in this public-private partnership because we understand how to play well with others, and ultimately we all share a vision for what New York can be, so it is absolutely critical to work across industries. That’s the higher purpose that NYC ACRE serves, Normally, these entities don’t speak to one another unless they absolutely have to. When you have an initiative that people feel they have a stake in, though, you can push things forward by executing and showing some real credibility.
GG: What do you think those large entities can learn from your model and take into their own business structure to use?
MK: Everyone appreciates creative innovation and, particularly in NYC, we are constantly reinventing ourselves. There is regard for new solutions that are filling and solving problems. However, the opposite is also true — we have a whole lot more to learn from these bigger institutions then they do from us. Those lessons revolve around how to operate effectively at scale, how to deliver on time and on budget, and how to work effectively across departments. People within the utilities base, within the city, and within some of these bigger companies have been doing this for a very long time. We aspire to institutionalize better ways to do things, and have transparency and real credibility because we’ve built reliable services.
GG: What is this shared vision of what New York City can be? If you are reinventing yourself as the most sustainable city in the United States, as the epicenter and the model to follow, what does that look like?
MK: From a policy perspective, a lot of those lines are drawn out in PlaNYC 2030. By that year, the city will have a million more people, walking distance to parks, the best quality of air of any big city in the country, low crime, reliable water and electric and gas. Those are the fundamental things every city has to have in order to attract smart, young, creative, talented people. Every city wants to attract those kinds of people. But in order to do that, you have to get the basics right.
Ultimately, we want to be able to capitalize on where some of those innovations lie. Historically, the challenge with New York is that we tend to buy green instead of making green. For example, when we were retrofitting the Empire State Building, we used technology that was made in California. The vision for NYC ACRE is to breed companies who are born and raised in New York that provide products and services to be used all over the world. These products and services should be used as the best practices in areas like energy efficiency solutions, solar project financing, the identification of wind energy resources or new ways to share transit at major transportation hubs. That’s the kind of cluster we want to create — a clean tech cluster where you have businesses that are capital-efficient, but are using the software and tech talent in New York in order to create jobs and create wealth via new products/services for export.
GG: A lot of times when we say ‘clean tech’, people think of renewable energy or energy efficiency. What else does that term encompass? What other areas are key components of the clean infrastructure?
MK: Clean tech also encompasses buildings, energy, water, waste and transportation. If we look at the parallel with the computer industry, it was that every company or institution had a computer department and that’s where computers existed. What we want to get to is where clean tech is ultimately inside of everything. It’s in how we’re moderating our energy usage and how we are getting to and from work. It’s also about the resources we use when we’re at school and work. It really becomes all-encompassing.
Our view on a lot of this is that there are significant opportunities to leverage the mobile and social web and to address the issues of resource constraints, climate change, adaptation and mitigation via clean tech. We refer to that as clean web or energy info tech, and it’s companies like Sungevity or Airbnb that are really using the resource cloud and are looking for models for collaborative consumption. They aren’t necessarily building new infrastructures, solar cells or new wind blades, but they are using technology to speed the adoption of renewables and efficiency and to harness the advantages we have in this increasingly interconnected space where everything has a sensor, the ability for two-way communication and is genuinely a “smart” product. That’s the vision we see.
If the last century was about the Internet and people, this century is about the opportunities that become available to capitalize on that foundation. There are huge opportunities in the cyber-security space, and that is one particular opportunity that NYU Poly has a real strength and research interest in. There are opportunities in fault management and fault prediction for the smart grid, and there are opportunities in micro-grids where you are essentially building small-scale networks that react intelligently to the demands of the larger network. So those opportunities, given New York’s unique landscape, work really well here.
GG: What do make of the attention New York is getting for a surge in its tech industry? Is it the next Silicon Valley? Or is it inherently different?
MK: It’s different and I think it’s best if New York doesn’t try to be Silicon Valley. We’re New York. This means we are taking advantage of industries that are already here, like real estate, fashion, media, finance, and transportation. We have proximity to markets and customers. Also, we have this incredible talent base of tech entrepreneurs who are trying to solve problems. A lot of what we do is try to mix things up and bring talent from mobile, gaming, finance and real estate into this clean tech space. What we have been challenged with, in the sustainability industry, is seeing much of the conversation get stuck because we don’t use language that other people in other industries can understand. Our philosophy here is to take a lot of different people — people from Wall Street, media, the technology space, an investor, an academic, and a policy maker — and put them in a room to see what comes out.
We actually have this event series called Clean Energy Connections at the WNYC Green Space. The link is www.cleanecnyc.org. And the we use this platform to get people that normally wouldn’t interact with one another to have a dialogue about issues for the benefit of the community.
GG: Could you highlight some NYC ACRE graduates? Is there a case study that highlights how and where this works?
MK: New York has a unique opportunity in demand-side management. One of our notable graduates is ThinkEco, which has developed a very simple, easy-to-use energy efficiency device called the Modlete. The Modlete is a modular outlet for pluggable loads. The modern electrical outlet hasn’t been updated since the 1920s, so what Think Eco has done is come out with a device that plugs into an outlet and comes with a USB. And now, Con Edison is using it in 10,000 window air conditioners this summer to help maintain the reliability of the grid and give users a choice in terms of allowing them to not set their thermostat at 70 degrees all day long when they’re not home, but instead, allowing them control so they can dial up their AC to hit comfortable when they come home.
The problem with scale in New York is that we have 6 million window air conditioning units here and they are all working during the hottest day of the year when things are plugged up and cranking away. So for Con Edison, it’s a really elegant solution because it’s essentially a consumer demand response tool. It’s smart grid technology, but for smart grid today. Not the smart grid from ten years from now. Essentially, you can use it for anything you plug in. With this particular program, it’s aggregating five megawatts of residential demand response. That is really a groundbreaking program for ConEdison and ThinkEco; and again, it’s simple, easy-to-use, R&D driven technology that we had a small hand in bringing to market. Now, they have more than 20 people working for them full time.
Micah Kotch is Director of incubator initiatives at NYU-Poly and Director of the New York City Accelerator for a Clean and Renewable Economy (NYC ACRE) initiative, where he is helping develop New York City’s emerging cleantech sector. He will join the GoGreen NYC line up to moderate a showcase of the 2012 Top Innovators in Sustainability. Learn more and register at newyork.gogreenconference.net