Arizona is poised to drive the country’s renewable energy industry, says a national site selector who helps businesses find cities they can relocate to or where they can expand.
“On the renewable energy side, I think Arizona probably is in the best position to lead the nation,” said Angelos G. Angelou, founder and principal executive officer at AngelouEconomics in Austin, Texas. Angelou’s economic development and site selection business focuses on renewable energy projects, as well as data centers and life science expansions.
Angelou made the remarks during a recent panel discussion with five other national site selectors at the Greater Phoenix Economic Council (GPEC). More than 80 local economic developers, city officials, and business leaders attended the discussion of industry trends and Greater Phoenix’s competitiveness.
Greater Phoenix’s renewable energy industry has grown dramatically since Governor Jan Brewer signed the Renewable Energy Tax Incentive Program in 2009. The program has drawn eight companies, 1,245 jobs, and $155 million in capital investment since January 2010.
Business Facilities magazine, a national publication for site selectors, last August ranked Arizona the country’s number-one renewable energy leader and called the state the “established solar energy king.”
magazine, a national publication for site selectors, last August ranked Arizona the country’s number-one renewable energy leader and called the state the “established solar energy king.”Greater Phoenix’s renewable energy market also was boosted this year when China-based Suntech Power Holdings, the world’s largest producer of solar panels, decided to open its U.S. manufacturing plant in Goodyear. Suntech plans to expand the Goodyear plant, which opened last October, to 50 megawatts from 30 megawatts and double the number of workers to more than 150 from 75 by the end of this year.
“Having Suntech as an anchored Chinese investor here will carry a lot of weight in China,” said Kris Knutsen, senior manager for Deloitte’s U.S. Chinese Services Group in New York. Many Chinese investors are unfamiliar with different U.S. economic markets, so all the cities in the country are on a level playing field, he said. “There is absolutely no reason why this area of the country couldn’t position itself as the place to be in terms of renewables.”
Greater Phoenix should look beyond Shanghai and Beijing to draw investments from inland markets, he said. “This area of the country—rather than Chicago, Cleveland, or New York—is a growth story. That resonates with a Chinese audience. They know growth.”
China will dominate the global renewable energy market, so attracting investments from there is increasingly important, Angelou said.
GPEC’s sharpened international business development strategy places China as a top-tier country from which to attract investment. GPEC has focused foreign direct investment efforts on China for several years.
One of Greater Phoenix’s biggest competitive advantages is its property tax depreciation schedule, Angelou said. Property tax reductions in Greater Phoenix are among the most aggressive in the country and appeal to industries that require large capital investments, he said. “Texas cannot compete with Greater Phoenix, and I know that from personal experience,” Angelou said.
While Greater Phoenix is smaller than the largest markets in the country such as New York City, its affordable operating environment makes it a better place to locate a startup company, said William E. Hartman, Cushman & Wakefield’s executive vice president of brokerage in New York. “It’s an easy kind of decision,” he said.
Greater Phoenix’s young workforce appeals to many companies that want workers in the 25-to-44 age range, the site selectors said. The region is the country’s third-youngest metropolitan area demographically. “I would say you are poised very, very well in terms of workforce on the corporate side,” said Philip R. Utigard, executive vice president of Tenant Advisory Services at Transwestern in Illinois. He suggested that Greater Phoenix tell companies about the region’s partnerships with Arizona State University to develop academic programs that meet companies’ specific labor needs.
Greater Phoenix is among the top markets in the western United States that companies examine when considering relocation, said Saul E. Grohs, a partner with Location Advisory Services in New Jersey. Companies also consider Albuquerque, cities in Texas, and Denver, he said.
Greater Phoenix should tell prospective companies about the region’s communities collaborating to improve economic development, efforts to integrate the region’s universities into the workforce, and the affordable business environment, said Henry J. Goodfriend, executive vice president of NAI Global in New York. “There are so many positives here, and those need to be bundled together and emphasized,” he said.
GPEC will continue efforts to attract new investments from China and help Arizona’s renewable energy industry grow, said Barry Broome, the organization’s president and chief executive. “We will continue to increase our competitiveness and to sell our story,” he said.
