Business and the Environment: More Compatible than Some Rankings Suggest

-by Michael Wysolmerski, CTLCV Summer Intern from Yale University, michael.wysolmerski@ctlcv.org

CNBC recently released its 2010 rankings for America’s Top States for Business. Connecticut did not perform well, ranking only 35^th. However, given some of the criteria used to rank the states, the meaning of Connecticut’s low ranking is far from clear—especially with respect to the environment.

CNBC Top States for Business

CNBC used ten broad categories to compile its rankings: cost of doing business, workforce, quality of life, economy, transportation & infrastructure, technology & innovation, education, business friendliness, access to capital, and cost of living. Connecticut scored best, 8^th, in both the education and access to capital category. But Connecticut got its lowest ranking, 47^th, in the cost of doing business category.

Connecticut also finishes low, at 40^th, in Transportation & Infrastructure. However, the study’s criteria in this category include the quality of roads and the availability of air travel in each state, and CNBC “measured the vitality of each state’s transportation system by the value of goods shipped by air, land and water.” The CNBC study makes no mention of evaluating mass transportation options. As such, a high transportation ranking does not necessarily mean the state has a green transportation system. However, in areas such as education, quality of life, and access to venture capital, Connecticut ranks in the top 10.

Top 10 U.S. States for Cleantech in 2009

Perhaps a more telling set of rankings is the Top 10 U.S. States for Cleantech in 2009. Though each state possesses different renewable resources to tap into, the rankings attempt to evaluate states on how they connect “all the parts of the economy with natural resources and manufacturing know-how.” Connecticut, according to Frank Kuchinski, the VP of Marketing for Poulsen Hybrid, LLC, ranks 37^th in the cleantech rankings. This is an even lower finish than the CNBC rankings and is more distressing.

Within our region, Massachusetts, New Jersey, Pennsylvania and New York, all finished in the top 10 in the Cleantech rankings. All the Cleantech top 10 states have a Cleantech Workforce Development Plan, while Connecticut does not. According to Mr. Kuchinski, if Connecticut establishes a Department of Energy or the CT Energy and Technology Authority and Division of Research, Energy and Technology that was proposed in SB 493, our ranking will improve quickly, which would indicate a prosperous, inviting cleantech industry.

If the CNBC rankings are any indication, Connecticut seems to have great potential for Cleantech. Connecticut is ranked 8^th in both access to venture capital and education, two factors which the Cleantech rankings repeatedly cite as important to developing Cleantech. While Connecticut lags behind many of the top Cleantech states in Technology & Innovation, its ranking of 17 is higher than two top 10 Cleantech states, Oregon and Tennessee.

Forbes Greenest States

In yet another online ranking, Connecticut performed quite well. In the 2007 Forbes Magazine Greenest State ranking, Connecticut finishes 6^th. Forbes looked at six categories: carbon footprint, air quality, water quality, hazardous waste management, policy initiatives, and energy consumption.

While the three rankings are clearly quite different, examining the relative location of states is intriguing. Of the top 10 Greenest States, Washington, ranked third, is the highest performer in the CNBC ranking, finishing 15^th. CNBC ranks Hawaii and Rhode Island, both top ten green finishers, 48^th and 49^th, respectively. Thus, based on the criteria used for each ranking, it is nearly impossible to be both green and business friendly. Yet, the environment and business do not always have to be pitted against each other, since efficiency in business and sustainability share a large amount of common ground. Three states, New Jersey, New York, and Oregon, finished in the top 10 of both green and cleantech states. These states appear to be on the road towards recognizing this common ground. As Connecticut attempts to further its cleantech industry, the state can, and should, look to these three states as successful examples of a green state with thriving, clean industry. If Connecticut can become a top 10 cleantech state without losing its “green” status, it will join a select group of leading states in this field.