For Immediate Release - April 22, 2010


$5 million in financing from Massachusetts Clean Energy Center will help A123 Systems expand facilities, create more than 250 jobs

BOSTON - Thursday, April 22, 2010 - On the 40th anniversary of Earth Day, Governor Deval Patrick today announced that advanced battery maker A123 Systems will create more than 250 new jobs and locate its growing grid power storage division in Massachusetts. The Governor also pointed to a new report's finding that Massachusetts is a clean energy leader nationally and progress in implementing the nation's most ambitious greenhouse gas law as further evidence of the Patrick-Murray Administration's commitment to building the Commonwealth's clean energy economy and future.

To help facilitate A123 System's expansion, the Massachusetts Clean Energy Center (MassCEC) has approved a $5 million forgivable loan for the Watertown-based company contingent on it hitting job creation and private investment milestones. The company anticipates making $80 million in capital expenditures in Massachusetts to build up its manufacturing and R&D capabilities here by the end of 2014.

"A123 has already established itself as a leading battery maker for the electric cars that are the clean energy future of the U.S. auto industry," said Governor Patrick. "I am pleased to see this Massachusetts company growing its operations here, creating jobs and contributing to the Commonwealth's clean energy leadership."

"With support from Governor Patrick and the Commonwealth of Massachusetts, A123 plans to develop and build systems that will create a smarter and more efficient grid, double the size of our R&D facilities, and create more than 250 new jobs right here where the company started," said David Vieau, president and CEO of A123 Systems. "Massachusetts has all of the key elements required for A123's continued growth: a well-educated workforce, access to world-leading innovations developed at top universities, and an environment which is supportive of clean energy technologies and companies."

Founded in 2001, A123 Systems develops and manufactures advanced lithium ion batteries and battery systems for the transportation, electric grid and consumer markets. Headquartered in Watertown with additional facilities in Hopkinton, the company is a leading supplier of battery systems for a wide variety of next-generation energy storage applications. In September 2009, A123 raised $378 million in its initial public offering.

A123 Systems has added more than 50 corporate and research and development jobs in Massachusetts in the last year associated with its expanded U.S. manufacturing capacity in Michigan. The expansion was supported by a $249 million federal stimulus U.S. Department of Energy grant designed to accelerate the manufacturing and deployment of the next generation of batteries for plug-in hybrid and all-electric automobiles.

"Electricity storage is a critical challenge for clean energy developments such as electrifying automobiles and managing intermittent sources of renewable energy such as wind and solar," said Energy and Environmental Affairs Secretary Ian Bowles, who serves as chairman of the MassCEC board. "A123 is one of Massachusetts' leading clean energy companies, moving the country and the world toward a clean energy future. Governor Patrick and I are glad to have them here - and growing."

With the expansion announced today, A123 Systems will assemble and commission its largest-sized battery systems in Massachusetts. These trailer-sized units will be used to store power for the electric grid, creating a more stable and efficient system. In addition, these systems can help integrate renewable sources of power, like wind and solar. Under the terms of the MassCEC financing, A123 will double its Massachusetts employment to more than 500 by 2014.

"With this financing offer, Massachusetts has shown once again it has the right incentives for clean energy companies to choose the Commonwealth," said MassCEC Executive Director Patrick Cloney. "Thanks to the leadership of Governor Patrick and Secretary Bowles, A123 will continue to grow in Massachusetts."

A123 Systems is part of a nationally significant cluster of innovative energy storage companies in Massachusetts. Other Massachusetts companies developing advanced batteries and other electricity storage devices include Boston-Power, Beacon Power and Premium Power.

"The Clean Energy Center loan will help create jobs in Hopkinton while advancing the Commonwealth's goal of embracing the economy of the future through green technology and clean energy. I am excited that Massachusetts is able to continue to support A123 Systems as it seeks to revolutionize the way we create energy for our cars and consumer electronics. This partnership will result in good jobs for Massachusetts residents and good clean technology for the global economy," said Senator Karen Spilka, Senate Chair of the Joint Committee on Economic Development and Emerging Technology.

"The state has always been an innovator in clean energy technology and policy. This strategic investment will help the Commonwealth meet its emission reduction targets, while creating sustainable jobs. It is a win for both the environment and the economy," said Senator Marc Pacheco, Chairman of the Senate Committee on Global Warming and Climate Change.

"Massachusetts is at the forefront of clean energy innovation, and companies like A123 have put us there. With this investment from the Clean Energy Center, the company can expand its operation here in Metrowest, create needed jobs, and leverage $80 million in private funds. There's real opportunity here and I'm so pleased to see this funding come through. And what better way to recognize Earth Day than to support a local company like A123 that's leading the way in green and sustainable sources of energy," said Representative Carolyn Dykema.

Clean Energy Report: Massachusetts Tops in the East, Second in the Nation

As part of the A123 announcement and in celebration of the 40th anniversary of Earth Day, Governor Patrick also highlighted a new study released today finding that Massachusetts is the leading clean energy state on the East Coast and second in the nation.

The report, A Future of Innovation and Growth: Advancing Massachusetts' Clean-Energy Leadership, prepared by Clean Edge Inc. for MassCEC, compares Massachusetts with other leading clean-energy states by a variety of quantitative and qualitative measures. In judging each state's regulatory incentives, financial incentives, knowledge capital, and economic/workforce development, Massachusetts ranked second nationally, following California, and ahead of Oregon, Colorado, New Jersey and ten other top clean-energy states.

"This report shows the progress we've made making Massachusetts reach its potential as a national leader in clean energy," said Governor Patrick. "Massachusetts has the right stuff to drive the next industrial revolution."

"Under Governor Patrick, and in partnership with the Legislature, Massachusetts has leapfrogged over our East Coast competitors in clean energy, and California better watch out," said Secretary Bowles. "The nation's clean energy future will come with a label saying, 'Made in Massachusetts.'"

World-class academic and innovation resources, strong government policies and leadership, active venture capital community, highly educated workforce, and deep commitment to energy efficiency are a few of the assets that give Massachusetts a leg up in clean energy technologies, products, and services, the report notes. Energy efficiency, solar power, and advanced energy storage are three clean energy sectors where Massachusetts shows particular strength, with potential for further growth and innovation in the future, according to the report.

"By a range of different measures, Massachusetts stands out as a clean-energy leader among states in the U.S.," states the report, which was prepared by a nationally known clean-tech research and publishing firm. "It has made the growth of clean energy a clear legislative and economic development priority in the state, with strong results to date in leading-edge policies, industry expansion, job creation, and increased investment and deployment."

"Governor Patrick has done more to advance clean energy in the Commonwealth of Massachusetts than many would have thought possible," said Nick d'Arbeloff, President of the New England Clean Energy Council. "In just a few short years under the Governor's leadership, we have moved from the middle of the pack to number two in the nation, and now stand ready to become a major supplier of clean energy solutions to the global marketplace."

"I applaud the Patrick-Murray Administration's efforts in growing the Commonwealth's green economy to be one of the top in the world and making our environment a healthier place to live. I look forward to continuing to work cooperatively to promote clean energy, energy efficiency, green technologies, and lowering our carbon footprint in Massachusetts. This is the pathway to our economic strength and our success as a planet," said Representative Frank Smizik, Chairman of the House Committee on Global Warming and Climate Change.

2020 Greenhouse Gas Emissions Reduction Target Hearings Set

Today, Secretary Bowles also announced upcoming hearings on the 2020 greenhouse gas emissions reduction target that the Secretary must set by January 1.

The Global Warming Solutions Act of 2008 requires the reduction of greenhouse gas emissions across the Massachusetts economy by 80 percent from 1990 levels by 2050.

For 2020, the Act requires the Secretary to set an emissions-reduction mandate between 10 and 25 percent below 1990 levels. Analysis released in January showed that state and federal policies now in place or anticipated have Massachusetts on track toward emissions reduction of 18 percent by 2020 - far below what any other state has announced it will achieve.

In hearings to be held around the state, Secretary Bowles will take public comment on a 2020 reduction target between 18 percent and 25 percent. He will also call for testimony on measures to achieve the target that show potential for energy cost savings and job growth. A schedule of hearings will be announced soon.

"Reducing greenhouse gas emissions means accelerating our transition to a clean energy economy - already a comparative advantage for Massachusetts," said Secretary Bowles. "How much we can reduce our fossil fuel use, save on energy costs, and create clean energy jobs will guide me in setting the 2020 emissions target. To go further than the 18 percent reduction our current policies will get us, I've asked our agencies, advisory board, and the public to focus on measures that save money for consumers and business by reducing energy use."

"With its remarkable wealth of intellectual capital and a long tradition of technology innovation, Massachusetts has a civic responsibility to be a national leader in reducing greenhouse gas emissions. We possess a strong combination of talent and determination to succeed, and that should encourage all of us to aim high, because all of us will benefit---consumers, businesses, the Commonwealth, and the Nation. Prosperity and job creation will flow naturally from our efforts to build a green economy based on clean energy technologies," said Susan Avery, president and CEO of the Woods Hole Oceanographic Institution and co-chair of the Climate Protection and Green Economy Advisory Committee created by the Global Warming Solutions Act.

"The state's commitment to reduce the impact of greenhouse gas emissions aims to secure the future for our children and grandchildren. In addition to being a responsibility, there is also incredible opportunity for Massachusetts consumers and the business community not only in terms of financial savings, but also economic growth. Tomorrow's leaders are no doubt those consumers and businesses already focused on energy efficiency and reducing dependency on GHG intensive energy sources," said Martin Madaus, Advisory Committee co-chair and CEO of Millipore Corp.
"To realize our vision for a clean energy future in New England, state leaders must have the courage to set aggressive yet achievable targets for reducing greenhouse gas emissions and engage all stakeholders in meeting them," said John Kassel, president, Conservation Law Foundation. "Massachusetts clearly is at the vanguard of meeting this challenge by developing and implementing innovative programs and solutions that will fuel clean, green economic growth in our region and show the country how it's done."

"It is critical that Massachusetts continues to build on its foundation of exceptional climate policy," said Dan Sosland, Executive Director of ENE (Environment Northeast). "The Commonwealth's environmental and economic health depends on our taking action to reduce carbon emissions today. Through solutions like investing in energy efficiency, we can continue to demonstrate that achieving ambitious climate goals can create jobs and put money in consumers' pockets."

"Setting strong pollution reduction targets challenges companies to innovate, and innovation creates jobs and economic growth," said Fred Krupp, President of Environmental Defense Fund. "The leadership of states like Massachusetts is a model for Washington and a driver for national action."


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