The remarkable story of Arnie Goldman, who had a fantastic idea, implemented it, ran out of money a few months before the legislation to validate it passed California’s legislature… and is trying again. This time, the story will have a happy end.

Arnold Goldman – or Arnie, as everyone calls him – is an extraordinary Jewish visionary, entrepreneur, electrical engineer, and author, in that order. Entrepreneurs can learn much from him. His earlier failure was colossal. Today, he is 63 years old, and has embarked on a new entrepreneurial venture. This time, he may succeed big-time. His latest book is Moving Jewish Thought to the Center of Modern Science. And, he believes he is the only person in the world who is convinced that 1+1 does not equal 2.
  
In California, where he was born and raised, Arnie was co-founder of Lexitron, the first company to sell word processing software, sold to Raytheon in 1977. He then came to Israel with his wife and three children to build a solar energy firm. In the early ‘80s, he founded Luz International, a pioneering solar-energy company based in Israel. The name Luz came from the Biblical city where Jacob dreamed of a ladder rising to heaven.  Jacob renamed the city Beit El (House of G-d). 

Arnie dreamed of building a new ladder to celestial energy. Between 1984 and 1990 Luz built nine SEGS (Solar Energy Generating Systems) in southern California, generating 2% of the area’s energy needs and aspiring to produce up to 10%. The solar energy fields built then used solar reflectors that covered 2 million square meters. Arnie used talented Israeli engineers for Luz’s R&D, done in Jerusalem.

At one point Luz produced 90% of all the solar-generated electricity in the world! But it ran into a snag. To compete with conventional energy suppliers, in the era of cheap oil, Luz needed its vast solar-mirror-covered fields to be exempt from property tax. Such exemptions had been legislated in California, but the legislation expired in 1990. Luz assumed the renewal and extension would pass easily. And it did, with over 90% of California’s legislature voting “aye.” Luz went ahead with construction of its 10th solar plant. At one point Luz had $300 m. in annual revenues. 

But in 1991, the Republican Governor of California, Pete Wilson, vetoed the bill, under pressure from powerful electricity companies. Later in 1991, the U.S. Congress passed national legislation exempting solar fields from property tax – but it was too late. Luz had burned $20 m. a month to keep the construction going, and had run out of money. It was broke. Business Week says Luz went bust because rival natural gas systems were superior. But I think the reason was the delayed tax exemption.

Goldman says “the failure was shattering – financially and personally,” according to the Jerusalem Post. It took him 15 years to recover. 

But Arnie is back – big time!

He has founded Luz II, wholly owned by BrightSource Energy, which he founded and chairs, a U.S. company that designs and builds large solar electricity plants. Investors in BrightSource include Google.org, the ‘social responsibility’ arm of Google, which together with other investors has put $115 m. into Luz II. According to Business Week (May 14), BrightSource signed a huge deal with utility giant PG&E (Pacific Gas and Electricity) to supply PG&E with up to 900 megawatts of solar electricity. 

Luz II’s technology is unique. Unlike photovoltaic cells, Luz II’s thermal system uses concentrated heat from the sun to drive turbines, which in turn generate electricity. This technology is based on the system developed by the original Luz, in the 1980’s. 

According to Business Week, “Israel is quickly becoming a hotbed of alternative energy research and startups.” Among them: Solel Systems, Zenith Solar, and the Trans-Mediterranean Renewable Energy Cooperation project, sponsoring Desertec, a scheme to install thousands of parabolic trough collectors in North Africa and the Middle East, to generate electricity for the often-cloudy Northern and Western Europe.

And Arnie? Well, about that 1+1… combine two hydrogen molecules with one oxygen molecule, 2+1, and you get not 3 but one water molecule. Combine one amoeba with another, and you get not 2 but millions.  

He believes he can quickly build Luz II’s revenues to $3 b., 10 times those of the original Luz. “We can produce energy less expensively and more cleanly than anyone else in the world,” he told Jerusalem Post columnist David Horovitz in 2006. 

“The Luz Brothers are back,” Arnie says. With oil at $130/bbl., we should all rejoice.

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