San Jose didn't spend $20 million to lure solar-cell "printer" Nanosolar to Silicon Valley, as the California Assembly is considering giving to Tesla Motors. The city's $1.5 million incentive, far less than what Nevada and Arizona were offering, was sufficient - coupled with the Valley's commitment to cleantech and the benefits of being in the technology hub.

Paul Krutko, director of the San Jose Office of Economic Development, told the Green Wombat blog that SJ doesn't just flash greenbacks, it builds green.

San Jose touts its green building initiatives - it opened the world's first LEED (Leadership in Environmental Design) certified public library - and cites local companies' efforts to fight global warming. Software maker Adobe's downtown San Jose headquarters, for instance, has been rated the greenest corporate building in the United States.

Green tech companies, says Krutko, are "looking at communities that have an approach to sustainability. It is very much a competitive advantage in having a community that really gets it in dealing with the global issues we’re facing in terms of climate change and global warming."

Ultimately, Krutko says, it's not about tax incentives. Speaking like a true Valley guy, he says, ""Our currency is really about time to market. Market entitlements and the ability for a company to find space and quickly occupy that space and move forward."

San Jose invests in a Pacific Community Ventures fund that will finance local companies. It's also streamlining the permitting process and changing zoning regs to accomodate green companies.