The Confusing State of Cleantech

We follow the Cleantech  world pretty closely. It started from our time at Waste Management, Inc. – a true pioneer and an industry leader today in recycling and the development of renewable energy. Today, we attend conferences, we know the industry players, and we read everything that we can get our hands on.  It’s an area that Jim and I are focused on in order to help our clients in the industry get better, faster. 

Some commentators have labeled the next few years a “perfect storm” for Cleantech investing. The Obama administration has called renewable energy a pillar of the new economy. It is estimated that the American Recovery and Reinvestment Act (ARRA) contains over $61.3 billion in energy-related public spending as well as tax credits and bond provisions expected to cost $20 billion over ten years. Private investing is increasing, as well. Venture capital investments in Cleantech companies rose to $4.1 billion in 2008 vs. $444 million in 2004 – but they are just getting started. John Doerr, partner at Kleiner Perkins Caufield & Byers recently commented  “…. green tech could be the largest economic opportunity of the 21st century,….however, this level of green VC investment is not enough.”  When you combine this type of investment interest, with the commercially ready technology available today, and add consumers who are ready to embrace the change – it is hard not to believe we are finally on the cusp of a major shift in US energy policy and practice. 

The media is chocked full of news stories every day about green initiatives; alternative energy; renewable energy; biofuels; smart grids; greentech; etc. Unfortunately, much of the news is confusing, and many of the facts and opinions are conflicting.  It’s difficult to figure out exactly what is going to happen next.  How are oil prices and Cleantech linked?  Are wind and solar power finally ready to become real energy alternatives in the US?   Is the real answer to reduce energy consumption through the use of smart grid technology?  Biofuels are hot, but is ethanol dead?  How will environmentalists weigh the benefits of reducing carbon emissions through new technologies vs. the other environmental impact of many of these approaches?  The list of issues and difficult questions is long.

Over the next few weeks, we’ll write about a number of conflicting signs in the Cleantech world, and how to navigate through the fog.  Stay tuned.