| Global Strategies: Cleaning Up |
| Departments | |
| Written by Ron Pernick and Clint Wilder | |
| Thursday, 01 May 2008 | |
 Will clean technologies be the next engine of business and economic growth? Authors Ron Pernick and Clint Wilder say yes. At a time when the US economy sputters in fits and starts and faces unprecedented challenges from high energy prices, depleted natural resources, volatile sources of foreign oil, record deficits, and unprecedented environmental and security challenges, clean tech offers the promise to be the next big engine of business and economic growth. Companies, investors, entrepreneurs, job seekers, and governments have a choice to either embrace and lead in this brave new world of clean-tech innovation or risk falling behind a host of competitors. At stake are trillions of dollars in economic opportunity and prosperity for the companies and individuals at the forefront of this next growth and investment opportunity. The clean-tech industry’s growth performance is telling: against a global economic backdrop of recession fears, the mortgage and credit crunch, and record oil prices, revenues in the top four clean-tech sectors surged 40% in 2007. According to market research data compiled annually by our company, Clean Edge, the combined worldwide market for solar photovoltaic energy, wind power, biofuels, and fuel cells grew from $55 billion in 2006 to $77.3 billion last year. For most people, the concept of clean tech is relatively new. It refers to any product, service, or process that delivers value using limited or zero nonrenewable resources and/or creates significantly less waste than conventional offerings. Clean technology comprises a diverse range of products and services that: • Harness renewable materials and energy sources or reduce the use of natural resources by using them more efficiently and productively • Cut or eliminate pollution and toxic wastes • Deliver equal or superior performance compared with conventional offerings • Provide investors, companies, and customers with the promise of increased returns, reduced costs, and lower prices • Create quality jobs in management, production, and deployment Clean tech covers four main sectors: energy, transportation, water, and materials. It includes relatively well-known technologies such as solar photovoltaics, wind power, biofuels, bio-based plastics, advanced lithium-ion batteries, and large-scale reverse-osmosis water desalination. It also includes emerging technologies such as tidal power, silicon-based fuel cells, distributed hydrogen generation, plug-in hybrid vehicles, and nanotechnology-based materials. Dramatic shift In the 1970s, clean tech was considered alternative, the province of back-to-the-land lifestyle advocates, altruistic environmentalists, and lab scientists on research grants—and for good reason. It was in an early development stage, was too expensive, didn’t have widespread political support, and was embraced by very few large, established companies. Three decades later, things have changed dramatically. Throughout the world, we’re seeing the beginning of a revolution that is changing the places we live and work, the products we manufacture and purchase, and the development plans of cities, regional governments, and nations around the globe. One need look no further than the daily headlines to see clean tech taking hold. Portland, Ore. has become the first city in the US to require all gasoline sold within city limits to contain at least 10% ethanol. California passed landmark legislation to cap and reduce greenhouse gas emissions and to install nearly 1 million solar roofs throughout the next decade. Gas-guzzling sport utility vehicle proprietors Ford and General Motors have seen their fortunes plummet as those of hybrid-leader Toyota rose. Entrepreneurs have raised venture capital to develop everything from a high-performance, battery-powered, $98,000 Tesla Motors electric sports car to solar cells based on nanotechnology. How did clean tech go from the stuff of back-to-the-earth utopian dreams to its current revolution among the inner circles of corporate boardrooms, Wall Street trading floors, and government offices around the globe? We’ve identified six major forces (the six C’s) that are pushing clean tech into the mainstream and driving the rapid growth, expansion, and economic necessity of clean tech across the globe: costs, capital, competition, China, consumers, and climate. These six forces are aligning to catalyze the growth and expansion of clean-energy solutions for transportation fuels and electricity generation; clean sources of water for drinking, irrigation, and manufacturing; and clean, environmentally benign materials for buildings and industrial processes. Together, they are creating lucrative business and investment opportunities for established companies, entrepreneurs, and investors of all types. Economic imperative We believe that clean tech, over and above the arguments for environmental protection and climate-change mitigation, is an economic imperative. Nations, companies, and investors who dismiss or disregard these trends run a strong risk of falling behind their competitors in attracting top talent and generating profits in the global marketplace. The clean-tech revolution is not about environmental do-goodism, and it is not a rejection of business and technology. Instead, it embraces capital, business, and technological innovation and provides a viable path for a world that’s reaching resource limits and dealing with unprecedented challenges. Governments, investors, companies, and entrepreneurs that seize the opportunity of clean tech are positioned to reap significant benefits and profits. From Beijing to Berlin and San Francisco to Bangalore, the clean-tech revolution is well under way. It will determine which regions lead and prosper and which are left choking on their own emissions and struggling to compete in a world that is leaner, greener, and less reliant on fossil fuels. Unlike the Internet, which went through a rapid boom-and-bust cycle—a classic bubble—the transition to new energy, transportation, advanced materials, and water technologies will look more like a long boom. To be sure, there will be periods of high-growth spurts and then retrenchment. There will be occasional irrational exuberance. But with the right combination of policy, capital, and technology, the exploding global market for clean tech will not abate any time soon. Ron Pernick and Clint Wilder are co-authors of The Clean Tech Revolution: The Next Big Growth and Investment Opportunity (Collins, 2007), from which this article is adapted. They are co-founder/principal and contributing editor, respectively, at Clean Edge (www.cleanedge.com), a research and online publishing firm covering the clean-tech industry since 2001. |
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© 2008 American Executive - RedCoat Publishing. All rights reserved.
American Executive is a RedCoat Publishing publication.
American Executive is a RedCoat Publishing publication.
