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The clean-tech field is a decade old by some measures, which seems like a good time to take stock and ask: How are we doing?
I say "we" because, for more than a decade, I have advised large companies on clean tech, as well as green business generally, and I've been an early-stage investor in the sector. (By clean tech, I mean technologies that address resource and environmental challenges -- and I'm thinking mostly of new companies, though some large corporations are notably active in the space.)
In my view, success for clean tech means achieving scalable impact in terms of returns for both investors and the environment. By these standards, are we succeeding?
Global investment in clean energy has grown five-fold over the last six years to $243 billion in 2010, but still needs to double to $500 billion annually for us to have any hope of reaching global warming targets, according to Bloomberg New Energy Finance.
Clean Edge's annual clean-energy report notes that, between 2000 and 2010, the global solar photovoltaic market grew from $2.5 billion to $71.2 billion, and the wind power market expanded from $4.0 billion to more than $60.5 billion. The US went from having fewer than 10,000 hybrid vehicles on the road to more than 1.4 million, and the number of LEED-certified green buildings went from almost none to more than 8,000.
This all sounds impressive -- until we consider the size of these markets: Solar and wind together make up just 2 percent of the $6 trillion global energy market. Hybrids represent less than 1 percent of America's 250 million passenger vehicles, and green buildings represent a fraction of 1 percent of the roughly 5 million commercial buildings in the U.S. With this context, we don't even need to look at the latest atmospheric carbon levels to know that clean tech's impact so far has been modest.
Of course, change takes time. But can we accelerate it? It is promising that the percentage of venture capital invested in clean tech grew to more than 23 percent in 2010 from less than 1 percent in 2000 -- and some of the smartest VC firms are leading the charge. Similarly, many corporate leaders are investing in clean tech. For example, as part of its ecomagination strategy, GE invested $5 billion in R&D in cleaner technologies between 2005 and 2010, and last year committed to invest twice that amount between 2010 and 2015. Indeed, the progress cited by Clean Edge over the last decade may have less to do with startups than with large companies such as GE (in wind), Toyota (hybrids) and Johnson Controls (buildings).
Next page: Three high-level ideas to scale clean tech's impacts
Deborah - Thanks for the
Deborah - Thanks for the comment. I will check out the site you mention.
Separately: I spoke today with a friend who is involved in Tesla. He made two points that suggest Tesla should get more credit than I gave it: (1) The company has done more to accelerate progress on EVs (vehicles, batteries, infrastructure) than most, if not all, traditional car manufacturers and (2) It is partnering with some of the biggest automotive OEMs, including Daimler and Toyota, to scale up its innovations. What do you think?
These are all valid
These are all valid points.
One way to look at the Tesla Roadster, even though limited production and high price, is as a catalyst for their S Sedan. Although the roadster only reached 1700 in 5 years, the S Sedan production is planned for 20,000 per year at roughly half the price. Moving in the right direction.
A recent Lux Report showed that the Hi-Tech Battery market is expected to reach $30B by 2016. Despite all the attention given to the Tesla, GM Volt and Nissan Leaf and their significant battery requirements, they'll use only 20% of that supply. Where is the other $24B of Lithium batteries going? According to the study; E-Bikes and Micro Cars.
The global economy continues to go South as people's environmental intentions head North.
At Organic Transit we're filling the space between bicycles and automobiles with Eco-Urban Vehicles for the masses. A base price of $3.3K US and an equivalent efficiency of 1800mpg, virtually anyone can mitigate 28 tons of CO2 per year. 100 OTVs (Organic Transit Vehicles) on the road is the same carbon mitigation as a 4MW wind turbine, at a fraction of the price. Pedal/Solar Hybrids that: are fully enclosed, have a range of 30 miles, can carry hundreds of pounds of payload and require none of the fees and hassles associated with cars.
Our team has produced some of the fastest bicycles in the world, have a World EV Record and produced millions of conventional bikes. We've come together to produce the cleanest, most efficient vehicles on the planet.
We launched our website on the Solstice, even though its not quite ready.
We are in the early stages but the time is so right.
Thanks you for insight and good luck at your NY conference.
Rob Cotter
Dear Mr. Shapiro, How about
Dear Mr. Shapiro,
How about not demanding returns of 1000 times investment? How about supporting entrepreneurs who work with technologies which go against the "normal green" type of technologies? Or perhaps using resources which are one's disposal, i.e. nature and the physics of nature? Maybe it's time to look at changing the basic business model of Green and looking to Economies of Scope as opposed to Economies of Scale?
I suggest you look at www.blueeconomy.de before you have your meeting and see what they are doing in supporting entrepreneurs with cleantech ideas - ideas which not only are good for the environment but create jobs and cultivate people and their culture. They have an incredible plan for helping Germany exit nuclear; a plan which will work for any country.
Perhaps it is time to turn the "green" world on its head and look at cleantech completely differently.
Best regards,
Deborah Veneziale
(Co-founder of a new Blue Economy company looking for funding)