Geothermal, Project Development

In the Mainstream, but Still Some Bumpy Rocks

The Grand Ballroom of the Waldorf-Astoria Hotel has played host to many momentous occasions over the years, from Presidential speeches to Metropolitan Opera galas to induction ceremonies for the Rock and Roll Hall of Fame. So it’s a clear sign of the mainstreaming of clean tech when such a celebrated venue is home to the Renewable Energy Finance Forum-Wall Street conference, the annual gathering of some 700 clean energy technology purveyors and financiers last month in New York.

When I walked into the four-story ballroom late the first morning, a conference speaker was noting a proposal in Ontario to shutter all of the Canadian province’s coal-fired plants by 2014, then extolling the eye-popping growth of private equity value in the solar power industry. As this charismatic gentleman reported total private equity in solar exploding from $1 billion in 2004 to tens of billions by next year, I assumed he was either a solar industry executive or consultant.

But in fact he was John Cavalier, vice chairman of corporate and investment banking at global finance giant Credit Suisse (and, by the way, a graduate of the U.S. Military Academy).

Clean tech in the mainstream? Case closed. In recent radio, TV, and print interviews around the country for our new book The Clean Tech Revolution (co-authored with Clean Edge co-founder and principal Ron Pernick), I’ve emphasized the growing non-partisan, non-environmentalist support for clean tech as a high-growth money maker. The subtitle of our book is “the next big growth and investment opportunity,” and just about everywhere you look, that is playing out.

Consider just a quick snapshot of developments in the past few weeks:

• Toyota announced the sale of its millionth hybrid vehicle.
• Clean tech now trails only biotech and software as the third- largest investment sector for U.S. venture capital, accounting for 11% of the total VC pie. It has moved ahead of telecom, medical devices, and semiconductors. (And the global solar industry surpassed the chip sector in its use of silicon some time ago).
• The first solar panels went up on the governor’s mansion in Denver, where Colorado Gov. Bill Ritter and a voter-approved renewable portfolio standard (RPS) in 2004 have made this “red state” an emerging clean energy leader. (I accepted an invitation to talk about clean tech to a conference of mining industry execs in Colorado later this year).
• The Motley Fool, the popular online investment guide, picked SunPower and First Solar as two of its “unloved growth stocks,” with projected five-year growth rates of 40.3% and 65%, respectively.
• The Oregon state legislature voted to join California in making Oregon another state with aggressive mandates to cap greenhouse gas emissions.
• In my personal favorite recent news item, Texas oil baron T. Boone Pickens announced plans to build and help finance the world’s largest wind farm—potentially 4,000 megawatts—in four Texas Panhandle counties.
• And we even finally saw some grudging progress on Capitol Hill, as the Senate approved the first increase in U.S. auto fuel efficiency standards in 32 years.

But the last item on the list also brings me to the bad news. What the Senate energy bill didn’t include were important long-term extensions to the investment tax credit for solar and production tax credit for wind, and a (modest, in my view) national RPS of 15% by 2020. Which means the U.S. still lags behind China in that regard, not to mention 24 of its own states comprising more than 50% of the nation’s population.

What’s even more frustrating was some of the rhetoric around the RPS debate. When Senate Minority Whip Trent Lott (R-Mississippi) called the proposed RPS “a greenie bill” that would “waste money on things that aren’t going to work,” he merely reprised the same old, tired, and no-longer-valid arguments that clean power technologies like wind, solar, and geothermal are unreliable and expensive.

So not everyone is on board, and perhaps some never will be. But it’s attitudes like Lott’s that have helped create our current scenario where you can walk onto the floor of the American Wind Energy Association’s annual Windpower convention and see that some of the biggest exhibitors (with a few exceptions like GE, FPL, and Airtricity) come from overseas. Denmark’s Vestas. Spain’s Acciona, Gamesa, and Iberdrola. India’s Suzlon. Germany’s Siemens. Japan’s Mitsubishi. Remember, this is at the American Wind Energy Association.

At the REFF-Wall Street conference in New York, California Energy Commissioner John Geesman called our lack of a federal-level RPS “a national embarrassment.” An RPS is not a magic bullet, but it would show that our federal leadership understands that clean tech is a key economic imperative for any nation to effectively compete, innovate, and move forward in the 21st century. I’d really like to think that’s not too much to hope for.

Clint Wilder is Clean Edge’s contributing editor and co-author of The Clean Tech Revolution. E-mail him at [email protected]