Published on June 9, 2014
Cleantech refers to technologies, products and services that enhance productivity, while decreasing energy use, expenses, waste or environmental pollution. The increased environmental awareness and the demand for cleaner energy has led to a significant growth in cleantech initiatives by large and reputed firms as well as start-ups.
2013 saw the downfall of a number of cleantech companies. Large number of solar power companies went into bankruptcy, which has given critics to write off the sector.
However, cleantech continues to show great potential, especially in the long run. Global wind installations have increased by nearly 25 per cent every year since 2006. Also, global investments in clean energy haa risen from about $30 billion in 2006 to $160 billion in 2012. This growth is likely to be aided by a few facts. The world will definitely face a resource crunch, driven by the ever-increasing consumption in developed and emerging economies. A total of 1.3 billion people still don't have access to electricity, forcing then to rely on traditional biomass. Their basic needs will have to fulfilled with the help of disruptive technologies provided by cleantech companies and not firms that follow the traditional path. While these facts help improve the prospects of the sector, there are myths that may stall its forward march.
The role of renewable energy is said to increase significantly. By 2035 investments in this sector will account for over 60 per cent of new power plant investments. Companies have been forced to rethink conventional business models, which are expensive and energy intensive.
Depite some setbacks, the technological development in areas like solar PV, LED lights, lithium ion batteries etc have proved to be cost-effective.
The improving technology base has made regulatory support less important. The increase in demand offsets the subsidy cuts. Thus, regularory support is no longer crucial in several sectors. Also, large firms are collaborating with small start-ups which will improve survival chances of the industry.
Once successful, the industry will establish a sector with tremendous growth potential and social impact.
