lördag 25 oktober 2008

Short term challenges, long term opportunities

No sector is immune to the current financial unrest, and also many cleantech companies will face hard times during the next year or two. And highly leveraged projects, as often is the case with many wind power, may be postponed or cancelled.

Still, there are reasons to believe that the cleantech sector will fare relatively better than other areas. And in the long term, the outlook is still positive. The reasons are several:

  • Renewable, domstic energy is a measure to improve national security. It's a long-term necessity independent of the current financial unrest. Public funding will continue to reach the necessary goals.
  • The possible physical mechanisms behind climate change are indifferent to a Wall Street crisis. Companies who embrace this fact will act accordingly and invest in renewable energy and related technology as a long term strategic resource. Further on, renewable energy will be a priority for public funding.
  • Emerging economies will participate in the global emissions market. Sooner or later, giant economies like China and India need to share the burden and reduce the CO2/$ growth ratio.

  • Higher living standards in emerging economies will increase consumer consciousness and the demand for a cleaner near-environment. When you are starving you don't have time to bother about smog or inadequate waste-management, but as conditions improve, these issues will come closer to the top of the agenda. That is good news for companies within these sectors.

  • Energy efficient is more important than ever when times are hard and resources scarse.

In particular, projects and technologies that benefit from public funding will find less problems than others. So will those companies and projects financed by equity rather than debt. The situation is troubling, but there is no need to panic.

2 kommentarer:

miljöteknik: avfuktare för krypgrund och vind sa...

Actually, our clean tech company (that makes dehumidifiers) have seen sales grow in the current turmoil. So a bumpy road ahead might speed up the transition from energu intensive to energy saving products.

Patrik Marckert sa...

Thanks for your comment. I agree with you completely. What many cleantech companies sell is basically "saves", "reductions" and "efficiency" - things that are strikingly necessary in a recession. In particular, I think retro-fitting of existing houses and buildings is a part of the construction industry that may even benefit from the crisis.