A Rebound in Cleantech Investments?

The first half of this year has been much slower regarding investments in clean technologies and renewable energy projects, $294 million in the US in Q1 2009, compared to $1,8Bn in Q3 2008. Recently however, investments are increasing, reaching $540 in Q2 '09. A clear sign that the economy is recovering.

The lower activity is not necessarily only a bad thing; vc funds making deeper assessments before committing themselves will make the capital influx into the clean tech sector hopefully reach those who most deserve it, healthy, profitable companies with a feasible expansion plans. This will decrease the risk for creating bubbles. Many good ventures will however suffer, especially if they have not yet reached the commercial stage.
Ideally, increasing cleantech investments will be done with the scrutiny and careful analysis applied during the worst decline.

More in the Mercury and, regarding the Swedish situation, here

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.