Risk för cleantechbubbla? Knappast. Däremot för enskilda företagsbubblor

Dagens Miljö skriver idag om risken för en cleantechbubbla. Visst, på kort sikt kan enskilda företag och delsektorer att sjunka i värdering, till föjld av uppskruvna förväntningar. Detta kan tillfälligt drabba hela sektorn. Men cleantechsektorn som helhet har större potential, särskilt om man sprider sina ägg.
Jag har redan skrivit om detta här, och om att nästa "boom" kommer inom energieffektivisering.

"Boomen" vi sett är i stort sett logisk och marknadsmässig.
Självklart kommer enskilda företag av olika skäl inte klara sig i konkurrensen, och vissa företag är säkerligen övervärderade redan idag.
T.o.m. hela delsektorer kan komma att krascha. Marknaden kommer till exempel så småningom att straffa t.ex. etanolsektorn p.g.a. lågt energiutbyte för vissa former av etanol (majs&spannmål), och externa kostnader för andra typer (jatropha). En eventuell rekyl inom en delsektor kommer att drabba hela sektorn, dock tillfälligt.
Cleantechsektorn som helhet kommer på lång sikt snarare bara öka, eftersom fler blir varse om de externa kostnaderna i ett icke-hållbart samhälle. Förnyelsebar energi behövs inte bara p.g.a. klimatförändringar, utan också av säkerhetsskäl och för energioberoende. Även andra delar av cleantechsektorn kommer att gynnas i takt med att länder blir rikare och efterfrågar en renare miljö. Dessutom har investerare dotcom-bubblan i färskt minne och kommer att vara mkt mer kritiska i granskningen av förhållandet mellan nuvarande vinster & värde.

Difference between the renewable energy boom and the dot-com bubble

Joel Makower at the Environmental Economics & Sustainable Development blog provides some important points about why the renewable energy boom is persistent, and not yet another dot-com bubble. The most important point he makes is:

1. The problems aren't getting any better. This is fairly obvious, especially if you've seen The Movie. The environmental movement, it's been said, is rapidly morphing into the climate movement, and there's a parallel shift taking place on the business side. The motivations may be different -- for activists, climate has become a rallying cry that gives disparate groups a singular focus; for companies, it's about the need to squeeze efficiency out of every operational nook and cranny while reducing risk and enhancing image -- but the upshot is the same: Until the climate problem is under control, it will be Job One, environmentally speaking, inside most companies. And as concern, regulation, and market-based mechanisms to address climate change ramp up, this will be a key business focus for a long, long time.

Although I do not entirely agree on the statement that problems aren't getting better (at least I believe they are become worse at a decreasing speed), the essence is important: there is a real and big problem to counter. Companies in the renewable energy and cleantech sectors are speculated at higher and higher values, but if they do provide a solution to the underlying problems, they deserve it.

Another point, that wasn't made by Makower, is the experience learnt by investors from the dot-com bubble. This time investors will investigate the companies scrupulously before investing, and companies will need to show net profit. The marginal influx of capital from gold-digging amateurs will not affect this. Companies will not become stock market stars only by claiming that they provide "cleantech solutions" or that they work with "sustainable fuels"

One may suggest that the renewables boom and the bubble of the late 90's have one thing in common: the element of uncertainty. Speculations in companies in the IT era where often made because of unknown future revenues, based on a large customer base. Investors wanted to jump on a train without knowing the final destination, only that the general direction felt right. There are two general aspects of uncertainty regarding the renewable energy sector: the extent and effects of climate change as well as the policys implemented to counter it. However, these elements are not significant for the development of the renewable energy sector as whole. The uncertainty regarding the effects of climate change does not refer to the existence of climate change, but rather details; will the damage on the global economy be 1% or 10% of global GDP? Further on, although the political development may vary, the general direction is clear. Certain types of renewable energy will most likely fall in political disfavour with time, like corn-based ethanol. Depending on how subsidies and taxes are designed, it will be easier to invest in certain types of energy because difference in capital and operational costs. It is clear however, that the sector as whole will benefit.

Prediction of the Cleantech Market: Looking into the Crystal Ball (I)

For many of us working or studying within the field of renewable energy, the recent boom in renewable energy interest among the general public and the financial sector did not come as a surprise. Scholars, engineers, inventors and environmentalists have for a long time seen and discussed the problems of current energy systems, and invested time, interest and money in alternatives and solutions. Our current energy systems are not sustainable and create high external costs. Reducing these external costs by replacing fossile energy sources with renewable energy is a logical step.

In the same manner, the next phase will come out of logic. Actually, it should be something that should have preceded the interest in renewable energy. The next boom will revolve around energy efficiency. This is not something entirely new; energy efficiency is an issue that has got a lot of attention during the last couple of years, with rising prices, climate change, energy dependence and other problems with the oil economy. Energy efficiency was a hot topic already during the oil crisis of the 70's. Whenever there are output reductions or price peaks, which may be the case with wars and conflicts, energy conservation and efficiency appear as necessary measures. What has not been frequently highlighted is the advantages of energy efficiency when compared to renewable energy. Don't get me wrong, they are two completely different concepts. Both are necessary for fighting climate change and other than on a national level, they mostly don't compete with each other. But when considering in which companies to invest your money, they often do compete. It is easy to understand the benefits of energy efficiency. If we need to reduce the energy generated from fossile sources with 1 TWh in a sustainable manner, we could go for installing more renewable energy capacity. Or, we could implement energy efficient technology. In the case of energy efficiency, we would not need to bother where to find more sources of energy. We would not even need to debate the issues of uncertain profitability and high investment costs of renewable energy production facilities, or deal with the issues with raw materia un-sustainability of ethanol, biogas generation versus incineration. Better than to find replacement sources of energy is to not need to use the energy in the first place. There is an inherent beauty in energy efficiency - earning more by wasting less. That is attractive for most of us conducting business. Thus, because of the logics of energy efficiency, it is a logical step that energy efficiency will be next highlighted cleantech sector. As in the case of renewable energy, this will not be a temporary trend. The problems connected to the oil economy are permanent, as are the problems with energy from other non-sustainable sources.

In a later post, I will highlight which sectors and companies will be the winners in this new wave of cleantech. There are a lot of companies that are rather invisible when thinking of cleantech, but that do work with energy efficiency.

PS. A quick note on energy efficiency vs. energy conservation. Although often used interchangably, they are not necessarily identical. Energy conservation means using less energy by doing less. That could involve sacrificing processes that we would have preferred to keep. Energy efficiency means using less energy by keep doing something, but with less energy input. Energy conservation is to turn off the light, energy efficiency is to change the light bulb to a energy saving one.