by: Joel Makower
The latest annual edition of Clean Energy Trends has just been published. My colleagues and I at Clean Edge have identified five key trends affecting clean-energy markets and produced our annual forecast of markets for four clean-energy technologies. And, working with our partners at New Energy Finance, we've analyzed the investment trends of the past year.
As we point out in the free, downloadable report, 2007 was a very strong year for clean energy technologies, with no signs of a slowdown in 2008. That said, with all of the uncertainties facing the economy, there are some potential speed bumps. One of the biggest is whether and how U.S. policies will extend the production tax credits for wind and solar, both of which are expiring at the end of the year. If these credits aren't extended before they expire, we could see the growth of solar, wind, and other renewables come to a standstill in the U.S., much as markets for wind power did at the end of 2006, when those credits expired for several months. During that period, the wind market simply flatlined. According to research by Navigant Consulting, more than 100,000 jobs within the solar and wind industry are in jeopardy, if the same thing happens again.
The problem is that Congress, in its infinite wisdom, seems to have an appetite to extend tax credits for only two years. That's not long enough to do the long-term planning that any emerging industry needs to scale up. Critics of clean energy like to point out that without subsidies and regulation, clean-energy sources would never be getting a foothold in the market. But that misses an important and critical point: all energy technologies are subsidized - some to the tune of billions of dollars a year. What would happen to oil and gas prices if those industries had to do away with federal subsidies and tax credits (not to mention the costs of fighting wars in oil-rich countries).
The five trends we cover in this year's Trends report cover electric cars (how all of the action seems to be from smaller players, not the major automotive companies); sustainable cities (the emergence of new, fossil-fuel, carbon-neutral cities - in the Middle East, of all places); wind (how the U.S. market is being driven by foreign companies); geothermal energy (it is experiencing a global renaissance, particularly as large, utility-scale projects); and shipping (the new push to create cleaner oceangoing transport, including putting sails on freighters).
You can download the free report here.