Back on September 9, John Podesta's Center for American Progress released a study called Green Recovery, which promised two million new jobs from a $100 billion investment over two years. That day was also my birthday, so my attention was elsewhere. But nearly two months later in the wake of the financial meltdown, taking a second look at the report seems worthwhile, since now more than ever, a road to recovery for the United States and the world could very well be paved with green bricks. Conversely, it could also be a story of "low carbon prosperity" that sounds good, but ends up dead on arrival. The landscape has changed greatly since September 9. To use one last Wizard of Oz allusion – we are no longer in Kansas. Credit has dried up, global stock markets are in chaos, unemployment is spiking and consumer confidence is at record lows. As a result, does this now put the basic assumptions in the Podesta report in question? ($50 billion in tax credits, or half of the proposed $100 billion, for example, would seem a non-starter today). More importantly, even if the assumptions are unchanged, will the perceived cost of carbon policy at a time of economic instability suck the political will out of Capitol Hill, a place over the last three decades renowned for monumental cowardice in the face of monumental challenge. The stakes couldn't be higher, especially on the eve of an Obama presidency and Podesta heading the transition team. It would be great for the Center to produce an update to their report, taking these new factors into account. But until that happens, some prominent voices in October continued to build a case for this notion of a Green Recovery as a message/vision worth rallying around.  

Deutsche Bank, in its Investing in Climate Change 2009: Necessity and Opportunity in Turbulent Times, argued that the economic turmoil of the past month sets the stage for a one-time windfall:

We believe that, when combined with energy security, climate change policies will play a role in government efforts to stimulate their economies in 2009. Governments now have an historic opportunity to define long-term regulatory frameworks to encourage private investment in climate change initiatives. Additional opportunity exists for governments to boost their economies by funding infrastructure projects that will serve to foster energy independence and climate-proof their economies.

As a result, the debate around climate change has started to shift away from issues of cost and risk toward the question of how to capitalize on investment strategies that span a vast array of asset classes and industries.

Similarly, Goldman Sachs GS Sustain weighed in, citing a "warming investment climate" for sustainability, and an increasingly clear rationale for corporations to view low carbon action as a key business driver: 

Going forward, we expect the importance of climate-change performance to rise further and extend to an increasing number of sectors where the direct costs and benefits of companies’ different strategies may currently be less quantifiable but will, in our view, become increasingly important aspects of their ability to achieve and sustain industry leadership. 

Finally, economist Nicholas Stern has also provided a valuable perspective, noting that the right policies will offer a globally sustainable model for growth:

Let us grow out of this recession in a way that both reduces risks for our planet and sparks off a wave of new investment which will create a more secure, cleaner and more attractive economy for all of us. And in so doing, we shall demonstrate for all, particularly the developing world, that low-carbon growth is not only possible, but that it can also be a productive and efficient route to overcome world poverty.

It all sounds good. Public works programs, a la the New Deal, to make smart upgrades to the outdated grid and public transportation infrastructure, jobs that can't be exported coming from installation of solar panels and other clean energy solutions, cost curves from McKinsey that provide a roadmap of affordable carbon abatement measures including significant savings from energy efficiency, etc.  

But there will also be those that counter with a picture of inefficacy and a price tag that's too high, as we caught a glimpse of during Senate infighting in June over possible climate policy. Already, new messaging against aggressive climate policy is emerging. A recent letter to a Florida paper offered a glimpse of the opposing camp and its messaging, criticizing Gov. Crist's recent recommendations on climate, and warning of a "carbon police state". 

What's so exciting right now from a positioning and messaging point of view, is that the global economic crisis provides the first real opportunity for the clean energy industry to fundamentally pivot away from the politically and emotionally charged topics of "global warming" and "green" (and their polarizing, Al Gore/treehugger affiliation, which turns off a large part of the population) and own outright the promise of growth, recovery and prosperity, issues that everyone can relate to and support.  

The rubber is about to hit the road. The next three to six months offer a chance in the United States for elected officials to be heroes or hucksters. It is no secret that the oil and coal industries have outspent the renewables industry by tens of millions of dollars in the past two years in campaign contributions, so it won't be surprising to see some of our politicians fold. What's needed is a concerted effort on the part of the broader clean energy community – the Apollo Alliance, Cleantech and Green Business for Obama, Environmental Entrepreneurs, Change to Win, USCAP, Evangelical Climate Initiative, ClimateWorks Foundation, US Conference of Mayors, etc – to unite and make sure that the message that is delivered in Washington, D.C. and state capitals is this – climate change notwithstanding, the clean energy economy is a legitimate and feasible road to recovery. It appears that two additional stimulus packages are set to emerge from DC in the near term, one lame duck and one post inauguration. The industry achieved its biggest win so far in the $700 billion stimulus package, with an 8-year extension of the investment tax credit for solar, and it is possible clean energy will benefit from the two upcoming packages as well. But that is just a start, and our thinking needs to be more expansive and inclusive. It's the Recovery, stupid.

The distributed and micro nature of cleantech means that it has an important role to play in helping the world's poor, especially in the areas of energy and water. In fact, cleantech in the developing world is increasingly seen as an economic opportunity for local communities (for example, solar water heaters in China). Perhaps just as important, the introduction of clean energy into the developing world, if successful, could have a hugely ameliorating effect on global climate change as those economies expand, people are pulled out of poverty and consumption increases. Solutions for the poor are often lower tech, but higher inspiration. Take the group of six African students who came up with a method of using the sun's energy to take humidity from the air and turn it into potable water. Or the compost toilet that came out of the Interprofessional Projects Program (IPRO) series appropriately called Developing Extremely Affordable Products for the Rural Poor of the World. More recently, the Sahara Forest Project was announced, with the goal of using concentrated solar power and seawater greenhouses to produce clean energy and water in Africa on a much greater scale. Other great examples that are also equally inspiring have been built around small scale wind, solar cooking, micro hydro, PV-powered water distillation and pumping, biogas, rainwater harvesting, etc  My closest association with the growing momentum in this area is my work with clean-emission cookstove company Envirofit, which is trying to end indoor air pollution, a silent and largely unknown killer in the developing world that results from the burning of dirty cooking and heating fuel in cramped quarters. Envirofit, although a non-profit, is taking a business approach to the problem. Traditionally, the failed top-down philanthropic model was built on spending money to buy clean-burning stoves, giving them away and hoping they didn't break. Instead, Envirofit is letting the market lead from the ground up – its building a sales, distribution, financing and service infrastructure around the stoves so that locals, starting in India, can actually own the process, as opposed to simply being recipients of charity. This market approach is gaining ground across the donor and NGO world, and initial results from the Envirofit approach in India are very promising. Dr. E.F. Schumacher was one of the earliest proponents of what he called "intermediate technology", a belief that there are cheaper, more appropriate ways of addressing problems in the developing world other than the capital- and resource-intensive ways of the West. Although motivated by different reasons, more and more for-profit companies are working to improve the development of clean water and energy technology in poor countries. Some companies, like Coke and others in the food and beverage industry, are simply involved because they have no choice (they only remain in business if there is clean water). At the international level, the World Bank, after signing on to support the Clean Energy for Development Investment Framework, announced it would raise a $5 billion cleantech fund for the developing world earlier this year, and Japan has also committed to $10 billion for its Cool Earth Partnership. Some influential private funding organizations are working increasingly in this area as well, including the Acumen Fund, Bill & Melinda Gates Foundation, Light up the World Foundation and Shell Foundation. If you are looking to make an individual contribution, consider INVEST, Green Microfinance, Practical Action, Global Green and Global Giving.

Ultimately its going to have to be a combination of private sector innovation and capital, and public sector support to bring the might of cleantech to the poor in places that lack basic infrastructure and are often remotely situated. Of course, poverty is not the exclusive domain of the developing world. Action is also being taken in the United States and other richer countries to bring clean energy to the poor. 

Here's a list of 12 technologies and initiatives with potential to help solve the clean energy and water conundrum for the world's poor. Additional programs focused on the use of solar to alleviate poverty and health issues can be found here and here. 

LifeStraw – Lighting Africa – Watel – Envirofit – Sahara Forest Project – Warm Winter Challenge –  World Clean Energy Awards – Global Network on Energy for Sustainable Development – Grameen Shakti – Architecture for Humanity – SELCO – REN21 

This post is my contribution to Blog Action Day.

A newly released report says Washington and Oregon states can assume leadership in five cleantech sectors with the potential to generate up to 63,000 direct jobs by 2025 (up from 11,000 today), and outlines what it says is a plan to be the first US region to achieve 75% of its electricity from carbon-free sources by 2025. By the report's own admission, there is nothing particularly new about the five presumptive areas of strength (PV manufacturing, wind power development, green building design, smart grid and bioenergy), and the 75% figure is somewhat misleading, given that the two states already get 62% of their electricity from clean hydro and renewable sources (The hydro, of course, has nothing to do with anything we've done, but merely the luck of living in a place with lots of mountains and rivers). That said, the report is a very helpful first step for a region that has struggled mightily to get its act together and to find a clear identity and focus amid the clean technology boom in the Bay Area and Boston. It points to a number of signals that point to the potential for future leadership – home to big PV plants from REC and Solar World, home to big wind developments, etc. The report, produced by Climate Solutions and CleanEdge, also proposes a top-level series of 10 actions for the Northwest to achieve its role as a cleantech leader. The top 10 list: 1. put a price on carbon, 2. increase Washington RPS to 25 percent by 2025, 3. implement low carbon fuel standards, 4. pass aggressive green building codes, 5. foster regional cooperation, 6. ensure public funding for clean technology via PERS investments and through targeted clean-tech funds, 7. implement effective tax credits for renewables development, 8. deploy cleantech workforce development programs, 9. establish government procurement policies for cleantech products and services and 10. build out regional smart grids and 21^st century transmission backbone. 

Oh, is that all? Not to mention that how we achieve all of that in 17 years is still unclear. But it is clear from the report that the proof of Northwest leadership is building in drips rather than torrents. It points out several major weaknesses, including some that make the top 10 actions look easy:

• Absence of a leading university technology incubator like MIT or Stanford
• Technology investment climate that pales in comparison to Silicon Valley and Boston
• Small size of public clean-energy support funds compared to other state leaders
• Aging electric utility grid system challenged to carry increasing distributed and variable energy sources such as wind, wave and solar
• Small regional market served by cheap hydro, compared to densely populated markets with high-power prices in other cleantech centers

Another issue that is particularly troubling to me: the lack of synergy between Oregon and Washington. They are working very much in silos, despite the best efforts of Climate Solutions. The one bright spot is the Western Climate Initiative, so that's hopefully something to build on. And the absence so far of any attempt by Oregon and

Washington's Fortune 500 companies to be advocates for the region and to work together to bring their influence to bare.

Nevertheless, the report is rather optimistic in its job creation forecasts, with an acclerated forecast of 63,000. The less aggressive target is 40,000. Nearly two thirds of the growth is expected to come from the PV and bioenergy sectors.

Disclosure: I was one of the 50+ people interviewed for the report and I'm a member of the Climate Solutions Business Leaders for Climate Action group. I've written about many of these obstacles and opportunities here in the past.

Nice to see Seattle and Portland starting to attract and create some quality cleantech, clean energy events. It starts next week with Oregon's Green Advantage: Opportunities for Entrepreneurs, which will showcase local companies such as PV Powered, Plas2Fuel, Greenlite Motors, Powermand, Shorepower and UV Cleaning (as well as some leading NW multinationals and investors). In addition, there is ACORE's Renewable Energy Finance Forum (REFF) – West, scheduled for Seattle in October, which promises to be a highlight of the year and already has a solid lineup of speakers. Also, because of the work being done in the region around algal biodiesel by such firms at Bionavitas and Bioalgene, the 2008 Algal Biomass Summit will also be taking place in Seattle in October. Stay tuned as well for the kick-off of the Pacific Northwest chapter of the Renewable Energy Business Network (REBN) in September (you can click on Chapters to find the PNW link and sign up for updates).

Cleantech is fun because it touches so much, although technically in the case of wireless there is no touching going on (alas). Wireless is particularly effective when applied to more efficient use of energy, water and other resources. I first took notice of the growing wireless/cleantech ecosystem when I learned that Vulcan Capital (my neighbor in Seattle) had invested in a company called Ember. Other companies in the space, many of which use wireless for various sensing applications that monitor and automate demand of  energy and water use for utilities, buildings and facilities, have attracted investment including SynapSense, Eka Systems, Accuwater and Powercast to name but a few. Of course major players such as Honeywell and Siemens (through spin-off EnOcean) are also heavily involved. A newcomer called On-Ramp Wireless is claiming orders of magnitude greater capacity and range when compared to other systems based on the Zigbee standard (a full list of companies involved with Zigbee can be seen here). Wayne Manges, a leading wireless advocate with the Oak Ridge National Lab, put the whole "green wireless" opportunity into perspective in an interview with Green Mountain Engineering. Mr. Manges noted: "The 'holy grail,' of course, is low-cost ubiquitous sensors. With improvements in process visibility users get better energy efficiency, materials use, quality control, inventory tracking and reduced waste." He predicted that wireless sensing will spark "a tidal wave of change" to industry and culture. Pacific Northwest National Labs is also doing work in this area, focused more on managing HVAC systems wirelessly, something my client Optimum Energy is working on as well. The Department of Energy (DOE) has largely been responsible for creating the industry for wireless in energy management, in part through its guaranteed loan program. One of the keys, according to Manges and others, to really blowing out the wireless cleantech segment is promulgating standards that take away the hesitation of end-users, many of whom are wary of investing without protocols that can talk to each other. ISA 100 intends to do that, and expects its first standard to come out in December 2008. Suffice it to say that cleantech is more than just the sexy, shiny (and high risk) renewable energy gadgetry. It is also the more mundane, but equally if not more impactful, world of wireless controls and automation and their importance in delivering on the promise of the smart grid. Even so, there is also cutting edge work being done to achieve Nikola Tesla's dream of wireless transmission of energy, including experimentation with magnetic resonance by Marin Soljacic at MIT, which might eventually have even bigger ramifications. This will continue to be a fun space to watch.

Hundreds of leaders from business, policy and NGOs in the same room for two days, naturally some interesting things will emerge. Below is a quick sketch of trends and comments from the just wrapped Fortune Brainstorm Green that I thought of particular note:

• The media "needs to get off cars and on to buildings" – Autodesk executive chairman Carol Bartz on the fact that the issue of buildings sucking energy, material and water is still not getting the attention it deserves. The numbers back her up. Conversely, it was noted by others in the green building space like Hycrete and Serious Materials that after a two decade hiatus, venture funding has found its way back to building in the past 2 years.
• A new version of LEED is set for unveil at Greenbuild in Boston and will be a "quantum leap" – head of USGBC Rick Fedrizzi
• Seems to be growing unease, and even skepticism, that cap and trade is going to be as easy at many thought. 2011 was heard repeatedly as a possible timeframe for legislation. Will a nascent business consensus fray into a mess? Are the economics fully understood to push forward aggressively? Is the Hill ready? Anecdotally at least, the answer is still clearly in the balance. One interesting alternative presented was Cap and Dividend.
• Like building, energy efficiency is still struggling to get more than a lot of lip service. Is recession the catalyst for cracking that nut? It was mentioned as a possibility.
• Hybrids and small cars are the fastest growing segment of US automotive market, according to Beth Lowery of GM. "The price of fuel is driving behavior," she said.
• "Living building" that taps into biomimicry is going mainstream. HOK – the giant architecture and design firm is starting to position itself as "bio-inspired", according to Janine Benyus, the founder of the Biomimicry Guild. Benyus' group is also looking to launch Asknature.org – a cool idea that allows anyone to query a database with questions about how nature addresses specific issues.
• Coke's environmental guru Jeff Seabright said look for something soon about consumer-facing information about "water used" in the company's products. It may not be on-package information, but something is coming. This would be welcome, since embedded water in consumer products is still very opaque to the consumer (for example, according to Dow Chemicals' Scott Noesen, it takes 2,000 liters of water to make a McDonald's hamburger if you do the whole-cost analysis.) There is nutritional information, now carbon labeling information has appeared, and water is the logical next step. Let's hope it happens.
• Vinod Khosla was the most provocative in my opinion during a 1:1 with Fortune's Adam Lashinsky. Highlights include:
  • Next generation batteries are not on a rapidly declining cost curve and require a quantum jump with a high probability of failure
  • The "Prius is more greenwash than green"
  • Technology for clean energy will only succeed if it passes the Chindia price test. If it's affordable in China and India then it has a shot.
  • Carbon emissions from all-electric cars are 3x more than that of cars powered by cellulosic ethanol.
• The highest correlation in the movement of solar stocks is the price of oil (not the price of natural gas as would be expected) – David Edwards, analyst at Morgan Stanley
• Both Monsanto CEO Hugh Grant and Khosla cited the same statistics placing biofuel as the fourth leading cause for the spike in global grain prices. The top three – rise in oil prices, drought in Australia and change in eating habits in developing countries like China (to more meat). I found one paper on Khosla's site about Fuel vs. Food, but it didn't appear to include the above list. Anyone know where it comes from?
• When Fortune's Marc Gunther asked a panel of Xerox, GM, SC Johnson and Dupont executives what grade corporate America should get in addressing environmental challenges (10 being the best grade), all of them said "1″, with the exception of GM's Lowery, who gave a "2″ because of innovation happening around new technologies. If you want to actually score a company, you can thanks to the CEO of Stonyfield Farm Gary Hirshberg, who has created an online corporate scorecard at Climatecounts.org

The Clean Technology and Sustainable Industries Organization (CTSI) organized a "DC Policy Tour for Clean Technology" this month, taking 50 cleantech industry players (representing cleaner coal, solar, wind, nuclear, hydrogen, demand response, water, biomass and fuel cells, plus investors) on a Congressional walk-about. I spoke with Patti Glaza, executive director and CEO, to get her take on the day and the outcomes. After a total of 45 meetings with elected officials from more than 20 states, Ms. Glaza reported that renewable energy tax credit extensions will happen, but only for one year (longer term extensions will most likely come in the next administration) and that climate change legislation will be considered in June, although again it would be surprising to see anything being signed into law prior to the next administration. She also said that both the House and Senate have requested a significant increase in the Dept. of Energy (DOE) budget from what was in the department's original request, and that more funding should be available than last year. Ms. Glaza added, however, that it was unlikely that the Advance Research Projects Energy (ARPA-E) program that was approved in the America Competes Act last year will get off the ground.  More details from the day can be gleaned from the Q&A below, including tips from Ms. Glaza for how companies, even start-ups, can work with their elected officials to make a bigger difference at the Federal level. 

Q: Any humorous moments from the tour?

A: We learned to never let a tour member tell a Republican official that we should pay for the renewable energy tax extensions with funding for the Iraq war.

Q: Who did you visit and get traction with?

A: The primary focus of the meetings was with members of the Appropriations and Ways & Means Committees as Congress is currently finalizing agency budgets and funding programs slated for this fiscal year. We also targeted the Science & Technology, Small Business, Energy Independence & Global Warming, and Energy & Commerce committees and subcommittees, in addition to several executive-level meetings at the DOE. The highlight was Sen. Byron Dorgan (ND) who leads the Democratic Policy Committee and sits on key committees including Appropriations; Commerce, Science & Transportation, and Committee on Energy & Natural Resources. Sen. Dorgan and his staff took a significant amount of time with our group and showed real interest and knowledge of the challenges the sector faces.    There are a lot of champions on the Hill and we need help in reaching out to all of them. Congressmen that took the time to meet with the tour directly included: Tom Udall, Vito Fossella, Dale Kildee, Phil English, Jay Inslee, and Dorgan. Additional offices showing high-level support included: Cantwell, Clinton, McNerney, Barrow, Capuano, and Candace Miller. 

Q: It seems there is a scarcity of coordinated government relations work being done on the part of the cleantech industry. Is that an accurate read on the situation?

A: My initial assessment is that as an industry or sector, clean technology has not had strong representation in Washington DC. Inslee made the comment that he has been waiting for a group like CTSI and is glad we have started our efforts. That being said, there is strong government relations work being done for specific clean technology segments, solar, wind, and biofuels being examples. The role CTSI is trying to fill is to advocate for policies and programs that address the complexity and interrelated issues of energy, water, and the environment. Renewable energy needs smart grid needs cleaner base load generation needs distributed generation support needs water management/reduction, etc.

It was obvious from our meetings that the Hill is extremely receptive to a sector they see as providing new jobs, energy security/independence, and increasing the US global competitiveness. Regardless of the group organizing, a broad technology platform is essential. Industry has to be seen as working together on solving the bigger issues (growing energy demand, climate change, etc.) and not just advocating for specific industry segments in isolation.    

Q: How can companies make a difference on the national level?

A: I see three immediate ways that organizations can make a difference:

- Companies need to take the time to educate their local representatives on their companies, technologies, and how they are working to solve the larger issues.

- Executives need to participate in Washington DC based meetings to emphasize the important role policy and regulation play in developing the clean technology sector. Nothing grabs attention like a company telling their representative that they expect to start laying off workers in June/July because the renewable tax credits haven't been extended.

- Overall, companies need to recognize that policy isn't just for the big players. Policy and regulations have and will have a significant impact on the rate of development and adoption of clean technologies, and growing technology companies need to be at the table when those policies and regulations are being created. Yes, resources are limited. Yes, policy is complicated and difficult to understand. Thus the role of policy and trade organizations.

Cleantech events abound these days, but the organizers of COPENMIND are taking a novel approach – creating a giant shopping mall for the most cutting edge cleantech ideas coming out of academia. Besides having a clever name, COPENMIND will hopefully drive more rapid technology transfer from leading research institutes to the market. In September, the event in Copenhagen will bring together 200 top-notch universities from around the world to provide potential business partners with an inside look at what's next in cleantech, according to event founder Steffen Moldow. Joining the scientists will be thousands of corporations, as well as investors and leading public figures. It's no secret that universities are poor marketers, so providing a venue that allows them to get their IP in front of the people who might fund commercialization is key to a more rapid development of the cleantech sector. Pre-event match-making will kick off on May 1 through COPENMIND's website.  

Besides technology transfer, the event will also focus on sponsored research and recruitment. "The event will help solve the issues that are discussed at Davos," Moldow told me, referring to the World Economic Forum. Cleantech areas of focus include: climate change & air pollution, energy, water, waste & recycling and agriculture & land.    

The event will also provide a nice prelude to COP15, the highest body of the UN Climate Change Convention, which is set to take place in Copenhagen in 2009 and will set global climate change direction from 2012.

Software as a service (SaaS) has already been declared by Forbes as a recession-averse part of the tech sector, citing the fact that it weathered an earlier downturn in 2000-2002. Cleantech barely existed as a category in 2002, so we don't have historical performance to go on. Would consumers and businesses continue to spend on green? Would investment remain hot? Would many of the positive environmental gains made in the past several years stall or even reverse?

Those are some of the questions posed informally to companies that I work with. The conclusion? Cleantech, like nearly every other sector, would take a hit, particularly the companies still in need of funding, but it would also find distinct opportunities – in particular efficiency plays (some are already calling 2008 the year of energy efficiency given that energy costs are at record-breaking highs and that the most significant energy-efficiency legislation in three decades was recently enacted.

If we think back to the dot-com shakeout, while the losses were staggering for many, the collapse separated the wheat from the chaff. Current blue-chips like Amazon, Ebay and Expedia all proved that they were more than just clever ideas and marketing gimmicks and used a tough business environment to propel themselves. If a recession hits, it is likely to have a similar outcome for cleantech, a market ripe for a shakeout.  Who will be the winners and the losers? Here are some comments to consider:

From David Rosenberg, CEO of Hycrete, whose product makes concrete waterproof in an environmentally-friendly, cost-saving way:

"The answer is yes and no. All of construction is effected by a recession and we are already starting to see some projects getting delayed and cancelled and financing getting tighter. On the positive side, a slow down often allows greater time to investigate and improve construction practices – like green.  On the negative side, where budgets are slimmer and profits are less, greater upfront costs associated with green construction get harder to justify – of course this is not a Hycrete problem as we are better, faster, and less expensive.".

From Matt Heinz, senior director of marketing at Verdiem, a developer of power management software for PC networks: 

"The polar ice caps don't care too much about recessions. Less flippantly, I think in the not-too-distant future, sustainability will be a fundamental, 'table stakes' part of doing business for global enterprises. Reducing the impact companies have on the world around them will soon become non-negotiable, and a requirement for doing business with customers (commercial and consumer) that expect them to act responsibly.

"Today, that isn't the case – at least not yet. While several businesses have blazed a trail with significant corporate responsibility and sustainability initiatives, not enough of those efforts have paid off – either in increased sales or decreased operational costs. Unless such initiatives demonstrate a consistent ability to provide value to the organization, they'll be close to the chopping block in leaner times.

"That said, technologies are emerging that allow companies to 'go green' and save green at the same time. And if this kind of savings is both real and verifiable, it's the kind of thing that will get prioritized higher in lean times."

From CEO Michael Ford of Choose Renewables, a source for consumer information and products on renewable energy content and commerce: 

"It's tough to make a broad projection regarding cleantech because there are so many facets. In general I think the entire space will perform better than most other segments – but I doubt it's entirely recession proof.  I think energy efficiency / fuel efficiency will actually see a significant bump from recessionary times. And maybe even the biofuels movement, though I personally think the overall philosophy around ethanol in particular is questionable. However, I think some of the more expensive pure play renewables (solar, small scale wind, fuels cells, hydrogen, etc...) will suffer a bit – but still grow. I think big wind is going to keep going no matter what – unless Congress continues to screw up with the PTC."

Michael Meehan, CEO of Carbonetworks, software platform that helps companies create effective carbon emissions strategies: 

"Cleantech as a whole will definitely feel the crunch, but it's a two-sided coin – how clients' requirements will likely change, and what will happen to vendors as a result.

"The market is still immature and spans a lot of industries. 'Niche-fication' (as Will put it in his blog) is only starting to occur. Especially in technology markets, niches can provide some insurance against recessive markets because the need for the service/technology is clearly defined and the incumbents are often well established. Cleantech is still a bit nebulous and a recession will have a direct effect on many areas of the cleantech spectrum: funding sources for startups, increased cost of outsourced services (e.g., int'l support, sales), and decreased demand for point products. That's one side of the coin: increased competition, consolidation, and likely a more protectionist industry as the US/CAN dollar weakens against the Euro, inhibiting growth in an emerging market.

"The other side of the coin (the clients) will hasten this process as their expectations and requirements change out of necessity. Faced with increased demands on potentially shrinking budgets, companies will be forced to place more stringent diligence on technology investments, and cleantech is no exception. But there's a somewhat unique opportunity for cleantech in this: the key here for vendors is to increase the focus on cost savings, process efficiencies, or uncovering opportunities that will help lower operational costs for these companies. That's where the defining line will be for successful cleantech vendors and those that simply react to the market as it tightens up. Unlike other supply/demand markets such as manufacturing or distribution, cleantech has an edge because it can become strategic by helping companies be more competitive through improving their bottom line. This of course is our strategy at Carbonetworks, but it is also true of Verdiem, GreatPoint Energy, IT virtualization technologies, and other innovators who help companies do more with less and diversify. That's the other side of the coin: rather than fighting over decreasing market share, successful cleantech companies will instead seek to increase the clients' competitive position through cost reductions and diversification. Recession may be the impetus for this cleantech market shift, but it will be the clients under pressure that will drive it to consolidation. Whether that's good or bad depends on where you sit, but cleantech is definitely not immune to market recession."

It's an unenviable position to have to prioritize the world's problems and solutions. First, there are too many. Second, there is an inter-relatedness to all of the problems that makes it difficult to pinpoint a chief culprit. Increasingly, however, it is clear that one issue trumps them all: energy. Plenty of other smart people have explained this, so I will just quote one – Nobel laureate Richard Smalley, who said "It is impossible to imagine bringing the lower half of the economic ladder of human civilization – about three billion people – up to a modern lifestyle without abundant, lowcost, clean energy". He made a strong case that energy touches everything – disease, water, poverty, terrorism, malnutrition, etc. As you might guess, I'm no Bjorn Lomborn booster. From where I sit he's advocating buying a dinghy to save those stranded on a desert isle when we need to marshal resources for an Armada to save the island's inhabitants... and everyone else. 

 

At any rate, it is encouraging to see a shift in public, business and government urgency that recognizes the energy calculus, some for energy security reasons, others for economic prosperity reasons and still others for climate change reasons. Support, happily, is getting stronger every day. Unhappily, as the Intergovernmental Panel on Climate Change notes, even with drastic action, we are still in big trouble.

 

Yet curiously, from a non-descript building on Lake Union here in Seattle, the Bill and Melinda Gates Foundation – the Fort

Knox of the NGO world with funds north of $30 billion and Warren Buffett's still to come – is so far nearly quiet on the issue of energy. And dare I say that Mr. Gates, a technology revolutionary himself, seems nonplussed that he is missing a revolution that badly needs him.

 

It almost goes without saying that the Foundation is doing incredible work to alleviate suffering of the world's poor. That work must continue and is testament to the size of Bill Gates’ heart and his commitment to activism and witness. But there are two sides to the coin. He is addressing the symptomatic and saving millions of lives, but oddly there is still nothing on the systemic issues surrounding energy that threaten billions. Even odder since technology – Mr. Gates' playground – has a key role to play in reducing poverty through the production of clean, distributed energy. 

 

Gates has clearly thought about energy. He has made two public pronouncements that I could find. One a 2006 interview with Newsweek, in which he stated that he was “already reading some books on energy and the environment… But I will read a lot more two years from now and think whether there's something the foundation should do in those areas,” he said. “The angle I'll have when I'll look at most things is, What about the 4 billion poorest people? What about energy and environmental issues for them?”

 

In November 2007, he added for Rolling Stone: "Between now and 2100, how many people in Africa are going to die of malaria? Just do the numbers. Helping them avoid an eleven-inch rise in the water in 2100, we could do it and we should do it, we will do it. But in terms of relative priorities, if you want to help the poor, this is not the issue to be focused on."  For a genius who started one of the most successful companies in human history, Gates appears to be unwilling to fully accept that energy affects the global commons, not discriminating based on income. While he's reading up on the issues, China put 90,000 megawatts of coal-fired power online in 2006 alone (about the equivalent of two Californias in capacity). All dirty coal, some of which finds its way to our lungs here in the Pacific Northwest. In Beijing last week for the Cleantech Forum, the Chinese government's cleantech guy, Shi Dinghuan, said that even by 2050, coal would still account for 50% of China's power generation (it's 70% now).  

So far, the Foundation appears to be hedging on energy/climate change. In August, it made its first investment, with a 100 million Euro commitment to Peony Capital Ltd., a Beijing-based company that is using investment in technology to lower GHG emissions through the UN CDM process. But we are all fooling ourselves if we think the market will take care of introducing the technologies to deal with GHG quickly enough to make a dent. Nor is the slow churn of policy going to get us there fast enough. Where Mr. Gates could make a difference, for example, is using his financial leverage to advocate for the creation of a public/private fund that works to provide financing for clean technologies that are already out there but not being implemented because of cost. Coal plants in China are a great example. They don't spend the money on cleaner technology, but if a powerful enough fund was created to drive the cost of the gasification/sequestration technology down and provide favorable financing (or even give it away), things could be greatly accelerated.  

 

It is certainly just a coincidence that the Gates Foundation is moving its offices from the lakeside to higher ground over the next two years. But maybe not. Maybe they are preparing to add their important voices to the campaign against dirty energy – from dry ground as the world's waters continue their eleven foot rise. One only hopes.