Just months ago, gas cost more than Chanel No. 5 and the presidential candidates loved every green technology they could name. But the Great Economic Crisis of 2008 took the steam out of clean.
T. Boone Pickens, who bet $58 million on wind power said last week that plummeting oil prices and challenging credit markets will “put off” the boom. The NEX, an index of clean-tech stocks, is down twice as much as the Dow since January, and several American utilities have slashed near-term investments in clean energy.
Florida Power and Light for example, reduced by 400 megawatts its investment in wind power for next year, while North Carolina’s Duke Energy slashed $50 million from next year’s solar power budget.
But long term prospects remain excellent for green tech. The world still needs energy, argues Steve Sawyer, head of the Global Wind Energy Council in last week’s Economist. And investing in fossil fuel-derived sources carries risks of its own, as recent oil price gyrations have demonstrated.
Meanwhile, the Big O argues persuasively that green tech addresses global warming while creating jobs that can’t be shipped overseas (someone has to unwind the rubber bands attached to the wind farm propellers, right?). Even Congress gave green tech the green light by adding renewable energy subsidies to last month’s bailout.
Green companies with solid business plans, especially those likely to generate revenue in the short term, are raising capital even now. EDF Nouvelles, a European renewable-energy firm, just raised $734 million in a secondary share issue. GridPoint, a US start-up focusing on improving electrical grid efficiency, just raised $120 million. And wind turbine and solar panel manufacturers still have long waiting-lists
Which is good because long term, global warming is a bigger problem than global economic cooling.