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Green energy hopes for Obama bounce

While many small businesses struggle with tight credit and declining sales, one fledgling industry is experiencing a boom in investment and sales growth: renewable energy. Alternative-energy firms are reporting an influx of enquiries and business from a wide range of companies looking to increase their energy efficiency – especially from those that believe the Obama administration will impose stricter regulations requiring them to conserve energy.


President-elect Obama has spoken often of the importance of clean technology, and his federal stimulus package is expected to include plans to improve the alternative-energy infrastructure and beef up energy efficiency in government buildings. In a speech last week, he called for the US to double the production of alternative energy in three years.

Alternative energy “has been the brightest sector in venture capital over the last year,” said Brian Fan, research director at Cleantech Group, an industry trade organisation in San Francisco. “Everyone is thinking it’s going to be a big priority of the incoming administration.”

While the overall volume of venture-capital deals sank last year, investments in clean-technology companies totalled $US8.4 billion ($12.4 billion), up nearly 40 per cent from 2007, according to Cleantech Group. In the third quarter alone, venture capitalists poured $US2.6 billion into clean technology, a quarterly record. In the fourth quarter, they invested $US1.7 billion.

Some venture capitalists believe that clean technology is the next big thing – the innovation that will drive the economy, much as internet-related ventures did a decade ago. “Anytime big innovation comes along, it brings the chance to build big companies,” says Erik Straser, general partner at venture-capital firm Mohr Davidow Ventures in Menlo Park, California, which has investments in several alternative-energy start-ups.