Clean Energy Sector "Poised for Explosive Growth"

America’s emerging clean energy sector grew nearly two and a half times faster than the rest of the economy between 1998 and 2007, and is poised for “explosive growth” according to a new report from the Pew Charitable Trust.

Jobs in the US clean energy economy grew by 9.1%, while traditional jobs grew by only 3.7% during the ten-year period of the study.

This impressive expansion also occurred long before there was substantial government support for the sector. A good example is a comparison with the conventional energy sector including oil, gas and coal.

Over the last ten years, fossil fuels enjoyed substantial market advantages over renewables. And while renewables currently supply only 7% of US energy, the sector already employs half as many people as traditional energy.

“The clean energy economy is poised for explosive growth,” said Lori Grange, interim deputy director of the Pew Center on the States. “These jobs are driving economic growth and environmental sustainability at a time when America needs both. There is a potential competitive advantage for federal and state policy leaders who act now to spur jobs, businesses and investments in the clean energy sector.”

Political leaders know this very well and are providing substantial funding and incentives as part of green energy and stimulus spending.

The recent commitment by the Obama Administration to inject more than $200 billion towards a “clean energy future” illustrates the remarkable shift in public policy that will directly benefit the renewable sector.

State governments competing for a slice of the growing green pie are ponying up cash and incentives to attract investors and employment.

• 46 states now have tax incentive programs to encourage renewable energy use or conservation.
• 29 states now have mandatory requirements for utilities to provide renewable energy.
• 19 states have energy efficiency standards for energy generation, transmission and use.
• 14 states now have enhanced vehicle emissions standards, and national standards are on the way.

Th big winners so far include Texas with 55,000 clean energy jobs in 2007, and California with more than 125,000.

Green venture capital has also been ballooning in the last five years. Cumulative private investments in this sector reached $1 billion by 2005 and grew to more than $12.6 billion by 2008.

In 2008 alone, investors poured $5.9 billion into the US clean energy economy - a 48% increase over 2007. That number represents an incredible 15% of all global venture capital investment last year.

Drilling down further, California again emerges as a star. The Golden State alone attracted a whopping $6.5 billion in green venture capital between 2006 and 2008.

While the renewable sector has admittedly been clobbered by the recession, experts predict it will rebound faster than the rest of the economy.

"[Cleantech] is faring better than the rest of the venture capital sectors -- that's driven by the sense that the government policy thinking has changed radically with the new administration," said David Prend, a NVCA director and managing general partner at the venture capital firm RockPort Capital Partners.

The Pew report did not make specific predictions for future jobs and investment, however industry observers are clearly upbeat.

“In 2008, there was a quantum leap in talent, resources and institutional appetite for clean technologies. Now, more than ever, clean technologies represent the biggest opportunities for job and wealth creation,” said Nicholas Parker, executive chairman of the Cleantech Group

For the record, the report defines the "clean-energy economy" as 16 seperate sectors, including: energy generation, energy transmission, energy storage, energy efficiency, transportation, manufacturing/industrial, construction, agriculture, energy production, materials, air and environment, recycling and waste, water and wastewater, business services, finance/investment, and research and advocacy. The authors counted only companies and jobs on the supply side, not the demand side.

"The numbers are probably on the conservative side," conceded Kil Huh, the report's lead researcher.