2012 Cleantech Investing Forecast Cloudy

What’s the forecast for cleantech investing in 2012? Cloudy with a chance of decline, according a new set of predictions from Kachan & Co., a cleantech analysis and consulting firm, though predictions for the coming year do include some bright spots as well, particularly in the realms of wave power and industrial wastewater.

First, the bad news: the amount of venture capital entering clean technology companies is expected to decline in 2012 for the first time since the global economic downturn of 2008. After three successive years of growth, the market for cleantech investing is now likely to flag due to increased difficulties in fundraising for investors themselves, waning policy support in the developed world and negative sentiment from the past two quarters (including the general fall-out from the high-profile bankruptcy of Solyndra).

Cleantech predictions investment infographic

image via Kachan & Co.

However, other factors are expected to help mitigate this decline, including China’s desire to manage its economic turbulence, a forecasted rise in oil prices and global corporations’ strengthened role in cleantech, as well as continued solar innovation and persistence of the fundamental drivers of cleantech.

Other bright spots for cleantech investing in the coming year include a rising interest in marine power, i.e., wave, tidal and ocean thermal energy. While  2012 will not be the year that marine power becomes cost-competitive with coal, or even nearly, we can expect to see increased private and corporate funding.  (This prediction is based on increased numbers of marine power trials around the world, as well as recent strategic investments by large companies like Siemens.)

We can also expect to see increased water and agricultural sector activity as industrial wastewater drives water investments, based on a growing understanding of the potential for produced water from the oil and gas industry to be put to work in growing crops.

Susan DeFreitas has covered all manner of green technology for EarthTechling since 2009. She is a graduate of Prescott College for the Liberal Arts and the Environment, and has a background in marketing green businesses. Her work on green living has been featured in Yes! Magazine, the Utne Reader and Natural Home.

    • Debby Lloyd

      Not sure I agree with this entirely – cleantech goes beyond wind, water & sun…u00a0Interesting that intelligent transport doesn’t feature, nor smart grid – all of those dot.green areas being driven by dot.com technologies and investors… and especially given the recent BHAG from the Government around smart cities and “no petrol or diesel cars in citiies by 2030”?u00a0 Something’s going to have to drive that ambition – albeit its a loft one and from where I’m sitting I’m seeing lots of investment interest in that sector.u00a0