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State of Clean Technology
C lean Technology or Cleantech is a catchy term. It signifies clean, renewable and sustainable technology development for the common public good. Adopting it suggests a good cause, purity of purpose and social consciousness. While coal, oil and even natural gas are the most widely used depleting fossil fuels, they all contribute to pollution and global warming. On the other hand, solar and wind are renewable sources of energy and are abundantly available and clean. Many advanced countries are embracing "Green Economy, Clean Technology or Cleantech" as the future energy paradigm.

So when a recent 60 Minutes CBS News Magazine report (01/05/14) portrayed Cleantech as bust -The Cleantech Crash -, it created a firestorm of criticism, suggesting that the report was biased and one-sided. Indeed, the program which was produced in the US, seemed limited in its scope and analysis as it focused on a few failed companies such as the solar panel maker - Solyndra, and the electric-car-battery manufacture -A 123 Systems, Inc. Both of these companies filed for bankruptcies despite receiving millions of dollars in support from the US government. These two failed companies are routinely portrayed as examples of the failure of Cleantech industry by anti-green proponents who may be political, economic or chattering class. It should be noted that the audience for the 60 Minutes CBS News Magazine is largely US-based. The focus on these two failed US companies was useful to CBS as a means to attract a wider audience and to increase its TV ratings since 60 Minutes is a commercial news show that depends on its viewership for profits and survival. But was the report a serious scientific or business inquiry? Considering 60 Minutes prestige as a news magazine, the producers should have done a more comprehensive global inquiry and analysis on the status of the Cleantech movement rather than focusing on a few unsuccessful companies and evaluating the potential for an entire industry on the basis of this very small and biased sample.

So what is the state and the future of the green economy or clean technology?

First, it is important to more broadly define what is encompassed in the terms the green economy, the clean technology or Cleantech. Simply, it is any energy generating or consuming system or entity that generates less pollution or no pollution when compared to an existing energy generating system. Clean technology is largely related to electric generation, distribution and efficient usage; therefore, it is strongly related to power electronics. Future development of the clean technology economy and its wider acceptance by different societies will have a direct impact on the technical developments and business opportunities for power electronics.

There are two aspects of clean technology: renewable power generation and higher power/energy utilization through improved efficiency within a system. So in order to better evaluate current state and future direction of the clean technology, it is necessary to review the various metrics related to global power generation and energy efficiency.

Some readily available data related to various "green" trends includes:

• Power Consumption (related to power generation):

Renewable energy generates less or no pollution compared to fossil fuel-based electric generation. According to International Energy Outlook (IEO), the global energy consumption generated by the renewable energy sources was about 10.7% in 2010. This is expected to increase to 14.9% by 2040. During the same period (2010-2040) energy consumption from fossil fuels will decline from 84% to 78%. (Source article: Our Fossil-Fueled Future: World Energy in 2040 by Michael T. Klare appeared on www.ecowatch.com on 09/10/13).

• Transportation:

Electric and hybrid vehicles generate less pollution than gas (petrol/diesel) power cars. According to the computation and data used from the CNBC and Navigant Research, Inc., the market share held by all types of electric vehicles will increase from 2.65% in 2013 to about 7.0% by 2020.

• Smart Grid:

Smart grid technologies can make the electrical grid operation more efficient. According to Navigant Research, Inc., the market for smart grid technologies will reach $73 billion in annual revenue by the end of 2020, totaling about $461 billion in cumulative revenue from 2013 to 2020.

• Smart Buildings:

This is technology that allows electricity used within a building to be more efficient. According to IDC Corp., global spending on smart buildings will increase from $5.5 billion in 2013 to $18.1 billion by 2017 at about 27.1% CAGR.

• LEDs:

LED light bulbs are replacing existing incandescent and CFL light bulbs at a rapid pace. LEDs use less energy to produce same amount of light or lumens. According to McKinsey & Company, the global LED lighting market will grow from about $16.38 billion in 2013, to $46.11 billion by 2017 at about 30% CAGR.

These are just a few of the metrics for clean technology development and deployment. If one analyses these trends, clean technology cannot be considered as a bust. The growth and adoption will be constrained as the technology will have to deal with issues of competition from the existing, well developed fossil-fuels infrastructure inertia and the changes required in human behavior. Some of the changes required may be quite radical in nature and will take years for widespread acceptance. In addition, since clean technologies are new and initially expensive these may pose their own issues and problems that will require novel and yet untested solutions. But clean technology is definitely not a Bust as portrayed by the 60 Minutes CBS News Magazine report, but in fact is rather gaining momentum and acceptance around the world. One item repeatedly mentioned in the failure of Solyndra and A 123 Systems, Inc. may be true, that the Federal government should not have invested in few select companies, but instead the Federal government should invest in the R&D efforts for development of new technologies.

Vinod Khosla, a Silicon Valley venture capitalist, has funded many clean technology start-ups through his venture company, Khosla Ventures and was interviewed for this segment. He gave a scathing rebuttal to the 60 Minutes CBS News Magazine report, mentioning that the report grossly misrepresented the state of the sustainable energy industry by not checking simple and easily available facts. After analyzing various data points and trends, that seems to be the case. The 60 Minutes CBS News Magazine report "The Cleantech Crash" was a shallow inquiry into an emerging, important and paradigm-shifting technology with long term consequences. In the long term, green economy, green technology, cleantech, or sustainable energy, whatever the name may be, is here to stay and thrive, because there is no other alternative. Fossil fuels are not forever.

 

Provided by Mohan Mankikar,
President, Micro-Tech Consultants

 

 

The views expressed in this article are solely of Mohan Mankikar. They do not represent the views of PSMA. Mohan Mankikar has been a part of the power supply industry for over twenty five years. An active member of the PSMA since its founding, he had been a board member of the PSMA and currently serves on the Advisory Council.

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