The amount of venture capital invested in "clean tech" -- the raft of technologies that would create a greener economy -- nearly doubled from 2005 to 2006, reaching about $3 billion, according to a study conducted at the University of California at Berkeley. Figures like these have some analysts warning that clean tech is in the throes of a bubble, which could end just like the Internet and real estate booms did -- badly.
Michael DeRosa, managing director of Element Partners, based in Radnor, Pa., doesn't buy that. A venture capitalist specializing in clean-tech investing, he sees significant differences. Unlike many of the dot-coms, clean-tech companies don't always depend on unproven technologies or untested ways of doing business. Instead, they are often offering the latest iterations of technologies, such as solar and wind power, that have existed for decades, he pointed out at a recent Wharton conference called "Winners and Losers in Green Technologies," sponsored by the William & Phyllis Mack Center for Technological Innovation. And unlike rising real estate prices, which were fueled by low interest rates and lax lending standards, the value of clean-tech firms isn't supported by factors that could disappear quickly. Rather, it's driven by forces -- high energy prices and global warming -- that could endure for decades.
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