Myths and realities of clean technologies

Don’t be fooled by high-profile setbacks. The cleantech sector is gaining steam—with less and less regulatory assistance.

The world is on the cusp of a resource revolution. As our colleagues Stefan Heck and Matt Rogers argue,1 advances in information technology, nanotechnology, materials science, and biology will radically increase the productivity of resources. The result will be a new industrial revolution that will enable strong economic growth, at a much lower environmental cost than in the past, thanks to the broad deployment of better, cleaner technologies and the development of more appropriate business models. But how do we reconcile this bold and heartening prediction with recent challenges experienced by cleantech, the general term for products and processes that improve environmental performance in the construction, transport, energy, water, and waste industries? Over the past couple of years, many cleantech equity indexes have performed poorly; in January 2014, the American news program 60 Minutes ran a highly critical segment on the subject. The former chief investment officer of California’s largest public pension fund complained in 2013 that its cleantech investments had not experienced the J-curve: losses followed by steep gains. It’s been “an L-curve, for ‘lose,’” he said.

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