The Greentech Revolution is Here!

After two decades the green technology sector is taking off

Green technology started in earnest in 2001. Twenty years later the greentech revolution seems to be establishing itself. Some of the early technologies are maturing and the sector is in its high growth phase. Green and sustainable investing is all the rage.

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The modern greentech movement can trace its origins back to 2001, when California Governor Gray Davis declared a state of emergency because of rolling power blackouts. Enron, rightly, got the blame and imploded soon afterwards. In February 2001, Enron's Ken Lay gave the hot seat to Jeff Skillings. Inadvertently, all three men become green Hall of Famers for what happened next. Davis was recalled and replaced by Arnold Schwarzenegger, who subsequently installed one of the most ambitious green programs in the world, while also renewing interest in one-liners from The Terminator.

At the same time, Cypress Semiconductor CEO T.J. Rodgers invested in a struggling outfit called SunPower after nearly everyone else in Silicon Valley, including Cypress' board, turned the company down. SunPower held a successful IPO in 2005 and Rodgers' investment, which got bought by SunPower, turned into $2.5 billion.

From this a slew of pioneering, industry-shaping greentech sectors and companies were born, including fuel cells, solar panels, wind turbines, electric cars, biofuels, waste management systems, demand response services and more. Companies like Bloom Energy, Suntech Power, EnerNoc, Konarka and GreenFuel Technologies became the stuff of Silicon Valley legend. And this was before Tesla arrived at the party.

In 2000, consulting firm Clean Edge, predicted that the market for clean energy-fuel cells, solar panels and turbines would grow from $7 billion in 2000 to over $82 billion in 2010, while the clean vehicle market would go from $2 billion to $48 billion. Only a few paid attention. The prediction turned out to be somewhat close. (In 2007, greentech came to $77.3 billion.) They stated that the market would be $254.5 billion in 2017.

But perhaps the most prescient signal that green technology was taking off occurred when General Electric started sniffing around environmental solutions and announced in February 2002 that it would buy the wind division of bankrupt Enron. From those ashes, GE went onto become one of the biggest wind turbine manufacturers in the world.

Even though Tesla Motors was founded in 2003, by Martin Eberhard and Marc Tarpenning, it did not hit the all-star radar until 2008 when Chairman Elon Musk raised $53 million, with the Google founders and an ex eBay president joining the investor roster. In 2008 Musk became CEO and Tesla’s first vehicle, the Roadster, went into production.

In 2020, Tesla had the highest sales in the plug-in and battery electric passenger car segments, capturing 16% of the plug-in market (which includes plug-in hybrids) and 23% of the battery-electric (purely electric) market. Through Tesla Energy, the company develops and is a major installer of solar photovoltaic energy generation systems in the United States. Tesla Energy is also one of the largest global suppliers of battery energy storage systems, with 3 GWh of battery storage supplied in 2020.

Last year Tesla’s sales totalled $31.5 billion and it is currently valued at $555 billion. Every major car manufacturer in the world is making electric vehicles.

Today greentech or green technology is an umbrella term that describes the use of technology and science to create products and services that are environmentally friendly. Greentech is related to cleantech, which specifically refers to products or services that improve operational performance while also reducing costs, energy consumption, waste, or negative effects on the environment. Over $200 billion a year is invested in greentech. More than $3.5 trillion has been invested in sources like solar and wind power since 2004.

Examples of greentech appear in recycling, clean water, building, energy, clean air, agriculture, corporate greentech and more recently in nature.

Renewables is one of the hottest and highest impact sectors. Traditionally it referenced ‘renewable energy’ - mostly solar and wind power.

Solar PV (photovoltaic) is rapidly becoming an inexpensive, low-carbon technology to harness renewable energy from the Sun. Photovoltaics were initially solely used as a source of electricity for small and medium-sized applications, from the calculator powered by a single solar cell to remote homes powered by an off-grid rooftop.

Commercial concentrated solar power plants were first developed in the 1980's. The current largest photovoltaic power station in the world is the Pavagada Solar Park, Karnataka, India with a generation capacity of 2050 MW.

The International Energy Agency projected in 2014 that under its "high renewables" scenario, by 2050, solar photovoltaics and concentrated solar power would contribute about 16 and 11 percent, respectively, of the worldwide electricity consumption, and solar would be the world's largest source of electricity. Most solar installations would be in China and India. In 2019, solar power provided 2.7% of total worldwide electricity production, growing over 24% from the previous year. As of October 2020, the unsubsidised levelised cost of electricity for utility-scale solar power is around $36/MWh.

Wind technology has been around for ever. Initially powering boats, simple water-pumps and windmills with woven-reed blades for grinding grain. In the late 1800s and early 1900s, small wind-electric generators (wind turbines) were widely used.

The oil shortages of the 1970s changed the energy environment for the world. The oil shortages created an interest in developing ways to use alternative energy sources, such as wind energy, to generate electricity. 

The share of U.S. electricity generation from wind grew from less than 1% in 1990 to about 8.4% in 2020. Incentives in Europe have resulted in a large expansion of wind energy use there. China has invested heavily in wind energy and is now the world's largest wind electricity generator. In 1990, 16 countries generated a total of about 3.6 billion kWh of wind electricity. In 2019, 127 countries generated a total of about 1.42 trillion kWh of wind electricity.

Vast, highly advanced on-shore and off-shore wind installations are becoming more commonplace. Recent advances include combination renewable energy farms with solar panels working during the day and wind turbines at night - initially in desert settings.

Increasingly it looks like the renewable sector will expand to include ‘renewable waste’, ‘renewable agriculture’ and ‘renewable nature’.

Renewable waste is likely to prove the optimal approach to waste management - ensuring that technology is developed to break waste down to compost, or raw materials that can be safely used in other products, to create a more circular economy. The holy grail is to achieve renewable waste from plastics.

Renewable or regenerative agriculture could prove vital to shift the methods of food production to more sustainable approaches and will likely need to run alongside changes in diet to reduce meat consumption as well as the development of artificial foods.

Regenerative agriculture is not a specific practice itself. Rather, proponents of regenerative agriculture utilize a variety of other sustainable agriculture techniques in combination. Practices include recycling farm waste and adding composted material from sources outside the farm. Regenerative agriculture on small farms and gardens is often based on philosophies like permaculture, agreocology, agroforestry and holistic management. Large farms tend to be less philosophy driven and often use ‘no till’ and/or ‘reduced till’ practices.

As soil health improves, input requirements should decrease, and crop yields may increase as soils are more resilient against extreme weather and harbor fewer pests and pathogens.

‘Renewable nature’ is perhaps the newest and potentially one of the more expansive greentech sectors. Environmental technologies such as rewilding can help us to store carbon on land and in seas while tackling the biodiversity crisis by creating self renewing habitats for wildlife and plant expansion - sustainability and diversity being the key.

Which ever way you look at it the greentech revolution is in high growth mode. And it will to need to retain the momentum if we are going to stand any chance of avoiding the worse effects of global heating. The Internet revolution changed the way we communicate and share information. The greentech revolution could change the course of mankind - our future is truly at stake.

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