I have been quite critical of the mainstream media for using the global recession to attack clean tech (see “Global recession? Must be time for the media’s alternative-energy backlash“).
One reason the storyline was lame is that a recession this deep is going to hit all new capital projects (see “Note to media: Credit crunch kills dirty stuff, too“). A second reason is that there had been no evidence that clean tech was being harder hit than any other sector and some reason to believe it would be hit less hard (see “Despite market downturn, cleantech venture investment hits record $2.6B in 3rd quarter“). And, of course, the election of a Barack Obama means there is going to be a massive infusion of funding for clean tech.
While it is premature to say that green tech won’t suffer seriously from the recession — after all, we don’t know how long and strong the slowdown will be — the WSJ acknowledged today it may have have been premature in proclaiming trouble for one of the biggest recent winners in the clean tech business:
Fears of a coming slowdown in the wind-energy business may be a little overblown, if wind turbine makers are an accurate weathervane.
Big turbine makers like Vestas of Denmark, Gamesa of Spain, General Electric and even troubled Suzlon of India are still booking orders for next year, in spite of fears that the economic slowdown, the credit crunch, and falling oil and gas prices would stifle new investment in clean energy. (Though Gamesa’s latest big order was just part of a long-term supply contract signed in 2007.)
Industry bellweather Vestas provides a peek on the sector’s prospects. The Danish company recently dialed back its expectations for 2009 due to the economic mess. But in just the last month, Vestas has booked another 500 megawatts of wind-turbine orders, bringing its order book to over 4,000 megawatts.
Jeffries Research analysts say Vestas’ robust pipeline is a sign that wind energy might not suffer as much from the financial fallout, especially as bigger, richer power companies elbow out small wind-power developers:
These orders illustrate that Vestas is still finding customers for 2009, despite concerns over financing availability. [The big order from Sweden's Vattenfall] illustrates that demand from utility scale players, with the ability to fund growth through internal cash flow generation, may be less affected by the financing situation than smaller developers.
While Vestas and other clean-energy players aren’t entirely out of the woods, the sector’s apparent resilience during the time of darkest economic news from the U.S., Europe, and Asia should offer clean tech some hope.
In short, reports of the death of clean tech have been exaggerated.