In Focus: Greening America

15 Dec 2010

With many countries around the globe increasing their focus on investment in Clean Energy and Technology innovation, the United States continues to make it a key priority.

With the election of the Obama administration in 2008, US Public Policy has more closely aligned with the US cleantech industry to provide support towards finding solutions to the many challenges the country and the world are facing. In particular, how to improve and protect the natural environment, how to develop and progress their national economy, and how to reduce the political and social costs produced by a carbon-based economy.

Water too is becoming a strategic issue across the US. With areas experiencing shortages, flooding, ground water depletion and an aging infrastructure, water has risen to the top of many states’ political agendas. Australia is considered a leader in water solutions and the opportunity for Australia to engage in the areas of water management and conservation are both real and needed. To help harness these opportunities, Austrade, in partnership with waterAustralia, is leading an Australian water mission as part of the G’Day USA program in January 2011.

The Obama administration has brought substantial change to the way US companies approach Energy. US stimulus has steered billions of dollars in new funding for Clean Energy projects and R&D towards revolutionary technologies.

As the US works towards new energy and emission legislation, many states have moved forward with their own Renewable Energy Targets. These policies have given the signal that the US is serious about developing new technologies across all areas of cleantech, offering new areas of investment and trade not seen before.

The private sector has responded accordingly. As reported in Austrade’s US Cleantech Investment Trends Report, the third quarter of 2010 saw the US as the second largest recipient of venture capital (VC) and private equity (PE) cleantech investment. India, which attracted US$1.4 billion, ranked first – slightly more than the US$1.2 billion invested in US companies. While the US ranked second in terms of overall volume of capital, the highest number of commercial deals were in the US, with 45 companies receiving investment – compared to just nine companies in India. In addition, despite receiving the second most cleantech VC and PE investment, the US ranked first in providing investment to the global cleantech economy; representing 90 per cent of the global total - US$3.7 billion of the US$4.1 billion invested in the third quarter of 2010.

The US also remains home to 54 of the world’s top 100 cleantech companies, according to the Cleantech Group’s Global Cleantech 100 of 2010.

US companies and individuals are also addressing how to reduce their environmental footprint. Multinationals such as Coca Cola, Boeing, IBM and Microsoft are all ensuring ‘clean and green’ plays a strategic role in their business operations. Retail giant Wal-Mart has also announced a plan to reduce 20 million metric tons of greenhouse gases from its supply chain by 2015.

Hardware stores in the US are now filled with aisles of environmentally friendly products, due to the growing demand from citizens wanting to change the way they light, insulate and provide energy to their homes.

For every new LEED (Leadership in Energy and Environmental Design) certified building built in 2010 under new green standards, 85 will be retrofitted. The US green building market for products and services is therefore forecast to grow, surpassing US$140 billion by 2013 – the largest figure globally.

The US solar industry is also on the rise having tripled in size since 2000 with 1GW of installed generation. By 2011, the US is expected to eclipse Germany as the largest solar market.

"These wholesale changes are driving new opportunities for Australia to engage with the US in a number of areas across the cleantech landscape, whether in water sustainability and management, biofuels, geothermal, green buildings and carbon capture and sequestration,” noted Grame Barty, Austrade Regional Director for the Americas.

“The US-Australia partnership has been built on decades of relationships at an individual, industry and government level. We will have to maintain the same level of commitment as the greening and ’re-energising’ of America continues to accelerate.”

Click here for Austrade's US export market profile.