This article was originally published in the December 2014 issue of Energy Digital.
Each year, the Cleantech Group, the World Wildlife Foundation, and the The Swedish Agency for Economic and Regional Growth (or Tillväxtverket) release their Global Cleantech Innovation Index, in which 40 countries are examined for their potential for entrepreneurial clean tech startups. The report takes a 10-year look down the line and ranks each country on a basis of 15 different indicators. While the top 10 haven’t changed since last year, the outlook certainly has.
Ireland is a strong contender in the cleantech field, with a lot of its efforts concentrated on tidal and wave energy, as well as wind. There is also a strong innovating force in the country, with support from prominent institutions in science and engineering. It’s anticipated that clean jobs in Ireland will grow to around 80,000 by 2020 and with projects such as the 138 MW Jeffrey’s Bay wind farm on the horizon, that number could get even bigger.
Germany remains a leader in the renewable energy market and operates one-third of the world’s installed solar capacity, despite its often cloudy climate. Earlier this year, Germany outlined its plans to reduce carbon emissions by 80 to 95 percent—a rather aggressive target. The report warns that this could lead to a lack of funds in the short term and potential governmental tension with the cleantech industry. Still, the country has a huge amount of cleantech funds floating around and will likely continue driving innovation in the next ten years.
Despite current weak financial support, Switzerland has extremely high innovation inputs. The cleantech industry is also driven by Switzerland’s high output of environmental patents and highly-supportive governmental policies. Innovation in Switzerland and similar countries, the report notes, is driven by pure entrepreneurial spirit rather than motives born from necessity. The above-average energy and transportation infrastructure in the country are also innovation drives. The only downside for the country is its lack of attractiveness for renewable energy deployments and below-average commercialized cleantech.
Not much has changed for Canada’s cleantech industry in the last year. It’s still currently average, though many innovating factors are in their early stages, meaning the country could see a big payoff in several years. While there are plenty willing to innovate in the country, they could be held back by lack of funding and governmental support. With those things in place, Canada could become a powerhouse in cleantech innovation.
The UK has strong access to cleantech financing and a high innovation input, making it a strong contender in the green tech innovation field. There is a lack of policy certainty after 2020, which could be a potential detriment to driving innovation, but that can still be addressed. The UK also needs a greater commercialization of cleantech innovation. Where the country truly excels, however, is in the wind sector. The report points to CyberHawk Innovations, a new innovator in the wind sector that provides aerial infrastructure inspection services as exactly the kind of drive the country needs. The UK also has the largest offshore wind market in the world.
When it comes to wind, Denmark’s the top dog. Still, Denmark has one of the two highest cleantech budgets on this list, with the other country being Finland. Relative to the size of its economy, Denmark overwhelmingly invests in cleantech—now more so than any other country. It’s also looking internationally for partnerships in places such as China. This is attracting investors both locally and abroad, making Denmark’s future a green one.
For general innovation drivers, Sweden still tops the list, for the country has high innovation inputs and estrong entrepreneurial attitudes. It is also home to quite a few high-impact cleantech startups. It is also a major consumer of renewable energy. There is still a large gap between innovation and commercialization, however. This is a positive, really, as it spells out a large potential for Sweden’s immediate future.
Not surprisingly, the US is still noted for its thriving private cleantech sector. Startups are the biggest driving factor, attracting investments both in the country and internationally. However, with the lack of clarity from the federal government regarding energy policy, the future remains somewhat uncertain. There are still quite a few strong green initiatives, such as the reduction of carbon emissions 30 percent by 3030 and the raising of fuel emission standards to make the country’s outlook a positive one. The U.S. also announced it would increase the FY14 budget for clean energy research and development 30 percent to $7.9 billion, showing it’s absolutely serious about clean energy innovation.
Several factors have made Finland a cleantech powerhouse, such as its lack of fossil fuels and harsh climate. There is an immediate need to innovate, and plenty of Finnish companies are up to the task as it has the second highest emerging clean tech industry. The wind sector has stepped up big time, as it’s one of the largest in the world. Cleantech in Finland currently employs 50,000 people, and the report projects that number will nearly double by 2020.
Israel is considered the definitive “cleantech innovation archetype for both embedding entrepreneurial spirit into its educational system and into its society’s everyday norms as well as for predisposing its start-ups to resource innovation—as a survival mechanism to overcome resource constraints and energy dependency.” Given the size of its economy, Israel has a large amount of cleantech companies and is still growing. Over the past two years, Israel has had an incredible amount of startups voted into the Global Cleantech 100 There is overwhelming evidence that it will remain a leader in the cleantech industry in the next decade.