A new report from audit specialist Grant Thornton paints an upbeat picture of the cleantech sector’s future prospects which is in stark contrast to that of most global industries.
The report, “Capturing opportunity: Cleantech business booms around the world”, reveals that privately held businesses in the cleantech sector are among the most confident enterprises in the world when it comes to future prosperity, far outpacing the optimism – or even pessimism – found in older, traditional industries.
A thriving cleantech sector also typically means thriving subsectors, as merger and acquisition opportunities and IPOs grow exponentially, driving further demand for cleantech financial and consulting services. For example, investment in the capital-intensive cleantech sector is being driven to record levels by government policies, stimulus funding and recovering financial markets and investor attitudes.
The Jefferies CleanTech Survey, conducted at the 11th Global Clean Technology Conference in 2011, found that:
approximately two-thirds of investors surveyed believe that a full recovery of the IPO market for cleantech companies is likely to occur by the first half of 2012
more than three-quarters of investors surveyed believe that large company conglomerates are expected to begin consolidating the cleantech sector during or after 2012
stable government subsidies and regulation are seen as being the most important growth driver for the cleantech sector
Businesses in the cleantech sector around the globe expressed optimism about the economy for the next 12 months, with net 37% optimistic in 2011, up from net 34% in 2010. This contrasts with the all-sector average, which declined from net 24% in 2010 to net 22% in 2011.
In the UK, like other countries such as India and South Africa, government policies, rather than market demands, drive much of the cleantech activity, according to Nathan Goode, partner, head of energy, environment and sustainability at Grant Thornton UK.
“Government support and the regulatory environment generally are very important, and the government is now in the process of undertaking some very significant changes to the electricity market in general, not just in the support for cleantech,” says Goode.
“Nobody is entirely sure how that is all going to pan out. The high-level view is that this government is committed to securing a low-carbon economy, both in terms of energy and other sectors, but the detail of what that really means for investors and businesses is highly uncertain at the moment. Having said that, we’re seeing much more deal activity, and we are seeing businesses in different parts of the cleantech sector actually starting to make money.”