01 April 2008
Investment in Environmental Technologies Soaring
Podcast with Commerce Department environmental industries official
The speakers are a narrator and Catherine Vial, environmental industries team leader with the U.S. Commerce Department’s Office of Energy and Environmental Industries.
(begin transcript)
Narrator: “The greatest commercial opportunity in history.” That’s what some experts are saying about green technologies. These technologies include renewable energy and energy efficiency, as well as water- and land-related innovations. Today, we discuss investing and the environment, and we’ll visit with the U.S. Commerce Department’s environmental industries office to see how U.S. corporations are going green.
Investment in environmental technologies such as wind and solar energy production has soared in recent years. Investors from small venture capital firms to the largest corporations have put big money into a variety of projects. But green investing is not only about the next big technology. It has a long history in the United States, and concerns many other parts of the business world.
During the wave of environmental investing in the 1980s and early 1990s, investors focused on the risks to their businesses, based on past environment-related activities. Today, investors consider future environmental risks, particularly those related to climate change. Climate change has emerged as the single largest concern for investors, because it affects all other issues, such as fresh water use and shortage, destruction of animal habitats, and air pollution.
For the companies that investors analyze, climate change presents a series of challenges for both current business and future planning. Climate and environmental concerns are also affecting the thinking of the private equity investors who buy and sell companies. In 2007, plans for new coal-fired plants were rejected by governments in Kansas, Oklahoma, Florida, and Washington state, largely on environmental grounds. These developments are setting the foundation for the future and presenting investors with a new set of considerations when engaging in projects.
Environmental investors are not shy about letting companies know about their concerns. Investors frequently join together to request information from companies. Many organizations, such as the Carbon Disclosure Project and the Global Reporting Initiative, have been created to encourage standard reporting frameworks on environmental activities to encourage transparency.
Today, hearing the terms “emission reductions” or “pollution prevention” in corporations and investment banks is becoming more and more common. One thing is clear: the days when environmental issues were the concerns of only students and activists are definitely over.
For as long as companies have manufactured products or provided services, they have looked for ways to lower costs. In the past, environmental concerns were not even part of cost considerations. But today, risk liabilities, combined with the threat of climate change, are pushing American companies to make green choices. How are they going about this? We asked Catherine Vial, environmental industries team leader with the U.S. Commerce Department’s Office of Energy and Environmental Industries, for some answers. One of the best examples of cost-saving environmental technology is in the building sector.
Catherine Vial: Green building technologies are very exciting for a number of reasons. First, populations everywhere are becoming more urbanized, and this trend would indicate a greater demand for housing, shopping centers, etc. Also, buildings bring together many other technologies in one area. You have water use and disposal, air cooling and heating, and, of course, lighting. And all of these things require reliable power supplies. By designing buildings with new materials and making the best use out of new ideas from the start, it opens up some incredible possibilities.
Narrator: The savings to companies can be considerable. Large companies such as financial conglomerate Citigroup have significant real estate holdings. By adopting new technologies such as power-saving devices and recycled materials, companies can save millions in maintenance and energy costs. The potential cost reductions are driving retailers such as Wal-Mart, Target, Lowe’s, and others to build green retail stores. Electronics retailer Best Buy claims that in the future, it will build only eco-friendly stores certified through the LEED certification program, given to stores that meet the U.S. Green Building Council’s Leadership in Energy and Environmental Design criteria.
Catherine Vial: Many companies are finding that, you know, the term “environmental technology” is somewhat misleading. Many of the innovations that are leading to environmental benefits for companies and communities -- such as reduced emissions or less water pollution -- are not based on some new product, per se. A lot of this is coming from redesign of processes and reorganizations of production methods. Now, when you combine new thinking and new technologies, you can see some remarkable solutions to environmental problems.
Narrator: This podcast is produced by the U.S. Department of State's Bureau of International Information Programs. Links to other Internet sites should not be considered an endorsement of other content and views.
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(Distributed by the Bureau of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)
