Annual Meeting of the New Champions 2009

  • Green Technologies and Business Models

    Friday 11th September 2009 - 3:30pm - 4:30pm

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  • Annual Meeting of the New Champions 2009

    Green Technologies and Business Models
    Dalian, People’s Republic of China 10-12 September

    Venture capital firms in the US, Europe and China poured a record US$ 6 billion into “green tech” companies last year. This session discussed the game-changing technologies and business models that are attracting these investments.

    Key Point


    • New forms of financing are required that link public policies with unlocking more private capital, such as specialized private equity funds for green tech, responding to a clear price signal for carbon

    Synopsis


    Participants agreed that exciting long-term opportunities to invest in green tech are strong despite the economic slowdown. However, some government actions could accelerate investments. These include creating a level playing field for all energy technologies, especially through the removal of subsidies, and the deployment of the right incentives, in particular creating a price signal for carbon. Deployment of these policies will enable true competition to take place and the market to take off.

    While some participants felt that the financial crisis offers an opportunity for economic and environmental stimuli to catalyse a green tech take-off, others felt that green tech investments would not jump to scale unless there is an environmental catastrophe.

    Further issues raised:
    • Systemic risk – ways to share the risk and offer a better framework to invest in green tech need to be found.
    • Subsidies – over US$ 300 million a year is spent globally on energy subsidies. This is both economically and environmentally suboptimal. Can high carbon subsidies be phased out? Subsidies also stifle innovation and blunt companies’ competitive edge. This is particularly the case in the energy sector, where R&D spending lags far behind other sectors, such as pharmaceuticals and ICT.
    • Regulations – a combination of cap and trade, regulation and progressive taxation can create the right kind of enabling policy environment but is dependent on effective integration between different government departments (energy, trade, environment, state, etc.).
    • While some think a generally agreed-upon global expression of a carbon price is possible by around 2014, others fear that legislation at the speed and scale needed around the world to make this happen is not possible. Yet capital for green technology solutions will only be released if and when an international price for carbon emerges.
    • Against this background of uncertainty on carbon pricing, given the need to push green tech down the cost curve, new forms of financing which use public monies to buy down risk and unlock more private capital are required.

    Session Panellists

    Michael Biddle

    , President and Founder, MBA Polymers, USA; Technology Pioneer

    James Cameron

    , Vice-Chairman, Climate Change Capital, United Kingdom; Global Agenda Council on Climate Change

    Richard Hausmann

    , President and Chief Executive Officer, Siemens, People's Republic of China

    Song Jiajing

    , Chairman, DHI•DCW Group, People's Republic of China

    Moderated by

    Indira V. Samarasekera

    , President, University of Alberta, Canada

    ________________________________

    Disclosures

    This summary was written by Dominic Waughray. The views expressed are those of certain participants in the discussion and do not necessarily reflect the views of all participants or of the World Economic Forum.

    Copyright 2009 World Economic Forum
    No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior written consent of the World Economic Forum.

    11 September 2009

    Keywords

    : green technology, investors, low carbon, opportunities

    Recommended reading for: investors, green tech companies

Moderated by

  • Indira V. Samarasekera Indira V. Samarasekera
    President, University of Alberta, Canada

    BSc, University of Ceylon; MSc, University of California; PhD in Materials Engineering, University o...

Speakers

  • Jayendra Naidoo Jayendra Naidoo
    Executive Chairman, J&J Group, South Africa

    1981-94, Trade Union Leader; 1991, led ANC-Alliance team in negotiating National Peace Accord; 1992,...

  • Richard Hausmann Richard Hausmann
    President and Chief Executive Officer, Siemens, People's Republic of China

    Studies in Physics, Regensburg University and State University of New York, Stony Brook; 1988, docto...

  • James Cameron James Cameron
    Chair of the Board, Overseas Development Institute, United Kingdom

    Non-Executive Chairman, Climate Change Capital. Chairman, Overseas Development Institute (ODI). Memb...

  • Song Jiajing Song Jiajing
    Chairman, DHI·DCW Group, People's Republic of China

    2001, MBA, Dalian University of Technology, China; 2008, Executive MBA course, Institute Of Technolo...

  • Michael B. Biddle Michael B. Biddle
    President and Founder, MBA Polymers, USA

    1978, BSc in Chemical Engineering, University of Louisville; 1991, Master's in Management Science, S...