Here’s a subtle dealbreaker for CleanTech: Energy is Easy.
In fact, too easy. Our utilities and regulators have worked hard for over 100 years to provide us with virtually unlimited energy at low prices, and they’ve been very successful at it. As a result, the average American spends all of eight minutes per year thinking about energy. No wonder it’s hard to get people to understand clean energy, let alone figure out how to pay for it.
It’s a very serious problem, though, when we’re trying to combat climate change by bringing CleanTech solutions to market. Remember that all the great technology companies, from Apple to Google to Facebook, succeeded by making something difficult easy. We couldn’t possibly make CleanTech successful by making something easy complicated.
The only way to overcome this problem is to make CleanTech as easy as traditional energy. Customers should be able to get clean energy without risk or capital investment, just like they get their energy now. This means delivering the new CleanTech solutions on an “energy as a service” basis, just like energy from a utility.
And this, in turn, is challenging because CleanTech assets are much smaller than traditional utility assets. Instead of multi-million dollar power plants, we’re talking about solar panels and batteries that start in the thousands, but each installation has its own unique blend of technology and business risks. Traditional energy finance is not set up to operate at these small scales.
Overcoming these challenges will require a new approach to CleanTech financing: Micro Securitization. This just means scaling financing down to account for the risks of each clean tech project. Fortunately, the new trends for distributed, peer-to-peer computing and open source software are ideally suited to make this happen.
For more about this, please see my article about it in Meeting of the Minds recently.