sourcengine.com, Sept. 13, 2024 –
Sustainable technology, also known as green or clean technology, addresses some of the most pressing environmental challenges. The history of green technology can be traced back to ancient civilizations where terrace farming and solar energy were used long before the advent of coal-fueled electricity. While not considered "green" back then, awareness about environmental impacts and growing efforts to reduce pollution began around the same time industrialization exploded.
Green technology, or the modern concept of sustainability, took concrete shape with the establishment of the Environmental Protection Agency (EPA) in 1970. As growing research extrapolated on the negative impacts of pollution, resource depletion, and climate change, environmental awareness pushed for developing sustainable practices and studies of renewable energy sources.
The 1970s oil crisis can be attributed to a flurry of interest and development within green technology. After the crisis, "solar panels became more efficient, wind turbines saw widespread installation, and geothermal energy potential was explored more than ever before."
Collaboration between countries, such as the Montreal Protocol in 1987 and the Kyoto Protocol in 1997, has helped push sustainability efforts to the forefront of government concerns. The more recent international Paris Agreement, signed in 2016, has been adopted by 196 parties in the United Nations Climate Change Conference. The Agreement aims to "increase in the global average temperature to well below 2°C above pre-industrial levels" and pursue efforts "to limit the temperature increase to 1.5°C above pre-industrial levels."
This international hyperfocus on green energy over the last several decades should have propelled progress in sustainability efforts. However, the green sector has often been fraught with challenges that have hindered progress and effective scalability, primarily due to financial trouble. This funding gap is reminiscent of the lack of government backing in the semiconductor sector before recent incentives and investment programs pushed the industry to new heights.
Financial Turbulence: A Major Roadblock to Sustainability
The green tech sector is rife with innovative technology. Renewable energy solutions have progressed immensely over the last several years with new developments in wind, solar, and bioenergy that have resulted in greater energy efficiency, improved energy access, better energy security, optimized land use, reduced resource utilization, and economic benefits. One such technology, electric vehicles (EVs), have helped meet environmental goals while boosting the economy through job generation, low energy costs, and advances in smart automotive tech.
Despite widespread recognition of its potential, this market has faced an uphill battle securing the capital necessary to support its efforts. Pablo Valerio writes in his article Lack of Fresh Money Threatens Green Tech Sector that "the number of renewable energy companies filing for bankruptcy with debts exceeding $50 million has reached its highest level since 2014," as seen in Bloomberg Data research.
Unfortunately, lack of funding is not uncommon in the history of sustainable technology. Green technology requires a lot of money; investors and consumers alike face sizeable initial costs before savings start to roll in. Current economic challenges and long development times have contributed to a reluctance to invest in such companies and products.