Industrial activity, like most human activity, often impacts the environment directly and indirectly in terms of contributing to pollution of air, water, and land. In the past 50 years, this has spawned increasing regulation and environmental compliance; environmental compliance is now a predictable cost of doing business. However, emerging climate change regulations will undoubtedly and inevitably pose new costs—costs not yet budgeted.
Converting to or investing in new Clean Technology solutions is one option to help mitigate these costs and indeed gain a competitive advantage. Recent North American stimulus packages contain funds to accelerate the uptake of Clean Technologies. Clean Technologies are those that help reduce environmental pollution and the adverse effects on climate.
There has never been a timelier investment and regulatory climate for prudent organizations to take a "deep dive" in investigating, qualifying, and implementing Clean Technologies.
Renewable Energy investments in 2008 outstripped those in conventional energy sources. No longer a fringe market for brave and passionate advocates, this new energy industry has grown to an estimated US$120 billion in 2008. Renewable energy is now part of the mainstream global energy mix.
North American incentives and subsidies to promote "off-oil" political policy and mitigate climate change are growing. From retailers such as Wal-Mart, to venues for rock concerts and business conventions, renewable energy has become the signature for green branding. Electric utilities are being regulated to provide a portion of their generated and distributed power from renewable sources.
On the supply side, there are many investment opportunities, while, on the demand side, there are decisions to be made on the cost-benefits of renewable energy as a component of a climate change compliance strategy.
As consumers become more environmentally conscious, they are demanding that companies and regulators pay closer attention to the types of products being offered and the manner in which they are made. Recent scandals concerning consumer products, such as children's toys and food, have placed the issue squarely in the public eye and highlighted the fact that there is an opportunity for firms with agility and creativity to capitalize.
While consumers may be willing to pay more for a sustainable product, they are not willing to sacrifice functionality or quality. This puts increased pressure on companies to design better products, not just cheaper or greener ones, but promises to raise many market segments above simple price wars.
Allocation of R&D funds and product development efforts will become more important as companies race to meet fresh consumer concerns and changing regulatory requirements with new products; those companies that can successfully bring together proficiency in design, consumer markets, manufacturing, environmental science, and public policy and regulation will likely have a distinct advantage.