Home Geography Accelerating Green Innovation: Essays on Alternative Investments in Clean Technologies
Motivation, purpose and scope
Innovation in clean technologies is key to green growth. The possibilities to support a sustainable economic environment have been under scrutiny by policymakers and researchers in recent years (Heck, Rogers, & Carroll, 2014; Mowery, Nelson, & Martin, 2010a; OECD, 2011; Stern, 2006). Important factors to achieve a transition to a more sustainable economy include policy and financial support. Governments and international organizations have been actively supporting environmentalism and clean technologies for decades. Since the 1990s a trend towards sustainability, especially in the ecological sense has emerged. Based on this fact, the financial sector and likewise entrepreneurial ventures, have recognized the economic value of this trend. New products, services, and processes with an environmentally friendly mindset are being developed (Foxon & Pearson, 2008b; Markard, Raven, & Truffer, 2012; Pernick & Wilder, 2007). Calls for further support from governments and private actors seek to accelerate green innovation. Finance, especially private finance as a means to bridge gaps and circumvent barriers is seen as one possible solution (Altenburg & Pegels, 2012; Mazzucato & Perez, 2014; OECD, 2011).
Finance for young innovative companies in the clean technology space is most often invested through alternative asset classes. Alternative investments (alternative to traditional public equity and bond investments) are expected to provide better returns and/or diversification of risk. Main categories within alternative investments are typically real estate, infrastructure, hedge funds, commodities, private equity (PE) and venture capital (VC). This thesis focuses on investments in private equity, venture capital and energy, which is a part of infrastructure, to analyze finance for green innovations (Fraser-Sampson, 2011; Greer, 1997; Kaminker & Stewart, 2012).
It uses a broad spectrum of qualitative and quantitative data on the alternative investment and clean technology sectors to find an answer to how to accelerate green innovation. Building on extensive interviews, conference visits, as well as, data from various financial databases, newspaper archives and policy reports, the following chapters show a comprehensive picture of the clean technology innovation system. The changing role of finance and policy along the clean technology innovation chain is scrutinized to understand the evolution of the associated industries. In addition to the contribution to academic literature, the thesis also derives implications for investors, innovators, and policy makers. The dissertation, consequently, contributes to the research debate on how to accelerate green innovation and as well on the role of finance and policy in the clean technology innovation chain (Altenburg & Pegels, 2012; Mazzucato & Perez, 2014; Wustenhagen & Menichetti, 2012).
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