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What is Green Technology?

Posted by on June 25, 2012 in Green Energy

Green technology is a popular term used to describe technology developed to monitor, model and conserve the natural environment and resources. These technologies can include renewable energies, recycling technologies, water/air purification, environmental remediation, waste management, and even statistical forecasting software.

Types of Green Technology

As mentioned above, green technology can come in many forms, ranging from energy conservation to environmental remediation. Moreover, new forms of technology are being developed every day to add to these categories or define new ones. However, there are a few basic categories that are commonly used to group green technologies.

These common categories include:

  • Air Purification – Technologies that remove carbon dioxide and other harmful green house gases from the air, particularly indoors.
  • Energy Conservation – Technologies that conserve energy in order to reduce the amount of electricity used to power something.
  • Environmental Remediation – Technologies that remove pollutants or contaminants from water or soil, particularly after a spill or leak.
  • eGain Forecasting – Technologies that predicts the weather’s impact on a building to adjust the use of heat and conserve energy.
  • Renewable Energy – Technologies that replenish energy without the use of fossil fuels by using things like the sun, wind or geothermal power sources.
  • Waste Management – Technologies that purify water levels or dispose and treat solid waste without negatively impacting the environment.

Green Technology Initiatives

Green technology adoption has been largely driven through government initiatives to promote a cleaner environment. While there are some technologies that make sense economically, most fall behind traditional solutions in terms of cost-effectiveness, making these initiatives necessary in order to ensure adoption and long-term sustainability.

Solar subsidies are perhaps the most obvious example of such initiatives designed to promote green technology. These subsidies offset the cost of solar panels and modules to help make the technology more competitive with traditional energy sources. And in the meantime, the subsidies also helped build the underlying infrastructure to make solar cheaper in the future.

Carbon trading schemes, such as the cap-and-trade approach, also represent government-led initiatives to promote green technology. Under these schemes, governments cap the amount of pollution that may be emitted and force companies to purchase carbon credits to offset any additional pollution, while production of such credits is accomplished using green technologies.

Investing in Green Technology

Green technology has become increasingly popular among investors due to governmental mandates for such solutions. For instance, government solar subsidies led to heightened demand and increased interest among investors. Most of these initiatives have been focused on the energy industry, but environmental remediation has also come into the spotlight.

The energy industry has been the largest source of success for green technology companies, due to a wide array of government initiatives. In addition to the aforementioned solar subsidies, many governments have also developed carbon-trading schemes designed to encourage companies to limit their carbon output or face penalties.

Recent oil spills have also brought environmental remediation technologies to the forefront of the financial markets. These green technologies help remove pollutants or contaminants from the air and water using environmentally safe chemicals or other means. For instance, Clean Harbors Inc. (NYSE: CLH) has been a large beneficiary of this trend.

Finally, many green technologies can simply reduce costs for customers, making government intervention optional. For instance, many green technology companies have developed products that use the byproducts of industrial processes for a new purpose.

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