Earlier this year, with the oil price at record heights, T. Boone Pickens, a celebrated Texas oilman, seemed to confirm the unstoppable growth of the clean-technology industry when he announced plans not only to build the world’s biggest wind farm, but also to spend $58 million of his personal fortune promoting the cause of wind power.
On Oct. 30, with oil prices having fallen by more than half, Pickens told a television reporter that the boom he had foreseen in wind would be “put off” because of the unexpected fall in the price of fossil fuels and the sudden difficulty of borrowing money.
Pickens is not the only clean-tech investor caught by the credit crunch. New Energy Finance, a research firm, calculates that the amount of money aimed at clean-energy projects around the world fell by almost 25 percent in the third quarter, to $18 billion. The firm expects it to fall further before the end of the year. It also expects firms to raise less money on stock markets because of the financial turmoil. NEX, an index that tracks clean-tech stocks globally, has tumbled even faster than the market.
Big U.S. utilities are slashing their investments in alternative energy. Florida Power & Light has cut its planned investment in wind power next year by 400 megawatts. Duke Energy of North Carolina has lopped $50 million off its budget for solar power. And on Oct. 31 VeraSun Energy, one of America’s biggest ethanol producers, caught out by gyrations in the prices of corn and gasoline, filed for Chapter 11 bankruptcy protection.
In the European Union the price of carbon permits has fallen from a high of almost $38 in July to around $25, making clean-tech investments less attractive.