Clean energy has moved from the margin to the mainstream, with wind, solar, and biofuels topping a combined $70 billion in revenue last year.
Market research firm Clean Edge on Tuesday released its annual report on clean technology and projected continued rapid growth in spending, even though the U.S. economy is slowing down.
Revenue from biofuels, wind power, solar power, and fuel cells grew 40 percent to $77.3 billion, compared with 2006. Clean Edge projects that number will grow to $254 billion by 2017.
Global investments in energy technologies from venture capitalists, public markets, and corporate research and development programs, are also on a tear, rising 60 percent to $148 billion in 2007, according to New Energy Finance.
Clean energy still represents a fraction of the overall energy industry, but the activity of governments and corporations--combined with high fossil fuel prices--is helping the industry scale up, Clean Edge said.
The slowing economy should not have an appreciable impact on matters, said Joel Makower, one of the report's authors.
"I don't see the (economic environment) having an impact because venture capital and corporate R&D (research and development) budgets are much longer term than any economic downturn we are likely to face," he said.
But despite the economic momentum around clean energy, there are a number of issues that pose challenges to the industry overall.
High on the list is the possibility that existing tax incentives for renewable energy investments could lapse at the end of this year.
Energy developers say that the uncertainty around federal policy is already postponing projects from going forward. Ron Pernick, another of the report's co-authors, said the failure to renew the tax credit and other incentives could bring the industry to a standstill.
Another issue is the growing concern over how the booming biofuels industry is causing deforestration and pushing up food prices.
Also, many new energy technology companies face a funding challenge as they seek to move from pilot demonstrations to commercial scale operations.
Pernick said that regardless of the next president, it is likely that carbon emissions will be regulated within a few years, which should make cleaner fuel and power-generating technologies more cost-effective.
"If you asked the question whether we are going to have carbon regulations...within the next five years, most analysts and experts who track the sector would say yes," said Pernick.