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Clean Power Green goods market growth

Published on June 15th, 2013 | by Silvio Marcacci

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The Big Green Business Opportunity For America’s Economy

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June 15th, 2013 by
 

As the US economy recovers from recession, America’s small businesses need to remember that going green often means making green.

Green goods market growth

Green goods market growth image via Big Green Opportunity

Growth rates for green business products and services are rising faster than conventional goods in America’s economy, outpacing the overall economy through the depths of the recession, and creating opportunity for the 88% of US businesses classified as  “microbusinesses” with five or fewer employees.

These findings come from The Big Green Opportunity,” a new survey of 1,300+ businesses conducted in 2012. Respondents said the greener a product, the more likely its sales increase, with 75% reporting an increase in green business from 2008-2011 at a 19% price premium compared to traditional goods. It creates enormous potential for aspiring green entrepreneurs looking for business opportunities.

Consumer Demand Creates Green Business Opportunity

The survey hints at a shift in consumer demand toward sustainability creating “green competition” among businesses, especially those with high environmental footprints. 79% of small businesses – particularly those in the food, personal goods, and construction markets – say offering green goods or services gave their business a competitive advantage.

Green business market opportunity

Green business market opportunity via Big Green Opportunity

That competitive advantage is being fueled by massive growth of consumer demand in the green economy. “Green segments today are growing far faster than their overall industries,” said Denise Hamsler of Green America. “The growth we’re seeing today is off the charts.”

Green Building And Renewables Outpaced The Recession

The economic promise of green business is most strongly shown in the construction industry. When America’s housing bubble burst, the recession began – but not when it came to green building. Between 2005-2011, the green building segment grew 1,700% while the overall US construction industry shrank 17%

By the end of 2011, green building represented 38% of the US construction market, up from just 5% in 2005. Profits have followed growth, with green building worth $54 billion in revenue in 2011, and forecast to hit $200 billion in 2016.

Spurred on by the need to save money and green building’s market growth, small businesses have also overwhelmingly opted to invest in small-scale renewables instead of fossil fuel to power their operations and energy efficiency measures to help cut costs.

From 2002-2011, renewable energy consumption (solar photovoltaics, biofuels, geothermal, and wind) grew 456% while non-renewables (oil, natural gas, and coal) fell 3.2% Survey respondents also reported purchasing energy efficient equipment, training staff to conserve energy, and installing efficient lighting were the top three actions they took to produce the fastest return on investment.

Healthy Products, Healthy Profits

While not as massive as green building’s growth, sustainable food and personal goods are also turning healthy profits. The organic food market segment grew 238% from 2002-2011 to hit $29 billion in revenue, while the overall food market only grew 33% during the same period. That may represent just 4.2% of the overall food market, but profits are projected to more than double to $78 billion in 2015.

The same trend was seen, on a smaller scale, in the organic non-food market. Green goods like clothing, personal care, pet food, and household products grew 400% from 2002-2011 while the overall non-food market grew 33% Revenue also jumped, from $439 million to $2.2 billion.

Last but not least, the economic benefits of sustainable products extended to American investments, perhaps a harbinger of success for the growing fossil fuel divestment movement. Assets in socially responsible investing portfolios grew 32% to $2.3 trillion from 2001-2010, and produced a 13.2% return compared to 0.4% for the overall investment market during the recession.

Can Small Businesses Seize The Opportunity?

Add the survey findings up, and small businesses have a compelling case to go green – stronger and more stable sales with higher profits. “Adopting green practices provides even the smallest businesses an opportunity to grow,” said Tammy Halevy of the Association for Enterprise Opportunity. But like all other business opportunities, the window to grow green won’t be open for long.

The survey notes that larger companies are noticing the consumer trend toward sustainability, and small businesses risk ceding this “big green opportunity” to large corporations unless they act fast. If this happens, a top-heavy and exclusive green economy could take hold. Still good for the planet, maybe, but not nearly as good for Main Street America.

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About the Author

Silvio is Principal at Marcacci Communications, a full-service clean energy and climate-focused public relations company based in Washington, D.C.



  • Anderson

    We need green product as alternative and it would be future. Small businesses are become smarter now. Thank you for great info..

  • Amber Archangel

    This is great information.Thanks.

  • Matt

    Yea Nuclear. To built one you get the government to guaranteed an minimum price for your product, but set no maximum. Then since you can’t get insurance, the government does that. Oh and the government covers cost of all the long lived waste. And if something goes really wrong, you close up shop and the tax payers handle that also. So you get all the upside and the tax payer get all the risk and down side. Its a sweet deal if you can get it.

    • anderlan

      Printing this out and putting it in my wallet for the next time a right winger puts on his glistening white robe of laissez-faire near me. Nuclear is loved because of its *historical* association with security and the military industrial complex. It’s antique. I have no idea why it’s still adored. Emotional attachment to it demonstrates a complete lack of analysis combined with total inability to change with time and circumstances.

  • Mohan Raj

    Despite all growth in Renewable Energy, the World Fossil Fuel consumption has increased by more than 2%. Now the World is talking about adapting to global warming instead of reducing it.

    Had we used the nuclear power, we will not be in this scenario.

    • Bob_Wallace

      Had we installed a lot of renewable generation we would not be in this scenario.

      Our electricity would be cheaper and we wouldn’t have the danger and radioactive waste problems we would have had we taken the nuclear route.

    • Ross

      Nuclear cannot be ramped up quickly enough, it is uneconomic, has a waste storage problem, onerous safety requirements and carries a non-negligible risk of substantial radioactive contaminant release.

      Renewables are becoming the dominant form of new energy generation, costs are continuing to fall, the external costs of global warming are beginning to be internalised, political support is growing.

      Adaptation will be necessary because of the lag in response of the earth’s climate to greenhouse gases already emitted.

      But the world is still moving in the direction of 100% renewables.

      http://about.bnef.com/press-releases/strong-growth-for-renewables-expected-through-to-2030/

      • Bob_Wallace

        It’s really interesting – watching the process that various locales are going through in order to build new nuclear.

        In Georgia (the state of) the state government has allowed the utility company to overcharge customers for the electricity they use. The utility company gets to use this “seized” money for reactor construction. This “free to them” money means that they get to lower the finance costs that helps make reactors so expensive. Building a reactor might be affordable. if you get free money from someone else.

        I could buy a Tesla S if I could steal the money from someone else and get away with it.

        And, after the reactor is brought on line your customers will already be used to paying a high rate for their power. You can bump up that price some more to pay for the expensive power you’re bringing on line without upsetting your customer base as much as if you bumped the price up from what they should have been paying. (This strategy was discussed some years ago in the nuclear industry.)

        In the UK, nuclear is demanding a guaranteed $0.15/kWh for the next 20 years before they will build a new reactor. They’re admitting up front that they have to earn a much higher rate than renewables would cost for the next two decades in order to recover their cost and make a little profit.

        We’ll build a few more reactors. A few utilities and governments are going to have to learn first hand that the price is too high.

        • Ross

          It’s a sad spectacle to watch, knowing that if the UK government, against all reason goes through with subsidising new Nuclear, taxpayers there will regret it for decades.

          • Bob_Wallace

            Well, if they only build one and if it never melts down on them they can spread the extra cost over a lot of utility bills and individuals won’t get badly hurt.

          • Ross

            That’s the most likely outcome. Like you can suggest above, it can serve as a case study in what not to do.

          • Bob_Wallace

            It’s going to be interesting to see if they continue to work on the South Carolina reactors.

            TVA recently announced that the reactor they were going to finish (it had been 80% built and then set aside for several years) is going to cost at least $4.5 billion as opposed to the $2 billion they first estimated.

            The Georgia reactors are now 14 months behind schedule (they’be been building for a year) and significantly over budget.

            That might be enough data to tell the people in South Carolina that nothing has changed in the nuclear industry. It’s still a case of bid really low with an unrealistic time line and then stick it to the investors.

            Apparently TVA is talking about cutting their losses and walking away from their project.

          • Ross

            The US has had a good record with shutting down nuclear lately, it would be a shame to spoil that.

            South Carolina like most places has good potential for renewables. Nice and plentiful green jobs.

            http://www.scstatehouse.gov/committeeinfo/EnergyAdvisoryCouncil/ResourceStudyComments/SCEACResourceStudy_FINAL.pdf

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