Venture capital investors report that there is a growing interest in environmental technologies, spurred by awareness of global issues such as climate change, as well as the diminishing sources, high costs, and environmental consequences of carbon-based energy, and the increasing costs and decreasing availability of other essential resources such as clean water.

Significant investments are being made by the venture capital community in clean energy-related technologies, including "cross-over" technologies that yield both energy and environmental benefits. Although the growth potential for most environmental sectors is expected to continue to rise through 2010, the most substantial growth is expected in the clean energy sector. Investors have indicated that there is a vast amount of capital available for investing in promising environmental technologies and many individual and institutional investors are seeking opportunities to invest in the growing environmental technology sector. Returns on these investments, however, still must complete with other investment options. Therefore, it is critical to investors that areas of investment risk—often based on regulatory uncertainty and unpredictability—be identified and reduced.

Horizons for investment contemplate long-term potential for the technology, and a predictable forecast of the regulatory environment is essential to reduce uncertainty. Moreover, the new challenges that will be solved by emerging technologies often require a new regulatory framework. Delays in establishing that regulatory framework impede investment in new technology by perpetuating the risk of an uncertain, unpredictable market.

For these reasons, effective stimulation and adoption of new technology requires timely regulatory action. EPA must act promptly to accelerate its engagement with new technology developers and investors, and commit to a credible, long-term advocacy of new technology. This includes not just clear, timely regulations and predictable, consistent enforcement, but also an institutional culture that advocates new technology and stimulates constructive interaction and communication among EPA, technology investors, technology developers, and users.