While the United States struggles to pass a climate bill, and we close in on the COP 15 meeting in Copenhagen, the success of any public policy commitment to reduce greenhouse gas emissions remains questionable. However, the industries that manufacture low carbon products (such as windmills or fuel cells), or that provide services (such as climate change and energy efficiency assessments), are growing and thriving. By Will Sarni

Recent research by HSBC (The Financial Times September 18, 2009) shows that low carbon products and services generate more revenue than the global aerospace and defense sectors. The HSBC "climate sector" industries include renewable energy, nuclear energy, energy management, waste and water companies. The global revenue for these industries was $534 billion in 2008, compared to the aerospace and defense sectors at $530 billion in 2008.

This is the power of business innovation.

According to HSBC, revenues for these low carbon industries increased by 75 percent despite the global recession. This growth is impressive and has even surpassed the growth estimates outlined in the Stern Review, published three years ago. The Stern Review forecast that low carbon products and services would reach approximately $500 billion by 2050. HSBC now predicts that revenue from this sector will exceed $2 trillion by 2020 based on current trends.

The growth in this sector is driven by the increased number of companies entering the market, with 268 in 2008 compared to 154 in 2004. The greatest number of companies in this sector were in the U.S.- with combined revenue of $111 billion. The next greatest numbers of companies were in Japan, Germany and the UK. The employment numbers in this sector are also impressive, with a total of more than 2.4 million jobs in 2008 compared to about 1 million in 2004

HSBC includes companies in the sector that have a market capitalization exceeding $350 million and that generate more than 10 percent of their revenues from clean tech or related services. Only the proportion of sales that came from clean technology was counted, and it was estimated if details were not provided by the individual companies.

The key growth areas within this industry sector are low carbon energy production; energy efficiency; control of water, waste and pollution; and climate finance. Energy efficiency companies had the highest investment returns for 2008 at 30 percent, followed by carbon finance at 24 percent.

I do not know if the Waxman Markey bill will make it through the U.S. Senate or if COP 15 will yield any meaningful commitments. However, it is clear that entrepreneurs will continue to create new products, services and business models as we move (with or without public policy support) to a low carbon economy. It just makes business sense.

Will Sarni is CEO of sustainability consulting firm DOMANI. Will has over 30 years of experience and has worked with high-profile companies such as Alcoa, BASF, Cisco, DIAGEO, and NTT DATA in developing and implementing cost-effective sustainability strategies. He is a member of the Environmental Compliance Committee of the Chicago Climate Exchange and the Conference Board. Read Will's blog here.