The indicator is based solely on data from the Cleantech Group. Reporting to the Cleantech Group is incomplete for any given country, and the completeness and representativeness (compared to overall ‘clean tech’ investment in a country) appears to vary significantly from country to country. In particular, the data collected for the United Kingdom appears to be more extensive than for any other European country. Due to the gaps in the Cleantech database, which lacks deal data for many years across most countries, systematic comparisons of individual countries over time or with each other is not possible.
Additionally, there are categorical challenges in terms of the classification of ‘Cleantech’ sectors. RECREATE has addressed some of these issues through a re-aggregation into the sectors used in the scoreboard, which among other changes treats fossil fuel efficiency as separate category from energy efficiency. However, it is difficult to guarantee whether the financing received by the included companies was dedicated to ‘clean’ technologies, as many companies have a portfolio of products and services with different characteristics. At the margin of a comprehensive data set, this should not be a problem, but given the sparse data for many countries in Europe, it may be a concern.
At lower levels of aggregation both early stage and late-stage financing is ‘lumpy’, so that for sectors with less financing (such as agriculture), year-to-year fluctuations can be large and not indicative of any particular driver. This could be mitigated by using rolling averages where complete time series are available, however this is not the case with the data currently available.
Finally, there is the issue of how well this data illustrates the functioning of the Technological Innovation System (TIS). With respect to Early Stage finance, different countries employ different approaches, and a relative lack of venture and angel funding may not necessarily reflect a lack of access to finance, if countries provide significant access to public funding, for example. With respect to Late Stage finance, data on IPOs, mergers, etc. may reflect the amount of financial activity among the sectors’ more mature companies, but provides only indirect information about the upscaling and broader dissemination of eco-innovations. Again, these issues will be less significant at the margin of a broader data set where the basic patterns are consistent.
